Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.

This is Equity Monday, our weekly kickoff that tracks the latest private market news, talks about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here — and be sure to check out our last main ep, in which Natasha coins a slogan for a16z that I both hate, and became the headline of the show!

But enough of all of that, we have a lot to get through this morning. Here’s what we talked about:

The Weekend: Coinbase at $100 billion? More on that to come. Toast is going public! Probably! Wait, Toast the company that laid off staff last year? Yep that Toast! It’s not toast! And new rules on online lending in China.This Morning: Oscar Health put together an IPO price range that is interesting, and Apex Clearing is going public via a SPAC.Funding Rounds: Gophr raises money! Ageras Group raises money! Promise raises money! It was hard to pick just three, but each of those rounds has something notable about it. Enjoy!Deeper Dive/Riff: If the public markets will float even the most leaden of startup via a SPAC-balloon, any late-stage startup that doesn’t take the ride out of the private markets must either be perfect or too heavy to lift. And if it’s the second, we can write it off? Maybe?

And, finally, this is precisely what I feel like this Monday morning. Chat soon and stay safe!

Equity drops every Monday at 7:00 a.m. PST and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

This morning Creatio, a Boston-based software company, announced that it has raised $68 million. Volition Capital, a growth-equity fund, led the round. The deal was a minority investment in the startup.

The deal is notable not merely thanks to its sheer size, but because up until today Creatio had bootstrapped. That’s according to founder and CEO Katherine Kostereva, with whom TechCrunch caught up with last week regarding the investment.

Per Kostereva, her company’s low-code platform helps other companies automate business processes. Creatio’s competitive edge, she said, comes in part from how quickly it can help companies automate; the faster that companies can get from a low-code platform to live apps matters.

Creatio also has a genre focus, namely that it touts its platform’s ability to help automate work in the CRM space — think marketing and sales-related tasks. But its crowning “jewel,” Kostereva said, is Creatio’s underlying low-code automation platform.

The low-code world that Creatio competes in is a broad space that is seeing active investment from the very-early to the very-late stage. For example, last month TechCrunch covered no-code-focused Stacker’s $1.7 million round. And earlier this month TechCrunch wrote about low-code-focused OutSystems’ $150 million raise at a $9.5 billion valuation.

To see another low-code company raise a big check was therefore not too surprising.

TechCrunch was curious where the company and its founder came down on the concept of low-code versus no-code, a topic that is always good to ask players in either space. Kostereva highlighted the importance of citizen developers, folks who can use drag-and-drop interfaces to create apps but who are less adept with code. But she added that with today’s no-code tools one can only build simple things. Creatio, she continued, is more focused on the mid-market and enterprise. As such, it’s just not possible for Creatio to go no-code today. But, her view did appear to be that citizen devs should be able to do more and more in time without code.

It’s a fair perspective, and an encouraging one. The more that folks can do sans code, the more power that can shift into the hands of business orgs that traditionally had to depend on other departments for dev lift.

Back to the money side of things; Creatio has historically targeted breakeven financial results, per its CEO. That means it reinvested in itself as it grew, an arrangement that made us curious as to why the company would raise capital now; why change up a working formula?

In short the company was getting itself ready to accelerate, according to its founder. Kostereva said that she wanted Creatio to have “world-class” numbers for metrics like net retention, revenue growth and net promoter score before it took on external funds.

Was the wait worth it? The company’s net retention was 122% last year, and its NPS score is 34, she disclosed. On the growth side of things, Kostereva said that her company started off doubling and tripling and is still close to doubling. Our read of her comments is that Creatio is probably growing its ARR in the high double digits today.

The company wants to use its capital to invest in sales and marketing to help spread the the word about its business, invest in its partner program, a key growth mechanism, and R&D, it said. So, a little bit of everything.

TechCrunch has recently noticed just how big the software world really is, indexing off the fast that there is enough room for a host of OKR-focused startups to grow and raise external capital without weeding out weaker players. Given how many business processes there are in the world to automate, it may be that Creatio and other low-code platforms that want to help other companies accelerate will enjoy similar market dynamics. Investors, at least, are betting like that’s the case.

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Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s broadly based on the daily column that appears on Extra Crunch, but free, and made for your weekend reading. Want it in your inbox every Saturday morning? Sign up here.

Ready? Let’s talk money, startups and spicy IPO rumors.

Can data fix healthcare?

Not alone, but you might be able to make a lot of progress with the right data in the right hands. And that’s precisely what the startup we’re talking about today is up to.

The Exchange caught up with Terry Myerson and Lisa Gurry this week, the CEO and CMO of Truveta, a young company that wants to collect oodles of data from healthcare providers, anonymize it, aggregate it and make it available to third parties for research.

It’s a big task, but the team behind Truveta has experience with big projects. Myerson is best known for his time one-rung below the top of the Microsoft org chart, where he ran things you might have heard of, like Windows. Gurry was a leader inside that org, most recently working on strategy for the Microsoft Store product.

But now they are at a healthtech data company. How did that come to be? After Myerson left Microsoft he worked with Madrona, the Seattle-area venture capital firm, and the Carlyle Group, a huge investing group with a taste for private equity. A few years later, several former Microsoft co-workers of Myerson had wound up at Providence, a healthcare giant. They reached out to Myerson around when COVID-19 was first locking down the United States. The former Microsoft exec agreed to take part in a few calls, but didn’t formally join them as he was stuck at home.

During that time he learned that Providence had put together a white paper concerning the idea that Truveta would become, that by collecting data from healthcare providers a dataset of sufficient size and diversity could be compiled to allow research of all sorts to leverage it. Myerson got stuck on the concept, later founding the company. Then he called up some former colleagues, including Gurry, to help him build it.

Truveta has around 50 people today and will scale to around 100 this year, Myerson said.

Questions abound in your head, I’m sure. Things are still early at Truveta, but the company announced last week that it has signed up 14 healthcare providers to help with its data goals. Those firms are also investors in the company (Myerson put in capital in as well).

I was curious about the company’s business plan. Per Myerson, Truveta will charge different rates depending on who wants to access its data. As you can imagine, commercial entities will pay a different price than an independent researcher.

Next for Truveta is getting more data, locking down its internal data schema, collecting feedback from researchers and, later, approaching commercial access.

Healthcare in America is inequitable — something that the pair of Truveta executives stressed during our call — thus giving the company a huge market to improve and make less racist and sexist.

It was a bit odd to talk to Myerson and Gurry about their startup. In the past I’d chatted with them about some of Microsoft’s largest platforms. Let’s see how fast they can transform Truveta from an idea I can’t help but dig, to a company that is a viable commercial concern. And then how big they can grow it.

Market Notes

A lot has happened in the past few days that we couldn’t get to. Adyen’s earnings, for example. The European payments platform reported H2 revenues of €379.4 million, up 28% compared to the year ago half-year. And from that it reported EBITDA of €236.8 million. Who said fintech can’t be profitable? (Note: Adyen’s results are required reading if you care about Stripe’s valuation and future public offering.)

And there were some rounds that also fell through our fingers. Investments like CloudTalk’s recent $7.3 million Series A. The Slovakia-based startup previously raised a $1.6 million seed round in 2019. The startup, as its name suggests, offers cloud telephony services to call centers.

We suspected that CloudTalk probably had a pretty good year in 2020 thanks to global growth in remote work. It did. In an email, CloudTalk said that it has not seen “Zoom-like [growth] figures” but that in 2020 demand for its services “exceeded [its] expectations.” That helps explain its latest round.

The Exchange was also curious if the company had a perspective on subscription pricing versus consumption pricing, a rising topic amongst software dorks such as myself (more to come on this next week with notes from Appian, Fastly and others). Per the company, CloudTalk charges “for both seats and for usage,” making it a hybrid company from a pricing perspective. CloudTalk called its pricing setup “a good balance for both parties because customers like to know what they are going to be paying ahead of time.”

It’s a startup to keep in mind. As is Zolve, a globally themed neobank with a focus on helping expats have a working financial world. I couldn’t get to it, but TechCrunch wrote it up. More here.

And in case you didn’t have time to watch television during work the last few days let’s talk about Robinhood. Which enjoyed a Congressional hearing this week that was mostly dull apart from some notes on the fintech giant’s business model.

Finally, it was a busy week for crowded startup niches. There was more money for OKR startups, leading to our question about VCs putting capital into related companies in the future. Public also raised several hundred million dollars. Because why not. And low-code player OutSystems raised $150 million to round out the group. It was one hell of a week.

Various and Sundry

I will leave you with a few data points. First, that Clubhouse’s metrics are finally starting to match the hype around the product. People are showing up in droves, pushing its total download figures over the 10 million mark.

And in news that I missed, Substack crossed the 500,000 subscriber mark. That’s impressive!

And to close, a Chicago-based, home-focused insurtech startup called Kin crossed the $10 billion “total insured property value” mark this week. The Exchange reached out, asking the company about its economics. After all it’s not hard to run up premium volume if you are selling dollars for 50-cent pieces.

Ruth Awad from the company responded that her company’s “ loss rate is 53% and our gross margins are 32%.” Not bad at all. Given how quickly insurtech has gone from experiment to public-success, Kin is a company to keep tabs on.

Wrapping, please make sure to support your local heavy metal band this weekend,

Alex

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Since the pandemic began, have you been walking more, or do you know someone who bought a new car? Perhaps you ran your first errand on a rented e-bike or scooter?

Over the last year, I’ve experimented with different mobility options to see which ones best suit my needs, as have most people I know. It can be challenging to maintain a recommended physical distance on a bus or subway. (After a decade-plus hiatus, I even briefly considered rejoining the ranks of automobile owners!)

Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.

It took some getting used to, but I now enjoy traveling around San Francisco on a scooter or e-bike. Pre-pandemic, I was leery of riding two-wheeled vehicles in a city with a high rate of injury collisions, but there are fewer cars on the road than there used to be.

COVID-19 has spotlighted many of the weakest points in our transportation system, but some of the rapid shifts in consumer behavior are creating opportunities for tech once considered fanciful, like sidewalk delivery robots and eVTOLs (electric vertical and takeoff vehicles).

Transportation editor Kirsten Korosec reached out to 10 investors to learn more “about the state of mobility, which trends they’re most excited about and what they’re looking for in their next investments.”

Here’s who she interviewed:

Clara Brenner, co-founder and managing partner, Urban Innovation FundShawn Carolan, partner, Menlo VenturesDave Clark, partner, ExpaAbhijit Ganguly, senior manager, Goodyear VenturesRachel Holt, co-founder and general partner, Construct CapitalDavid Lawee, founder and general partner, CapitalGSasha Ostojic, operating partner, Playground GlobalSebastian Peck, managing director, InMotion VenturesNatalia Quintero and Rachel Haot, Transit Innovation Partnership/Transit Tech Lab

Thanks very much for reading Extra Crunch this week!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

A fraction of Robinhood’s users are driving its runaway growth

Yesterday’s House Financial Services Committee hearing on the GameStop short squeeze saga was fairly typical: Most lawmakers used their time to grandstand and little new information was revealed.

But Alex Wilhelm found one tidbit: Much of Robinhood’s revenue is generated from payment for order flow (PFOF). Under the practice, market makers pay the trading platform for executing trades.

To get a sense of how much Robinhood’s high rollers contribute to the company’s general health, he calculated its PFOF revenues for the last three months of 2020.

“Borrowing a term from the casino trade, these whales generate the bulk of the company’s revenue stream.”

Why do SaaS companies with usage-based pricing grow faster?

HubStop introduced usage-based pricing in 2011 to boost its retention rate, then near 70%.

When it went public three years later, its net revenue retention rate was edging close to 100%, “all without hurting the company’s ability to acquire new customers.”

Offering new users frictionless onboarding, customer support and free credits is a proven method for making them more active — and loyal.

So, why do public SaaS firms with usage-based pricing see faster growth?

“Because they’re better at landing new customers, growing with them and keeping them as customers,” says Kyle Powar, VP of growth at OpenView.

Paying $115B for Stripe or $77B for Coinbase might be quite rational

In October 2018, private-market money valued Coinbase at around $8 billion. As of this week, it’s valued at $77 billion.

Similarly, Stripe is valued at $115 billion on secondary markets. In the middle of last year, that figure was closer to $36 billion.

“Would I line up to pay $77 billion for Coinbase?” asked Alex. “Probably not, but that doesn’t mean that the public markets won’t.”

Pandemic-era growth and SPACs are helping edtech startups graduate early

Natasha Mascarenhas reports that some edtech startups are hitching rides with special purpose acquisition vehicles so they can speed up their journey to the public markets.

To learn more, she interviewed Susan Wolford, chairperson of $200 million SPAC Edify Acquisition, and Nerdy CEO Chuck Cohn. Nerdy, parent company of Varsity Tutors, is going through a reverse merger with TPG Pace Tech Opportunities.

“It’s less about going into the public markets and more about that this transaction allows us to take an offensive position and lean into the big opportunities,” Cohn said.

Dear Sophie: Tips for filing for a green card for my soon-to-be spouse

Dear Sophie:

My fiancé is in the U.S. on an H-1B visa, which is set to expire in about a year and a half.

We were originally planning to marry last year, but both he and I want to have a ceremony and party with our families and friends, so we decided to hold off until the pandemic ends. I’m a U.S. citizen and plan to sponsor my fiancé for a green card.

How long does it typically take to get a green card for a spouse? Any tips you can share?

— Sweetheart in San Francisco

Inside Rover and MoneyLion’s SPAC-led public debuts

When I saw that Alex Wilhelm wrote on Tuesday about two more startups that were taking the SPAC route to public markets, I briefly wondered if we’ve been covering special purpose acquisition companies too frequently.

After I read his first sentence, I realized Alex made exactly the right call because the trend that emerged in 2020 may be turning into a actual wave: This week, pet e-commerce company Rover and fintech startup MoneyLion both announced that they’re planning SPAC-led debuts.

On Monday, Alex covered the news that Lerer Hippeau Acquisition Corp. and Khosla Ventures Acquisition Co. I, II and III. filed S-1 filings last week.

“You have to wonder if every VC worth a damn in the future will have their own raft of SPAC offerings,” says Alex.

Wrote Lerer Hippeau Acquisition Corp.:

With our portfolio now maturing to the stage at which many are considering the public markets, we view SPACs as a natural next step in the evolution of our platform.

“If we are not careful, every entry of this column could consist of SPAC news,” writes Alex.

From dorm rooms to board rooms: How universities are promoting entrepreneurship

Fifteen U.S.-based institutions of higher learning have joined forces to create the University Technology Licensing Program LLC (UTLP).

The program makes it easier for entrepreneurs and investors to find IP that can drive their companies forward, but it’s also an attempt to repair what one participant calls “the somewhat broken interface between universities and very large companies in the tech space.”

4 strategies for deep tech companies recruiting top growth marketers

Here’s some real talk for technical founders: if you find it frustrating to work with growth experts and marketing professionals, the feeling’s probably mutual.

“Incredible growth people are independent and creative and are drawn to environments that explicitly value these traits,” says Jessica Li, a content/growth professional who was previously a VC.

To land top talent, “demonstrate that you have a team structure in place where a growth marketer could fit in and thrive.”

9 investors discuss hurdles, opportunities and the impact of cloud vendors in enterprise data lakes

Before my first cup of coffee this morning, I’d already interacted with four different devices that transmitted details about my behavior to a data lake.

Hopefully, the response I sent to an automated text while waiting for the kettle to boil will generate a discount offer in my inbox later today. (And hopefully, the raw data I’m transmitting has been properly secured and cataloged.)

Enterprise reporter Ron Miller interviewed nine investors to learn more about their approach to the lucrative data lake market:

Caryn Marooney, general partner, Coatue ManagementDharmesh Thakker, general partner, Battery VenturesCasey Aylward, principal, Costanoa VenturesDerek Zanutto, general partner, CapitalGNavin Chaddha, managing director, MayfieldJon Lehr, co-founder and general partner, Work-BenchPeter Wagner, founding partner, Wing VenturesNicole Priel, managing director, Ibex VenturesIlya Sukah, partner, Matrix Partners

Felicis’ Aydin Senkut and Guideline’s Kevin Busque on the value of simple pitch decks

When it comes to building a durable relationship between a founder and an investor, “the trust starts in the pitch deck,” says Guideline CEO Kevin Busque.

Busque joined Extra Crunch Live last week with Felicis Ventures’ Aydin Senku to discuss the seed round Senku declined to join — and the Series B he led a short while later.

In keeping with our new format, the pair also offered feedback on pitch decks submitted by members of the audience. Read highlights, or watch a video with the full conversation.

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