Forter raises $300M on a $3B valuation to combat e-commerce fraud

E-commerce is on the rise, but that also means the risk, and occurrence, of e-commerce fraud is, too. Now, Forter, one of the startups building a business to tackle that malicious activity, has closed $300 million in funding — a sign both of the size of the issue and its success in tackling it to date.

The new funding, a Series F, values Forter at $3 billion — notable not least because the funding is coming only about six months since Forter’s previous round, a $125 million Series E that valued it at over $1.3 billion.

Tiger Global Management is leading this latest equity infusion, with new backers Third Point Ventures and Adage Capital Management, and existing investors Bessemer Venture Partners, Sequoia Capital, March Capital, NewView Capital, Salesforce Ventures and Scale Venture Partners, also involved.

The plan will be to use to the money to expand Forter — founded in Tel Aviv and now based in New York — geographically, bring more functionality into its product and explore adjacent areas where Forter might expand its capabilities, either organically or by way of acquisition.

Forter today focuses mainly on identifying fraud at the point of transaction and building an AI-based platform that “learns” more behaviors to improve its accuracy; it also builds models that keep more people transacting and helps bring down the number of “false positives” where activity that appears suspicious actually is not.

One area on its roadmap for expansion is remediation after the fraud occurs, said Liron Damri, Forter’s co-founder and president.

“Our vision is to serve the merchant as the go-to trusted partner for everything, so remediation is definitely on our roadmap,” he said of potential acquisition targets.

Damri, who co-founded the company with Michael Reitblat, CEO, and Alon Shemesh, chief analyst, said in an interview that the startup — which works with some 350 large customers like Priceline and Instacart and a growing number of service providers like FreedomPay and Flutterwave, altogether seeing some $250 billion worth of transactions globally last year — wasn’t proactively looking for more money.

“All we wanted to do was go back to run the company,” he said. “But in the past six months we’ve seen such a great momentum, doubling revenue and ARR, and seeing our customer volumes grow.”

That led to a lot of investors proactively reaching out and asking questions, he continued. He described Tiger as a “kingmaker” in the category of e-commerce, so it was an easy decision to make, and gave it the “gas” it needed to take its next growth steps.

E-commerce has been one of the major technology growth stories of the last year, fueled by a rush of consumers and businesses playing out their lives online at a time when it has been harder, and in some cases impossible, to transact in person.

While we have definitely seen a lot of growth, and growing sophistication, in the number of tools on the market to combat cybercrime, it’s in some ways an ouroboros of a problem: The more transactions that are made, the more there are that need to be monitored for suspicious activity. And in any case, fraud in e-commerce is not exactly going away. It’s estimated that it will cost retailers some $20 billion in 2021 and is always on the rise.

Forter got its start in 2013 focusing first on monitoring activity on sites wherever customers happened to be to identify suspicious behavior — a sign that it might be a bot or someone on an illicit spending spree racking up a lot of items in quick succession — with the bigger concept being to build a network of activity from which to learn and help make more informed decisions over time.

In more recent years, the essence of the issue has expanded somewhat, and also grown more sophisticated. As companies have grown their businesses to reach beyond early adopters and core audiences, and into a more “omnichannel” environment beyond basic check-outs on their own sites, so too have the kinds of consumers coming to shop.

This has meant that traditional “signals” of legitimate buyers no longer were the same as before — a predicament that really rose in profile in the last year, as many newcomers came to e-commerce for the first time during the pandemic. In fact, Damri told me that in 2020 there were seven times more “newcomers” to sites than in 2019.

So with most of the flagging of suspicious activity coming up at the point of transaction, Forter expanded to analyzing activity there.

As with a recent acquisition of Stripe’s, Bouncer, to build out its own anti-fraud product, a large part of Forter’s attention these days is on providing tools to companies to identify suspicious purchasing, but even more than that, to make sure that the many occasions that might look suspicious are not, to help reduce the amount of “cart abandonment” and increase conversions.

The old way of doing things, Damri said, involved “thousands of rules and applying suspicion on everyone. You were guilty unless proved otherwise.”

Using its AI engine and some risk analysis (not unlike the kind that, say, an insurance or loan provider might apply in their businesses), Forter turned the proposition on its head.

“We wanted to approve as much as possible. We wanted to gradually increase the trust you have of your own customers. We changed the sentiment and approach… especially in areas that were neglected, such as those who saw significant changes in life,” Damri said. “This was extremely important as COVID-19 hit.”

Forter’s risk tolerance model, it seems, has so far proven out. Damri said that its algorithms applied reduce the total number of declines by 80%, but also reduce the number of chargebacks — one indicator of a mistake — by 60%.

This implies that it’s blocking more of the “wrong” kind of purchases, and letting through more of the legitimate ones. (That is, he pointed out, in addition to a few bad actors Forter intentionally lets buy things, just to learn how they operate. Damri referred to this as “paid-tuition.”)

Risk-based approvals, coupled with algorithms to learn what is truly bad, has resonated with customers, and investors.

“With the unprecedented rate of digital transformation and the fierce competition in creating the slickest user experience, superior fraud prevention plays an ever more critical role in e-commerce revenue growth” said John Curtius, a partner at Tiger Global Management, in a statement. “After we talked with dozens of customers of every relevant solution in this space, it was very clear to us that Forter is the clear leader in performance and scale.”

“As a longtime investor, it’s been incredible to see Forter’s ascent,” added Ravi Viswanathan, NewView Capital. “It’s a testament to the leadership team’s vision and execution in allowing merchants to provide the seamless experiences customers expect and to be able to accept as many transactions as possible, while still accurately identifying and blocking fraud.”

Twilio invests in adaptive communications platform Hyro

Hyro, formerly Airbud, is today announcing the close of a $10.5 million Series A financing round led by Spero Ventures, with participation from Twilio and Mindset Ventures. Existing investors Hanaco Ventures, Spider Capital and Entrepreneurs Roundtable Accelerator also participated in the round.

Hyro is an enterprise application, currently aimed at the healthcare sector but with eyes on new verticals, that adds an intelligent layer of voice chat or text chat to any application or website.

The company calls itself an adaptive communications platform, which essentially means that customers use plug-and-play tools to get information to end-users in a conversational way, whether that be voice or chat. It can integrate with contact centers, chatbots, SMS and other forms of communication. Essentially, Hyro targets information-heavy industries that often have to communicate with end-users.

This type of scenario, in the words of co-founder Israel Krush, usually leads to a terrible experience for the end user and a costly, inefficient process for the organization. The problem was no more apparent than in the healthcare sector during the pandemic. End users would flood platforms for information regarding the virus, the vaccine, testing, etc., but ask those redundant questions in myriad ways. On the enterprise side, the answers to those questions were changing over time.

Hyro allows these organizations to easily edit and change that information and deliver it to end users in an efficient way. But perhaps most importantly, Hyro scrapes information from the website to set up its own conversational tree, so the client doesn’t have to do a lot of heavy lifting up front.

Krush says that the problem is big, which means that the space is crowded. He views Twilio’s participation in this round of fundraising as a differentiator.

“The market is crowded so it’s really hard to differentiate yourself from the crowd,” said Krush. “Even though we have great technology, everyone says they have great technology. Twilio coming into this round and the partnership we’re trying to develop around contact centers really attests to the differentiation of our approach, to the scalability and the modularity of our approach.”

He added that Hyro is not a healthcare company — “it’s really about serving any enterprise.”

Hyro healthcare customers include Carroll, Wheelpros, Mercy Health, University of Rochester Medical Center and Weill Cornell Medicine, but the company plans to use this new funding to scale into more verticals, with an aim toward real estate, government and other information-heavy industries. 

This latest round brings Hyro’s total funding to $15 million.

UK’s Paysend raises $125M at a $700M+ valuation to expand its all-in-one payments platform

With more people than ever before going online to pay for things and pay each other, startups that are building the infrastructure that enables these actions continue to get a lot of attention.

In the latest development, Paysend, a fintech that has built a mobile-based payments platform — which currently offers international money transfers, global accounts, and business banking and e-commerce for SMBs — has picked up some money of its own. The London-based startup has closed a round of $125 million, a sizable Series B that the company’s CEO and founder Ronnie Millar said it will be using to continue expanding its business geographically, to hire more people, and to continue building more fintech products.

The funding is being led by One Peak, with Infravia Growth Capital, Hermes GPE, previous backer Plug and Play and others participating.

Millar said Paysend is not disclosing valuation today but described it as a “substantial kick-up” and “a great step forward in our position ahead toward unicorn status.”

From what I understand though, the company was valued at $160 million in its previous round, and its core metrics have gone up 4.5x. Doing some basic math, that gives the company a valuation of around $720 million, a figure that a source close to the company did not dispute when I brought it up.

Something that likely caught investors’ attention is that Paysend has grown to the size it is today — it currently has 3.7 million consumer customers using its transfer and global account services, and 17,000 small business customers, and is now available in 110 receiving countries — in less than four years and $50 million in funding.

There are a couple of notable things about Paysend and its position in the market today, the first being the competitive landscape.

On paper, Paysend appears to offer many of the same features as a number of other fintechs: money transfer, global payments, and banking and e-commerce services for smaller businesses are all well-trodden areas with companies like Wise (formerly “TransferWise”), PayPal, Revolut, and so many others also providing either all or a range of these services.

To me, the fact that any one company relatively off the tech radar can grow to the size that it has speaks about the opportunity in the market for more than just one or two, or maybe five, dominant players.

Considering just remittances alone, the WorldBank in April said that flows just to low- and middle-income countries stood at $540 million last year, and that was with a dip in volumes due to COVID-19. The cut that companies like Paysend make in providing services to send money is, of course, significantly smaller than that — business models include commission charges, flat fees or making money off exchange rates; Paysend charges £1 per transfer in the U.K. More than that, the overall volumes, and the opportunity to build more services for that audience, are why we’re likely to see a lot of companies with ambitions to serve that market.

Services for small businesses, and tapping into the opportunity to provide more e-commerce tools at a time when more business and sales are being conducted online, is similarly crowded but also massive.

Indeed, Paysend points out that there is still a lot of growing and evolution left to do. Citing McKinsey research, it notes that some 70% of international payments are currently still cash-to-cash, with fees averaging up to 5.2% per transaction, and timing taking up to an hour each for sender and recipient to complete transfers. (Paysend claims it can cut fees by up to 60%.)

This brings us to the second point about Paysend: How it’s built its services. The fintech world today leans heavily on APIs: Companies that are knitting together a lot of complexity and packaging it into APIs that are used by others who bypass needing to build those tools themselves, instead integrating them and adding better user experience and responsive personalization around them. Paysend is a little different from these, with a vertically integrated approach, having itself built everything that it uses from the ground up.

Millar — a Scottish repeat entrepreneur (his previous company Paywizard, which has rebranded to Singula, is a specialist in pay-TV subscriber management) — notes that Paysend has built both its processing and acquiring facilities. “Because we have built everything in-house it lets us see what the consumer needs and uses, and to deliver that at a lower cost basis,” he said. “It’s much more cost-efficient and we pass that savings on to the consumer. We designed our technology to be in complete control of it. It’s the most profitable approach, too, from a business point of view.”

That being said, he confirmed that Paysend itself is not yet profitable, but investors believe it’s making the right moves to get there. To be clear, Paysend actually does partner with other companies, including those providing APIs, to improve its services. In April, Plaid and Paysend announced they were working together to power open banking transfers, reducing the time to initiate and receive money.

“We are excited by Paysend’s enormous growth potential in a massive market, benefiting from a rapid acceleration in the adoption of digital payments,” said Humbert de Liedekerke, managing partner at One Peak Partners, in a statement. “In particular, we are seeing strong opportunities as Paysend moves beyond consumers to serve business customers and expands its international footprint to address a growing need for fast, easy and low-cost cross-border digital payments. Paysend has built an exceptional payment platform by maintaining an unwavering focus on its customers and constantly innovating. We are excited to back the entire Paysend team in their next phase of explosive growth.”

Salt Security lands $70M for tech to protect APIs from malicious abuse

APIs make the world go round in tech, but that also makes them a very key target for bad actors: As doorways into huge data troves and services, malicious hackers spent a lot of time looking for ways to pick their locks or just force them open when they’re closed, in order to access that information. And a lot of recent security breaches stemming from API vulnerabilities (see here, here and here for just a few) show just how real and current the problem is.

Today, a company that’s building a network of services to help those using and producing APIs to identify and eradicate those risks is announcing a round of funding to meet a growing demand for its services. Salt Security, which provides AI-based technology to identify issues and stop attacks across the whole of your API library, has closed $70 million in funding, money that it will be using both to meet current demand but also continue building out its technology for a wider set of services and use cases for API management.

The funding is being led by Advent International, by way of Advent Tech, with Alkeon Capital, DFJ Growth and previous backers Sequoia Capital, Tenaya Capital, S Capital VC and Y Combinator all also participating.

Salt, founded in Israel and now active globally, is not disclosing valuation, but I understand from a reliable source that it is in the region of $600-700 million.

As with many of the funding rounds that seem to be getting announced these days, this one is coming on the heels of both another recent round, as well as strong growth. Salt has raised $131 million since 2016, but nearly all of that — $120 million, to be exact — has been raised in the last year.

Part of the reason for that is Salt’s performance: In the last 12 months, it’s seen revenue grow 400% (with customers including a range of Fortune 500 and other large businesses in the financial services, retail and SaaS sectors like Equinix, Finastra, TripActions, Armis and DeinDeal); headcount grow 160%; and, perhaps most importantly, API traffic on its network grow 380%.

That growth in API traffic underscores the issue that Salt is tackling. Companies these days use a variety of APIs — some private, some public — in their tech stack as a way to interface with other businesses and run their services. APIs are a huge part of how the internet and digital services operate, with Akamai estimating that as much as 83% of all IP traffic is API traffic.

The problem, Roey Eliyahu, CEO and co-founder of Salt Security, told me, is that this usage has outpaced how well many manage those APIs.

“How APIs have evolved is very different to how developers used APIs years ago,” he said. “Before, there were very few, and you could say they were more manageable, and they contained less-sensitive data, and there were very few changes and updates made to them,” he said. “Today with the pace of development, not only are they always getting updated, but you have thousands of them now touching crown jewels of the company.”

This has made them a prime target for malicious hackers. Eliyahu notes Gartner stats that predict that by 2022, APIs will make up the largest attack vector in cybercrime.

Salt’s approach starts with taking stock of a whole network and doing a kind of spring clean to find all the APIs that might be used or abused.

“Companies don’t know how many APIs they even have,” Eliyahu said, noting that some 40%-80% of the APIs in existence for a typical company’s data are not even in active operation, lying there as “shadow APIs” for someone to pick up and misuse.

It then looks at what vulnerabilities might inadvertently be contained in this mix and makes suggestions for how to alter them to fix that. After this, it also monitors how they are used in order to stop attacks as they happen. The third of these also involves remediation “insights”, but carrying out the remediation is done by third parties at the moment, Eliyahu said. All of this is done through Salt’s automated, AI-based, flagship Salt Security API Protection Platform.

There are a number of competitors in the same space as Salt, including Ping, and newer players like Imvision and 42Crunch (which raised funding earlier this month), and the list is likely to grow as not just other API management companies get deeper into this huge space, but cybersecurity companies do, too.

“The rapid proliferation of APIs has dramatically altered the attack surface of applications, creating a major challenge for large enterprises since existing security mechanisms cannot protect against this new threat,” said Bryan Taylor, managing partner and head of Advent’s technology team, in a statement. “We continue to see API security incidents make the news headlines and cause significant reputational risk for companies. As we investigated the API security market, Salt stood out for its multi-year technical lead, significant customer traction and references, and talented team. We look forward to drawing on our deep experience in this sector to partner with Salt in this exciting new chapter.”

Uptycs secures $50M Series C as security platform continues to expand

Uptycs, a Boston-area startup that uses data to help understand and prevent security attacks, announced a $50 million Series C today, 11 months after announcing a $30 million Series B. Norwest Venture Partners led the round with participation from Sapphire Ventures and ServiceNow Ventures.

Company co-founder and CEO Ganesh Pai says that he was still well capitalized from last year’s investment, and wasn’t actually looking to raise funds, but the investors came looking for him and he saw a way to speed up some aspects of the company’s roadmap.

“It was one of those things where the round came in primarily as a function of execution and success to date, and we decided to capitalize on that because we know the partners and raised the capital so that we could use it meaningfully for a couple of different things, primarily sales and marketing acceleration,” Pai said.

He said that part of the reason for the company’s success over the last year was that the pandemic generated more customer interest as people moved to work from home, the SolarWinds hack happened and companies were moving to the cloud faster. “We provided a solution which was telemetric powered and very insightful when it came to solving their security problems and that’s what led to triple digit growth over the last year,” he said.

But Pai says that the company has not been sitting still in terms of the platform. While last year, he described it primarily as a forensic security data solution, helping customers figure out what happened after a security issue has happened, he says that the company has begun expanding on that vision to include all four main areas of security, including being proactive, reactive, predictive and protective.

The company started primarily in being reactive by figuring what happened in the past, but has begun to expand into these other areas over the last year, and the plan is to continue to build out that functionality.

“In the context of SolarWinds, what everyone is trying to figure out is how soon into the supply chain can you figure out what could be potentially wrong by looking at indications of behavior or indications of compromise, and our ability to ingest telemetry from a diverse set of sources, not as a bolt-on solution, but something which is built from the ground up, resonated really well,” Pai explained.

The company had 65 employees when we spoke last year for the Series B. Today, Pai says that number is approaching 140 and he is adding new people every week, with a goal to get to around 200 people by the end of the year. He says as the company grows, he keeps diversity top of mind.

“As we grow and as we raise capital diversity has been something which has been a high priority and very critical for us,” he said. In fact, he reports that more than 50% of his employees come from under-represented groups whether it’s Latinx, Black or Asian heritage.

Pai says that one of the reasons he has been able to build a diverse workforce is his commitment to a remote workplace, which means he can hire from anywhere, something he will continue to do even after the pandemic ends.

 

Zoom fatigue no more: Rewatch raises $20M to index, transcribe and store enterprise video content

We don’t hear as much these days about “Zoom fatigue” as we did in the first months after the COVID-19 pandemic kicked off last year, but what’s less clear is whether people became more tolerant of the medium, or if they found ways of coping with it better, or if they were hopeful that tools for coping would soon be around the corner.

Today, a startup that has come up with a solution to handling all that video is announcing some funding to grow, on the understanding that whatever people are doing with video today, there will be a lot more video to handle in the future, and they will need more than just a good internet connection, microphone and video camera to deal with it.

Rewatch, which has built a set of tools for organizations to create a “system of record” for their internal video archives — not just a place to “rewatch” all of their older live video calls, but to search and organise information arising from those calls — has closed a $20 million round of funding.

Along with this, Rewatch from today is opening up its platform from invite-only to general availability.

This latest round is a Series A and is being led by Andreessen Horowitz, with Semil Shah at Haystack and Kent Goldman at Upside Partners, as well as a number of individuals, also participating.

It comes on the heels of Rewatch announcing a $2 million seed round only in January of this year. But it’s had some buzz in the intervening months: Customers that have started using Rewatch include GitHub (where co-founders Connor Sears and Scott Goldman previously worked together), Brex, Envoy and The Athletic.

The issue that Rewatch is tackling is the fact that a lot more of our work communications are happening over video. But while video calling has been hailed as a great boost to productivity — you can work wherever you are now, as long as you have a video connection — in fact, it’s not.

Yes, we are talking to each other a lot, but we are also losing information from those calls because they’re not being tracked as well as they could be. And, by spending all of our time talking, many of us are working on other things less, or are confined into more rigid times when we can.

Rewatch has built a system that plugs into Zoom and Google Meet, two of the most-used video tools in the workplace, and automatically imports all of your office’s or team’s video chats into a system. This lets you browse libraries of video-based conversations or meetings to watch them on-demand, on your time. It also provides transcripts and search tools for finding information in those calls.

You can turn off the automatic imports, or further customize how meetings are filed or accessibility. Sears said that Rewatch can be used for any video created on any platform; for now those require manually importing the videos into the Rewatch system.

Sears also said that over time it will also be adding ways to automatically turn items from meetings into, say, work tickets to follow them up.

While there are a number of transcription services available on tap these days, as well as any number of cloud-based storage providers where you can keep video archives, what is notable about Rewatch is that it has identified the pain point of managing and indexing those archives and keeping them in a single place for many to use.

In this way, Rewatch is highlighting and addressing what I think of as the crux of the productivity paradox.

Essentially, it is this: The tech industry has given us a lot of tools to help us work better, but actually, the work required to use those tools can outweigh the utility of the tools themselves.

(And I have to admit, this is one of the reasons I’ve grown to dislike Slack. Yes, we all get to communicate on it, and it’s great to have something to connect all of us, but it just takes up so much damn time to read through everything and figure out what’s useful and what is just watercooler chat.)

“We go to where companies already are, and we automate, pull in video so that you don’t have to think about it,” Sears said. “The effort around a lot of this takes a lot of diligence to make sure people are recording and transcribing and distributing and removing. We are making this seamless and effortless.”

It sometimes feels like we are on the cusp, technologically, of leaning on tools by way of AI and other innovations that might finally cross that chasm and give us actual productivity out of our productivity apps.

In another example of how this is playing out, Dooly, which raised funding last week, is looking to do the same in the world of sales software (automatically populating various sales software with data from your phone, video and text chats, and other sources).

Similarly, we’re starting to see an interesting wave of companies emerge that are looking for better ways to manage and tap into all that video content that we now have swimming around us.

AnyClip, which announced funding yesterday, is also applying better analytics and search to internal company video libraries, but also has its sights on a wider opportunity: organizing any video trove. That points, too, to the bigger opportunity for Rewatch.

For now, though, enterprises and businesses are an opportunity enough.

“As investors we get excited about founders first and foremost, and Connor and Scott immediately impressed us with their experience, clear articulation of the problem, and their vision for how Rewatch could be the end-all solution for video and knowledge management in an organization,” noted David Ulevitch, a general partner at Andreessen Horowitz, in a blog post. “They both worked at GitHub in senior roles from the early days, as a Senior Director of Product Design and a Principal Engineer, respectively, and have first-hand experience scaling a product. Since founding Rewatch in early 2020, they have very quickly built a great product, sold it to large-scale customers, and hired top-tier talent, demonstrating rapid founder and company velocity that is key to building an enduring company.”

Databricks introduces Delta Sharing, an open-source tool for sharing data

Databricks launched its fifth open-source project today, a new tool called Delta Sharing designed to be a vendor-neutral way to share data with any cloud infrastructure or SaaS product, so long as you have the appropriate connector. It’s part of the broader Databricks open-source Delta Lake project.

As CEO Ali Ghodsi points out, data is exploding, and moving data from Point A to Point B is an increasingly difficult problem to solve with proprietary tooling. “The number one barrier for organizations to succeed with data is sharing data, sharing it between different views, sharing it across organizations — that’s the number one issue we’ve seen in organizations,” Ghodsi explained.

Delta Sharing is an open-source protocol designed to solve that problem. “This is the industry’s first-ever open protocol, an open standard for sharing a data set securely. […] They can standardize on Databricks or something else. For instance, they might have standardized on using AWS Data Exchange, Power BI or Tableau — and they can then access that data securely.”

The tool is designed to work with multiple cloud infrastructure and SaaS services and out of the gate there are multiple partners involved, including the Big Three cloud infrastructure vendors Amazon, Microsoft and Google, as well as data visualization and management vendors like Qlik, Starburst, Collibra and Alation and data providers like Nasdaq, S&P and Foursquare

Ghodsi said the key to making this work is the open nature of the project. By doing that and donating it to The Linux Foundation, he is trying to ensure that it can work across different environments. Another big aspect of this is the partnerships and the companies involved. When you can get big-name companies involved in a project like this, it’s more likely to succeed because it works across this broad set of popular services. In fact, there are a number of connectors available today, but Databricks expects that number to increase over time as contributors build more connectors to other services.

Databricks operates on a consumption pricing model much like Snowflake, meaning the more data you move through its software, the more money it’s going to make, but the Delta Sharing tool means you can share with anyone, not just another Databricks customer. Ghodsi says that the open-source nature of Delta Sharing means his company can still win, while giving customers more flexibility to move data between services.

The infrastructure vendors also love this model because the cloud data lake tools move massive amounts of data through their services and they make money too, which probably explains why they are all on board with this.

One of the big fears of modern cloud customers is being tied to a single vendor as they often were in the 1990s and early 2000s when most companies bought a stack of services from a single vendor like Microsoft, IBM or Oracle. On one hand, you had the veritable single throat to choke, but you were beholden to the vendor because the cost of moving to another one was prohibitively high. Companies don’t want to be locked in like that again and open source tooling is one way to prevent that.

Databricks was founded in 2013 and has raised almost $2 billion. The latest round was in February for $1 billion at a $28 billion valuation, an astonishing number for a private company. Snowflake, a primary competitor, went public last September. As of today, it has a market cap of over $66 billion.

Microsoft launches new tools for Teams developers

At its (virtual) Build conference today, Microsoft launched a number of new features, tools and services for developers who want to integrate their services with Teams, the company’s Slack competitor. It’s no secret that Microsoft basically looks at Teams, which now has about 145 million daily active users, as the new hub for employees to get work done, so it’s no surprise that it wants third-party developers to bring their services right to Teams as well. And to do so, it’s now offering a set of new tools that will make this easier and enable developers to build new user experiences in Teams.

There’s a lot going on here, but maybe the most important news is the launch of the enhanced Microsoft Teams Toolkit for Visual Studio and Visual Studio Code.

“This essentially enables developers to build apps easier and faster — and to build very powerful apps tapping into the rich Microsoft stack,” Microsoft group program manager Archana Saseetharan explained. “With the updated toolkit […], we enable flexibility for developers. We want to meet developers where they are.”

Image Credits: Microsoft

The toolkit offers support for tools and frameworks like React, SharePoint and .NET. Some of the updates the team enabled with this release are integration with Aure Functions, the SharePoint Framework integration and a single-line integration with the Microsoft Graph. Microsoft is also making it easier for developers to integrate an authorization workflow into their Teams apps. “Login is the first kind of experience of any user with an app — and most of the drop-offs happen there,” Saseetharan said. “So [single-sign on] is something we completely are pushing hard on.”

The team also launched a new Developer Portal for Microsoft Teams that makes it easier for developers to register and configure their apps from a single tool. ISVs will also be able to use the new portal to offer their apps for in-Teams purchases.

Other new Teams features for developers include ways for developers to build real-time multi-user experiences like whiteboards and project boards, for example, as well as a new meeting event API to build meeting-related workflows for when a meeting starts and ends, for example, as well as new features for the Teams Together mode that will let developers design their own Together experiences.

There are a few other new features here as well, but what it all comes down to is that Microsoft wants developers to consider Teams as a viable platform for their services — and with 145 million daily active users, that’s potentially a lucrative way for software firms to get their services in front of a new audience.

“Teams is enabling a new class of apps called collaborative apps,” said Karan Nigam, Microsoft’s director of product marketing for Teams. “We are uniquely positioned to bring the richness to the collaboration space — a ton of innovation to the extensibility side to make apps richer, making it easier with the toolkit update, and then have a single-stop shop with the developer portal where the entire lifecycle can be managed. Ultimately, for a developer, they don’t have to go to multiple places, it’s one single flow from the business perspective for them as well.”

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How Expensify shed Silicon Valley arrogance to realize its global ambitions

Expensify may be the most ambitious software company ever to mostly abandon the Bay Area as the center of its operations.

Expensify may be the most ambitious software company ever to mostly abandon the Bay Area as the center of its operations.

The startup’s history is tied to places representative of San Francisco: The founding team worked out of Peet’s Coffee on Mission Street for a few months, then crashed at a penthouse lounge near the 4th and King Caltrain station, followed by a tiny office and then a slightly bigger one in the Flatiron building near Market Street.

Thirteen years later, Expensify still has an office a few blocks away on Kearny Street, but it’s no longer a San Francisco company or even a Silicon Valley firm. The company is truly global with employees across the world — and it did that before COVID-19 made remote working cool.

“Things got so much better when we stopped viewing ourselves as a Silicon Valley company. We basically said, no, we’re just a global company,” CEO David Barrett told TechCrunch. That globalism led to it opening a major office in — of all places —a small town in rural Michigan. That Ironwood expansion would eventually lead to a cultural makeover that would see the company broadly abandon its focus on the Bay Area, expanding from a headquarters in Portland to offices around the globe.

It makes sense that a company founded by internet pirates would let its workforce live anywhere they please and however they want to. Yet, how does it manage to make it all work well enough to reach $100 million in annual revenue with just a tad more than 100 employees?

As I described in Part 2 of this EC-1, that staffing efficiency is partly due to its culture and who it hires. It’s also because it has attracted top talent from across the world by giving them benefits like the option to work remotely all year as well as paying SF-level salaries even to those not based in the tech hub. It’s also got annual fully paid month-long “workcations” for every employee, their partner and kids.

Yet the real story is how a company can become untethered from its original geography, willing to adapt to new places and new cultures, and ultimately, give up the past while building the future.

Qualified raises $51M to help Salesforce users improve their sales and marketing conversations

Salesforce dominates the world of CRM today, but while it’s a popular and well-used tool for organizing contacts and information, it doesn’t have all the answers when it comes to helping salespeople and marketers sell better, especially when meetings are not in person. Today, one of the startups that has emerged to help fill the gap is announcing a round of growth funding on the back of a huge year for its business.

Qualified — which builds better interactions for B2B sales and marketing teams that already use Salesforce by tapping into extra data sources to develop a better profile of those visiting your website, in aid of improving and personalizing the outreach (hence the name: you’re building “qualified” leads) — has picked up $51 million in funding. The startup will be using the Series B to continue building out its business with more functionality in the platform, and hiring across the board to expand business development and more.

Led by Salesforce Ventures, the funding round also included Norwest Venture Partners and Redpoint Ventures, both previous backers, among others. As with so many rounds at the moment — the venture world is flush with funding at the moment — this one is coming less than a year after Qualified’s last raise. It closed a $12 million Series A in August of last year.

Qualified was co-founded by two Salesforce veterans — ex-Salesforce CMO Kraig Swensrud and ex-SVP of Salesforce.com Sean Whiteley — serial entrepreneurs who you could say have long been hammering away at the challenges of building digital tools for sales and marketing people to do their jobs better online. The pair have founded and sold two other startups filling holes to that end: GetFeedback, acquired by SurveyMonkey, and Kieden, acquired by Salesforce.

The gap that they’re aiming to fill with this latest venture is the fact that when sales and marketing teams want to connect with prospects directly through, say, a phone call, they might have all of that contact’s information at their disposal. But if those teams want to make a more engaged contact when someone is visiting their site — a sign that a person is actually interested and thinking already about engaging with a company — usually the sales and marketing teams are in the dark about who those visitors are.

“We founded Qualified on the premise that a website should be more than a marketing brochure, but not just a sales site,” Swensrud, who is the CEO, said in an interview.

Qualified has built a tool that essentially takes several signals from Salesforce as well as other places to build up some information about the site visitor. It then uses it to give the sales and marketing teams more of a steer so that when they reach out via a screen chat to say “how can I help?” they actually have more information and can target their questions in a better way. A sales or marketing rep might know which pages a person is also visiting, and can then use the conversation that starts with an online chat to progress to a voice or video call, or a meeting.

If a person is already in your Salesforce Rolodex, you get more information; but even without that there is some detail provided to be slightly less impersonal. (Example: When I logged into Qualified to look around the site, a chat popped up with a person greeting me “across the pond”… I’m in London.)

Qualified also integrates with a number of other tools that are used to help source data and build its customer profiles, including Slack, Microsoft Teams, 6sense, Demandbase, Marketo, HubSpot, Oracle Eloqua, Clearbit, ZoomInfo and Outreach.

Additional data is part and parcel of the kinds of information that sales and marketing people always need when reaching out to prospective customers, whether it’s via a “virtual” digital channel or in person. However, in the last year — where in-person meetings, team meetings and working side-by-side with those who can give advice have all disappeared — having extra tools like these arguably have proven indispensable.

“Sales reps would heavily rely on their ‘road warrior’ image,” Swensrud said. “But all that stuff is gone, so as a result every seller is sitting at an office, at home, expecting digital interactions to happen that never existed before.”

And it seems some believe that even outside of COVID-19 enforcing a different way of doing things, the trend for “virtual selling”, as it’s often called, is here to stay: Gartner forecasts that by 2025, some 80% of B2B sales interactions will take place in digital channels. (So long to the expense account lunch, I guess.)

It’s because of the events of 2020, plus those bigger trends, that Qualified has seen revenues in the last year grow some 800% and its net customer revenue retention rate hover at 175%, with funding rounds come in relatively close succession in the wake of that.

There is something interesting to Qualified that reminds me a bit of more targeted ad retargeting, as it were, and in that, you can imagine a lot of other opportunities for how Qualified might expand in scenarios where it would be more useful to know why someone is visiting your site, without outright asking them and bothering them with the question. That could include customer service, or even a version that might sell better to consumers coming to, say, a clothes site after reading something about orange being the new black.

For now, though, it’s focused on the B2B opportunity.

There are a number of tools on the market that are competing with Salesforce as the go-to platform for people to organise and run CRM operations, but Swensrud is bullish for now on the idea of building specifically for the Salesforce ecosystem.

“Our product is being driven by and runs on Salesforce,” he noted, pointing out that it’s through Salesforce that you’re able to go from chatting to a phone call by routing the information to the data you have on file there. “Our roots go very deep.”

The funding round today is a sign that Salesforce is also happy with that close arrangement, which gives it a customization that its competitors lack.

“Qualified represents an entirely new way for B2B companies to engage buyers,” said Bill Patterson, EVP of CRM Applications at Salesforce, in a statement. “When marketing and inbound sales teams use this solution with Sales Cloud… they see a notable impact on pipeline. We are thrilled about our growing partnership with Qualified and their success within the Salesforce ecosystem.”