Nigerian fintech startup Kuda — a digital-only retail bank — has raised $1.6 million in pre-seed funding.

The Lagos and London-based company recently launched the beta version of its online mobile finance platform. Kuda also received its banking license from the Nigerian Central Bank, giving it a distinction compared to other fintech startups.

“Kuda is the first digital-only bank in Nigeria with a standalone license. We’re not a mobile wallet or simply a mobile app piggybacking on an existing bank,” Kuda bank founder Babs Ogundeyi told TechCrunch.

“We have built our own full-stack banking software from scratch. We can also take deposits and connect directly to the switch,” Ogundeyi added, referring to the Nigeria’s Central Switch — a SWIFT-like system that facilitates bank communication and settlements.

A representative for the Central Bank of Nigeria (speaking on background) confirmed Kuda’s banking license and status, telling TechCrunch, “As far as I’m aware there is no other digital bank [in Nigeria] that has a micro-finance license.”

Kuda offers checking accounts with no monthly-fees, a free debit card, and plans to offer consumer savings and P2P payments options on its platform in coming months.

“You can open a bank account within five minutes, do all the KYC in the app, and you get issued a new bank account number,” according to Ogundeyi. Ogundeyi — a repeat founder who exited classifieds publication Motortrader and worked in a finance advisory role to the Nigerian government — co-founded Kuda in 2018 with former Stanbic Bank software developer Musty Mustapha.

The two convinced investor Haresh Aswani to lead the $1.6 million pre-seed funding, along with Ragnar Meitern and other angel investors. Aswani confirmed his investment to TechCrunch and that he will take a position on Kuda’s board.

Kuda plans to use its seed funds to go from beta to live launch in Nigeria by fourth-quarter 2019. The startup will also build out the tech of its banking platform, including support for its developer team located in Lagos and Cape Town, according to Ogundeyi.

Kuda also intends to expand in the near future. “It’s Nigeria for right now, but the plan is build a Pan-African digital-only bank,” he said.

As of 2014, Nigeria has held the dual distinction as Africa’s largest economy and most populous country (with 190 million people).

To scale there, and add some physical infrastructure to its online model, Kuda has correspondent relationships with three of Nigeria’s largest financial institutions: GTBank, Access Bank and Zenith Bank.

Kuda’s CEO clarified the banks are partners and not investors. Kuda customers can use these banks’ branches and ATMs to put money into bank accounts or withdraw funds without a fee.

“Even though we don’t own a single branch, we actually have the largest branch network in the country,” Ogundeyi claimed.

Kuda’s plans to generate revenues focus largely around leveraging its bank balances. “We plan to match different liability classes to the different asset classes that we create. That’s how we make money, that’s how we get efficiency in terms of income,” Ogundeyi said.

In Nigeria, Kuda enters a potentially revenue-rich market, but its one that already hosts a crowded fintech field — as the country becomes ground zero for payments startups and tech investment in Africa.

In both raw and per capita numbers, Nigeria has been slower to convert to digital payments than leading African countries, such as Kenya, according to joint McKinsey Company and Gates Foundation analysis done several years ago. The same study estimated there could be nearly $1.3 billion in revenue up for grabs if Nigeria could reach the same digital-payments penetration as Kenya.

A number of startups (established and new) are going after that prize in the West African country — several with a strategy to scale in Nigeria first before expanding outward on the continent and globally.

San Francisco-based, no-fee payment venture Chipper Cash entered Nigeria this month.

Series B-stage Nigerian payments company Paga raised $10 million in 2018 to further grow its customer base (that now tallies 13 million) and expand to Asia and Latin America.

Kuda CEO Babs Ogundeyi believes Kuda can scale and compete in Nigeria on a number of factors, one being financial safety. He names the company’s official bank status and the Nigeria Deposit Insurance Corporation security that brings as something that can attract cash-comfortable bank clients to digital finance.

Ogundeyi also points to offerings and price.”We look to be the next generation bank where you can do everything— savings, payments and transfers — and also the one that’s least expensive,” he said.

Assembly Bill 5, the gig worker bill opposed by the likes of Uber, Lyft and DoorDash, has passed in the California State Senate. This comes shortly after California Governor Gavin Newsom officially put his support behind AB-5 in an op-ed.

AB-5 would ensure gig economy workers are entitled to minimum wage, workers’ compensation and other benefits.

The state Senate passed the bill in a 29 to 11 vote this evening. The state Assembly, which previously approved the legislation, will now vote on amendments to AB-5. If the Assembly passes the legislation, which it is expected to, it will go to Gov. Newsom, who has expressed support for the measure.

Assuming Gov. Newsom signs the bill, it will go into effect January 1, 2020.

“AB5 is only the beginning,” Gig Workers Rising member and driver Edan Alva said in a statement. “I talk daily to other drivers who want a change but they are scared. They don’t want to lose their only source of income. But just because someone really needs to work does not mean that their rights as a worker should be stepped all over. That is why a union is critical. It simply won’t work without it.”

The bill, first introduced in December 2018, aims to codify the ruling established in Dynamex Operations West, Inc. v Superior Court of Los Angeles. In that case, the court applied the ABC test and decided Dynamex wrongfully classified its workers as independent contractors based on the presumption that “a worker who performs services for a hirer is an employee for purposes of claims for wages and benefits…”

Those who work as 1099 contractors can set their own schedules, and decide when, where and how much they want to work. For employers, bringing on 1099 contractors means they can avoid paying payroll taxes, overtime pay, benefits and workers’ compensation.

According to the ABC test, in order for a hiring entity to legally classify a worker as an independent contractor, it must prove the worker is free from the control and direction of the hiring entity, performs work outside the scope of the entity’s business and is regularly engaged in an “independently established trade, occupation, or business of the same nature as the work performed.”

Uber and Lyft, two of the main targets of this legislation, are adamantly against it. Last month, Uber, Lyft and DoorDash amped up their efforts to do whatever they can to prevent it from happening. That’s in part due to the fact that the companies cost of operating would increase.

Uber, Lyft and DoorDash each put $30 million toward funding a 2020 ballot initiative that would enable them to keep their drivers as independent contractors.

Correction: AB5 must head back to the state Assembly for a vote on Senate amendments. TechCrunch has corrected the headline and article to reflect this. We’ve also updated this story with comment from Lyft.

The U.K.-based vegetarian frozen food company Strong Roots has picked up $18.3 million in funding from the private equity firm Goode Partners as it looks to expand its U.S. presence and build out its technological capabilities.

Advised by global mid-market investment bank Alantra, Strong Roots has a presence in the U.S. in retailers, including Target, Wegmans and Whole Foods, and in the U.K. at Tesco, Asda, Sainsbury’s and Marks and Spencer.

Neither a direct to consumer company nor a novel technology developer, Strong Roots is hoping to use the new financing to expand its research and development efforts to provide more functional foods and nutrients, according to chief executive officer Samuel Dennigan.

The company is on track to move $50 million worth of frozen vegan food items in the calendar year, and it expects its sales to more than quadruple over the next four years.

The company’s exceptional growth comes at a time when consumers globally are looking for healthy options. Strong Roots offers a range of tasty plant-based food designed for busy lives. Found in your freezer aisle, the award-winning line includes premium root vegetables, veggie burgers and freezer favorites like Cauliflower Hash Browns.

The company has found a strong partner in Goode Partners, whose previous investments include AllSaints and La Colombe.

Dennigan’s career in agribusiness stretches back 15 years, but his family has long been in the food production and distribution business.

“I started working with some international brands in the late nineties and saw how CPG companies were doing things in a poor way,” says Dennigan. At first the company thought it would go after fresh foods, but saw more opportunity in the frozen food aisle.

Strong Roots began selling its frozen foods in 2015 just as the vegan and health food craze began to surge.

While the company has spent the past four years building up a brand as a vegan alternative in frozen foods, Dennigan is now ready to expand into other categories. “The pieces of IP that are going to be developed and placed in market in the next 12 months especially around the fortification of the products,” he says. “What our research is showing us is that there’s a huge opportunity between extruded and food and what we’re doing.”

Dennigan is, of course, referring to companies like Beyond Meat and Impossible Foods, which have built protein replacement businesses over the past 10 years and have surged into consumer consciousness with big deals at fast food chains (and no small amount of kerfuffles).

The success of those two companies has set up a feeding frenzy among investors who are voraciously scarfing up vegetarian food companies to add to their portfolios.

Ross Lipson comes from an entrepreneurial family, so perhaps it’s no wonder that as a college student, he dropped out of school to jump into the online food space, including co-founding, then selling, one of Canada’s first online food ordering service startups.

It’s even less surprising that having gone through that experience, Lipson would use what he learned in the service of another startup: Dutchie, a two-year-old, 36-person, Bend, Ore.-based startup whose software is used by a growing number of cannabis dispensaries that pay the startup a monthly subscription fee to create and maintain their websites, as well as to accept orders and track what needs to be ready for pickup.

The decision is looking like a smart one right now. Dutchie says it’s now being used by 450 dispensaries across 18 states and that it’s seeing $140 million in gross merchandise volume. The company also just locked down $15 million in Series A funding led by Gron Ventures, a new cannabis-focused venture fund with at least $117 million to invest. Other participants in the round include earlier backers Casa Verde Capital, Thirty Five Ventures (founded by NBA star Kevin Durant and sports agent Rich Kleiman), Sinai Ventures and individual investors, including Shutterstock founder and CEO Jon Oringer.

Altogether, Dutchie (named after the song), has now raised $18 million. We talked earlier today with Lipson about the company, its challenges and working with his big brother Zach, himself a serial entrepreneur who co-founded Dutchie and today serves as its chief product officer while Ross serves as CEO.

TC: It’s so interesting when siblings team up. Did you always get along with your brother?

RL: We complement each other strongly. I’m energy, I’m sales and business development. I’m fast-moving by nature and the guy who wants to drive the car as fast as possible. Zach is the one who wants to make sure that we’re doing everything right. He’s the methodical one. We really do understand each other quite well and appreciate each other’s strengths and weaknesses, which enables us to meet in the middle on a lot of things.

TC: It’s also interesting that you’ve both been founders beginning around the time you were in college. Were your parents entrepreneurs?

RL: Our father is a founder and has run his own business for the last 35 years. Our parents also always pitched us that anything is possible and encouraged us to go for it. He was the dreamer and our mom was the cheerleader, which is a pretty nice combination.

TC: You started Dutchie a couple of years ago. Is running this startup more or less challenging than your experience in the food delivery business?

RL: It’s our second year in business, and we’ve seen some explosive, unprecedented growth. As for whether it’s harder or easier than food, we’re very product and user-centric, and by that we mean consumers but also dispensaries. We’re focused on the customer all day, every day, with a team that ensures that they have support, that they receive their orders, that the orders are out the door quickly or at least, ready for pickup. We make sure the photos work, that different potencies are marked. Our system is kind of like a Shopify of the cannabis space maybe meets DoorDash.

TC: You don’t deliver, though.

RL: No. We don’t do delivery for legal reasons; the dispensaries [handle this piece].

TC: You’re charging like other software-as-service businesses. Do you also take a cut of each sale?

RL: We don’t charge on transaction volume.

TC: You’re working with 450 dispensaries. Is there any way to know what percentage of the overall market that is, and how much is left for you to chase after?

RL: First, there are more than 30 states where cannabis is either medically legal or that have legalized the recreational use of marijuana and we operate in both types of markets. It’s hard to know the actual count [of dispensaries], because they are always being formed, getting acquired or going out of business, but counting registered dispensaries, we work with more than 15% of them right now.

TC: Who are your biggest competitors? Eaze? Leafly? They also help consumers find cannabis and, in Eaze’s case, deliver it, too.

RL: Eaze is more focused on delivery where we’re more focused on pickup. It’s also only available in California and Oregon, whereas we’re in 18 states. They educate the consumer about online ordering, which is great, but they also own the consumer experience, where we’re really powering the dispensary.

Leafly and Weedmaps are really different types of platforms; they’re mostly known for their dispensary and strain reviews, where we’re strictly an online ordering service.

TC: You’ve raised a big Series A for a company in the cannabis space. Do you have concerns about there being later-stage funding available when you need it?

RL: It’s true the most investors still haven’t touched cannabis, though you are seeing bigger deals. Thrive Capital led that [$35 million] round in [the online cannabis inventory and ordering platform] LeafLink [last month]. You saw Tiger Global [lead a $17 million round ] in [the software platform for cannabis dispensaries] Green Bits last summer. It’s a big advantage to the funds that can right now invest because there are these barriers to entry; they’re finding deals that are promising and they can get in early and without competition.

Pictured, left to right, above: Ross and Zach Lipson

Peloton, which debuted its IPO prospectus last month, plans to charge as much as $29 per share in its upcoming Nasdaq listing.

In an amended S-1 filing released Tuesday afternoon, the developer of internet-connected stationary bikes and treadmills announced a proposed price range of $26 to $29 per share, allowing the company to raise as much as $1.2 billion in its 2019 public offering.

At the high end of the proposed price, Peloton’s valuation would surpass $8 billion. The business is expected to launch its IPO roadshow as soon as Wednesday, according to Bloomberg.

New York-based Peloton will trade under the ticker symbol PTON. Goldman Sachs & Co. and J.P. Morgan Securities are managing the IPO as lead underwriters.

Peloton, founded in 2012, raised $550 million in venture capital funding last year at a valuation of $4.15 billion. In total, the company has attracted $994 million in venture capital investment, according to PitchBook. Its S-1 filing lists CP Interactive Fitness (5.4% pre-IPO stake) — an entity connected to the private equity firm Catterton — TCV (6.7%), Tiger Global (19.8%), True Ventures (12%) and Fidelity Investments (6.8%) as principal stakeholders, or investors with at least a 5% stake in the company.

Peloton reported an impressive $915 million in total revenue for the year ending June 30, 2019, an increase of 110% from $435 million in fiscal 2018 and $218.6 million in 2017. Its losses, meanwhile, hit $245.7 million in 2019, up significantly from a reported net loss of $47.9 million last year.

The company’s upcoming float is expected to be one of the largest of the year.

The AdRoll Group has a new name — NextRoll — designed to reflect the company’s moves beyond ad retargeting.

“We have, for the longest time, been pigeonholed as a retargeting company, but the reality is that we have really been evolving,” CEO Toby Gabriner told me.

To be clear, the AdRoll retargeting business isn’t going away. But the company subsequently introduced RollWorks, which offers business-to-business marketing tools, and today it’s launching a third unit, NextRoll Platform Services.

Gabriner became CEO of AdRoll in November 2017, and he said the rebrand has been in the works for a while now. When the company launched the RollWorks product last year, both business units continued to operate under The AdRoll Group umbrella, but Gabriner said that was always “a temporary placeholder.”

He added, “We’re now a year and a half into the RollWorks brand launch and it’s firmly planted on its own two feet. It makes a ton of sense for us to move onto the NextRoll brand. This was always planned.”

As for how NextRoll Platform Services fits into that strategy, the company describes it as a “marketing-technology-as-a-service offering.” Gabriner explained that it provides access to AdRoll’s underlying technologies through APIs, allowing businesses to bring these capabilities into other ad products, or to resell them as part of their own platforms.

The initial offerings are Channels-as-a-Service, which allows businesses to extend their marketing to new channels, and Audiences-as-a-Service, which turns audience data into targetable segments.

“This is something we’ve been pulled by a lot of customers to do,” Gabriner said. “What we’ve been doing over the last couple of years is externalizing those services so people outside of the company, developers, would have an easier time using them. [Now we’ve] gone that last mile of making them commercially friendly.”

Policing hate speech is something nearly every online communication platform struggles with. Because to police it, you must detect it; and to detect it, you must understand it. Hatebase is a company that has made understanding hate speech its primary mission, and it provides that understanding as a service — an increasingly valuable one.

Essentially Hatebase analyzes language use on the web, structures and contextualizes the resulting data, and sells (or provides) the resulting database to companies and researchers that don’t have the expertise to do this themselves.

The Canadian company, a small but growing operation, emerged out of research at the Sentinel Project into predicting and preventing atrocities based on analyzing the language used in a conflict-ridden region.

“What Sentinel discovered was that hate speech tends to precede escalation of these conflicts,” explained Timothy Quinn, founder and CEO of Hatebase. “I partnered with them to build Hatebase as a pilot project — basically a lexicon of multilingual hate speech. What surprised us was that a lot of other NGOs [non-governmental organizations] started using our data for the same purpose. Then we started getting a lot of commercial entities using our data. So last year we decided to spin it out as a startup.”

You might be thinking, “what’s so hard about detecting a handful ethnic slurs and hateful phrases?” And sure, anyone can tell you (perhaps reluctantly) the most common slurs and offensive things to say — in their language… that they know of. There’s much more to hate speech than just a couple ugly words. It’s an entire genre of slang, and the slang of a single language would fill a dictionary. What about the slang of all languages?

A shifting lexicon

As Victor Hugo pointed out in Les Miserables, slang (or “argot” in French) is the most mutable part of any language. These words can be “solitary, barbarous, sometimes hideous words… Argot, being the idiom of corruption, is easily corrupted. Moreover, as it always seeks disguise so soon as it perceives it is understood, it transforms itself.”

Not only is slang and hate speech voluminous, but it is ever-shifting. So the task of cataloguing it is a continuous one.

Hatebase uses a combination of human and automated processes to scrape the public web for uses of hate-related terms. “We go out to a bunch of sources — the biggest, as you might imagine, is Twitter — and we pull it all in and turn it over to Hatebrain. It’s a natural language program that goes through the post and returns true, false, or unknown.”

True means it’s pretty sure it’s hate speech — as you can imagine, there are plenty of examples of this. False means no, of course. And unknown means it can’t be sure; perhaps it’s sarcasm, or academic chatter about a phrase, or someone using a word who belongs to the group and is attempting to reclaim it or rebuke others who use it. Those are the values that go out via the API, and users can choose to look up more information or context in the larger database, including location, frequency, level of offensiveness, and so on. With that kind of data you can understand global trends, correlate activity with other events, or simply keep abreast of the fast-moving world of ethnic slurs.

Quinn doesn’t pretend the process is magical or perfect, though. “There are very few 100 percents coming out of Hatebrain,” he explained. “It varies a little from the machine learning approach others use. ML is great when you have an unambiguous training set, but with human speech, and hate speech, which can be so nuanced, that’s when you get bias floating in. We just don’t have a massive corpus of hate speech, because no one can agree on what hate speech is.”

That’s part of the problem faced by companies like Google, Twitter, and Facebook — you can’t automate what can’t be automatically understood.

Fortunately Hatebrain also employs human intelligence, in the form of a corps of volunteers and partners who authenticate, adjudicate, and aggregate the more ambiguous data points.

“We have a bunch of NGOs that partner with us in linguistically diverse regions around the world, and we just launched our ‘citizen linguists’ program, which is a volunteer arm of our company, and they’re constantly updating and approving and cleaning up definitions,” Quinn said. “We place a high degree of authenticity on the data they provide us.”

That local perspective can be crucial for understanding the context of a word. He gave the example of a word in Nigeria, which when used between members of one group means friend, but when used by that group to refer to someone else means uneducated. It’s unlikely anyone but a Nigerian would be able to tell you that. Currently Hatebase covers 95 languages in 200 countries, and they’re adding to that all the time.

Furthermore there are “intensifiers,” words or phrases that are not offensive on their own but serve to indicate whether someone is emphasizing the slur or phrase. Other factors enter into it too, some of which a natural language engine may not be able to recognize because it has so little data concerning them. So in addition to keeping definitions up to date, the team is also constantly working on improving the parameters used to categorize speech Hatebrain encounters.

Building a better database for science and profit

The system just ingested its millionth hate speech sighting (out of perhaps tens times that many phrases evaluated), which sounds simultaneously like a lot and a little. It’s a little because the volume of speech on the internet is so vast that one rather expects even the tiny proportion of it constituting hate speech to add up to millions and millions.

But it’s a lot because no one else has put together a database of this size and quality. A vetted, million-data-point set of words and phrases classified as hate speech or not hate speech is a valuable commodity all on its own. That’s why Hatebase provides it for free to researchers and institutions using it for humanitarian or scientific purposes.

But companies and larger organizations looking to outsource hate speech detection for moderation purposes pay a license fee, which keeps the lights on and allows the free tier to exist.

“We’ve got, I think, four of the world’s ten largest social networks pulling our data. We’ve got the UN pulling data, NGOs, the hyper local ones working in conflict areas. We’ve been pulling data for the LAPD for the last couple years. And we’re increasingly talking to government departments,” Quinn said.

They have a number of commercial clients, many of which are under NDA, Quinn noted, but the most recent to join up did so publicly, and that’s TikTok. As you can imagine, a popular platform like that has a great need for quick, accurate moderation.

In fact it’s something of a crisis, since there are laws coming into play that penalize companies enormous amounts if they don’t promptly remove offending content. That kind of threat really loosens the purse strings; If a fine could be in the tens of millions of dollars, paying a significant fraction of that for a service like Hatebase’s is a good investment.

“These big online ecosystems need to get this stuff off their platforms, and they need to automate a certain percentage of their content moderation,” Quinn said. “We don’t ever think we’ll be able to get rid of human moderation, that’s a ridiculous and unachievable goal; What we want to do is help automation that’s already in place. It’s increasingly unrealistic that every online community under the sun is going to build up their own massive database of multilingual hate speech, their own AI. The same way companies don’t have their own mail server any more, they use Gmail, or they don’t have server rooms, they use AWS — that’s our model, we call ourselves hate speech as a service. About half of us love that term, half don’t, but that really is our model.”

Hatebase’s commercial clients have made the company profitable from day one, but they’re “not rolling in cash by any means.”

“We were nonprofit until we spun out, and we’re not walking away from that, but we wanted to be self-funding,” Quinn said. Relying on the kindness of rich strangers is no way to stay in business, after all. The company is hiring and investing in its infrastructure, but Quinn indicated that they’re not looking to juice growth or anything — just make sure the jobs that need doing have someone to do them.

In the meantime it seems clear to Quinn and everyone else that this kind of information has real value, though it’s rarely simple.

“It’s a really, it’s a really complicated problem. We always grapple with it, you know, in terms of, well, what role does hate speech play? What role does misinformation play? What role do socioeconomics play?” he said. “There’s a great paper that came out of the University of Warwick, they studied the correlation between hate speech and violence against immigrants in Germany over, I want to say, 2015 to 2017. They graph it out. And its peak for peak, you know, valid for Valley. It’s amazing. We don’t do a hell of a lot of analysis — we’re a data provider.”

“But now have like, almost 300 universities pulling the data, and they do those kinds of those kinds of analyses. So that’s very validating for us.”

You can learn more about Hatebase, join the Citizen Linguists or research partnership, or see recent sightings and updates to the database at the company’s website.