Category: alex wilhelm

June 8, 2019 Off

Startups Weekly: The Peloton IPO (bull vs. bear)

By Jill T Frey

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s noteworthy venture capital deals, funds and trends. Before I dive into this week’s topic, let’s catch up a bit. Last week, I wrote about the proliferation of billion-dollar companies. Before that, I noted the uptick in beverage startup rounds. Remember, you can send me tips, suggestions and feedback to [email protected] or on Twitter @KateClarkTweets.

Now, time for some quick notes on Peloton’s confirmed initial public offering. The fitness unicorn, which sells a high-tech exercise bike and affiliated subscription to original fitness content, confidentially filed to go public earlier this week. Unfortunately, there’s no S-1 to pore through yet; all I can do for now is speculate a bit about Peloton’s long-term potential.

What I know: 

  • Peloton is profitable. Founder and chief executive John Foley said at one point that he
Read the rest
June 1, 2019 Off

Startups Weekly: Will the real unicorns please stand up?

By Jill T Frey

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s noteworthy venture capital deals, funds and trends. Before I dive into this week’s topic, let’s catch up a bit. Last week, I wrote about the sudden uptick in beverage startup rounds. Before that, I noted an alternative to venture capital fundraising called revenue-based financing. Remember, you can send me tips, suggestions and feedback to [email protected] or on Twitter @KateClarkTweets.

Here’s what I’ve been thinking about this week: Unicorn scarcity, or lack thereof. I’ve written about this concept before, as has my Equity co-host, Crunchbase News editor-in-chief Alex Wilhelm. I apologize if the two of us are broken records, but I think we’re equally perplexed by the pace at which companies are garnering $1 billion valuations.

Here’s the latest data, according to Crunchbase: “2018 outstripped all previous years in terms of … Read the rest

May 31, 2019 Off

Is the tech press too positive in its coverage of startups?

By Jill T Frey

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

It’s our first week in the new TechCrunch podcast studio, or it was for Kate Clark and Chris Gates. Alex Wilhelm will be back in SF next week. For now, we fired up the mics and dug into what was a veritable barrage of news.

First, Paul Graham’s contentious comments. The co-founder of Y Combinator tweeted some criticism of the tech press on Thursday; naturally, Kate and Alex had a few thoughts. In summary, Graham doesn’t seem to understand what it is we tech journalists do, and that’s a problem.

Next … Read the rest

May 25, 2019 Off

Startups Weekly: VCs are drunk on beverage startups

By Jill T Frey

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s most noteworthy venture deals, fundraises, M&A transactions and trends. Let’s take a quick moment to catch up. Last week, I wrote about an alternative to venture capital called revenue-based financing and before that, I jotted down some notes on one of VCs’ favorite spaces: cannabis tech. Remember, you can send me tips, suggestions and feedback to [email protected] or on Twitter @KateClarkTweets.

This week, I want to share some thoughts — questions, rather — on beverages. Just as my inbox has been full of cannabis-related pitches, it’s also been packed with descriptions of new…drinks. Perhaps the most noted so far is Liquid Death, canned water for the punk rock crowd, because why not? Liquid Death has attracted nearly $2 million in funding from angel investors like Away co-founder Jen Rubio and … Read the rest

May 18, 2019 Off

Startups Weekly: There’s an alternative to raising VC and it’s called revenue-based financing

By Jill T Frey

Revenue-based financing is on the rise, at least according to Lighter Capital, a firm that doles out entrepreneur-friendly debt capital.

What exactly is RBF you ask? It’s a relatively new form of funding for tech companies that are posting monthly recurring revenue. Here’s how Lighter Capital, which completed 500 RBF deals in 2018, explains it: “It’s an alternative funding model that mixes some aspects of debt and equity. Most RBF is technically structured as a loan. However, RBF investors’ returns are tied directly to the startup’s performance, which is more like equity.”

Source: Lighter Capital

What’s the appeal? As I said, RBFs are essentially dressed up debt rounds. Founders who opt for RBFs as opposed to venture capital deals hold on to all their equity and they don’t get stuck on the VC hamster wheel, the process in which you are forced to continually accept VC while losing more … Read the rest

May 10, 2019 Off

Equity Shot: Judging Uber’s less-than-grand opening day

By Jill T Frey

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

We are back, as promised. Kate Clark and Alex Wilhelm re-convened today to discuss the latest from the Uber IPO. Namely that it opened down, and then kept falling.

A few questions spring to mind. Why did Uber lose ground? Was it the company’s fault? Was it simply the macro market? Was it something else altogether? What we do know is that Uber’s pricing wasn’t what we were expecting and its first day was not smooth.

There are a whole bunch of reasons why Uber went out the way it did. Firstly, the stock market has had a rough week. That, coupled with rising U.S.-China tensions made this week one of the worst of the year for Uber’s monstrous IPO.

But, to make all that clear, we ran … Read the rest

May 4, 2019 Off

Startups Weekly: Will the Seattle tech scene ever reach its full potential?

By Jill T Frey

Greetings from Seattle, the land of Amazon, Microsoft, two of the world’s richest men and some startups.

I’m always surprised the Seattle startup ecosystem hasn’t grown to compete with the likes of Silicon Valley — or at least Boston and New York City — since the dot-com boom. Today, it’s the strongest it’s has been due to the successes of companies like the newly minted unicorn Outreach, trucking business Convoy and, of course, the dog walking startup Rover. But the city still lags behind, failing to adopt the culture of entrepreneurship that defines San Francisco.

I spent a lot of time wondering why it hasn’t reached its full potential. Is it because Microsoft and Amazon pay their employees so well they don’t have the same urge to build something from the ground up? Is it a lack of access to capital? Is the city not attracting top talent? If you … Read the rest

April 29, 2019 Off

Starbucks CEO says Chinese rival Luckin’s ‘heavy discount’ strategy isn’t sustainable

By Jill T Frey

A war of words in the coffee world is brewing after the CEO of Starbucks claimed Chinese upstart Luckin can’t last just days after it filed for a U.S IPO.

Kevin Johnson, who leads the American coffee giant, told CNBC that competitors in China including Luckin have adopted a strategy of building market share using “heavy, heavy discounts” that he believes is not sustainable.

“We’re deploying capital and building 600 new stores per year,” he said. We’re “generating the return on invested capital that we believe is sustainable to continue to build new stores at this rate for many years to come.”

Starbucks claims 30,000 stores worldwide. It has been in China for 20 years and it is aiming to reach 6,000 stores in the country by 2022. Luckin, fuelled by over $550 million in VC money, has quickly scaled to reach 2,370 locations in under two years … Read the rest

April 27, 2019 Off

Startups Weekly: All these startups are raising big rounds

By Jill T Frey

TechCrunch’s Connie Loizos published some interesting stats on seed and Series A financings this week, courtesy of data collected by Wing Venture Capital. In short, seed is the new Series A and Series A is the new Series B. Sure, we’ve been saying that for a while, but Wing has some clean data to back up those claims.

Years ago, a Series A round was roughly $5 million and a startup at that stage wasn’t expected to be generating revenue just yet, something typically expected upon raising a Series B. Now, those rounds have swelled to $15 million, according to deal data from the top 21 VC firms. And VCs are expecting the startups to be making money off their customers.

“Again, for the old gangsters of the industry, that’s a big shift from 2010, when just 15 percent of seed-stage companies that raised Series A rounds were already making … Read the rest