Demo days at startup accelerators are a pretty big deal around here.

These events aren’t just a chance to review the latest cohort of hopeful entrepreneurs — they also showcase the technology, products and services that will compete for VC and consumer attention over the next few years.

You never know where a hit will come from, which is why these events capture our attention. Here’s just one example from Y Combinator’s Summer 2013 Demo Day:

Positioning itself as the “FedEx of today,” it hopes to provide a logistics framework that goes beyond food and can be used for any type of on-demand order.

That startup was DoorDash, by the way.

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Full disclosure: In 2016, I was 500 Startups’ Journalist-in-residence. I covered one demo day in person, spending most of my time backstage where founder teams practiced their pitches.

It was quite a scene: Several people literally jumped up and down to shake off their nervous energy, but I also recall one who calmly recited their lines while gazing through a window.

Yesterday, Jon Shieber and Alex Wilhelm covered 500 Startups’ 27th virtual demo day and selected eight companies as their favorites:

StackAdaptyMightyFlyOmnitron SensorsAWSMMemechatRyu GamesApothecary

Thank you very much for reading Extra Crunch this week! I hope you have a safe, relaxing weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

TechCrunch’s favorite companies from 500 Startups’ latest demo day

How the GameStop stonkathon helped Robinhood raise $3.4B last week

I’ve never used “stonkathon” in a headline before, but it’s been that kind of week.

The war between hedge funds and day traders over GameStop vaulted discount trader Robinhood into the headlines for days.

But how did it affect the company’s financial health?

This morning, Alex Wilhelm examined why Robinhood’s investors were willing to inject $3.4 billion more into the company in just one week.

“More trades means more PFOF (payment for order flow) revenue,” says Alex. “And Robinhood effectively doubled in size.”

Udemy’s new president discusses the reskilling company’s future

Reporter Natasha Mascarenhas interviewed Greg Brown, new president of digital learning platform Udemy, after his company announced that it surpassed $100 million ARR.

A new arm of the company, Udemy for Business, just secured a 100,000-employee contract with Cisco Systems to offer software, business and technology courses.

“The opportunity that the company sees has really forced us to reallocate resources and strategy,” said Brown.

Why one Databricks investor thinks the company may be undervalued

After scaling its ARR to $425 million and reaching a valuation of $28 billion, data analytics company Databricks is clearly IPO-ready.

Battery Ventures has backed Databricks since 2017, so Alex Wilhelm interviewed General Partner Dharmesh Thakker to understand why he thinks the company may be undervalued.

“Whether it’s digital transformation, whether it’s analytics, data is everywhere,” said Thakker. “So the TAM is massive.”

4 strategies for deep tech founders who are fundraising

Deep tech founders face special challenges when pitching investors: they usually don’t have a product, customers or revenue.

It’s difficult enough to ask a stranger for a check when there’s a beta product, but how do you drum up interest in an unproven idea that may exist largely in your imagination?

“Early-stage investors are in the business of funding dreams,” says angel investor Jessica Li.

“Investors are less interested in the intricacies of your technology and more interested in what impact it can create.”

Step one: use storytelling to highlight your big vision.

Edtech valuations aren’t skyrocketing, but investors see more exit opportunities

Investors funded edtech startups with $10 billion last year as the pandemic forced widespread adoption of remote learning.

The valuations of these companies aren’t rising at the same rate as SaaS or fintech startups, but “where edtech lacks in impressive valuations, investors see it gaining in exit opportunities,” writes Natasha Mascarenhas.

For this edtech investor survey, she interviewed:

Deborah Quazzo, managing partner, GSV Ventures (an education fund backing ClassDojo, Degreed and Clever)Ashley Bittner, founding partner, Firework Ventures (a future-of-work fund with portfolio companies LearnIn and TransfrVR)Jomayra Herrera, principal, Cowboy Ventures (a generalist fund with portfolio companies Hone and Guild Education)John Danner, managing partner, Dunce Capital (an edtech and future-of-work fund with portfolio companies Lambda School and Outschool)Mercedes Bent and Bradley Twohig, partners, Lightspeed Venture Partners (a multistage generalist fund with investments including Forage, Clever and Outschool)Ian Chiu, managing director, Owl Ventures (a large edtech-focused fund backing highly valued companies including BYJU’s, Newsela and MasterClass)Jan Lynn-Matern, founder and partner, Emerge Education (a leading edtech seed fund in Europe with portfolio companies like Aula, Unibuddy and BibliU)Benoit Wirz, partner, Brighteye Ventures (an active edtech-focused venture capital fund in Europe that backs YouSchool, Lightneer and Aula)Charles Birnbaum, partner, Bessemer Venture Partners (a generalist fund with portfolio companies including Guild Education and Brightwheel)Daniel Pianko, co-founder and managing director, University Ventures (a higher-ed and future-of-work fund that is backing Imbellus and AdmitHub)Rebecca Kaden, managing partner, Union Square Ventures (a generalist fund with portfolio companies including TopHat, Quizlet and Duolingo)Andreata Muforo, partner, TLcom Capital (a generalist fund backing uLesson)

Deep Science: AIs with high class and higher altitudes

In his latest recap of recent breakthroughs in applied science, Devin Coldewey looked at how researchers are using AI to:

Categorize thousands of pieces of classical musicRead MRIs to spot patients with schizophreniaTrack elephant herds via satelliteImprove accessibility on mobile phones

Spotify Group Session UX teardown: the fails and their fixes

In the latest of a series of articles that examines user experiences for consumer apps, UX expert Peter Ramsey and TechCrunch reporter Steve O’Hear studied Spotify Group Session, the shared-queue feature that permits users to create playlists collaboratively.

“Many of these lessons can be applied to other existing digital products or ones you are currently building,” such as the need to add context for important decisions and how to best use “react and explain” prompts.

Lightspeed’s Gaurav Gupta and Grafana’s Raj Dutt discuss pitch decks, pricing and how to nail the narrative

Extra Crunch Live returned this week with two guests: Lightspeed Venture Partners’ Gaurav Gupta and Raj Dutt, co-founder and CEO of Grafana Labs.

In addition to walking us through the presentation that encouraged Lightspeed to invest in Grafana’s Series A, the duo also gave direct feedback to audience members about their pitch decks.

Watch a video with our complete episode, or read highlights from the chat to get Gupta and Dutt’s insights on what goes into a successful pitch deck.

New episodes of Extra Crunch Live drop each Wednesday at 12 p.m. PST/3 p.m. EST/8 p.m. GMT.

Here’s a breakdown of the complete episode with Gaurav Gupta and Raj Dutt:

How they met — 2:00Grafana’s early pitch deck — 12:00The enterprise ecosystem — 25:00The pitch deck teardown — 32:00

Subscription-based pricing is dead: Smart SaaS companies are shifting to usage-based models

Some IT managers may still be debating the merits of usage-based pricing versus subscription-based models, but SaaS investors have made up their minds.

Compared to their rivals, companies that employ usage-based pricing trade at a 50% revenue multiple premium. You can argue with success, but seven out of the nine IPOs since 2018 with the best net dollar retention offer usage-based models.

If you’re a founder who hopes to break into the $100M ARR club, this guest post can help you identify the right usage metrics for creating a sustainable customer journey.

For more actionable advice regarding SaaS pricing and sales, see these previously published Extra Crunch stories:

Should your SaaS startup embrace a bottom-up GTM strategy?How should SaaS companies deliver and price professional services?

Bumble IPO could raise more than $1B for dating service

How many dating networks can the public market support?

In Tuesday’s column, Alex Wilhelm examined the latest IPO filing from relationship-finding service Bumble.

The company set a range of $28 – $30 per share, so Alex set out to find its simple and diluted valuations, how much it expects investors to pay and “how those stack up compared to Match Group’s own numbers.”

Robinhood’s Q4 2020 revenue shows a return to growth

Discount brokerage Robinhood stayed in the news last week as it became a proxy battlefield for institutional and retail investors, but its backers “put in another billion just last week,” says Alex Wilhelm.

Why were investors so bullish after days of screaming headlines?

In yesterday’s column, Alex unpacked Robinhood’s Q4 2020 numbers, “which shows a return to sequential-quarterly growth at the trading upstart.”

Trading app Public drops payment for order flow in favor of tips

Before Redditors came after GameStop, zero-cost trading service Public says it was seeing “steady ~30%” month-over-month growth.

Last week, however, “new user signups went up 20x,” founders Leif Abraham and Jannick Malling told TechCrunch.

After closing a $65 million Series C, Public announced yesterday that it would “stop participating in the practice of Payment for Order Flow,” replacing PFOF with an “optional tipping feature.”

Customer advisory boards are a gold mine for startup brand champions

Startups that don’t directly engage their earliest customers with purpose and intention are leaving money on the table.

Creating a Customer Advisory Board (CAB) is a proven method for soliciting product ideas, testing marketing plans and turning early users into loyal brand advocates.

Before you call a CAB, read this post to find out how to identify customers who’ll contribute real insights, establish goals and “pick members who play well together.”

Best practices as a service is a key investment theme to watch in 2021

Identity and access management company Okta announced in a study last week that its largest customers use an average of 175 different applications to manage their operations.

Managing Editor Danny Crichton says this “explosion of creativity and expressiveness and operational latitude” offers widespread benefits, but it’s “also a recipe for disaster,” since many end users aren’t well-trained when it comes to using these tools.

This enterprise version of the Tower of Babel creates an opening for companies that offer “best practices as a service,” says Danny. “The next generation of SaaS software has to take those abecedarian building blocks and forcibly guide users to using those tools in the best possible way.”

This week, flexible workspace operator (and one-time unicorn) Knotel announced it had filed for bankruptcy and that its assets were being acquired by investor and commercial real estate brokerage Newmark for a reported $70 million.

Knotel designed, built and ran custom headquarters for companies. It then managed the spaces with “flexible” terms. In March 2020, it was reportedly valued at $1.6 billion.

At first glance, one might think that the WeWork rival, which had raised about $560 million since its 2016 inception, was another casualty of the COVID-19 pandemic. 

But New York-based Knotel was reportedly in trouble — facing a number of lawsuits and evictions — before the pandemic had even hit, according to multiple reports, such as this one in The Real Deal.

As such, some industry observers believe the company’s Chapter 11 filing was inevitable despite it reaching unicorn status after raising $400 million in Series C funding in August 2019.

 

Newmark’s purchase of Knotel’s assets is believed to an effort to recoup some of its investment, according to Jonathan Pasternak, bankruptcy attorney and partner at New York-based Davidoff Hutcher & Citron.

Anytime a company that has raised more than half a billion dollars basically implodes, it’s worth taking a look at the roller coaster ride it was on before it got to that point.

2016

Virgin Mobile co-founder Amol Sarva and former VC Edward Shenderovich founded Knotel, essentially reversing the WeWork model. There’s hype around the company in its early days.

2017

Knotel raised a Series A round of $25 million in February from investors such as Peak State Ventures, Invest AG, Bloomberg Beta and 500 startups. It marketed its offering as “headquarters as a service” — or a flexible office space that could be customized for each tenant while also growing or shrinking as needed. 

2018

In April, Knotel announced the close of a $70 million Series B financing led by Newmark Knight Frank and The Sapir Organization. In August, the company told me that it was operating over 1 million square feet across 60 locations in New York, London, San Francisco and Berlin, and that it was on track to reach 2.5 million square feet and $100 million in revenue by year’s end. Revenue growth had increased by 300% year over year, according to the company. Customers and users and clients ranged from VC-backed startups Stash and HotelTonight to enterprise customers such as The Body Shop. 

“What they’re doing is different,” said Barry Gosin, CEO of Newmark Knight Frank, in a press release, at the time of the round. “It’s a new category the industry hasn’t seen and is rapidly adopting. We’ve watched their ascent from a distance and are now thrilled to join them on the journey. It marks a shift in how owners and tenants are coming together.”

2019

In August, Knotel announced the completion of a $400 million financing, led by Wafra, an investment arm of the Sovereign Wealth Fund of Kuwait. With the round, the company had achieved unicorn status and was being touted as a formidable WeWork competitor. At the time, Knotel said it operated more than 4 million square feet across more than 200 locations in New York, San Francisco, London, Los Angeles, Washington, D.C., Paris, Berlin, Toronto, Boston, São Paulo and Rio de Janeiro. 

In a statement at the time, CEO Sarva said: “Knotel is building the future of the workplace, and we are excited to welcome a group of investors who believe passionately in our product, vision and ability to execute. Wafra will help us continue our rapid global expansion and solidify our position as the leader in a fast-growing, trillion-dollar flexible office market.”

2020

In late March, Forbes reported that Knotel had laid off 30% of its workforce and furloughed another 20%, due to the impact of the coronavirus. At the time, it was valued at about $1.6 billion. 

The company had started the year with about 500 employees. By the third week of March, it had a headcount of 400. With the cuts, about 200 employees remained with the other 200 having either lost their jobs or on unpaid leave, according to Forbes. 

“Business as usual is over,” Amol Sarva, Knotel’s CEO and co-founder, said in a statement to Forbes. “Knotel has decided to take sharp action to prepare for the worst case — a long health and economic crisis.”

In the second quarter, Knotel’s revenue slipped by about 20% to about $59 million compared to the first quarter, reported Forbes. Multiple landlords had filed lawsuits against the company.

By July, Forbes had reported that Knotel was attempting to raise as much as $100 million, according to various sources “familiar with the matter.”

2021

Knotel files for bankruptcy, agrees to sell assets to investor Newmark for a reported $70 million after being valued at $1.6 billion less than one year prior.

“Newmark’s commitment offers a path forward amidst this challenging climate,” CEO Sarva said in a statement. “We are optimistic that, through a successful restructuring, we can refocus on our mission of providing state-of-the-art, tailored flex space in key U.S. and international markets.”

To facilitate the transaction under Section 363 of the United States Bankruptcy Code, an affiliate of Newmark agreed to provide Knotel with about $20 million in cash as DIP financing to support Knotel through the bankruptcy process.

Just as the startup and VC world watched as WeWork lost a significant amount of value over the past two years, we’re paying attention to the demise of Knotel and wondering what this means for the flexible workspace sector. As much of the world continues to work from home and office buildings remain mostly vacant as this pandemic rages, our guess is that things will only get worse before they get better.

 

When Laura Wittig and Liza Moiseeva met as guests on a podcast about sustainable fashion, they jibed so well together that they began one of their own: Good Together. Their show’s goal was to provide listeners with a place to learn how to be eco-conscious consumers, but with baby steps.

Wittig thinks the non-judgmental environment (one that doesn’t knock on a consumer for not being zero-waste overnight) is the show’s biggest differentiator. “Then, people were emailing us and asking how they can be on our journey beyond being a listener,” Wittig said. Now, over a year after launching the show, the co-hosts are turning validation from listeners into the blueprint for a standalone business: Brightly.

Brightly is a curated platform that sells vetted eco-friendly goods and shares tips about conscious consumerism. While the startup is launching with more than 200 products from eco-friendly brands, such as Sheets & Giggles and Juice Beauty, the long-term vision is to start their own commerce brand of Brightly-branded products. The starting lineup will include two to four products in the home space.

To get those products out by the holiday season, Brightly tells TechCrunch that it has raised $1 million in venture funding from investors, including Tacoma Venture Fund, Keeler Investments, Odile Roujol (a FAB Ventures backer and former L’Oréal CEO) and Female Founder’s Alliance.

The funding caps off a busy 12 months for Brightly. The startup has gone through Snap’s Yellow accelerator, an in-house effort from the social media company that began in 2018. As part of the program Snap invests $150,000 in each Yellow startup for an equity stake. The company also did Ready Set Raise, an equity-free accelerator put on by Female Founders Alliance, in the fall.

With new funding, Brightly is seeking to take a Glossier-style approach to become the next big brand in commerce: gather a community by recommending great products, then turn the strategy on its head and make your superfans buy in-house products under the same brand.

“We have access to a community of women who are beating our door down to shop directly with us and have exclusive products made for them,” Wittig said.

Brightly wants to be more than a “boring storefront” one could quickly whip up on Shopify or Amazon, Wittig says.

The company’s curation process, which every product goes through before being listed on the platform, is extensive. The startup makes sure that every product is created with sustainable and ethical supply chain processes and sustainable material. The team also interviews every brand’s founders to understand the genesis of any product that lives on the Brightly platform. The co-founders also weigh the durability and longevity of products, adopting what Wittig sees as a “Wirecutter approach.”

“It’s more like, ‘why would we pick an ethically produced leather handbag over something that might be made not from leather but wouldn’t last too long necessarily,’ ” she said. “These are the conversations we have with our audience, because the term eco-friendly is very much our grayscale.”

More than 250,000 people come to Brightly, either through their app or website, every day, according to Wittig. The startup monetizes largely through brand partnerships and getting those users in front of paid products.

The monetization strategy is similar to what you might find a podcast use: affiliate links or product placement mid-episode. But while the co-founders are relying on this strategy right now, they see the opportunity to create their own e-commerce company as larger and more lucrative.

“The billion-dollar opportunity is not with that,” Wittig said. “The value will be going direct commerce and selling our picks of ethical sustainable goods.”

Marking the transition from podcasting about eco-friendly goods to creating them in-house is a strong pivot. The co-founders consider creating a distribution commerce channel to be a larger opportunity and likely more lucrative than the podcasting business.

Beyond creating a line of their own products, Brightly is thinking about how to partner with white-label sustainable products. Another option, Wittig said, is to partner with big corporations to get products on their shelves with colors and customization for Brightly. An example of an ideal partnership would be Reformation’s recent partnership with Blueland.

Wittig declined to share more details on how they plan to win, but likened the strategy to that of Goop or Glossier, two companies that started with content arms and drew their community into a commerce platform.

“It’s not going to be a Thrive Market where there are hundreds and thousands of sustainable goods on there. It’s going to be much more curated,” she said.

COVID-19 has helped the startup further validate the need for a platform that unites a conscious consumer community.

“We are all so aware of the purchasing power we have,” she said. “As consumers we go out and support small businesses by getting coffee on the go. But before, we did not think twice about getting everything from Amazon.”

The conversation with investors hasn’t been as simple, the co-founder said. Investors continue to be “hands off” about community-based platforms because they are unsure it will work. Wittig says that many bearish investors have placed bets on singular direct-to-consumer brands, such as Away or Blueland.

“Those investors know the rising costs of customer acquisition, and see what happens when you don’t have a community that surrounds our business,” she said.

Brightly is betting that the future of commerce brands has to start with a go-to-market, and then bring in the end-product, instead of the other way. The end goal here for Brightly is attracting, and generating excitement from, Gen Z and millennial shoppers. To do so, Wittig says that Brightly is experimenting with ways to implement socialization aspects into the shopping experience.

Leslie Feinzaig, the founder of Female Founders Alliance, said that what’s special about Brightly is that it “demonstrated demand before building for it.”

“I think a lot of people today could build software to connect people and sell things, but very few people could get thousands of fanatical followers to actually engage with each other and make that software useful,” Feinzaig said. “Brightly built that community with matchsticks and tape.”

BeGreatTV, an online education platform featuring Black and brown instructors, recently closed a $450K pre-seed round from Stand Together Ventures Lab, Arlan Hamilton, Tiffany Haddish and others.

The goal with BeGreatTV is to enable anyone to learn from talented Black and brown innovators and leaders, founder and CEO Cortney Woodruff told TechCrunch.

“When you think of being a Black or brown person or individual who wants to learn from a Black or brown person, there’s nothing that really exists that gives you a glossary of every business vertical and where you see representation at every level in a well put together way,” Woodruff said. “That alone makes our market a lot larger because there are just so many verticals where no one has really invested in or shown before.”

The courses are designed to teach folks how to execute and succeed in a particular industry, and enable people to better understand the business aspect of industries while also teaching “you how to deal with the socioeconomic and racial injustices that come with being the only one in the room. Whether you are a Black man or woman who wants to get into the makeup industry, there will always be a lot of biases in the world.”

When BeGreatTV launches in a couple of months (the plan is to launch in April), the platform will feature at least 10 courses — each with around 15 episodes — focused on arts, entertainment, beauty and more. At launch, courses will be available from Sir John, a celebrity makeup artist for L’Oréal and Beyoncé’s personal makeup artist, BeGreatTV co-founder Cortez Bryant, who was also Lil Wayne and Drake’s manager, as well as Law Roach, Zendaya’s stylist.

Hamilton and Haddish will also teach their own respective courses on business and entertainment, Woodruff said. So far, BeGreatTV has produced more than 40 episodes that range anywhere from three to 15 minutes each.

Each course will cost $64.99, and the plan is to eventually offer an all-access subscription model once BeGreatTV beefs up its offerings a bit more. For instructors, BeGreatTV shares royalties with them.

“Ultimately, the platform can include a more diverse casting of instructors that aren’t just Black and brown,” Woodruff said. But for now, he said, the idea is to “reverse the course of ‘Now this is our first Black instructor’ but ‘now this is the first white instructor’ ” on the platform.

BeGreatTV’s team consists of just 15 people, but includes heavy hitters like Cortez Bryant and actor Jesse Williams. Currently, BeGreatTV is working on closing its seed round and anticipates a six-figure user base by the end the year.

MasterClass is perhaps BeGreatTV’s biggest competitor. With classes taught by the likes of Gordon Ramsay, Shonda Rhimes and David Sedaris, it’s no wonder why MasterClass has become worth more than $800 million. The company’s $180 annual subscription fee accounts for all of its revenue.

“If you benchmark [BeGreatTV] to MasterClass, we are finding individuals that are not only the best at what they do in the world, but often times these individuals have broken barriers because often times they were the first to do it,” Woodruff said. “And do it without having people who look like them.”

 

Before he was a partner at Lightspeed Venture Partners, Gaurav Gupta had his eye on Grafana Labs, the company that supports open-source analytics platform Grafana. But Raj Dutt, Grafana’s co-founder and CEO, played hard to get.

This week on Extra Crunch Live, the duo explained how they came together for Grafana’s Series A — and eventually, its Series B. They also walked us through Grafana’s original Series A pitch deck before Gupta shared the aspects that stood out to him and how he communicated those points to the broader partnership at Lightspeed.

Gupta and Dutt also offered feedback on pitch decks submitted by audience members and shared their thoughts about what makes a great founder presentation, pulling back the curtain on how VCs actually consume pitch decks.

We’ve included highlights below as well as the full video of our conversation.

We record new episodes of Extra Crunch Live each Wednesday at 12 p.m. PST/3 p.m. EST/8 p.m. GMT. Check out the February schedule here.

Episode breakdown:

How they met — 2:20Grafana’s early pitch deck — 12:25The enterprise ecosystem — 26:00The pitch deck teardown — 33:00

How they met

As soon as Gupta joined Lightspeed in June 2019, he began pursuing Dutt and Grafana Labs. He texted, called and emailed, but he got little to no response. Eventually, he made plans to go meet the team in Stockholm but, even then, Dutt wasn’t super responsive.

The pair told the story with smiles on their faces. Dutt said that not only was he disorganized and not entirely sure of his own travel plans to see his co-founder in Stockholm, Grafana wasn’t even raising. Still, Gupta persisted and eventually sent a stern email.

“At one point, I was like ‘Raj, forget it. This isn’t working’,” recalled Gupta. “And suddenly he woke up.” Gupta added that he got mad, which “usually does not work for VCs, by the way, but in this case, it kind of worked.”

When they finally met, they got along. Dutt said they were able to talk shop due to Gupta’s experience inside organizations like Splunk and Elastic. Gupta described the trip as a whirlwind, where time just flew by.

“One of the reasons that I liked Gaurav is that he was a new VC,” explained Dutt. “So to me, he seemed like one of the most non-VC VCs I’d ever met. And that was actually quite attractive.”

To this day, Gupta and Dutt don’t have weekly standing meetings. Instead, they speak several times a week, conversing organically about industry news, Grafana’s products and the company’s overall trajectory.

Grafana’s early pitch deck

Dutt shared Grafana’s pre-Series A pitch deck — which he actually sent to Gupta and Lightspeed before they met — with the Extra Crunch Live audience. But as we know now, it was the conversations that Dutt and Gupta had (eventually) that provided the spark for that deal.

Robinhood has shown an impressive ability to raise enormous amounts of capital in the past few weeks to ensure it has the funds needed to allow users to trade and, presumably, provide it with enough cash until it goes public. Raising $3.4 billion so quickly is an extraordinary feat.

But how the company managed to get investors to wire money with such alacrity has been a curiosity; what about Robinhood was so compelling that giving it a multibillion dollar injection was such an obvious decision?

The Exchange explores startups, markets and money. Read it every morning on Extra Crunch, or get The Exchange newsletter every Saturday.

We got a whiff of it when we parsed Robinhood’s Q4 2020 payment for order flow (PFOF) data, which showed the discount trading service growing nicely from its Q3 results. Robinhood’s PFOF revenue growth had slowed in sequential terms in the third quarter of 2020, but the final quarter iced near-term concerns that the unicorn’s growth days were behind it.

But then the company gave us a little more, a few charts that I think better explain why Robinhood was able to raise so much money so quickly.

Equities and options volumes go up

The reason why Robinhood was able to raise lots more cash very quickly was because the company’s PFOF revenue driver likely went into overdrive during the mess that was the GameStop period, This is somewhat obvious, as many people were trading.

But thanks to a new chart from the company posted on its own blog, we now know that Robinhood’s PFOF incomes were likely spiking to all-time highs.

Here’s the chart the company published, which I have loosely marked with quarterly intervals. Per Robinhood, the green line is “Robinhood equities and options trading volumes over a longer time horizon, through last week:”

Tickr, an app that allows U.K. consumers to make financial investments based on their impact on society and the environment, has secured £2.5 million ($3.4 million) in funding lead by Ada Ventures, a VC which focuses on “impact” startups. The cash will be used for product development, expanding the user base, and eventually taking Tickr into other European countries from its current U.K. base.

As well as investing, the platform allows customers to spend their cash via partnerships with impact-oriented compares, and offset their carbon footprint through a subscription. The core business model is £1 p/m per customer, plus 0.30% on assets above £3,000. Additional products, like carbon offsets, for example, are charged as a separate additional subscription depending on the tier selected.

The startup says it is approaching 100,000 users in the U.K. and is reaching a millennial audience, 90% of which have “never invested before” (they say) and these users are investing £250 per month on average.

The app is not billed as a trading app, with quick “in and outs”, but is about building wealth whilst investing in a diversified portfolio of high-impact companies. Its competitors include MoneyBox, but Tickr says it is “100% pure impact focus” by contrast. The vast majority of Europeans don’t invest in markets, so this could be a good opportunity for the product.

Founders Tom McGillycuddy and Matt Latham spent eight years working in investment management, but say they became disillusioned by the jargon, high fees and indifference to causes such as the environment.

Over text interview, McGillycuddy told me: “We also realized there was zero consideration for the underlying impact of the investments people were making; it was purely about the return. Coming from Wigan and Liverpool, we were the first people in our families to be exposed to this world, and it didn’t seem right.” The pair moved into impact investing and subsequently went on to launch Tickr in 2018.

Latitude, a startup building games with “infinite storylines” generated by artificial intelligence, is announcing that it has raised $3.3 million in seed funding.

The idea of an AI-generated story might make you think of hilariously nonsensical experiments like “Sunspring,” but Latitude’s first title, AI Dungeon, is an impressively open-ended (and coherent) text adventure game where you can choose from a wide variety of genres and characters.

Unlike a classic text adventure like Zork — where players quickly become familiar with “you can’t do that”-style messages when they type something the designers hadn’t planned for — AI Dungeon can respond to any command. For example, when my brave knight was charging into battle, I typed “get depressed” and he quickly sat on a rock with his head between his hands.

“How does the AI know what’s a good story?” said co-founder and CEO Nick Walton. “Because it’s read a lot of good stories and knows the patterns involved in that.”

AI Dungeon actually started out as one of Walton’s hackathon projects. While the initial version didn’t win any prizes, he kept at it, assisted by improvements in OpenAI’s language generator, of which the most recent version is GPT-3.

“The very first version of AI Dungeon I built was coherent on a sentence level, but on a paragraph level it made no sense,” Walton said. “Once you get to GPT-2, it makes a lot more sense. Once you get to GPT-3, it’s a lot more coherent on a story level. And so I think to a degree, these issues with coherency, the story not making sense, get solved as the AI gets better.”

Latitude says AI Dungeon is attracting 1.5 million monthly active users. The startup plans to create more AI-powered games, and eventually to release a platform allowing other game designers to do the same.

Walton noted that without AI, video games are always constrained by the imagination of its creators. Even when you get to games like The Elder Scrolls II: Daggerfall or No Man’s Sky, with randomly generated towns or planets, he argued that they’re really offering “the same spin on a similar concept.”

For example, he said that in Daggerfall, “When you go to all these towns, they’re all basically the same. That’s the problem with procedural generation: You’re not coming up with unique things.” AI, on the other hand, can come up with “something completely unique that’s so, so different every time.”

From a business perspective, he said that this could lower the cost of developing AAA games from more than $100 million to less than $100,000 — though Latitude has a ways to go before it reaches that level, since it hasn’t even released a game with graphics yet. Walton also said this could lead to new levels of immersion and interactivity.

“With this technology, you could have a world with tens of thousands of characters with their own hopes and wants and dreams,” he said. “You can have worlds that are dynamic, that are alive, rather than something like World of Warcraft, where you’ve got 10 million people who are doing the same quest.”

The startup’s funding was led by NFX, with participation from Album VC and Griffin Gaming Partners.

“Latitude is revolutionizing how games are made, creating a whole new genre of entertainment gaming fueled by AI,” said James Currier of NFX in a statement. “The best AI minds and engineers are gathering there to produce games that the world has never seen before. Latitude is already by far the leading AI games company.“

As impressive as the cameras in our smartphones are, they’re fundamentally limited by the physical necessities of lenses and sensors. Metalenz skips over that part with a camera made of a single “metasurface” that could save precious space and battery life in phones and other devices… and they’re about to ship it.

The concept is similar to, but not descended from, the “metamaterials” that gave rise to flat beam-forming radar and lidar of Lumotive and Echodyne. The idea is to take a complex 3D structure and accomplish what it does using a precisely engineered “2D” surface — not actually two-dimensional, of course, but usually a plane with features measured in microns.

In the case of a camera, the main components are of course a lens (these days it’s usually several stacked), which corrals the light, and an image sensor, which senses and measures that light. The problem faced by cameras now, particularly in smartphones, is that the lenses can’t be made much smaller without seriously affecting the clarity of the image. Likewise sensors are nearly at the limit of how much light they can work with. Consequently, most of the photography advancements of the last few years have been done on the computational side.

Using an engineered surface that does away with the need for complex optics and other camera systems has been a goal for years. Back in 2016 I wrote about a NASA project that took inspiration from moth eyes to create a 2D camera of sorts. It’s harder than it sounds, though — usable imagery has been generated in labs, but it’s not the kind of thing that you take to Apple or Samsung.

Metalenz aims to change that. The company’s tech is built on the work of Harvard’s Federico Capasso, who has been publishing on the science behind metasurfaces for years. He and Rob Devlin, who did his doctorate work in Capasso’s lab, co-founded the company to commercialize their efforts.

“Early demos were extremely inefficient,” said Devlin of the field’s first entrants. “You had light scattering all over the place, the materials and processes were non-standard, the designs weren’t able to handle the demands that a real world throws at you. Making one that works and publishing a paper on it is one thing, making 10 million and making sure they all do the same thing is another.”

Their breakthrough — if years of hard work and research can be called that — is the ability not just to make a metasurface camera that produces decent images, but to do it without exotic components or manufacturing processes.

“We’re really using all standard semiconductor processes and materials here, the exact same equipment — but with lenses instead of electronics,” said Devlin. “We can already make a million lenses a day with our foundry partners.”

The first challenge is more or less contained in the fact that incoming light, without lenses to bend and direct it, hits the metasurface in a much more chaotic way. Devlin’s own PhD work was concerned with taming this chaos.

“Light on a macro [i.e. conventional scale, not close-focusing] lens is controlled on the macro scale, you’re relying on the curvature to bend the light. There’s only so much you can do with it,” he explained. “But here you have features a thousand times smaller than a human hair, which gives us very fine control over the light that hits the lens.”

Those features, as you can see in this extreme close-up of the metasurface, are precisely tuned cylinders, “almost like little nano-scale Coke cans,” Devlin suggested. Like other metamaterials, these structures, far smaller than a visible or near-infrared light ray’s wavelength, manipulate the radiation by means that take a few years of study to understand.

The result is a camera with extremely small proportions and vastly less complexity than the compact camera stacks found in consumer and industrial devices. To be clear, Metalenz isn’t looking to replace the main camera on your iPhone — for conventional photography purposes the conventional lens and sensor are still the way to go. But there are other applications that play to the chip-style lens’s strengths.

Something like the FaceID assembly, for instance, presents an opportunity. “That module is a very complex one for the cell phone world — it’s almost like a Rube Goldberg machine,” said Devlin. Likewise the miniature lidar sensor.

At this scale, the priorities are different, and by subtracting the lens from the equation the amount of light that reaches the sensor is significantly increased. That means it can potentially be smaller in every dimension while performing better and drawing less power.

Lest you think this is still a lab-bound “wouldn’t it be nice if” type device, Metalenz is well on its way to commercial availability. The $10 million Series A they just raised was led by 3M Ventures, Applied Ventures LLC, Intel Capital, M Ventures and TDK Ventures, along with Tsingyuan Ventures and Braemar Energy Ventures — a lot of suppliers in there.

Unlike many other hardware startups, Metalenz isn’t starting with a short run of boutique demo devices but going big out of the gate.

“Because we’re using traditional fabrication techniques, it allows us to scale really quickly. We’re not building factories or foundries, we don’t have to raise hundreds of mils; we can use what’s already there,” said Devlin. “But it means we have to look at applications that are high volume. We need the units to be in that tens of millions range for our foundry partners to see it making sense.”

Although Devlin declined to get specific, he did say that their first partner is “active in 3D sensing” and that a consumer device, though not a phone, would be shipping with Metalenz cameras in early 2022 — and later in 2022 will see a phone-based solution shipping as well.

In other words, while Metalenz is indeed a startup just coming out of stealth and raising its A round… it already has shipments planned on the order of tens of millions. The $10 million isn’t a bridge to commercial viability but short-term cash to hire and cover upfront costs associated with such a serious endeavor. It’s doubtful anyone on that list of investors harbors any serious doubts on ROI.

The 3D sensing thing is Metalenz’s first major application, but the company is already working on others. The potential to reduce complex lab equipment to handheld electronics that can be fielded easily is one, and improving the benchtop versions of tools with more light-gathering ability or quicker operation is another.

Though a device you use may in a few years have a Metalenz component in it, it’s likely you won’t know — the phone manufacturer will probably take all the credit for the improved performance or slimmer form factor. Nevertheless, it may show up in teardowns and bills of material, at which point you’ll know this particular university spin-out has made it to the big leagues.

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Djamo, a financial super app for consumers in Francophone Africa, is the first startup from Ivory Coast to get backing from Y Combinator.

While there has been a huge profusion of financial services that have emerged in recent years in Africa, Djamo’s mission is to try to plug one specific and a very underserved gap in Francophone Africa.

In the region, less than 25% of adults have bank accounts as the focus for banks remains the top 10-20% wealthiest customers. The rest, which is a huge segment of the market of about 120 million people, is not perceived as profitable. But as banks slacked, mobile money from the region’s telcos filled in the gap. In the last 10 years, their wallets have reached more than 60% of the population — proof of how many millions of French-speaking natives were hungry for financial services. Today, this mobile money infrastructure and reach allows startups to build upon their existing payment infrastructure to democratize access through different applications.

Djamo is one of such companies taking advantage of this opportunity to bring affordable and seamless banking to the region.

In 2019, Hassan Bourgi, a second-time founder, returned to Ivory Coast after exiting his Latin American-based startup, Busportal, to Naspers-company redBus. There he met Régis Bamba who was still working at MTN, one of Africa’s largest telcos, leading several mobile money projects.

Frustrated by the unpleasant banking experiences they and many millennials faced in the country, Bourgi and Bamba launched Djamo last year to challenge the banking industry status quo. 

“Banking services are really difficult to access here, and we saw that as a huge opportunity,”  Djamo CEO Bourgi said to TechCrunch. “Since day one, we wanted to design a mobile-first platform that could break into the masses and our combined experience building mass-market consumer products was very critical to launching Djamo.”

According to Bourgi, the country’s millennials are trying to create relations with technology companies and be served differently from the norm. So, Djamo is providing this audience with a better front end experience and faster customer service.

Rather than offering a one-size-fits-all approach, they focused on accommodating multiple layers tailored to different user needs. Whether it’s affording Ivorians the luxury to pay for online services like Amazon, Alibaba, or Netflix, or providing VISA debit cards in a timely fashion, these tailored approaches have made Djamo grow organically via word of mouth.

And why not? Before Djamo came along, the CEO says people would need to go to their bank branches and stay in long queues to get their cards or even load them with credit. Djamo relieves that stress and even allows customers to use their cards with zero fees in a wide range of services.

“For us, it was important to offer a zero-fee card with no recurring fee to a certain limit. After that, you pay as you go in transaction fees. There is a premium plan around $4 a month where users can transact to higher limits,” said Bourgi.

Today, Djamo claims to have around 90,000 registered users and processes over 50,000 transactions monthly. However, to get to this point, the company has ridden on sheer resourcefulness around its operations.  

Unlike Nigeria, where there are established payment infrastructure players like Flutterwave and Paystack, Ivory Coast doesn’t have such household names.

 “We have a couple of providers, but most are unreliable. But this doesn’t matter to the end-user, you have to make it work somehow,” said Bambi, the company’s CPO and CTO.

Lacking better options, Djamo switches from one provider to another to keep operations running. The year-old startup has also faced scepticism issues, common with most African fintech startups when they first launch. In Djamo’s case though, the founders had to go at lengths to prove to banks and customers that the platform was safe to use for onboarding, KYC and transactions.

Onboarding customers also came with its own set of problems: the delivery of Djamo VISA cards. Bourgi says unlike more developed countries on the continent, it is a Herculean task to access efficient delivery and logistics services in Ivory Coast. So, the startup built a delivery app with in-house delivery agents for this particular purpose. “The objective for our customers is that after registering with us, they get their cards the next day in a timely fashion,” Bourgi added.

But even before pushing out its MVP, Djamo had already received monetary validation for its product. In June 2019, it raised a pre-seed investment of $350,000 from private investors — arguably the largest round at this stage in the Francophone region. The ingenuity of the solution, at least to French-speaking Africa, and the founders’ track record was crucial to Djamo closing the round, Hassan explained.

For a long time, Francophone Africa has been underrated by international investors despite signs pointing to the emergence of a budding startup scene. Part of this has to do with language barriers and the region’s GDP and income per capita where English-speaking countries, excluding South Africa, contribute to 47% of sub-Saharan Africa’s average GDP, while French-speaking countries boast of only 19%.

However, with the World Bank stating that the region will have 62.5% of Africa’s fastest-growing economies by 2021, there’s bullishness around its growth in the coming years. 

With so many untapped opportunities, underrepresented regions like Francophone Africa are ripe for disruption. Investors know this and though their checks are still skewed towards Anglophone Africa, million-dollar raises from Senegalese energy startup, Oolu and Cameroonian healthtech startup, Healthlane in 2020 show their keenness on the market.

Like Djamo, both startups are YC-backed and are the other Francophone startups to have made it into the accelerator. But with this Winter 2021 batch, Djamo becomes the first fintech startup from the region. Following Healthlane’s acceptance in 2020, it is also the first time French-speaking Africa has had representatives for consecutive years.

To the founders, YC’s backing validates Djamo’s premise that financial service distribution across the Francophone Africa region is fundamentally changing towards applications.

“In Ivory Coast, people always say that the banking industry is too complex and we can’t do anything about it. But we saw it as a huge opportunity and a great industry to take on. Everywhere you see frustration, customers in pain, there is an opportunity for a business to come and do it better,” said Régis.

After participating in the three-month-long program which culminates in a Demo Day on March 23rd, Djamo will also take part in Visa’s Fintech Fast Track Program, an avenue for the company to leverage the fintech giant’s network to introduce new payment experiences.