May 27, 2024

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VC Daily: Tool Aims to Spot Startups With Top Managers

Good day. Can a founder’s “intangibles,” which many venture capitalists cite when choosing to back a startup, in fact be made tangible?

An artificial intelligence software tool launched last week by analytics firm CB Insights aims to give investors a data-driven shortcut to finding startups with the best management teams.

The software tool, called Management Mosaic, conducts an “algorithmic analysis” using inputs about a startup’s founding and management team. The inputs include data points on work history, business milestones achieved and professional networks to assign a score that is meant to reflect the likelihood that the team will create a “successful outcome,” such as an initial public offering or an acquisition.

As venture deal-making activity has soared amid a hot market, the tool is meant to assist in what is normally a time-consuming effort, CB Insights said.

CB Insights offered a test run of the product, identifying 15 seed-stage startups with the strongest founders and founding teams.

For instance, the tool assigned data-management startup Mozart Data a score of 960 out of 1,000. The program identified one of the founders, Peter Fishman, as a key person. Among other jobs, Mr. Fishman was previously head of strategy at medical cannabis delivery app Eaze Technologies Inc. and holds a Ph.D. in economics from the University of California, Berkeley.

How and to what extent venture investors implement this tool into their deal making strategy remains to be seen.

And now on to the news…

Top News

Debut venture funds step up. For years, first-time venture fundraising in the U.S. has been on the decline. This year, it is on track to reverse course. While megafunds continue to dominate, more debut-fund managers are striking out on their own, emboldened by strong returns in the markets, WSJ Pro’s Yuliya Chernova reports.

“I finally have the confidence and track record to double down on myself, ” said Jenny Fielding, who is planning to leave Techstars, a New York startup accelerator where she has been managing director for the past seven years. This month, she will begin dedicating her full efforts to The Fund, a venture firm she co-founded that was previously a “side hustle.”

Debut funds in the market today are more likely to be led by female and minority managers and invest in undercapitalized technology sectors, like climate tech, according to an analysis by Different Funds.

The newcomers are bringing more competition to an already frothy startup market, as well as making it harder for larger venture partnerships to keep talented staff from jumping ship to pursue their own firms.

235,000

Number of jobs that were added in the U.S. in August, well below economists’ estimates for 720,000 new jobs. (WSJ)

Regulators Investigate Crypto-Exchange Developer Uniswap Labs

The Securities and Exchange Commission is investigating the startup behind one of the biggest cryptocurrency exchanges, as regulators probe further into parts of the digital-asset market that have resisted oversight, according to people familiar with the matter, The Wall Street Journal reports. Regulators are examining Uniswap Labs, the main developer of the world’s largest decentralized exchange, called Uniswap, the people said. Enforcement attorneys are seeking information about how investors use Uniswap and how it is marketed, the people said. A spokesman for Uniswap Labs said the company is “committed to complying with the laws and regulations governing our industry and to providing information to regulators that will assist them with any inquiry.”

Companies Need More Workers. Why Do They Reject Millions of Résumés?

Companies are desperate to hire, and yet some workers still can’t seem to find jobs, WSJ reports. Here may be one reason why: The software that sorts through applicants deletes millions of people from consideration. Employers today rely on increasing levels of automation to fill vacancies efficiently, deploying software to do everything from sourcing candidates and managing the application process to scheduling interviews and performing background checks.

Industry News

Funds

Canadian firm The51 Ventures is raising $25 million for its Food & AgTech Fund, which is focused on women-led and diverse businesses in the agriculture, food and aquaculture technology sectors.

People

Transcarent, a provider of healthcare services for employees of self-insured employers, appointed Snezana Mahon as chief operating officer. She was most recently vice president and general manager of care solutions at Evernorth, a division of Cigna. San Francisco-based Transcarent said in June it raised $58 million in Series B funding led by General Catalyst and 7wireVentures.

Organic-food delivery service Trifecta Inc. hired Karen Townsend as chief financial officer. She previously held positions at Sole Technology Inc., Brighton Collectibles and Lakeshore Learning Materials. Sacramento, Calif.-based Trifecta recently closed a $20 million Series B round from Spring Lake Equity Partners, Data Point Capital and Raptor Group.

Thrive Global, a startup founded by Arianna Huffington that helps improve well-being, performance and mental resilience in the workplace, appointed Christopher O’Donnell as chief product officer. He previously held the same position at HubSpot. Based in New York, Thrive Global recently raised an $80 million Series C round co-led by Kleiner Perkins and Owl Ventures.

Exits

FLYR Labs, a revenue operating system for airlines, acquired ancillary revenue services provider Faredirect and marketing technology tools company xCheck for an undisclosed amount. San Francisco-based FLYR is backed by investors including JetBlue Technology Ventures, Streamlined Ventures, Haymaker Ventures and Brightstone Venture Capital.

Creator platform Patreon acquired tech recruiter Clear Talent for an undisclosed sum. Earlier this year, San Francisco-based Patreon raised a $155 million Series F round, valuing the company at $4 billion. Investors in the funding included Tiger Global Management, Woodline Partners, Wellington Management, Lone Pine Capital, New Enterprise Associates, Glade Brook Capital and DFJ Growth.

Sales and marketing software provider 6sense purchased revenue intelligence platform Fortella. Terms weren’t disclosed. Earlier this year, San Francisco-based 6sense raised a $125 million Series D round from D1 Capital Partners, Sapphire Ventures, Tiger Global Management and Insight Partners. Fortella’s website lists Monta Vista Capital, BluePointe Ventures and Uncorrelated Ventures as backers.

New Money

Jeeves, a New York-based expense management platform for startups in global markets, snagged $57 million in Series B financing at a $500 million valuation. Lead investor CRV was joined by Tencent, Silicon Valley Bank, Alkeon Capital Management, Soros Fund Management and others in the round. Saar Gur, general partner at CRV, will join the Jeeves board. The company also named Katharine Reaugh to the post of chief people officer. She previously held HR positions at Netflix and Facebook.

Botify, a provider of search engine and voice assistant technology, closed a $55 million Series C round. InfraVia Capital Partners led the investment, which included contributions from Bpifrance, Eurazeo and Ventech. InfraVia’s Nicolas Herschtel and Bpifrance’s Antoine Izsak will join the board. Botify has offices in New York, Seattle, Paris, London and Singapore.

Code Climate Inc., a New York-based engineering intelligence platform, obtained $50 million in Series C funding. Growth equity firm PSG led the round, which included support from previous investors Union Square Ventures, Foundry Group, Lerer Hippeau and NextView Ventures.

Quantum Machines Ltd., a provider of cloud infrastructure for quantum computing, secured $50 million in Series B funding. Red Dot Capital Partners led the round, with Managing Partner Yaniv Stern joining the company’s board. Exor, Claridge Israel, Samsung NEXT, Valor Equity Partners, Atreides Management, TLV Partners, Battery Ventures and others also participated in the round.

Vic.ai, a New York- and Oslo-based AI platform for autonomous accounting and financial intelligence, secured $50 million in Series B financing. Iconiq Growth led the investment, which included participation from GGV Capital, Cowboy Ventures and Costanoa Ventures. Will Griffith, founding partner at Iconiq Growth, will join the board.

Sunday, a Bangkok-based insurtech startup, landed $45 million in Series B funding from Tencent, SCB 10X, Vertex Growth, Vertex Ventures Southeast Asia & India, Quona Capital, Granite Oak, Aflac Ventures and Z Venture Capital.

Simba Chain Inc., a Plymouth, Ind.-based blockchain app development startup, completed a $25 million Series A round led by Valley Capital Partners. Steve O’Hara from Valley Capital will join the board.

Hound Labs Inc., an Oakland, Calif.-based maker of a marijuana breathalyzer, picked up a $20 million investment. Entourage Effect Capital led the round, which saw participation from Intrinsic Capital, Benchmark, Icon Ventures and Tuatara Capital.

Centaur Labs, a Boston-based medical data labeling company, raised $15 million in Series A funding. Matrix Partners led the round, which included participation from Accel, Global Founders Capital, Susa Ventures, Y Combinator and others.

Kalepa, a New York-based commercial insurtech startup, raised a $14 million Series A round. Inspired Capital led the funding, which saw support from IA Ventures.

SmartSwap Exchange, a blockchain technology provider, raised more than $10 million in funding from investors including Moonwhale, Draper Venture Network, Alpha Capital Ventures, Meridian Capital and Maven Ventures.

(MORE TO FOLLOW) Dow Jones Newswires

September 07, 2021 09:59 ET (13:59 GMT)

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