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AlphaSense, a search engine for analysis and business intel, raises $50M led by Innovation Endeavors

AlphaSense, a search engine for analysis and business intel, raises $50M led by Innovation Endeavors

July 17, 2019

Google and its flagship search portal opened the door to the possibilities of how to build a business empire on the back of organising and navigating the world’s information, as found on the internet. Now, a startup that’s built a search engine tailored to the needs of enterprises and their own quests for information has raised a round of funding to see if it can do the same for the B2B world.

AlphaSense, which provides a way for companies to quickly amass market intelligence around specific trends, industries and more to help them make business decisions, has closed a $50 million round of funding, a Series B that it’s planning to use to continue enhancing its product and expanding to more verticals.

Today, the company today counts some 1,000 clients on its books, with a heavy emphasis on investment banks and related financial services companies. That’s in part because of how the company got its start: Finnish co-founder and CEO Jaakko (Jack) Kokko he had been an analyst at Morgan Stanley in a past life and understood the labor and time pain points of doing market research, and decided to build a platform to help shorted a good part of the information gathering process.

“My experience as an analyst on Wall Street showed me just how fragmented information really was,” he said in an interview, citing as one example how complex sites like those of the FDA are not easy to navigate to look for new information an updates — the kind of thing that a computer would be much more adept at monitoring and flagging. “Even with the best tools and services, it still was really hard to manually get the work done, in part because of market volatility and the many factors that cause it. We can …

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What seed-stage dilution tells us about changing investor expectations

What seed-stage dilution tells us about changing investor expectations

July 16, 2019

Round sizes are up. Valuations are up. There are more investors than ever hunting unicorns around the globe. But for all the talk about the abundance of venture funding, there is a lot less being said about what it all means for entrepreneurs raising their early funding rounds.

Take for instance Seed-stage dilution. Since 2014, enterprise-focused tech companies have given up significantly more ownership during Seed rounds. What gives?

Scale is an investor in early-in-revenue enterprise technology companies, so we wanted to better understand how this trend in Seed-stage dilution impacts companies raising Series A and Series B rounds.

Using our Scale Studio dataset of performance metrics on nearly 800 cloud and SaaS companies as well as Pitchbook fundraising records covering B2B software startups, we started connecting the dots between trends in valuations, round sizes, and winner-take-all markets.

Bottom line for founders: Don’t let all the capital in venture mislead you. There’s an important connection between higher Seed-stage dilution and increased investor expectations during Series A and Series B rounds.

These days, successful startups are growing up faster than ever.

Founders face an important trade-off decision

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UK-based women’s networking and private club, Allbright, raises $18.8 million as it expands into the U.S.

UK-based women’s networking and private club, Allbright, raises $18.8 million as it expands into the U.S.

July 15, 2019

AllBright, the London-based women’s membership club backed by private real estate investment firm Cain International, has raised $18.8 million to expand into the U.S.

The company’s new round was led by Cain International and was designed to take AllBright into three U.S. locations — Los Angeles, New York, and Washington.

The company said that the new facilities would be opening in the coming months.

Coupled with the launch of a new networking application called AllBright Connect and the company’s AllBright Magazine, the women’s networking organization is on a full-on media blitz.

Other investors in the round include Allan Leighton, who serves as the company’s non-executive chairman; Gail Mandel, who acquired Love Home Swap (a company founded by AllBright’s co-founder Debbie Wosskow); Stephanie Daily Smith, a former finance director to Hillary Clinton; and Darren Throop the founder, president and chief executive of Entertainment One.

A spokesperson for the company said that the new financing would value the company at roughly 100 million pounds sterling.

The club’s current members include actors, members of the House of Lords, and other fancy pants, high-falutin folks from the worlds of politics, business, and entertainment.

The club’s first American location will be in West Hollywood, and is slated to open in September 2019. The largest club, in Mayfair has five floors boasts over 12,000 square feet and features rooftop terraces, a dedicated space for coaching and mentoring a small restaurant and bar.

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Facebook’s testimony to Congress: Libra will be regulated by Swiss

Facebook’s testimony to Congress: Libra will be regulated by Swiss

July 15, 2019

The head of Facebook’s blockchain subsidiary Calibra David Marcus has released his prepared testimony before Congress for tomorrow and Wednesday, explaining that the Libra Association will be regulated by the Swiss government because that’s where it’s headquartered. Meanwhile, he says the Libra Association and Facebook’s Calibra wallet intend to comply will all U.S. tax, anti-money laundering and anti-fraud laws.

“The Libra Association expects that it will be licensed, regulated, and subject to supervisory oversight. Because the Association is headquartered in Geneva, it will be supervised by the Swiss Financial Markets Supervisory Authority (FINMA),” Marcus writes. “We have had preliminary discussions with FINMA and expect to engage with them on an appropriate regulatory framework for the Libra Association. The Association also intends to register with FinCEN [The U.S. Treasury Department’s Financial Crimes Enforcement Network] as a money services business.”

Marcus will be defending Libra before the Senate Banking Committee on July 16th and the House Financial Services Committees on July 17th. The House subcomittee’s Rep. Maxine Waters has already issued a letter to Facebook and the Libra Association requesting that it halt development and plans to launch Libra in early 2020 “until regulators and Congress have an opportunity to examine these issues and take action.”

The big question is whether Congress is savvy enough to understand Libra to the extent that it can coherently regulate it. Facebook CEO Mark Zuckerberg’s testimonies before Congress last year were rife with lawmakers dispensing clueless or off-topic questions.

Sen. Orin Hatch infamously demanded to know “how do you sustain a business model in which users don’t pay for your service?,” to which Zuckerberg smirked, “Senator, we run ads.” If that concept trips up Congress, it’s hard to imagine it grasping a semi-decentralized stablecoin cryptocurrency …

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Canal+ acquires Nollywood studio ROK from IROKOtv to grow African film

Canal+ acquires Nollywood studio ROK from IROKOtv to grow African film

July 15, 2019

French television company Canal+ has acquired the ROK film studio from VOD company IROKOtv for an undisclosed amount.

Founded by Jason Njoku in 2010—and backed by $45 million  in VC—IROKOtv boasts the largest online catalog of Nollywood film content in the world.

Nollywood is a movie genre popularized in Nigeria that has become Africa’s de facto film industry and one of the largest globally, by production volume.

Based in Lagos, ROK film studios was incubated to create original content for IROKOtv, which can be accessed online anywhere in the world.

Actress and producer Mary Njoku—IROKOtv CEO Jason Njoku’s wife—founded ROK studios and will stay on as Director General under the Canal+ acquisition.

Owned by media conglomerate Vivendi, Canal+ looks to give Mary more production resources, without disrupting ROK’s creative chemistry.

“We are acquiring the talent of Mary,” Canal+ Chief Content Officer Fabrice Faux told TechCrunch on a call.

“We will provide administrative support, finance, and equipment, but otherwise it is our intention to give Mary maximum autonomy and creative freedom,” he said.

Mrs. Njoku’s creative work so far has led ROK to produce over 540 movies and 25 original TV series, according to company data.

Through ROK, Njoku has expanded Nollywood’s formula for producing films on low budgets, largely shot on location in Nigeria, that connect with African audiences wherever they are. One of ROK’s more recent popular productions is Ojukwu, a period series set in an 1800s Nigerian village, in which Njoku directs and acts.

“Nollywood is Africa…We tell the African story. You can bring a Nigerian story, a Ghanaian story, a South African story…we talk the same drama. So Africans can connect to the average Nollywood story anywhere in the world,” Njoku told TechCrunch.

With the ROK acquisition, Canal+ looks to bring the Nollywood production ethos …

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Facebook answers how Libra taxes & anti-fraud will work

Facebook answers how Libra taxes & anti-fraud will work

July 12, 2019

Facebook provided TechCrunch with new information on how its cryptocurrency will stay legal amidst allegations from President Trump that Libra could facilitate “unlawful behavior.” Facebook and Libra Association executives tell me they expect Libra will incur sales tax and capital gains taxes. They confirmed that Facebook is also in talks with local convenience stores and money exchanges to ensure anti-laundering checks are applied when people cash-in or cash-out Libra for traditional currency, and to let you use a QR code to buy or sell Libra in person.

A Facebook spokesperson said the company wouldn’t respond directly to Trump’s tweets, but noted that the Libra association won’t interact with consumers or operate as a bank, and that Libra is meant to be a complement to the existing financial system.

Trump had tweeted that “Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity. Similarly, Facebook Libra’s ‘virtual currency’ will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National and International.”

For a primer on how Libra works, watch our explainer video below or read our deep dive into everything you need to know:

In a wide-reaching series of interviews this week, the Libra Association’s head of policy Dante Disparte, Facebook’s head economist for blockchain Christian Catalini and Facebook’s blockchain project subsidiary Calibra’s VP of product Kevin Weil answered questions about regulation of Libra. Here’s what we’ve learned (their answers were trimmed for clarity but not edited):

Would Facebook’s Calibra Wallet launch elsewhere even if it’s banned in the USA by regulators?

Calibra’s Kevin Weil: We believe that creating a financial ecosystem that has significantly broader access where all it …

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SEC approves 1st consumer RegA+ token Props for cross-app rewards

SEC approves 1st consumer RegA+ token Props for cross-app rewards

July 11, 2019

After cracking down on ICOs, the SEC just okayed the first two RegA+ tokens that offer an alternative way for anyone to gain a financial stake in a company, even unaccredited investors. Blockstack got approved for a $28 million digital token sale to raise money, while influencer live-streaming app YouNow’s spin-off Props received a formal green light for a consumer utility “Howey” token users can earn to get loyalty perks in multiple apps.

Props has already raised $21 million by pre-selling tokens to Union Square Ventures, Comcast, Venrock, Andreessen Horowitz’s Chris Dixon and YouTuber Casey Neistat, so it isn’t raising any money with the RegA+ by selling its tokens like Blockstack. Instead, users earn or “mine” Props by engaging with apps like YouNow, which will award the tokens for creating broadcasts, watching videos and tipping creators. Having more Props entitles YouNow’s 47 million registered users bonus features, VIP status and more purchasing power with the app’s proprietary credits called Bars, which users have bought $70 million-worth of to date.

But unlike most virtual currencies that can only be used in a single app and don’t technically belong to consumers, the open-sourced Props blockchain system can be integrated into other apps via an API and people can export their Props to cryptocurrency wallets. That lets them apply their Props in other apps beyond YouNow. Four partnered apps have been lined up, including xSplit, a 17 million-registered-user app for video game streaming.

While Props aren’t currently redeemable for fiat currency, they were valued at $0.1369 each by the SEC-approved filing. The company is working to have Props listed on Alternative Trading Systems that work similarly to cryptocurrency exchanges. That lets Props give everyday app users a financial incentive to see the network of apps that adopt them grow. Because there’s a finite …

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Grasshopper’s Judith Erwin leaps into innovation banking

Grasshopper’s Judith Erwin leaps into innovation banking

July 8, 2019

In the years following the financial crisis, de novo bank activity in the US slowed to a trickle. But as memories fade, the economy expands and the potential of tech-powered financial services marches forward, entrepreneurs have once again been asking the question, “Should I start a bank?”

And by bank, I’m not referring to a neobank, which sits on top of a bank, or a fintech startup that offers an interesting banking-like service of one kind or another. I mean a bank bank.

One of those entrepreneurs is Judith Erwin, a well-known business banking executive who was part of the founding team at Square 1 Bank, which was bought in 2015. Fast forward a few years and Erwin is back, this time as CEO of the cleverly named Grasshopper Bank in New York.

With over $130 million in capital raised from investors including Patriot Financial and T. Rowe Price Associates, Grasshopper has a notable amount of heft for a banking newbie. But as Erwin and her team seek to build share in the innovation banking market, she knows that she’ll need the capital as she navigates a hotly contested niche that has benefited from a robust start-up and venture capital environment.

Gregg Schoenberg: Good to see you, Judith. To jump right in, in my opinion, you were a key part of one of the most successful de novo banks in quite some time. You were responsible for VC relationships there, right?

…My background is one where people give me broken things, I fix them and give them back.

Judith Erwin: The VC relationships and the products and services managing the balance sheet around deposits. Those were my two primary roles, but my background is one where people give me broken things, I fix them and give them back.

Schoenberg:

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The startups creating the future of RegTech and financial services

The startups creating the future of RegTech and financial services

July 8, 2019

Technology has been used to manage regulatory risk since the advent of the ledger book (or the Bloomberg terminal, depending on your reference point). However, the cost-consciousness internalized by banks during the 2008 financial crisis combined with more robust methods of analyzing large datasets has spurred innovation and increased efficiency by automating tasks that previously required manual reviews and other labor-intensive efforts.

So even if RegTech wasn’t born during the financial crisis, it was probably old enough to drive a car by 2008. The intervening 11 years have seen RegTech’s scope and influence grow.

RegTech startups targeting financial services, or FinServ for short, require very different growth strategies — even compared to other enterprise software companies. From a practical perspective, everything from the security requirements influencing software architecture and development to the sales process are substantially different for FinServ RegTechs.

The most successful RegTechs are those that draw on expertise from security-minded engineers, FinServ-savvy sales staff as well as legal and compliance professionals from the industry. FinServ RegTechs have emerged in a number of areas due to the increasing directives emanating from financial regulators.

This new crop of startups performs sophisticated background checks and transaction monitoring for anti-money laundering purposes pursuant to the Bank Secrecy Act, the Office of Foreign Asset Control (OFAC) and FINRA rules; tracks supervision requirements and retention for electronic communications under FINRA, SEC, and CFTC regulations; as well as monitors information security and privacy laws from the EU, SEC, and several US state regulators such as the New York Department of Financial Services (“NYDFS”).

In this article, we’ll examine RegTech startups in these three fields to determine how solutions …

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PayU, Naspers’ global fintech firm, enters Southeast Asia with acquisition of Red Dot Payment

PayU, Naspers’ global fintech firm, enters Southeast Asia with acquisition of Red Dot Payment

July 5, 2019

PayU, the Naspers-owned fintech firm that specializes in emerging markets, is broadening its global reach into Southeast Asia after it announced a deal to buy a majority stake in Singapore-based Red Dot Payment.

Naspers is best known for its payments and fintech business in markets like India, Latin America, Africa and Eastern Europe, but now it will enter Southeast Asia, a market with more than 600 million consumers and rapidly rising internet access.

PayU plans to tap that potential through Red Dot, an eight-year-old startup founded by finance veterans that offers services that include a payment gateway, e-commerce storefronts and online invoicing across Southeast Asia. PayU said it has acquired “a majority stake” in the business. It did not specify the exact size but it did disclose that the deal values Red Dot at $65 million.

It isn’t clear exactly how much Red Dot had raised from investors overall — its Series B was $5.2 million but the value of prior rounds were not disclosed — but its backers include Japan’s GMO, Wavemaker, Skype co-founder Toivo Annus and MDI Ventures. The company said “the majority” of its investors exited through this transaction, but some stakeholders — including CEO Randy Tan — are keeping shares with a view to a later buyout in full.

That’s important for PayU, according to CEO Laurent le Moal, who stressed that the company believes in retaining teams and empowering them through acquisitions, rather than simply buying an asset.

“We have to strike the balance between a solid majority [acquisition] and an opportunity” for founders, he told TechCrunch in an interview.

PayU plans to put “real investment” into the startup, whilst also integrating its services into its “Hub” of services and tech, a stack that is shared with its mesh of global business and …

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