Legacy, a male fertility startup, has just raised a fresh, $3.5 million in funding from Bill Maris’s San Diego-based venture firm, Section 32, along with Y Combinator and Bain Capital Ventures, which led a $1.5 million seed round for the Boston startup last year.
We talked earlier today with Legacy’s founder and CEO Khaled Kteily about his now two-year-old, five-person startup and its big ambitions to become the world’s preeminent male fertility center. Our biggest question was how Legacy and similar startups convince men — who are generally less concerned with their fertility than women — that they need the company’s at-home testing kits and services in the first place.
“They should be worried about [their fertility],” said Kteily, a former healthcare and life sciences consultant with a masters degree in public policy from the Harvard Kennedy School. “Sperm counts have gone down 50 to 60 percent over the last 40 years.” More from our chat with Legacy, a former TechCrunch Battlefield winner, follows; it has been edited lightly for length.
TC: Why start this company?
KK: I didn’t grow up wanting to be the king of sperm [laughs]. But I had a pretty accident — a second-degree burn on my legs after having four hot Starbuck’s teas spill on my lap in a car — and between that and a colleague at the Kennedy Center who’d been diagnosed with cancer and whose doctor suggested he freeze his sperm ahead of his radiation treatments, it just clicked for me that maybe I should also save my sperm. When I went into Cambridge to do this, the place was right next to the restaurant Dumpling House and it was just very awkward and expensive and I thought, there must be a better way of doing this.
TC: How do you get started on something like this?
KK: This was before Ro and Hims began taking off, but people were increasingly comfortable doing things from the own homes, so I started doing research around the idea. I joined the American Society of Reproductive Medicine. I started taking continuing education classes about sperm…
TC: Women are under so much pressure from the time they turn 30 to monitor their fertility. Aside from extreme circumstances, as with your friend, do men really think about testing their sperm?
KK: Men should be worried about it, and they should be taking responsibility for it. What a lot of folks don’t know in for every one in seven couples that are actively trying to get pregnant, the man is equally responsible [for their fertility struggles]. Women are taught about their fertility but men aren’t, yet the quality of their sperm is degrading over the years. Sperm counts have gone down by 50 to 60 percent over last 40 years, too.
TC: Wait, what? Why?
KK: [Likely culprits are] chemicals in plastics, chemicals in what we eat eat and drink, changes in lifestyle; we move less and eat more, and sperm health relates to overall health. I also think mobile phones are causing it. I will caveat this by saying there’s been mixed research, but I’m convinced that cell phones are the new smoking in that it wasn’t clear that smoking was as dangerous as it is when the research was being conducted by companies that benefited by [perpetuating cigarette use]. There’s also a generational decline in sperm quality [to consider]; it poses increased risk to the mother but also the child, as the risk of gestational diabetes goes up, the rate of autism, and other congenital conditions.
TC: You’re selling directly to consumers. Are you also working with companies to incorporate your tests in their overall wellness offerings?
KK: We’re investing heavily in business-to-business and expect that to be a huge acquisition channel for us. We can’t share any names yet, but we just signed a big company last week and have a few more in the works. These are mostly Bay Area companies right now; it’s an area where our experience as a YC alum was valuable because of the founders who’ve gone through and now run large companies of their own.
TC: When you’re talking with investors, how do you describe the market size?
KK: There are four million couples that are facing fertility challenges and in all cases, we believe the man should be tested. So do [their significant others]. Almost half of purchases [of our kits] are by a female partner. We also see men in the military freezing their sperm before being deployed, same-sex couples who plan to use a surrogate at some point, and transgender patients who are looking at a life-changing [moment] and want to preserve their fertility before they start the process. But we see this as something that every man might do as they go off to college, and investors see that bigger picture.
TC: How much do the kits and storage cost?
KK: The kit cost $195 up front, and if they choose to store their sperm, $145 a year. We offer different packages. You can also spend $1,995 for two deposits and 10 years of storage.
TC: Is one or two samples effective? According to the Mayo Clinic, sperm counts fluctuate meaningfully from one sample to the next, so they suggest semen analysis tests over a period of time to ensure accurate results.
KK: We encourage our clients to make multiple deposits. The scores will be variable, but they’ll gather around an average.
TC: But they are charged for these deposits separately?
KK: Yes.
TC: And what are you looking for?
KK: Volume, count, concentration, motility, and morphology [meaning the shape of the sperm].
TC: Who, exactly, is doing the analysis and handling the storage?
KK: We partner with Andrology Labs in Chicago on analysis; it’s one of the top fertility labs in the country. For storage, we partner with a couple of cryo-storage providers in different geographies. We divide the samples into four, then store them in two different tanks within each of two locations. We want to make sure we’re never in a position where [the samples are accidentally destroyed, as has happened at clinics elsewhere].
TC: I can imagine fears about these samples being mishandled. How can you assure customers this won’t happen?
KK: Trust and legitimacy are core factors and a huge area of focus for us. We’re CPPA and HIPAA compliant. All [related data] is encrypted and anonymized and every customer receives a unique ID [which is a series of digits so that even the storage facilities don’t know whose sperm they are handling]. We have extreme redundancies and processes in place to ensure that we’re handling [samples] in the most scientifically rigorous way possible, as well as ensuring the safety and privacy of each [specimen].
TC: How long can sperm be frozen?
KK: Indefinitely.
TC: How will you use all the data you’ll be collecting?
KK: I could see us entering into partnerships with research institutions. What we won’t do is sell it like 23andMe.
Kyle Lomeli is the CTO and a founding engineer at CarGurus.com.
Online commerce accounted for nearly $518 billion in revenue in the United States alone last year. The growing number of online marketplaces like Amazon and eBay will command 40% of the global retail market in 2020. As the number of digital offerings — not only marketplaces but also online storefronts and company websites — available to consumers continues to grow, the primary challenge for any online platform lies in setting itself apart.
The central question for how to accomplish this: Where does differentiation matter most?
A customer’s ability to easily (and accurately) find a specific product or service with minimal barriers helps ensure they feel satisfied and confident with their choice of purchase. This ultimately becomes the differentiator that sets an online platform apart. It’s about coupling a stellar product with an exceptional experience. Often, that takes the form of simple, searchable access to a wide variety of products and services. Sometimes, it’s about surfacing a brand that meets an individual consumer’s needs or price point. In both cases, platforms are in a position to help customers avoid having to chase down a product or service through multiple clicks while offering a better way of comparing apples to apples.
To be successful, a company should adopt a consumer-first philosophy that informs its product ideation and development process. A successful consumer-first development resides in a company’s ability to expediently deliver fresh features that customers actually respond to, rather than prioritize the update that seems most profitable. The best way to inform both elements is to consistently collect and learn from customer feedback in a timely way — and sometimes, this will mean making decisions for the benefit of consumers versus what is in the best interest of companies.
We’re reporting all the time on advancements in payment technology that allow your business to take multiple forms of payment.
Some businesses are going a little further and not accepting cash at all. The totally cashless business, however, is becoming a bit of problem.
And this week, we learned that several cities across the US are making it illegal for a business to go cashless.
It’s something to think about as you consider upgrading your own company’s point of sales system and payment options.
This is just one of the many things making headlines that small business owners shouldn’t miss this week.
Check out the rest in this week’s small business news and information roundup.
Small Business News
Web.com Has a New DIY Website Builder
Web.com, providers of domain name registration and web development services, has announced the launch of an easy-to-use DIY website builder. The new website builder enables businesses to create well-designed and impactful websites and online stores with ease, affordability and without delay. The website builder is available to all new customers of the Web.
Most Americans Don’t Take a Break During the Holidays
Americans work more, take fewer vacations, work longer days and retire later than most industrialized nations. According to a new survey from Reservations.com, more than 1 in 4 or 27% of Americans didn’t take a day off during the 2019 holidays. The result from this survey is almost the same as the poll Small Business Trends carried out in December 2019.
60% of Americans Worry About Contracting Flu, So Keep Your Business Clean
For small businesses, the flu season can be especially crippling. Imagine your small company has five employees and two or more of them call in sick because of the flu. The impact is going to be immediate. So, the fact 60% of Americans say they worry about contracting the flu, highlights the problem. This data comes from Bradley’s 2020 Healthy Hand Washing Survey.
Some Californians are Fighting AB5
The gig economy has upended the way people work, and policymakers are grappling on how to address this change. California is tackling the issue with Assembly Bill 5 or as it is commonly known AB5. However, not all is going according to plan because US District Judge Roger Benitez in San Diego has temporarily blocked AB5.
Small Businesses Selling on Amazon Seeing Big Revenue Growth
If you are searching for new avenues to grow the sales for your small business, you should consider selling on Amazon. According to the new research from Internet Data Corporation (IDC), small business owners are 2.5 times more likely to have registered 25% or more growth in the past year than those not selling in Amazon stores.
Taxes
Everything You Need to Know About the Standard Deduction
The Tax Cuts and Jobs Act just about doubled the standard deduction amounts for individuals for 2018 through 2025. As a result, the law eliminated or curtailed various itemized deductions. Today, most individuals (the Tax Foundation estimates 90%) choose the standard deduction instead of itemizing personal deductions. You have to decide which option is better for your situation.
10 Resources Where Small Businesses Can Get Free Help With Taxes from a Real Live Person
Tax season can be stressful for small business owners. There’s all the receipts you need to get together and that’s usually just a slice of the other invoices, documents and data that needs to be corralled and made sense of. Sometimes you just need to talk with someone who knows where a piece or two fits into the bigger puzzle.
Technology Trends
Veriato Vision Helps Small Businesses Monitor Employee Productivity
Research suggests the average employee is productive just 2 hours and 54 minutes in an 8 hour day. And that’s not all! Some employees may even be engaging in activities that will seriously harm your business — like fraud and embezzlement. As a small business owner, you know employee productivity ultimately determines your company’s success.
Ann Miura-Ko is a co-founding partner at Floodgate, a seed-stage VC firm. A repeat member of the Forbes Midas List and the New York Times Top 20 Venture Capitalists Worldwide, she earned a PhD in math modeling of cybersecurity at Stanford University.
I was one of the first investors in Lyft, Refinery29 and Xamarin. I’ve been on the Midas List for the past three years and was recently named on The New York Times’ list of The Top 20 Venture Capitalists. In 2008, I co-founded Floodgate, one of the first seed-stage VC funds in Silicon Valley. Unlike most funds, we invest exclusively in seed, making us experts in finding product-market fit and building a minimum viable company. Seed is fundamentally different from later stages, so we’ve made it more than a specialty: It’s all we do. Each of our partners sees thousands of companies every year before electing to invest in only the top three or four.
For the past 11 years, I’ve invested at the inception phase of startups. We’ve seen startups go wildly right (Lyft, Refinery29, Twitch, Xamarin) and wildly wrong. When I reflect on the failures, the root cause inevitably stems from misconceptions around the nature of product-market fit.
True product-market fit is a minimum viable company
Before attempting to scale your minimum viable product, you should focus on cultivating your minimum viable company. Nail down your value proposition, find your place in the broader ecosystem and craft a business model that adds up. In other words, true product-market fit is actually the magical moment when three elements click together:
To have built a minimum viable company, these three elements must work in concert together:
People must value your product enough to be willing to pay for it. This value also determines how you package your product to the world (freemium versus free to pay versus enterprise sales).
Your business model and pricing must fit your ecosystem. They must also generate enough sales volume and revenue to sustain your business.
Your product’s value must satisfy the needs of the ecosystem and the ecosystem needs to accept your product.
Many entrepreneurs conceptualize product-market fit as the point where some subset of customers love their product’s features. This conceptualization is dangerous. Many failing companies have features that customers loved. Some even have multiple beloved features! Great features constitute only one-half of one-third of the whole puzzle. To have created a minimum viable company, a company needs all three of these elements — value propositions,business model andecosystem— working in concert.
So founders take heed…
Moving into “growth mode” while missing any of these elements is building your company on an unsound foundation.
Founders who tune out the latest tweet cycle on “the secrets to raising Series A” and focus instead on the intricacies of their own business will find that product-market fit is a predictable, achievable phenomenon. On the other hand, founders who prematurely focus on growth without knowing the basic ingredients of their minimum viable company often fuel an addictive and destructive cycle around their business’ fake growth, acquiring non-optimal users that contribute to their company’s destruction.
Ann Miura-Ko is a co-founding partner at Floodgate, a seed-stage VC firm. A repeat member of the Forbes Midas List and the New York Times Top 20 Venture Capitalists Worldwide, she earned a PhD in math modeling of cybersecurity at Stanford University.
I was one of the first investors in Lyft, Refinery29 and Xamarin. I’ve been on the Midas List for the past three years and was recently named on The New York Times’ list of The Top 20 Venture Capitalists. In 2008, I co-founded Floodgate, one of the first seed-stage VC funds in Silicon Valley. Unlike most funds, we invest exclusively in seed, making us experts in finding product-market fit and building a minimum viable company. Seed is fundamentally different from later stages, so we’ve made it more than a specialty: It’s all we do. Each of our partners sees thousands of companies every year before electing to invest in only the top three or four.
For the past 11 years, I’ve invested at the inception phase of startups. We’ve seen startups go wildly right (Lyft, Refinery29, Twitch, Xamarin) and wildly wrong. When I reflect on the failures, the root cause inevitably stems from misconceptions around the nature of product-market fit.
The magic of product-market fit
Most successful entrepreneurs and VCs agree that product-market fit is the defining quality of an early-stage startup. Getting to product-market fit allows you to succeed even if you aren’t optimized on other fronts.
Most entrepreneurs conceptualize product-market fit as the point where some subset of customers love their product’s features. At Floodgate, we forensically analyzed companies that died and concluded this conceptualization is wrong. Many failing companies had features that customers loved. Some of these companies even had multiple beloved features! We discovered that having customers love the product is merely a part of product-market fit, not the entire thing. This raises the question: What were they lacking?
Well I know we’re into a new year now, because my first conference of 2020 just ended. Zoho’s annual analyst event took place in Austin, Texas this week and as in year’s past I had a chance to sit down with CEO and co-founder Sridhar Vembu for a wide-ranging conversation. And quite literally we had a fireside chat.. while in rocking chairs.
Below is an edited transcript of our conversation, where Vembu shares his thoughts on how the company has developed over the past five years, how it is positioning itself as a technology company and not just a software company, why he feels the cloud should help provide dignity and opportunity to rural communities, and why Zoho is taking a hard stance against the industry practice of “surveilling” customer data. To hear the full conversation watch the video or click on the embedded SoundCloud player below.
Small Business Trends: When you think about the last five years, what has that meant to Zoho the company?
Sridhar Vembu: We’ve seen tremendous growth. I think we showed, say over six, seven years, almost 10 fold growth we have seen. And that I think is continuing now; the growth rate is still accelerating now. Now we now have an ability to tell the story as well as we are able to engineer the product. We’ve been a good company, but we were not able to tell the story before. Now, I think these events have helped us refine our messaging, help tell the story and connect with people.
Small Business Trends: So what is the big part of the story that may have been missing a couple of years ago that you can now tell and feel good about?
Sridhar Vembu: I think a lot of it is our culture as a company, how unique it is, how differentiated it is. I mean, we’re shy talking about ourselves as a company.
Small Business Trends: I’m going to say you are very shy …
Sridhar Vembu: Always, always been true. You know my attitude, build a great product, throw it over the fence, people would buy it if they want it. That was the attitude. These things have helped us realize there’s more to it than that. Because ultimately, every engineer has to learn this. Computers don’t buy products people do. And people have a reason, need a reason to buy it.
Small Business Trends: Right.
Sridhar Vembu: They have to feel a connection with who is supplying technology to them. It’s not just only the technology, it’s also the connection, human connection. That’s the biggest thing that has changed in the last five years.
Small Business Trends: Now your evangelist, Raju Vegesna, he said a little earlier today that Zoho is not just a software company. It’s a technology company. Talk about that, what does that mean?
Sridhar Vembu: What Raju means is that this is a company that goes deep down into every aspect of what we do. And that is the depth of technology in terms of the software itself, the hardware underlying it, the networks that are powering or the data centers; all of it. Also, in a deeper way, for example, we talked about construction, we talked about education, we talked about healthcare. So we think holistically about all these problems, not fragmented pieces, but we think holistically how are we going to get employees, train employees. How do our facilities look and how do they provide a nice home for employees. So these all of these aspects we think about.
Small Business Trends: You always come up with very good phrases. The last time we talked you talked about, how the capital is within the culture of the organization and not the finances.
Sridhar Vembu: Exactly.
Small Business Trends: And that really resonated with not only me but a lot of people. But this year you talked about how you don’t want to be … I want to make sure I get the phrase right. You don’t want to be a cost –
Sridhar Vembu: Costly input to our customers.
Small Business Trends: Costly input to your customers.
Sridhar Vembu: Yes.
Small Business Trends: Talk about what that means?
Sridhar Vembu: This actually came from my observation of the farm problem. The farmer problem, farmers face a problem where their inputs are getting costlier and costlier while the output is getting commoditized. So they’re literally squeezed. In fact, a lot of them have negative margin in their business now more and more, which is why the farm bankruptcies, a lot of the crises, rural crisis, agrarian crisis, which is pretty much worldwide. This is in the US, this is an India everywhere it’s happening.
I spent time in rural India and so I was able to observe these things first hand. Then I realized for a lot of businesses technology is a critical cost and we don’t want to be a costly input to our customers, because then our customers cannot survive in business very long term if they have very costly inputs from us. And so the only way to be sustainable, this relationship to be sustainable is we become an affordable input to them. This provides a nice framework to think about our business, how we structured ourselves. I talked about deep technology that is driven by the fact that we have to avoid costly inputs ourselves so that we don’t become a costly input to our customer.
Small Business Trends: So the other thing that really resonated is not only that you don’t want to be a costly input to your customers, but you want the cloud to be more than some great technology. You want it to – and I never heard anybody talk about it like this – you want the cloud to provide dignity.
Sridhar Vembu: Yeah.
Small Business Trends: And give more opportunity.
Sridhar Vembu: Correct.
Small Business Trends: Talk about that a little bit.
Sridhar Vembu: Today with technology we are able to work from anywhere. We just spoke before you said you work from home?
Small Business Trends: Right.
Sridhar Vembu: From Atlanta, in suburb of Atlanta, right? I actually worked for now mostly from rural India now and Raju works in Austin. And yet we are all connected now. I talked to Raju from rural India at least once a week and on video a couple of times a week.
Small Business Trends: Right.
Sridhar Vembu: That’s what technology has enabled now. And this actually has startling implications for where the jobs are to be and what the incomes can be and the identity of people. In other words, if someone is a rural citizen and they have skills now they can actually have a job that pays a meaningful wage, that affords them a dignified life and they’re also be … could be change leaders in their communities. And all of this is possible today that was never before possible.
So to me, the cloud has a broader purpose, a bigger purpose. The cloud is not a delivery channel for software, cloud has a bigger purpose. It enables us to work from anywhere and that liberates us from constraints for example, expensive real estate trap that so many young people are trapped. So many people are trapped in heavy big mortgages in big cities. One of the reasons entrepreneurship has fallen in the last 20 years in this country is because too many people are trapped in heavy mortgage that they … and student loans, all of these issues. So they don’t have the freedom to experiment, freedom to go out on their own. So the cloud can be actually a transformational medium for it and the fact that we can work from anywhere and that is critical.
I see this now in terms that are not purely technology, but its sociological implications that it can revitalize rural areas. It can retain talent, it can even attract talent back into rural areas because rural areas have suffered a brain drain, talent drain for a long time, talent it will be simply upper leaf. But now people can stay in their home towns, maybe come back to their home towns and help revitalize those areas. So all these are possible today.
Small Business Trends: And you talk education in terms of lowering that cost. But when you started looking at the data centers and being able to be more efficient in the way that you use power in that role of it, talk a little bit about that in terms of “costly inputs.”
Sridhar Vembu: I remember one of the biggest cost items would be running the data centers to deliver our services, our applications to customers. One crucial ingredient of data center cost is power. The power consumed by all the servers and the switches and all of that. And it turns out there are many, many ways now to reduce the power and also provide the power in the renewable power, like a hydroelectric power or solar power all of these. So we look for data centers with that, so we now built a solar plant to power data centers in India, we’ve hydro-power powering our data centers in the US, so these are some of the areas that we pay attention to. We also are looking for ways next generation to reduce the amount of power, to serve a particular customer in the data center, this translates both into lower overall power consumption and it also lowers the cost of service delivery long term. So these are things that we look at.
Small Business Trends: One of the stats that came out, I forget who said about it might have been you or it might’ve been Raju, somewhere along the line, it would cost $10 million a year if you are running Zia [Zoho’s AI technology] on AWS. Talk about the impact of not running on AWS has for Zoho, and Zoho customers.
Sridhar Vembu: As you look at our search infrastructure that is searching across a very wide span of applications, it’s sucking in all of the data of the customer in Zoho, indexing it, cross correlating it and cross indexing it. Your CRM data, your financial data, your document data, your email data, your chat data, all of it has to be cross-referenced, correlated, all of that. This takes massive amounts of compute and storage, all of these, these indexes, all that.
Public cloud infrastructure, we did evaluate for this. It cost us a lot more to do this than what it costs to do it ourselves. We would have to increase the prices substantially on our customers.
Customer Data Surveilling
Small Business Trends: I think, this subject today that got a lot of people’s attention was this whole idea of surveillance companies and surveilled data. A lot of people probably don’t know what that means and maybe you could just define what that means?
Sridhar Vembu: Today, regrettably, many consumer internet companies have become de facto surveillance companies. It’s Google and Facebook, all of them. Whether they like to be called that or not, they have become surveillance companies. And exactly the same way that citizens would react to the thought of if the government surveilled them, we also have to react to internet company surveillance. It’s wrong, it’s wrong with them but normally it’s wrong when private companies do it and it’s done with the purpose of marketing all of that data.
But in fact there was news yesterday where this company was fined 140 million something because they were actually the free software for EHR, Electronic Health Records. They were showing the doctors, they were prompting the doctors to prescribe their Opioids. And they had a secret arrangement with a pharma company to enable this, to increase the sales of all those painkiller prescriptions and the Feds caught them and severe fine was imposed on them. This just shows the negative consequence of that type of a business model were you are sharing data with [crosstalk 00:13:05] .
Small Business Trends: Basically, it’s the data/advertising model like Google.
Sridhar Vembu: Yes.
Small Business Trends: They make a lot of their money from ads [crosstalk 00:13:13].
Sridhar Vembu: And this creates really bad incentives on … and there is always somebody with a tempting offer for how we want to use the data. And this example this pharma example shows that.
Small Business Trends: Right.
Sridhar Vembu: But it has a huge cost to society and to people who are prescribed useless painkillers for things they don’t need. So this is why I think it’s important. And at the same time, I would say this, my phone knows everything I do, especially today. To be a smart phone it has to know everything about me. So I’m not worried that it knows what I do, I’m only worried about where the data will go, what the companies that have access to the data build with the data.
Small Business Trends: How they use it.
Sridhar Vembu: How they use it.
Small Business Trends: How they sell it off to the third party.
Sridhar Vembu: Exactly, so this is why I think I draw this thing right to be a smart phone. It needs to know a lot about me, but I don’t want everyone to know everything about me. My where abouts, where I am, what I’m doing right now all of these things, it doesn’t have to be broadcast to the entire world. In effect that’s what has happened to a lot of us, where all these surveillance companies are taking this data and repackaging it and selling it to various parties, without the customers knowledge, you don’t even know how many places this data is going today. And so I do believe that we are going to have … not only this is, in fact I give this analogy, it’s exactly how smoking was 40, 50 years ago, but if we had … we’re sitting here having this chat 40, 50 years ago, one of us would be smoking.
Small Business Trends: Yeah.
Sridhar Vembu: It was very common.
Small Business Trends: Right on TV.
Sridhar Vembu: Right on TV and In this room probably like everybody would be smoking and it would be so common place that we all accepted it.
Small Business Trends: Right.
Sridhar Vembu: Today we actually don’t accept it. Nobody smokes inside buildings and we even have laws against it now that every closed place and offices, hotels everything should be smoke free, no smoking zone. And this happened both by social awareness of the harms of secondhand smoke and legislation. I believe the same thing is happening now, the awareness is spreading that this privacy violation is happening, surveillance is wrong. Now legislation is following, slowly GDPR as an example, California passed a law. I don’t believe stringent regulations are necessarily here and this won’t prevent progress. It will guide it the right direction where we draw boundaries, ethical boundaries. What can a software engineer do with the data? Data is now a valuable thing about a person and so software engineers have to handle it the same way a doctor handles a patient.
Small Business Trends: Medical records, yeah.
Sridhar Vembu: Medical records of a patient. There’re ethical boundaries based on doctors, we need ethical boundaries on software engineers.
Small Business Trends: There was a question because you went over this today and there was a question. I think it’s a pretty valid question, because everybody in industry pretty much is doing this. I don’t know if that’s purposely or not there, it’s the way it’s gone in the industry. But what does that cost Zoho in terms of is there a lost insights? Is there lost revenue? What does that cost you and why do you think the benefit of doing what you’re doing outweighs it?
Sridhar Vembu: So for example, we eliminated all trackers, third party trackers from our site and even our own marketing was apprehensive at first that they’re going to lose certain insights. And I told them that’s okay. We build the tools in house and we do not share the data with anybody so that’s a given. So that was what I said and that did have an initial cost to it. And I’m the certain we cannot compute for certain campaigns we do. And that’s an acceptable price to pay in my opinion, longer term, the trust we had with the customer, is far better than any short term things.
In reality, we have been growing consistently and the growth has actually accelerated in the last couple of years as we have taken a stronger privacy stance. So I would say maybe does even help the business, even though that was not why we did it, because we were willing to pay the price. In fact, we were willing to suffer a reduction on traffic if that’s what’s going to happen. I said, that’s okay. Because life is short. How badly do you want to be successful if you don’t feel good about how you do it … you cannot sleep well at night. That’s how I put it.
Shares of One Medical are worth $19.50 this morning after the venture-backed unicorn priced its IPO at $14 per share last night. The company opened at $18 before rising further, according to Yahoo Finance data. At its current price, One Medical is worth about 40% more than its IPO price, a strong debut for the company.
The result is a boon for One Medical, which raised $532.1 million during its time as a private company. At $14 per share, the company was worth $1.71 billion. At 19.50, One Medical is worth $2.38 billion, a winning result for a company said to be worth around $1.5 billion as a private company.
For investors The Carlyle Group, J.P. Morgan, Redmile Group, GV and Benchmark (among others), the debut is a success, pricing their stakes in the company higher once again. For other unicorns, the news is even better. One Medical, a company with gross margins under the 50% mark, deeply minority recurring revenue and 30% revenue growth in 2019 at best is now worth about 8.5x its trailing revenues.
That is about as good a signal as one could imagine for venture-backed companies that aren’t in as good shape as Slack or Zoom were letting them know that now is the time to go public.
Unicorn directions
It’s possible to read One Medical’s new revenue multiple in a few ways. You can be positive, saying that its valuation and resulting metrics are signs of investor optimism for the medical service company. Or you could go negative and assume that its pricing looks like a case of the market being more excited about a brand than a set of accounting results.
Today’s your last day to score early-bird pricing on tickets to TC Sessions: Robotics + AI 2020, which takes place on March 3. If you want to keep $150 in your wallet, beat the deadline and buy your ticket here before the clock strikes 11:59 p.m. (PT) tonight!
Our one-day conference dedicated to robotics and AI — the good, the bad and the challenging — features interviews, panel discussions, Q&As, workshops and demos. Join roughly 1,500 experts, visionaries, creators, founders, investors, researchers and engineers. Rub elbows, network and engage with current and aspiring leaders, as well as students poised to drive future innovation.
We have a stellar line up, and just because we’re biased doesn’t mean we’re wrong. I mean come on — assistive robots, ethics and AI, the state of VC investment and robot demos. And that’s just for starters. Here are a couple of specific examples, and you can peruse the full agenda right here.
Cultivating Intelligence in Agricultural Robots: The benefits of robotics in agriculture are undeniable, yet at the same time only getting started. Lewis Anderson (Traptic) and Sebastien Boyer (Farmwise) will compare notes on the rigors of developing industrial-grade robots that both pick crops and weed fields respectively. Pyka’s Michael Norcia will discuss taking flight over those fields with an autonomous crop-spraying drone.
Building the Robots that Build: Join Daniel Blank (Toggle), Tessa Lau (Dusty Robotics) and Noah Ready-Campbell (Built Robotics) as they discuss whether robots can help us build structures faster, smarter and cheaper. Built Robotics makes a self-driving excavator. Toggle is developing a new fabrication of rebar for reinforced concrete and Dusty Robotics builds robot-powered tools. We’ll talk with the founders to learn how and when robots will become a part of the construction crew.
And in case you haven’t heard, we’ve added Pitch Night, a mini pitch-off, into the mix this year. We’re accepting applications until tomorrow, February 1. This is no time for fence-sitting! Apply to compete in Pitch Night now. TechCrunch editors will review the applications and choose 10 startups to pitch at a private event the night before the conference. A panel of VC judges will select five teams as finalists. Those founders will pitch again the next day — live from the Main Stage. It’s awesome exposure that could take your startup to the next level.
If you love robots, you need to be at TC Sessions: Robotics + AI 2020 on March 3. And there’s no point paying more than necessary. Today’s the last day to buy an early-bird ticket. Buy yours before the deadline expires at 11:59 p.m. (PT) and save $150.
Is your company interested in sponsoring or exhibiting at TC Sessions: Robotics + AI 2020? Contact our sponsorship sales team byfilling out this form.
Moda Operandi, an online marketplace that specialises in right-off-the-runway luxury fashion, accessories and home decor, is today announcing a high-priced event of its own: it’s raised $100 million, a mix of equity and debt that it will use to invest in its platform and technology as well as to continue growing business overall, which was founded in 2010 and today offers products from some 1,000 brands and designers and ships to 125 countries.
“For the past eight years, Moda has disrupted the way people shop for luxury fashion,” said Moda Operandi CEO Ganesh Srivats in a statement. “This investment will enable us to build on that innovation, investing further in the client and designer experience and connecting more of the world’s best fashion to more people.”
The financing is being co-led by NEA and Apax Partners, both previous investors in Moda Operandi, with participation also from the Santo Domingo Family (connected to Lauren Santo Domingo, who co-founded Moda with Aslaug Magnusdottir), Comerica Bank, TriplePoint Capital and other unnamed investors.
The company’s valuation is not being disclosed but in its last round, in 2017, Moda Operandi had a post-money valuation of $650 million, according to data from PitchBook. It has raised $345 million to date.
High-end fashion might not be the first thing that comes to mind when you think about online shopping, but it has actually been a ripe market for the e-commerce industry.
While those in the know (and in the money) might attend catwalk shows, and bijou boutiques in swish locales are likely to be around for many years to come, there is a massive population of people who have the income and inclination to shop for luxury fashion, but might not be in the right place, or have the time, to do so.
For these shoppers, websites, mobile apps — and most recently new channels like Instagram and messaging services — have become a key route to browsing and buying, leading to the rise of huge businesses like Farfetch, Net-a-Porter and more.
That trend has helped to buffer Moda Operandi up to now, but it’s also the one that will be interesting to watch down the line.
We’ve written about the rise of direct-to-consumer brands and how that has played out specifically in the world of fashion, which in turn becomes a new group of competitors to aggregating marketplaces like Moda Operandi.
Similarly, the growing trend of targeting consumers wherever they happen to be also represents a rival business model, with some fashion retailers now foregoing websites altogether in favor of using third-party messaging apps to reach their target customers. Will Moda Operandi change with the times to do more of this kind of selling, too? Like fashion, what’s in today might be out tomorrow, so even the best channels are moving targets.
In any case, Moda Operandi has most definitely shown that it’s prepared to evolve and upset the status quo. The company got its start in 2010 in part out of an aha-moment from Santo Domingo, a socialite, former model and former editor at Vogue.
As someone who had worked for years in the luxury fashion industry, fully immersed as a consumer to boot, she knew that only a small, rarefied group of people ever got full access to a designer’s runway collection.
Moda Operandi was her solution — a platform to broaden that out, giving access to a full trunkshows (as the runway collections are called) to a wider selection of possible buyers and improving revenues for designers and brands in the process, since they no longer had to rely just on more traditional channels, namely buyers for retailers. The site had some catches — for example, as we pointed out at the time, you could shop a runway look, but still had to wait months for the piece to actually arrive with you, since those items would have yet to be made; but it caught on with a loyal following.
Over the years, the site’s basic remit has expanded, covering not only runway collections but also extending into jewellery, accessories and home decor. (We asked what size the business is today, and whether Moda Operandi can share any details on how that has changed over time, but a spokesperson said the company would not be sharing these or other financial details today.)
In any case, it’s remained a compelling enough business to have brought in a hefty round of growth funding from its previous backers.
“We continue to be impressed with the power of Moda’s brand and its positioning in the luxury market,” said Dan O’Keefe, managing partner of Apax Digital, in a statement. “Moda has been enhancing its technology capabilities as a world leading platform for fashion discovery and is led by a world-class team. We look forward to continuing to support their expansion.”
“Moda Operandi has really disrupted the traditional ecommerce model, using technology to give people unprecedented access to fashion,” added Tony Florence, general partner and head of technology investing at NEA, in a statement. “It was a really big idea when we led the Series A, and today Ganesh and the team are executing on that data-enabled retail model at scale. We are thrilled to continue supporting the company in this latest round.”
Business casual seems the common dress code for workplaces. But what exactly defines business casual? And do you include jeans in the mix for your small business’s dress code?
You’ll find conflicting rules about business casual these days. So you might end up wondering, “Are jeans business casual?” See the answer below.
Are Jeans Business Casual?
It turns out they could be. But it depends on a number of factors. Small Business Trends recently spoke with some style and etiquette experts to dig into the details.
Bridgette Raes serves as the personal stylist and consultant behind Bridgette Raes Style Group. Raes says, “With the continued casualization of the workplace, jeans have become increasingly more acceptable. Of course, there are still work environments where jeans are either never acceptable or are only acceptable on Fridays and these environments tend to be more corporate or professional, like law or finance or situations where employees are interfacing with more corporate companies.”
Sherry Maysonave works as an author, speaker, and founded Empowerment Enterprises. Maysonave adds, “In my book, Casual Power, I discouraged jeans in the workplace. At that time, sloppy casual was the norm. Today, the pendulum has leveled and professional attire embraces suits as well as many levels of business casual. I do believe that jeans have their place in some work environments, especially when they’re worn smartly. It’s important though that the employee understand what type and when appropriate.”
Where Business Casual Jeans May and May Not Be Acceptable
The first factor experts recommend when determining whether or not denim may be appropriate is considering industry itself. A casual business could include things like an online marketing firm, app development company, or bicycle repair shop. However, many traditional industries require formal attire like suits, dresses, or nice pants.
Lucy Hume works as Associate Director at etiquette training provider Debrett’s. Hume told Small Business Trends, “The level of formality demanded by office wear is largely dependent on the industry and culture of the organisation. Jeans may be considered more appropriate for modern creative fields such as PR, marketing and media, and less so in more formal and traditional industries such as insurance, law and finance.”
Think About the Job
Think about the types of jobs you have to complete on a daily basis. Do you do a lot of behind the scenes work? If so, jeans translate as a comfortable option. Do you meet with big clients? If so, consider something more dressy as an option. Additionally, don’t wear jeans for a job interview, unless specifically stated otherwise.
Raes says, “A dress code that is becoming more common is “dress for your day” which means the dress code is more situational and an employee can make their own decisions on what is appropriate for the type of day they have or who they will be interacting with. In dress for your day workplaces, an employee is entrusted to know when it is or isn’t appropriate to wear jeans. This can be very empowering for employees an employer is trusting their employees to make smart choices.”
In fact, businesses don’t need to have just one basic dress code. Some employees can get away with more casual attire than others.
Maysonave says, “Many companies today require one level of dress for salespeople and those employees interfacing with customers/the public, while allowing a more casual level for workers in cubicles or back offices.”
However, please note that many small businesses have fairly fluid roles. So don’t assume your employees will be doing the same job everyday.
Maysonave adds, “And one never knows just when opportunity may knock. You may seem to be stuck in a back office and suddenly be thrust in front of the customer unexpectedly. In small businesses, employees often must double up on roles when understaffed.”
How to Wear Business Casual Jeans
Look at Your Superiors’ Attire
Hume suggests, “Observe how other people dress, particularly those who are senior to you, and try to reflect this in your own office wear. Consider the style of communication within the organisation – does it tend to be formal and official, or quite casual? Do you have to attend meetings with clients, where it’s necessary to present a professional persona? All of these factors will give you some idea about whether or not jeans are appropriate.”
Keep Jeans Professional
Raes explains, “Employees who are allowed to wear jeans to work should avoid wearing a casual pair of jeans they would wear on the weekends. Darker and unfaded jeans are typically seen as less casual and more professional. Fit is also important. Employees should test bending down to make sure nothing unsuitable is exposed when bending. Jeans should not be too tight or too body hugging. Jeans should be hemmed properly, fresh and clean.”
Pair Them With Other Business Casual Attire
Maysonave says, “Keep in mind that your physical/visual image is a shocking 55% of your overall communication. The multitude of nonverbal messages inherent in clothing and grooming often supersede intentions and even good performance, affecting how one’s abilities and aptitudes are perceived by the powers that be. Your personal image matters. You send critical messages about yourself, your habits, and your goals simply by the way you present yourself. Think of it this way: your choices of garments (and how they’re put together as well as their color, condition and quality), your shoes and other accessories, and your grooming all shout out information about you.”
Tips for Setting a Small Business Dress Code
Consider the Perception of Your Work Wear
Small business owners should consider this. Don’t just think about dressing appropriately yourself. Also make sure your employees represent your brand in a positive way. Carefully think about when, and how jeans may or may not be acceptable in your workplace.
Maysonave says, “Also, it’s important to address how you want jeans to be worn. What’s acceptable and promotes your company brand? Jeans with t-shirts and sneakers? Or jeans with business-like shirts, blouses/tops, and shoes. Employers must consider how they want to be perceived, and their employees are their golden face to the public.”
Be Specific When It Comes to Style
Ideally, your dress code should make it very clear what you expect from your employees in specific situations.
Hume says, “If business owners wish to impose an office dress code, it’s best to set this out in an employee manual or introductory document for any new recruits. Be as specific as possible, eg. ’No jeans or trainers’ or ‘Jeans may be worn, but should be neat and clean with no rips.’”
This improves your company’s professionalism when working with clients or customers. But it also give employees more confidence and clarity. They know what’s expected when getting ready for work.
Raes says, “Many employees I have spoken to miss having to wear suits not because they necessarily want to go back to wearing suits again but because it was easy and clear for them to figure out what to wear. In a time where offices have become more casual and sportswear driven, employees are expected to figure out how to create dynamic and professional looks with mix-and-match separates. And because employers can be too general with their dress code do’s and don’ts, this leaves a lot up to the employee to figure it out.”
Address Dress Code Issues Fairly
In some cases, simply explain what you expect from employees. But this may not ensure they live up to your dress code standards. Still don’t disallow jeans altogether. Consider simply providing examples of what is appropriate and what isn’t.
Raes adds, “Visuals partnered with verbal direction can be helpful in making the guidelines clear. Also, go beyond just giving parameters on the type of jeans that are allowed. Show examples of complete denim looks so employees understand that general the type of jeans outfits that are allowed in the workplace.”
Bring in a Style Expert
Finally, you may not wish to design a dress code or address business casual jeans in the office. If not, let a style consultant help. Raes and similar professionals offer consulting services. They can determine the types of clothing that work for your business goals and objectives.
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
It was yet another jam-packed week full of big news, IPO happenings, and venture activity. As always we’ve done our best to deliver the gist on what’s been going on. We had Alex Wilhelm and Danny Crichton on hand to handle it all, which went medium-good. In other Equity news, we’re back with guests over the next few weeks, so if you miss us having a venture capitalist along for the ride, fear not, their return is just around the corner.
Up top this week was Jon Shieber’s report that Kleiner Perkins has rapidly deployed its most recent fund, a $600 million vehicle. While the news felt surprising, digging back through our archives we were reminded that the firm had indicated it might put its capital to work quickly. Still, as Danny pointed out, it’s rare that venture capitalists have to go our raising from LPs on an annual basis.
After that, we turned to some funding rounds that held our attention, including the Free Agency round that is working to bring talent management to the technology industry similar to the sports and entertainment worlds.
The concept makes some sense as compensation packages for top talent in the industry can extend into the seven-figures (Free Agency takes a 5-10% cut of an employee’s income using the increasingly popular income-share agreements). Also this round felt a bit like a reminder that the labor market is tight at the moment.
We then moved on to Josh Constine’s story about “Ring for enterprise” startup Verkada, which raised a massive $80 million round at a $1.6 billion valuation. That’s eye popping, since the extremely small dilution implied with those numbers (5%) is very rare in the venture world.
After that we turned to a few rounds that Alex has had his eye on, namely the somewhat-recent Insurify round, the pretty-recent Gabi round, and the most-recent Policygenius. All told they sum to $150 million, which made us ask the question, why are venture capitalists so into insurance marketplace startups?
Finally, we touched on the latest from the intra-SoftBank delivery war between DoorDash and Uber Eats, including who is impacted, and what it means for future consolidation in the on-demand world. Or more precisely, why hasn’t there been more?
Increasingly, the streets of Karachi and Lahore are being flooded with men riding bikes and wearing green T-shirts, a writer friend recently told me. In a sense, these men represent the emergence of Pakistan’s tech startups.
India now has more than 25,000 startups and raised a record $14.5 billion last year, according to government figures. But not all Asian countries are as large as India or have such a thriving startup ecosystem. Long overdue, things are beginning to change in bordering Pakistan.
Bykea, a three-year-old ride-hailing and delivery service, today has more than 500,000 bikes registered on its platform. It operates in some of Pakistan’s most populated cities, such as Karachi, Lahore and Islamabad, Muneeb Maayr, Bykea founder and CEO, told TechCrunch.
Maayr is one of the most recognized startup founders in Pakistan, and previously worked for Rocket Internet, helping the giant run fashion e-commerce platform Daraz in the country. While leading Daraz, he expanded the platform to cater to categories beyond fashion; Daraz was later sold to Alibaba.
Your automobile can be a walking billboard with the vinyl wrap over it. These tips will help you select the design for the advertising on your vehicle.
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In 1998, the startup company Illumina launched a revolution in the life sciences industry by developing technology to slash the costs of identifying and mapping genetic material.
Now, a little over 20 years later, Mammoth Biosciences is hoping to do the same thing for gene editing tools.
The company, co-founded by Jennifer Doudna, who did some of the pioneering work to discover the gene editing enzyme known as CRISPR, has just raised $45 million as it looks to bring to market products that can be used not only for disease detection, but are more precise editing tools for genetic material.
Rather than get bogged down in the patent dispute that raged over the provenance and ownership of applications for the original CRISPR enzyme — the Cas9 discovered by Doudna and developed for clinical applications at the Broad Institute — Mammoth has joined a number of startups in identifying new enzymes with a broader array of properties.
“From the very beginning of the company we’ve only worked with novel new enzymes to create these diagnostic products and the new novel diagnostic and editing,” says Trevor Martin, Mammoth Biosciences co-founder and chief executive.
Chiefly, the company is touting its Cas14 enzyme, which the company says opens up new possibilities for programmable biology thanks to its small size, diverse targeting ability and high fidelity — meaning that there are no unforeseen side effects to edits made using the enzyme (something that has arisen with Cas9 applications).
“There’s not one protein that’s going to be the best at everything,” says Martin. “For any particular product that you’re building, at Mammoth, we have the broadest toolbox.”
The Cas14 enzyme can be used to make gene edits in-vivo, meaning in live organisms, instead of ex-vivo, or outside of an organism. The in-vivo use-case could accelerate the time it takes to conduct experiments or develop treatments.
“Twenty years from now, when the umpteenth drug gets approved using Crispr and some nuclease named Cas132013, people are going to look back on this patent battle and think, ‘what a godawful waste of money,’ ” Jacob Sherkow a patent law scholar at New York Law School told Wired back in 2018.
Already, Horizon Discovery, a Cambridge, U.K.-based gene editing technology developer, is using the new tools developed by Mammoth Bioscience to create new CRISPR tools for Chinese Hamster Ovary cell line editing.
That partnership is an example of how Mammoth is thinking about the commercialization of the new Cas14 enzyme line and its role in biological engineering.
“You will need a full toolbox of CRISPR proteins,” says Martin. “That will allow you to interact with biology in the same way that we interact with software and computers. “From first principles, companies will programmatically modify biology to cure a disease or decrease risk for a disease. That’s going to be really kind of a turning point.”
To achieve its vision, Mammoth has managed to nab top talent from the life sciences industry, including Peter Nell, a co-founder of Casebia (a joint venture between Bayer and CRISPR Therapeutics), who came on board as chief business officer, and Ted Tisch, a former executive at Synthego and Bio-Rad, who joined the company as chief operating officer.
The company also nabbed $45 million of funding, including investment firms Mayfield, NFX, Verily (the Alphabet subsidiary) and Brook Byers, which was led by Decheng Capital — bringing the company to more than $70 million in funding.
“There are a dozen or so products that are in clinical development with CRISPR,” says Ursheet Parikh, a partner with Mayfield. “Maybe that number would go up by five or 10 without Mammoth, but it will go up by one or two orders of magnitude with Mammoth.”
To Parikh, Mammoth is the best positioned of the CRISPR development tools, because the company is building a whole platform that customers can license and use to develop products using gene editing.
The thinking, according to Parikh, is as follows, “if this technology can power lots of applications, let’s basically ensure that lots of these applications can come to market and as that happens I get my app store cut.”
“It’s an Illumina-like business,” Parikh says. “Just as anybody who is innovating with genomics needs an Illumina sequencer because they want to be able to do the sequencing… if someone wants to do editing… This gives them the access to do the right sequencing.”
Insticator, a startup helping publishers add elements like polls, quizzes and suggested story widgets to their content, has made its first acquisition — a commenting platform called Sqwuak It.
Insticator CEO Zack Dugow said his platform benefits online publishers by keeping audiences engaged and bringing in new ad revenue (which is split between Insticator and the publisher). And he sees commenting as a natural next step towards his goal to become “the main monetization and community engagement solution for publishers.”
While “don’t read the comments” remains one of the most reliable pieces of advice you’ll get online, Dugow said Sqwuak It (yes, that’s the real spelling — it was formerly known as Solid Opinion) stands out from other commenting platforms because of its reliance on “100 percent human moderation,” with moderators working in three shifts to to monitor partner sites 24 hours each day.
“Anybody can game an algorithm,” he said.
And when I brought up the concern that so much of the discussion has moved out of the comments section and onto social media, Dugow responded that “merging social commenting” so that it feels like everything is part of the same conversation is “in our roadmap.”
Like other Insticator products, Sqwuak It comments (which you can see below the article here) are monetized through advertising. But Dugow noted that the ads run above the comments, rather interrupting or distracting from the comments themselves.
The financial terms of the acquisition were not disclosed. Dugow said the entire 13-person Squawk It team (headquartered in New York but with an engineering team in Kiev) has joined Insticator, and that the product has already been rebranded as Insticator Comments.
