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Main article: Village Global

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No one knows how effective digital therapies are, but a new tool from Elektra Labs aims to change that

17:28 | 12 November

Depending on which study you believe, the wearable and digital health market could be worth anywhere from $30 billion to nearly $90 billion in the next six years.

If the numbers around the size of the market are a moving target, just think about how to gauge the validity and efficacy of the products that are behind all of those billions of dollars in spending.

Andy Coravos, the co-founder of Elektra Labs, certainly has.

Coravos, whose parents were a dentist and a nurse practitioner, has been thinking about healthcare for a long time. After a stint in private equity and consulting, she took a coding bootcamp and returned to the world she was raised in by taking an internship with the digital therapeutics company, Akili Interactive.

Coravos always thought she wanted to be in healthcare, but there was one thing holding her back, she says. “I’m really bad with blood.”

That’s why digital therapeutics made sense. The stint at Akili led to a position at the U.S. Food and Drug Administration as an entrepreneur in residence, which led to the creation of Elektra Labs roughly two years ago.

Now the company is launching Atlas, which aims to catalog the biometric monitoring technologies that are flooding the consumer health market.

These monitoring technologies, and the applications layered on top of them, have profound implications for consumer health, but there’s been no single place to gauge how effective they are, or whether the suggestions they’re making about how their tools can be used are even valid. Atlas and Elektra are out to change that. 

The FDA has been accelerating its clearances for software-driven products like the atrial fibrillation detection algorithm on the Apple Watch and the ActiGraph activity monitors. And big pharma companies like Roche, Pfizer and Novartis have been investing in these technologies to collect digital biomarker data and improve clinical trials.

Connected technologies could provide better care, but the technologies aren’t without risks. Specifically the accuracy of data and the potential for bias inherent in algorithms which were created using flawed datasets mean that there’s a lot of oversight that still needs to be done, and consumers and pharmaceutical companies need to have a source of easily accessible data about the industry.

”The increase in FDA clearances for digital health products coupled with heavy investment in technology has led to accelerated adoption of connected tools in both clinical trials and routine care. However, this adoption has not come without controversy,” said Coravos, co-founder and CEO of Elektra Labs, in a statement. “During my time as an Entrepreneur in Residence in the FDA’s Digital Health Unit, it became clear to me that like pharmacies which review, prepare, and dispense drug components, our healthcare system needs infrastructure to review, prepare, and dispense connected technologies components.

The analogy to a pharmacy isn’t an exact fit, because Elektra Labs currently doesn’t prepare or dispense any of the treatments that it reviews. But Atlas is clearly the first pillar that the digital therapeutics industry needs as it looks to supplant pharmaceuticals as treatments for some of the largest and most expensive chronic conditions (like diabetes).

Coravos and here team interviewed more than 300 professionals as they built the Atlas toolkit for pharmaceutical companies and other healthcare stakeholders seeking a one-stop-shop for all of their digital healthcare data needs. Like a drug label, or nutrition label, Atlas publishes labels that highlight issues around the usability, validation, utility, security and data governance of a product.

In an article in Quartz earlier this year, Coravos made her pitch for Elektra Labs and the types of things it would monitor for the nascent digital therapeutics industry. It includes the ability to handle adverse events involving digital therapies by providing a single source where problems could be reported; a basic description for consumers of how the products work; an assessment of who should actually receive digital therapies, based on the assessment of how well certain digital products perform with certain users; a description of a digital therapy’s provenance and how it was developed; a database of the potential risks associated with the product; and a record of the product’s security and privacy features.

As the projections on market size show, the problem isn’t going to get any smaller. As Google’s recent acquisition bid for FitBit and the company’s reported partnership with Ascension on “Project Nightingale” to collect and digitize more patient data shows, the intersection of technology and healthcare is a huge opportunity for technology companies.

“Google is investing more. Apple is investing more… More and more of these devices are getting FDA cleared and they’re becoming not just wellness tools but healthcare tools,” says Coravos of the explosion of digital devices pitching potential health and wellness benefits.

Elektra Labs is already working with undisclosed pharmaceutical companies to map out the digital therapeutic environment and identify companies that might be appropriate partners for clinical trials or acquisition targets in the digital market.

“The FDA is thinking about these digital technologies, but there were a lot of gaps,” says Coravos. And those gaps are what Elektra Labs is designed to fill. 

At its core, the company is developing a catalog of the digital biomarkers that modern sensing technologies can track and how effective different products are at providing those measurements. The company is also on the lookout for peer-reviewed published research or any clinical trial data about how effective various digital products are.

Backing Coravos and her vision for the digital pharmacy of the future are venture capital investors including Maverick Ventures, Arkitekt Ventures, Boost VC, Founder Collective, Lux Capital, SV Angel, and Village Global.

Alongside several angel investors, including the founders and chief executives from companies including: PillPack, Flatiron Health, National Vision, Shippo, Revel and Verge Genomics, the venture investors pitched in for a total of $2.9 million in seed funding for Coravos’ latest venture.

“Timing seems right for what Elektra is building,” wrote Brandon Reeves, an investor at Lux Capital, which was . one of the first institutional investors in the company. “We have seen the zeitgeist around privacy data in applications on mobile phones and now starting to have the convo in the public domain about our most sensitive data (health).” 

If the validation of efficacy is one key tenet of the Atlas platform, then security is the other big emphasis of the company’s digital therapeutic assessment.  Indeed, Coravos believes that the two go hand-in-hand. As privacy issues proliferate across the internet, Coravos believes that the same troubles are exponentially compounded by internet-connected devices that are monitoring the most sensitive information that a person has — their own health records.

In an article for Wired, Koravos wrote:

Our healthcare system has strong protections for patients’ biospecimens, like blood or genomic data, but what about our digital specimens? Due to an increase in biometric surveillance from digital tools—which can recognize our face, gait, speech, and behavioral patterns—data rights and governance become critical. Terms of service that gain user consent one time, upon sign-up, are no longer sufficient. We need better social contracts that have informed consent baked into the products themselves and can be adjusted as user preferences change over time.

We need to ensure that the industry has strong ethical underpinning as it brings these monitoring and surveillance tools into the mainstream. Inspired by the Hippocratic Oath—a symbolic promise to provide care in the best interest of patients—a number of security researchers have drafted a new version for Connected Medical Devices.

With more effective regulations, increased commercial activity, and strong governance, software-driven medical products are poised to change healthcare delivery. At this rate, apps and algorithms have the opportunity to augment doctors and complement—or even replace—drugs sooner than we think.

 


0

Bill Gates on making “one of the greatest mistakes of all time”

20:53 | 22 June

At a recent event hosted for founders by the venture firm Village Global, one of its most prominent investors, Bill Gates, sat down with Eventbrite cofounder and CEO Julia Hartz to discuss founding a company and the tough decisions necessary at nearly every turn in order to create and sustain a thriving enterprise.

As part of that conversation, Hartz asked Gates about his views on work-life balance, and whether they have evolved from an earlier point in Gates’s life, when he has said that he “didn’t really believe in vacations.”

His reply, in short: no, not in a company’s earliest years and especially not if that company is building a software platform. As Gates told Hartz, “I have a fairly hardcore view that there should be a very large sacrifice made during those early years, particularly if you’re trying to do some engineering things that you have to get the feasibility” or proof that a project can be performed successfully.

In fact, Gates is still kicking himself for taking his eyes off the ball and allowing Google to develop Android, the “standard non-Apple phone form platform,” as he describes it. “That was a natural thing for Microsoft to win.”

You can find their entire chat below, but here’s Gate’s full response to whether he thinks it worth it to focus narrowly on work or whether early-stage founders can strike a better balance:

I think you could over worship and mythologize the idea of working extremely hard. For my particular makeup — and it really is true that I didn’t believe in weekends; I didn’t believe in vacations; I mean, I knew everybody’s license plate so I could tell you over the last month when their card had come and gone from the parking lot — so I don’t recommend it and I don’t think most people would enjoy it.

Once I got into my 30s, I could hardly even imagine how I had done that. Because by then, some natural behavior kicked in, and I loved weekends. And, you know, my girlfriend liked vacations. And that turned out to be kind of a neat thing. Now I take lots of vacation. My 20-year-old self is so disgusted with my current self. You know, I, I was sure I would never fly anything but coach and you know, now I have a plane. So it’s very much counter revelations and taken place at high speed.

But yes, it is nice if during those first several years, you have a team that has chosen to be pretty maniacal about the company, and how far that goes, you should have a mutual understanding, so you’re not one person expecting one thing, and another person expecting another thing.

And you’ll have individuals who, who have, you know, health or relatives or things that [distract them]. But yes, I have a fairly hardcore view that there should be a very large sacrifice made during those, those early years, particularly if you’re trying to do some engineering things that you have to get the feasibility.

You know, in the software world, in particular for platforms, these are winner-take-all markets. So, you know, the greatest mistake ever is the whatever mismanagement I engaged in that caused Microsoft not to be what Android is, [meaning] Android is the standard non-Apple phone form platform. That was a natural thing for Microsoft to win.

It really is winner take all. If you’re there with half as many apps or 90% as many apps, you’re on your way to complete doom. There’s room for exactly one non-Apple operating system, and what’s that worth? $400 billion that would be transferred from company G [Google] to company M [Microsoft].

And it’s amazing to me, having made one of the greatest mistakes of all time — and there was this antitrust lawsuit and various things that, you know, our other assets, Windows, Office,  are still very strong. So we are a leading company. If we got that one right, we would be the company. But oh well.

So this idea that just small differences can magnify themselves doesn’t exist for a lot of businesses. You know, if you’re a service business, it doesn’t exist. But for software platforms, it’s absolutely gigantic. And so that’s partly where you have the mentality of every night you think, ‘Am I screwing this up?’ And eventually, we did screw up a super important one.

 


0

Colombian point-of-sale lender ADDI nabs $12.5 million from Andreessen Horowitz

17:00 | 11 June

Andreessen Horowitz <3 Latin American startups.

Latin America is the only region outside of the U.S. where the venture firm is routinely investing capital and it has just made another commitment, doubling down on its early stage support for the point-of-sale lending startup, ADDI.

ADDI picked up $12.5 million in new financing in April of this year as the company looks to expand its lending services online.

For an American audience, the closest corollary to what ADDI is up to is likely Affirm, the point-of-sale lender that’s raised a ton of cash and come in for some (valid) criticism for its basic business model.

Like Affirm, ADDI lets its borrowers apply for credit at the moment of purchase. The company likens its service to the layaway and credit plans that already exist in Colombia — but involve pretty onerous requirements to use. Company co-founder Santiago Suarez and Andreessen Horowitz general partner Angela Strange both commented on how, in some cases, Colombian shoppers have to have three people vouch for a borrower before a store will issue credit or agree to a layaway plan.

The difference between an ADDI loan — or any loan — and layaway is that an installment payment plan doesn’t charge interest (and even with the fees that installment plans do charge, they are often still cheaper than taking out a loan).

But financial products are coming for consumers in Latin America whether those buyers like it or not — and for the most part, it seems they do like it.

Historically, only the wealthiest clientele in Latin America received anything resembling the kinds of financial products that are more widely available in the United States, according to Strange. And the investment in ADDI is just part of her firm’s thesis in trying to make more services more broadly available in a region where a technological transformation is creating unprecedented opportunities for challengers.

That assessment is what drew Santiago Suarez back to Latin America only two years ago. A former executive at Lending Club who previously had worked as the head of New Product Development and Emerging Services at J.P. Morgan, Suarez saw the tremendous growth happening in Latin America and returned to Colombia to see if he could bring some much needed services to his home country.

Suarez partnered with his childhood friend, Elmer Ortega, who was working as the chief technology officer of the local hedge fund where he had previously been employed as a derivatives trader before learning how to code.

Together the two men, who had known each other since they were five-years-old, set out to transform how credit was offered in retail shops. It’s an industry that Suarez had known well since his parents had owned stores.

“In the U.S. there are all of these gaps that fintech companies are filling,” says Suarez. “But the gapes in Latin America are bigger.”

Suarez and Ortega incorporated the company in September 2018, around the same time they raised $2.3 million from the regional investment firm, Monashees, Andreessen, and Village Global . They then raised another $1.5 million in an internal round of financing before closing the most recent funding.

The company offers loans at annual percentage rates ranging from19.99% to 28.90%. The company started with a digital solution for brick and mortar retailers because 90% of retail in Colombia still happens offline. 

Although it’s in its early days, the company has already originated 10,000 borrowers and typically loans out roughly $500 since it launched on February 22, according to Suarez. He declined to comment on the company’s default rate on loans.

Now with 40 employees on staff, the company is looking to bring its lending tool to more e-commerce and physical retailers, according to Suarez. And despite the threat of cyclical political turmoil, Suarez says there’s no better time to be investing in Colombia. 

“It’s the most stable country outside of Chile… Way more stable than Brazil, way more stable than Argentina and way more stable than Mexico,” Suarez says. “What we’re looking at is more than cyclical instability… those things go beyond that.. Nubank was able to build a multibillion business in the worst political and economic crisis in Brazil’s history. I think Colombia is an incredibly attractive space with a deep talent pool.”

 


0

Distru, a maker of supply chain software for the cannabis industry, has raised $3 million led by Felicis

22:49 | 3 June

Distru, a nearly three-year-old, Oakland-based startup whose platform aims to help track cannabis through its seed-to-sale process, has raised $3 million in seed funding led by Felicis Ventures, with participation from Village Global, Global Founders Capital, and numerous notable angel investors, including Elad Gil, Katie Stanton, and Avichal Garg.

The deal is an interesting one for numerous reasons, including that it marks Felicis’s first investment in the cannabis space after many months spent looking at a wide array of related startups, says Niki Pezeshki, a principal with the firm. Indeed, though interest in cannabis-related products and services is growing among traditional venture firms as a growing number of states move to legalize and regulate marijuana, there’s lingering concern about what will happen and when at the federal level.

Distru is also entering into a space that tech investors can grok: it’s a software as a service company, one that just happens to give cannabis operators insight into their inventory and order management, their customer relationship management, and their logistics. Most important, Distru’s software helps them automate compliance with complicated and growing state regulations by integrating with Metrc, which is itself inventory tracing software that’s being used by a growing number of states to record the inventory and movement of cannabis and cannabis products through the commercial supply chain. (We wrote about six-year-old Metrc last year when it raised $50 million in funding, including from Casa Verde Capital and Tiger Global Management.)

Not last, Distru’s team, headed by founder and CEO Blaine Hatab, comes from the tech world, even while most are in the formative stages of their careers. Hatab has spent much of his post-collegiate career as a software developer, as has his cofounder, Blake Gentry, who joined forced with Hatab after leaving a developer role with the startup Opendoor to create his own company, Actualyze, which merged with Distru last fall. A third cofounder, Johnny Li, who further serves as Distru’s chief technical officer, was most recently a JavaScript instructor. Altogether, says Hatab, the team is made up of just nine employees who work remotely, though with its new funding, Distru plans to fill five more roles imminently.

In the meantime, it seems to pick picking up momentum despite its scale. Among its customers are major cannabis producers and distributors Humboldt Farms and CannaCraft. More, though it has competitors, including nine-year-old, Denver-based, venture-backed MJ Freeway, Hatab says it’s growing steadily based solely on word of mouth. Perhaps most compelling to Felicis and its other backers, the company has been operating in the black for some time. Says Hatab, “I think [our investors] were surprised by profitable we were.”

Distru operates in California alone today, but Hatab says it plans to follow Metrc into other markets, including roughly a dozen other states that include Colorado, Oregon, Alaska, Maryland, Michigan, Ohio, Massachusetts, Montana, Nevada and Louisiana.

 


0

Village Global’s accelerator introduces founders to Bill Gates, Reid Hoffman, Eric Schmidt and more

22:32 | 2 November

Village Global is leveraging its network of tech luminaries to support the next generation of entrepreneurs.

The $100 million early-stage venture capital firm, which counts Microsoft’s Bill Gates, Facebook’s Mark Zuckerberg, Alphabet’s Eric Schmidt, Amazon’s Jeff Bezos, LinkedIn’s Reid Hoffman and many other high-profile techies as limited partners (LPs), quietly announced on Friday that the accelerator it piloted earlier this year would become a permanent fixture.

Called Network Catalyst, Village provides formation-stage startups with $150,000 and three-months of programming in exchange for 7 percent equity. Its key offering, however, is access to its impressive roster of LPs.

To formally announce Network Catalyst, Village brought none other than Bill Gates to San Francisco for a fireside chat with Eventbrite CEO Julia Hartz . During the hour-long talk, Gaves handed out candid advice on building a successful company, insights on philanthropy and predictions on the future of technology. He later met individually with Village’s portfolio founders.

“I have a fairly hardcore view that there should be a very large sacrifice made during those early years,” Gates said. “In those early years, you need to have a team that’s pretty maniacal about the company.”

During the Q&A session, Gates regurgitated one of his great anecdotes. In the early days of Microsoft, he would memorize his employee’s license plates so he knew when they were coming and going, quietly noting who was working the longest hours. He admitted, to no one’s surprise, that he struggled with work-life balance.

“I think you can over worship the idea of working extremely hard,” he said. “For my particular makeup, it’s really true I didn’t believe in weekends or vacations … Once I got in my 30s,’ I could hardly imagine how I’d done that because by then something natural thing inside of me kicked in and I loved weekends and my girlfriend liked vacations and that turned out to be a great thing.”

Gates has been an active investor in Village since it emerged one year ago. VMWare founder Diane Greene, Disney CEO Bob Iger, Spanx CEO Sara Blakely are also on the firm’s long list of LPs.

Village is led by four general partners: Erik Torenberg, Product Hunt’s first employee; LinkedIn’s former chief of staff Ben Casnocha; Chegg’s former chief business officer Anne Dwane; and former Canaan partner Ross Fubini. They initially filed to raise a $50 million fund in mid-2017 but ultimately closed on $100 million in March for their debut effort. The firm relies heavily on scouts — angel investors and others knowledgeable of the startup world — to source deals. The scouts, in return, earn a portion of the firm’s returns.

Former Alphabet chairman Eric Schmidt.

An accelerator program has been part of Village’s plan since the beginning.

Pinterest CEO Ben Silbermann, Fidelity CEO Abby Johnson, Hoffman, Iger, Blakely and Schmidt all worked with Network Catalyst’s debut cohort of founders. Village co-founder Anne Dwane said Hoffman and former Twitter CEO Ev Williams have signed on to work with the next cohort.

“It is about contacts, not content,” Dwane told TechCrunch. “The most important thing is who you can meet to help you take your business forward.”

San Francisco-based VeriSIM, a startup building AI-enabled biosimulation models, was among the debut class of companies that participated in Network Catalyst. Jo Varshney, the company’s founder and CEO, said the accelerator’s personalization and customization set it apart from competing options.

“It seemed like I had a team of people working alongside me even though I’m a solo founder,” Varshney told TechCrunch.

After completing the Network Catalyst program, Schmidt introduced Varshney to a number of investors. She quickly closed a $1.5 million seed round.

“One year in and I already have a one-on-one meeting with Bill Gates,” she added.”

Applications for the accelerator close on Dec. 7 with programming kicking off Jan. 14. Village plans to enroll at least 12 companies across industries.

 


0

Freight trucking startup Shipwell gets a $10 million boost

17:10 | 9 October

Shipwell, a startup pitching a marketplace for domestic ground shipping and fleet and cargo management services for freight trucking companies, has raised $10 million in a new round of funding.

A booming American economy coupled with failing infrastructure and a low-margin business reluctant to adopt new technologies have put stress on domestic logistics companies in the $900 billion market for U.S. trucking services.

Shipwell combines a marketplace for shippers to connect with freight companies and online tools to manage those shipments. In effect, the company is pitching a version of the proprietary logistics management toolkit that has made Amazon so successful, to any retailer or outlet. 

We coordinate the freight, we pay the truckers, we help optimize the fleets,” says Shipwell president and co-founder, Jason Traff. 

Those services — and the company’s growing business among small and medium-sized suppliers to the construction industry — brought the Austin-based company to the attention of Fifth Wall Ventures, the Los Angeles based investment firm whose limited partners are among the biggest construction companies in the world.

For Fifth Wall the opportunity was clear. “Shipwell’s full-service, digitized brokerage platform can streamline the way many of our Anchor LPs and portfolio companies approach large-scale freight shipping,” the firm’s principal — and newest Shipwell board member — Vik Chawla wrote in a blog post announcing its most recent deal.

Fifth Wall led the company’s Series A round, which also included the new investor Global Founders Capital and previous investors First Round Capital, Base 10 Ventures, Capital Theory and Village Global .

The company’s business isn’t for big shippers that deal with thousands of shipments per-day, but rather the small and medium sized businesses that spend $100 million or less per-year on freight. And the small-fleet shipping companies that make up the bulk of the industry.

“In addition to the obvious use case for Shipwell customers who own warehousing, landlords can use Shipwell to become effective facilitators for their tenants,” according to Chawla. “Some Anchor LPs [the limited partners that provide capital for Fifth Wall to invest] are already engaged in this shipping ecosystem on behalf of their tenants, while others act as transport hubs. Beyond these, however, there are easy tie-ins within a number of key categories of Fifth Wall Anchors [sic] that regularly ship or receive freight—developers, of course, but also retail, office, homebuilding anchors.”

“We focus on the longer tail. If you are doing $50 million in freight per-year then you’re doing dozens of shipments per week,” said Traff. “Most of our freight is less than a truckload or a full truckload freight and it’s more long-haul.”

It hasn’t been a straight road for Traff and his co-founder Gregory Price. Traff originally got the startup bug in Asia, where he launched a company that would sell low-cost copies of old masters paintings. When he sold that business he moved back to the U.S. and pitched an idea to Y Combinator that eventually became Leaky, a car insurance company.

When Leaky shut down and its business was acquired by Navion in 2013, Traff moved to Austin to figure out his next move.I t was there that he ran into a fellow Massachusetts Institute of Technology alumnus named Greg Price and the two began hatching schemes for the company that would become Shipwell.

The two men began planning the business in 2016 and only launched the service in the beginning of this year. “Supply chains were very complex and there was a lot of building to do,” Traff said. 

Shipwell makes money by charging a commission on freight services and fees for its freight management software platform.

Ultimately this could create a new model to unify a fragmented industry. “This connective approach makes all of the difference in an industry with so many small companies at play,” Chawla wrote. “A surprising 89% of freight trucks in the U.S. are owned by carriers with fewer than five total trucks, and 99% of freight carriers possess fewer than 10 total trucks in their fleet. Despite the big business of freight shipping in the U.S., it’s actually a fragmented market of small businesses.”

 

 


0

African financial technology startups move beyond payment services

19:30 | 5 October

Jake Bright Contributor
Jake Bright is a writer and author in New York City. He is co-author of The Next Africa.

If mobile money was the first phase in the development of digital finance in Africa, the next phase of digital financial services on the continent will focus on lending, insurance and wealth management

In “Beyond Payments: The Next Generation of Fintech Startups in Sub-Saharan Africa,” the venture capital firm Village Global, and their reporting partner, PayPal, tip their hat to M-Pesa and mobile money in Africa, but say that there’s a wave of innovation still to come.

The investment firm identified f 12 companies it determined were “building solutions in fintech subsectors outside of payments.”

In partnership with PayPal, Village Capital has set up Fintech: Africa 2018, a program in that seeks to find and support startups bringing other “critical services” to Africa’s unbanked populations.

“We can’t do enough to highlight what the next generation of fintech startups will and should be driving….whether it’s in agriculture—helping farmers have access to the financial system—through alternative credit scoring and lending—so people can actually get access to loans or insurance—or building savings and wealth,” Village Capital Managing Director and report co-author Allie Burns told TechCrunch.

Village Capital’s work gives a snapshot of these four sub-sectors—agricultural finance, insurtech, alternative credit scoring, and savings and wealth—including players, opportunities and challenges, recent raises, and early-stage startups to watch.

In alternative credit scoring and lending it sees blockchain as a driver of innovation in reducing “both transaction costs and intermediation costs, helping entrepreneurs bypass expensive verification systems and third parties.”

The report highlights recent raises by savings startup PiggybankNG and Nigerian agtech firm Farmcrowdy. Village Capital sees the biggest opportunities for insurtech startups in five countries: South Africa, Morocco, Egypt, Kenya and Nigeria.

On non-payments fintech startups overall, Village Capital chose a cohort of 12 for its 2018 program. They included F-Pesa — a Kenyan foreign exchange app­ — and Nigerian installment e-commerce app CredPal. All 12 participated in three Village Capital and PayPal sponsored workshops to introduce them to mentors and investors. Two of the cohort (identity venture Youverify and Ugandan cloud focused microfinance company Ensibuuko) received funding offers from Village Capital.

PayPal’s involvement in Village Capital’s Fintech Africa program “is really about…our commitment to financial health and the democratization of finance,” PayPal head of social innovation Sean Milliken told TechCrunch.

PayPal provided financial resources for the Fintech Africa program and study and participated in the development of the curriculum “toward those participating ventures getting investment ready,” said PayPal’s Director of Corporate Affairs Tyler Spalding. They didn’t invest though: “our funds were not actually deployed in an investment capacity,” he added.

PayPal has increased its presence and payment activity in Africa over the last several years through a number of partnerships—including one to transfer funds through Safaricom’s M-Pesa product—and plans to deliver more remittances into Nigeria and South Africa through its Xoom subsidiary.

Village Capital is still mulling the possibility running another round of its Fintech Africa program in 2019. To date the fund has invested in 14 Sub-Saharan African startups.

Whether its payment or non-payment applications, the number of startups in Africa’s fintech space and the breadth of their activities continue to grow.

Big developments TecCrunch has covered this year have mostly been on the digital payments side including Paga’s global expansion and plans to take on providers such as PayPal and Safaricom. Then there have been big raises by payments focused Paga ($10), Cellulant ($47M), and Mines ($13) and by lending platform Jumo ($52) and South African business enterprise services startup Yoco.

 


0

DFINITY raises $102M from a16z and Polychain for a decentralised ‘Internet Computer’ to rival AWS

14:30 | 29 August

Since blockchain technology appeared, there has been a persistent problem in its development: how to make it scale to billions of users. Bitcoin was famously never really designed for this, and today other platforms like Ethereum are also struggling. If you could crack this problem, the thinking goes, you’d end up with the hottest property in blockchain right now.

That, a very healthy dose of ambition, and a bench of strong computer science talent are some of the big reasons why investors are gathering around DFINITY, a startup based out of Zug, Switzerland and Palo Alto that is also a foundation, and has a very lofty goal to build what it calls the “Internet Computer”: a blockchain-based, decentralised and non-proprietary network to run the next generation of mega-applications. DFINITY aims to launch an initial version of its public network — which it has also dubbed “Cloud 3.0” — towards the end of the year.

Today, DFINITY is announcing that it has raised $102 million in funding, in a round jointly led by Andreessen Horowitz (via its crypto fund a16z crypto) and Polychain Capital. Both were previous investors in a $61 million round DFINITY announced earlier this year — which has been a blockbuster for blockchain, with at least $1.3 billion being invested into the technology in the first half of 2018 alone. DFINITY has now raised just over $195 million to date since being founded in 2015.

Other investors in this latest round include SV Angel, Aspect Ventures, Village Global, Multicoin Capital, Scalar Capital, and Amino Capital, as well as DFINITY community members.

DFINITY’s approach to the scalability problem is to resolve the dilemma between full decentralization (where every miner runs every instruction of every computation) versus delegating the mechanics to nodes or super nodes (so therefore more centralisation). DFINITY says it has tested its network to the point where it can finalize software computations in under 5 seconds, which is extremely fast. Bitcoin by contrasts takes 3600 seconds, and Ethereum 600 seconds.

DFINITY conducted an airdrop in May of 35 million Swiss Francs worth of tokens to DFINITY community members to help them become early users. Now DFINITY has followed the newer approach of raising a private sale for its token, without going to a public sale.

You can also watch a test demo of the network here:

While a lot of blockchain projects are tied up with currency (an area that DFINITY has also developed, as you can see), what’s notable about what this startup is doing is that its wider focus is on building a platform that could be used across a significantly wider set of applications.

The Internet Computer, as described by founder and chief scientist Dominic Williams, “is a public infrastructure that aims to host the world’s next generation of software and services.” The belief is that by making it open source and non-proprietary, it’s significantly more secure and less costly to maintain. DFINITY claims that R&D on such an architecture is 90 percent lower.

“We are excited to back DFINITY’s Internet Computer and their vision to host the world’s next generation of software and services on a public network,” said Chris Dixon, Partner at a16z crypto. “The Internet Computer is on track to become a critical piece of the future technology stack. This is groundbreaking and a real testament to Dominic and the incredible team at DFINITY.”

In addition to Williams, that team is impressive indeed.

It includes Timo Hanke as head of engineering, who is a former mathematics and cryptography professor who created AsicBoost to increase the efficiency of Bitcoin mining; Mahnush Movahedi, who joined as a senior researcher from Yale where he’s worked on “scalable and fault-tolerant distributed algorithms for consensus and secure multi-party computation, secret sharing, and interactive communication over noisy channels”; ex-Googler Ben Lynn, who is the “L” from BLS cryptography, used in Threshold Relay to “generate randomness and achieve security, speed and scale in public networks”; and Adreas Rossberg, another ex-Googler who had co-designed the WebAssembly virtual machine, which is also used at DFINITY.

While Internet networks and the largest players online today are proprietary entities with their own commercial and strategic agendas, the vision behind DFINITY is that it can be used to run “autonomous software” that will run in a more independent way. These will exist as running open source software that updates itself using inbuilt governance that can provide hard guarantees to users in the form of “smart contracts” (computing and other transactions that can be made without third parties). These can cover how data might be used, or provide guarantees to startups wishing to build functionality without the precarious worry of a platform access getting revoked. You can read more about the technology in its white paper.

DFINITY has not disclosed its valuation with this round.

 


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RDMD attacks rare diseases with data mined from health records

17:10 | 20 August

You wouldn’t expect a medical app to get its start as a Snapchat competitor. Neither did video chat startup TapTalk’s founder Onno Faber. But four years ago he was diagnosed with a rare disease called Neurofibromatosis Type 2 that caused tumors leading Onno to lose hearing in one ear. He’s amongst the one in ten people with an uncommon health condition suffering from the lack of data designed to invent treatments for their ails. And he’s now the co-founder of RDMD.

Emerging from stealth today, RDMD aggregates and analyzes medical records and sells the de-identified data to pharmaceutical companies to help them develop medicines. In exchange for access to the data, patients gets their fragmented medical records organized into an app they can use to track their treatment and get second opinions. It’s like Flatiron Health, the Google-backed cancer data startup that just got bought for $2 billion, but for rare diseases.

Now RDMD is announcing it’s raised a $3 million seed round led by Lux Capital and joined by Village Global, Shasta, Garuda, First Round’s Healthcare Coop, and a ton of top healthtech angels including Flatiron investors and board members. The cash will help RDMD expand to build out its product and address more rare diseases.

RDMD founders (from left): Nancy Yu and Onno Faber

We believe that the traditional way rare disease R&D is done needs to change” RDMD CEO Nancy Yu tells TechCrunch. The former head of corp dev at 23andme explains that, “There are over 7,000 rare diseases and growing, yet <5% of them have an FDA-approved therapy . . . it’s a massive problem.” 

While data infrastructure supports development of treatments for more common diseases like cancer and diabetes, rare diseases have been ignored because it’s wildly expensive and difficult to collect the high-quality data required to invent new medicines. But “RDMD generates research-grade, regulatory-grade data from patient medical records for use in rare disease drug R&D” says Yu. The more data it can collect, the more pharma companies can do to help patients.

Trading Utility For Patient Data

With RDMD’s app, a patient’s medical data that’s strewn across hospitals and health facilities can be compiled, organized and synthesized. Handwritten physicians’ notes and faxes are digitized with optical character recognition, structuring the data for scientific research. RDMD lays out a patients’ records in a disease-specific timeline that summarizes their data that can be kept updated, delivered to specialists for consultations, or shared with their family and caregivers.

If users opt in, that data can be anonymized and provided to research organizations, hospitals, and pharma companies that pay RDMD, though these patients can delete their accounts at any time. Since it’s straight from the medical records, the data is reliable enough to be regulation-compliant and research-ready. That allows it to accelerate the drug development process that’s both lucrative and life-saving. “It normally takes millions of dollars over several years to gather this type of data in rare diseases” Yu notes. “For the first time, we have a centralized and consented set of data for use in translational research, in a fraction of the time and cost.”

So far, RDMD has enrolled 150 patients with neurofibromatosis. But the potential to expand to other rare diseases attracted a previous pre-seed round from Village Global and new funding from angels like Clover Health CEO and Flatiron board member Vivek Garipalli, Flatiron investor and GV (Google Ventures) partner Vineeta Agarwala, Twitter CTO Parag Agrawal, former 23andme president Andy Page, and the husband and wife duo of former Instagram VP of product Kevin Weil and 137 Ventures managing director Elizabeth Weil.

“Onno and Nancy realized there’s an opportunity to do in rare diseases what Flatiron has done in oncology — to aggregate clinical data from patients, and to leverage that data in clinical trials and other use cases for biotech and pharma” says Shasta partner Nikhil Basu Trivedi. RDMD will be competing against pharma contract research organizations that incur high costs for collecting data the startup gets for free from patients in exchange for its product. Luckily, Flatiron’s exit paved the way for industry acceptance of RDMD’s model.

“The biggest risk for our company is if we lose our focus on providing real, immediate value to rare disease patients and families. Patients are the reason we are all here, and only with their trust can we fundamentally change how rare disease drug research is done” says Yu. RDMD will have to ensure it can protect the privacy of patients, the security of data, and the efficacy of its application to drug development.

Hindering this process is just one more consequence of our fractured medical records. Hopefully if startups like RDMD and Flatiron can demonstrate the massive value created by unifying medical data, it will pressure the healthcare power players to cooperate on a true industry standard.

 


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Sokowatch closes $2 million seed round to modernize Africa’s B2B retail

11:00 | 26 July

Jake Bright Contributor
Jake Bright is a writer and author in New York City. He is co-author of The Next Africa.

Kenya based Sokowatch aims to shake up the supply chain market for Africa’s informal retailers.

The B2B e-commerce company closed a $2 million seed investment led by 4DX Ventures. Others to join the round were Village Global, Lynett Capital, Golden Palm Investments, and Outlierz  Ventures.

Sokowatch’s platform connects Africa’s informal retail stores directly to local and multinational suppliers—such as Unilever and Proctor and Gamble—by digitizing orders, delivery, and payments with the aim of reducing costs and increasing profit margins.

The term disrupt is used less frequently in African tech since startups are often entering new business spaces where there’s little to actually disrupt.

That’s not the case with Sokowatch, which sees price and productivity benefits to revamping existing supply chain structures for Africa’s informal retailers.

“With both manufacturers and the small shops, we’re becoming the connective layer between them, where previously you had multiple layers of middle-men from distributors, sub-distributors, to wholesalers,” Sokowatch founder and CEO Daniel Yu told TechCrunch.

“The cost of sourcing goods right now…we estimate we’re cutting that cost by about 20 percent [for] these shopkeepers,” he said

Quantifying the size and potential of Africa’s informal markets has captured the attention of economists and startups. GDP revisions in several African countries have revealed outdated statistical methods were missing billions of dollars in economic activity. And one estimate by The International Labor Organization places up to two-thirds of Sub-Saharan Africa’s non-agricultural employment in the informal economy.

On the number of small shops on the continent, Yu noted a lack of reliable numbers but cited a 2016 KPMG study pegging fast moving consumer goods spending in Nigeria alone at $41 billion annually. A portion of those goods move through the continent’s vast network of roadside markets, shops, and stands.

“There are millions of informal stores across Africa’s cities selling hundreds of billions worth of consumer goods every year,” said Yu.

These stores can use Sokowatch’s app on mobile phones to buy wares directly from large suppliers, arrange for transport, and make payments online. “Ordering on SMS or Android gets you free delivery of products to your store, on average, in about two hours,” said Yu.

Sokowatch generates revenues by earning “a margin on the goods that we’re selling to shopkeepers,” said Yu. On the supplier side, they also benefit from “aggregating demand…and getting bulk deals on the products that we distribute.”

The startup has delivered 100,000 orders to customers for “a few thousands shops,” according to Yu and company data.

The company recently launched a line of credit product to extend working capital loans to platform clients. With the $2 million round, Sokowatch—which currently operates in Kenya and Tanzania—plans to “expand to new markets in East Africa, as well as pilot additional value add services to the shops,” said Yu.

Peter Orth, Co-Founder and Managing Partner at lead investor 4DX Ventures, will join Sokowatch’s board of directors.

Yu also noted the possible big data benefits to informal African retail from Sokowatch. “If you are …selling into this market you have no clue who ultimately ends up with your product, even two layers down. That’s a big challenge,” he said.

“With us, not only do we know who’s buying the product, we know when they are buying the product, what they’re buying it in conjunction with, and the pricing.”

 


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