Extra Crunch roundup: Toast and Freshbook S-1s, pre-pitch tips, flexible funding lessons

The digital transformation currently sweeping society has likely reached your favorite local restaurant.

Since 2013, Boston-based Toast has offered bars and eateries a software platform that lets them manage orders, payments and deliveries.

Over the last year, its customers have processed more than $38 billion in gross payment volume, so Alex Wilhelm analyzed the company’s S-1 for The Exchange with great interest.

“Toast was last valued at just under $5 billion when it last raised, per Crunchbase data,” he writes. “And folks are saying that it could be worth $20 billion in its debut. Does that square with the numbers?”


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Airbnb, DoorDash and Coinbase each debuted at past Y Combinator Demo Days; as of this writing, they employ a combined 10,000 people.

Today and tomorrow, TechCrunch reporters will cover the proceedings at YC’s Summer 20201 Demo Day. In addition to writing up founder pitches, they’ll also rank their favorites.

Even remotely, I can feel a palpable sense of excitement radiating from our team — anything can happen at YC Demo Day, so sign up for Extra Crunch to follow the action.

Thanks very much for reading; I hope you have an excellent week.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

How Amazon EC2 grew from a notion into a foundational element of cloud computing

Image Credits: Ron Miller/TechCrunch

In August 2006, AWS activated its EC2 cloud-based virtual computer, a milestone in the cloud infrastructure giant’s development.

“You really can’t overstate what Amazon was able to accomplish,” writes enterprise reporter Ron Miller.

In the 15 years since, EC2 has enabled clients of any size to test and run their own applications on AWS’ virtual machines.

To learn more about a fundamental technological shift that “would help fuel a whole generation of startups,” Ron interviewed EC2 VP Dave Brown, who built and led the Amazon EC2 Frontend team.

3 ways to become a better manager in the work-from-home era

Image of a manager talking to his team via a video conference.

Image Credits: Jasmin Merdan (opens in a new window)/ Getty Images

Most managers agree that OKRs foster transparency and accountability, but running a team effectively has different challenges when workers are attending all-hands meetings from their kitchen tables.

Instead of just discussing key metrics before board meetings or performance reviews, make them part of the day-to-day culture, recommends Jeremy Epstein, Gtmhub’s CMO.

“Strengthen your team by creating authentic workplace transparency using numbers as a universal language and providing meaning behind your team’s work.”

The pre-pitch: 7 ways to build relationships with VCs

A person attracts people to his side with a magnet.

Image Credits: Getty Images under an Andrii Yalanskyi (opens in a new window) license

Many founders must overcome a few emotional hurdles before they’re comfortable pitching a potential investor face-to-face.

To alleviate that pressure, Unicorn Capital founder Evan Fisher recommends that entrepreneurs use pre-pitch meetings to build and strengthen relationships before asking for a check:

“This is the ‘we actually aren’t looking for money; we just want to be friends for now’ pitch that gets you on an investor’s radar so that when it’s time to raise your next round, they’ll be far more likely to answer the phone because they actually know who you are.”

Pre-pitches are good for more than curing the jitters: These conversations help founders get a better sense of how VCs think and sometimes lead to serendipitous outcomes.

“Investors are opportunists by necessity,” says Fisher, “so if they like the cut of your business’s jib, you never know — the FOMO might start kicking hard.”

Lessons from COVID: Flexible funding is a must for alternative lenders

Flexible Multi Colored Coil Crossing Hexagon Frame on White Background.

Image Credits: MirageC (opens in a new window) / Getty Images

FischerJordan’s Deeba Goyal and Archita Bhandari break down the pandemic’s impact on alternative lenders, specifically what they had to do to survive the crisis, taking a look at smaller lenders including Credibly, Kabbage, Kapitus and BlueVine.

“Only those who were able to find a way through the complexities of their existing capital sources were able to maintain their performance, and the rest were left to perish or find new funding avenues,” they write.

Inside Freshworks’ IPO filing

Customer engagement software company Freshworks’ S-1 filing depicts a company that’s experiencing accelerating revenue growth, “a great sign for the health of its business,” reports Alex Wilhelm in this morning’s The Exchange.

“Most companies see their growth rates decline as they scale, as larger denominators make growth in percentage terms more difficult.”

Studying the company’s SEC filing, he found that “Freshworks isn’t a company where we need to cut it lots of slack, as we might with an adjusted EBITDA number. It is going public ready for Big Kid metrics.”

Everything enterprise software and SaaS at TechCrunch Disrupt 2021

When you hear the word, “enterprise” and you immediately think software instead of Star Trek, you’re going to love this post — and the SaaS and Enterprise-focused knowledge waiting for you at TechCrunch Disrupt 2021 on September 21-23.

We’ve packed a veritable boatload of Grade A prime programming into three full days of Disrupt. Prepare to hear and learn from an endless parade of tech icons, visionaries, movers, shakers and unicorn makers. We’re talking more than 80 scheduled offerings, folks.

Join your people: Buy your pass today and get ready to hear from the leading voices across the startup spectrum.

Where were we? Ah, yes — we’re here to help save you a bit of time by spotlighting just some of the sessions focused on enterprise software and SaaS. Plus, we’ll have a dedicated Disrupt Desk session where industry experts, like Emergence Capital’s Carlotta (Lotti) Siniscalco, and TechCrunch editors, will break it down with deep-analysis, insight and likely a laugh or two.

Check out the Disrupt agenda for exact days and times, and then plan your daily schedule in advance.

From Bootstrapped to Billions

Dozens have tried to reinvent the calendar, and dozens have failed. Tope Awotona built Calendly not as a way to reinvent the wheel, but to add a layer of simplicity to the chaos of human communication and time management. And boy did it work! The once-bootstrapped company is now worth more than $3 billion, serving individuals and enterprises alike. Hear from the founder and CEO on how he got Calendly off the ground, why he decided to finally take institutional investment and how the company has changed as it grows.

An Unstoppable Force and an Immovable Object

Slack and Salesforce are two of the biggest names in tech. The communication tool (born from one of the odder pivots in tech history) is commonplace across organizations from almost every industry. It’s an unstoppable force. The sales CRM behemoth is used all over the world by sales teams small and large. An immovable object. In December of 2020, the pair announced a $27.7 billion merger. Hear from Slack co-founder and CEO Stewart Butterfield and Salesforce President and COO Bret Taylor about the future of the combined entity, why the deal made sense and what it’s like to write down that many 0’s.

Powering the Small Business Economy with Cloud Technology

Small business is a critical engine of job creation, economic growth and innovation, and a driver in our efforts to recover from a global pandemic. Fifteen years ago, a New Zealand start-up called Xero was founded with the purpose of making life better for small businesses and their advisors. Xero achieved this by shifting accounting practices to the cloud and providing an open set of APIs, which has enabled more than 1,000 application partners to build affordable tech solutions connected to the Xero platform. Xero CEO Steve Vamos will discuss how Xero is revolutionizing the way small businesses do business by using the cloud and its platform to connect real-time data with bespoke business solutions that help small business owners be more successful. Steve will speak to a number of key initiatives that will change the game for startups and entrepreneurs who want to innovate and collaborate on the Xero platform, and he will explain how Xero’s vision extends beyond just technology to galvanizing a global community of support and purpose to help small businesses everywhere. Presented by Xero.

Powering What’s Next: Insights from the Enterprise Software Market

Spurred by digital transformation and the recent shift to remote work, the enterprise software industry has gone from strength-to-strength, and competition for deals and valuations are at all-time highs. While investor appetite for enterprise software may be strong, it doesn’t mean that all tech businesses make worthy investments. In this panel, hear from Michael Fosnaugh and Monti Saroya, co-heads of Vista’s flagship investment strategy, and a selection of Vista CEOs on the hallmarks of best-in-class software companies and trends driving the industry. Presented by Vista Equity Partners.

Achieve Sustainable IT with Prometheus, Grafana and Hardware Sentry

Implementing sustainability initiatives to achieve net-zero carbon emissions in the data center is a vital challenge. Join Bertrand Martin, Sentry Software’s co-founder and CEO, as he presents Hardware Sentry Exporter for Prometheus. Measure the power consumption and temperature of more than 250 platforms with this unique pure-software solution. Report CO₂ emissions, electricity usage and costs of applications and services in Grafana. Reduce the carbon footprint of your data center with intelligent optimization of ambient temperature. Presented by Sentry Software.

TechCrunch Disrupt 2021 takes place on September 21-23. Buy your pass today and learn about the latest trends and developments in SaaS and enterprise software — and so much more.

Is your company interested in sponsoring or exhibiting at Disrupt 2021? We have just a few spots left — so contact our sponsorship sales team asap by filling out this form.

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How Amazon EC2 grew from a notion into a foundational element of cloud computing

Fifteen years ago this week on August 25, 2006, AWS turned on the very first beta instance of EC2, its cloud-based virtual computers. Today cloud computing, and more specifically infrastructure as a service, is a staple of how businesses use computing, but at that moment it wasn’t a well known or widely understood concept.

The EC in EC2 stands for Elastic Compute, and that name was chosen deliberately. The idea was to provide as much compute power as you needed to do a job, then shut it down when you no longer needed it — making it flexible like an elastic band. The launch of EC2 in beta was preceded by the beta release of S3 storage six months earlier, and both services marked the starting point in AWS’ cloud infrastructure journey.

You really can’t overstate what Amazon was able to accomplish with these moves. It was able to anticipate an entirely different way of computing and create a market and a substantial side business in the process. It took vision to recognize what was coming and the courage to forge ahead and invest the resources necessary to make it happen, something that every business could learn from.

The AWS origin story is complex, but it was about bringing the IT power of the Amazon business to others. Amazon at the time was not the business it is today, but it was still rather substantial and still had to deal with massive fluctuations in traffic such as Black Friday when its website would be flooded with traffic for a short but sustained period of time. While the goal of an e-commerce site, and indeed every business, is attracting as many customers as possible, keeping the site up under such stress takes some doing and Amazon was learning how to do that well.

Those lessons and a desire to bring the company’s internal development processes under control would eventually lead to what we know today as Amazon Web Services, and that side business would help fuel a whole generation of startups. We spoke to Dave Brown, who is VP of EC2 today, and who helped build the first versions of the tech, to find out how this technological shift went down.

Sometimes you get a great notion

The genesis of the idea behind AWS started in the 2000 timeframe when the company began looking at creating a set of services to simplify how they produced software internally. Eventually, they developed a set of foundational services — compute, storage and database — that every developer could tap into.

But the idea of selling that set of services really began to take shape at an executive offsite at Jeff Bezos’ house in 2003. A 2016 TechCrunch article on the origins AWS described how that started to come together:

As the team worked, Jassy recalled, they realized they had also become quite good at running infrastructure services like compute, storage and database (due to those previously articulated internal requirements). What’s more, they had become highly skilled at running reliable, scalable, cost-effective data centers out of need. As a low-margin business like Amazon, they had to be as lean and efficient as possible.

They realized that those skills and abilities could translate into a side business that would eventually become AWS. It would take a while to put these initial ideas into action, but by December 2004, they had opened an engineering office in South Africa to begin building what would become EC2. As Brown explains it, the company was looking to expand outside of Seattle at the time, and Chris Pinkham, who was director in those days, hailed from South Africa and wanted to return home.

Microsoft is discontinuing its Office apps for Chromebook users in favor of web versions 

Since 2017, Microsoft has offered its Office suite to Chromebook users via the Google Play store, but that is set to come to an end in a few short weeks.

As of September 18, Microsoft is discontinuing support for Office (which includes Word, Excel, PowerPoint, OneNote and Outlook) on Chromebook. Microsoft is not, however, abandoning the popular mobile device altogether. Instead of an app that is downloaded, Microsoft is encouraging users to go to the web instead.

“In an effort to provide the most optimized experience for Chromebook customers, Microsoft apps (Office and Outlook) will be transitioned to web experiences (Office.com and Outlook.com) on September 18, 2021,” Microsoft wrote in a statement emailed to TechCrunch. 

Microsoft’s statement also noted that “this transition brings Chromebook customers access to additional and premium features.” 

The Microsoft web experience will serve to transition its base of Chromebook users to the Microsoft 365 service, which provides more Office templates and generally more functionality than what the app-based approach provides. The web approach is also more optimized for larger screens than the app.

In terms of how Microsoft wants Chromebook users to get access to Office and Outlook, the plan is for customers to, “…sign in with their personal Microsoft Account or account associated with their Microsoft 365 subscription,” according to the statement. Microsoft has also provided online documentation to show users how to run Office on a Chromebook.

Chromebooks run on Google’s Chrome OS, which is a Linux-based operating system. Chromebooks also enable Android apps to run, as Android is also Linux based, with apps downloaded from Google Play. It’s important to note that while support for Chromebooks is going away, Microsoft is not abandoning other Android-based mobile devices, such as tablets and smartphones.

For those Chromebook users that have already downloaded the Microsoft Office apps, the apps will continue to function after September 18, though they will not receive any support or future updates.

Linux 5.14 set to boost future enterprise application security

Linux is set for a big release this Sunday August 29, setting the stage for enterprise and cloud applications for months to come. The 5.14 kernel update will include security and performance improvements.

A particular area of interest for both enterprise and cloud users is always security and to that end, Linux 5.14 will help with several new capabilities. Mike McGrath, vice president, Linux Engineering at Red Hat told TechCrunch that the kernel update includes a feature known as core scheduling, which is intended to help mitigate processor-level vulnerabilities like Spectre and Meltdown, which first surfaced in 2018. One of the ways that Linux users have had to mitigate those vulnerabilities is by disabling hyper-threading on CPUs and therefore taking a performance hit.

“More specifically, the feature helps to split trusted and untrusted tasks so that they don’t share a core, limiting the overall threat surface while keeping cloud-scale performance relatively unchanged,” McGrath explained.

Another area of security innovation in Linux 5.14 is a feature that has been in development for over a year and a half that will help to protect system memory in a better way than before. Attacks against Linux and other operating systems often target memory as a primary attack surface to exploit. With the new kernel, there is a capability known as memfd_secret () that will enable an application running on a Linux system to create a memory range that is inaccessible to anyone else, including the kernel.

“This means cryptographic keys, sensitive data and other secrets can be stored there to limit exposure to other users or system activities,” McGrath said.

At the heart of the open source Linux operating system that powers much of the cloud and enterprise application delivery is what is known as the Linux kernel. The kernel is the component that provides the core functionality for system operations.

The Linux 5.14 kernel release has gone through seven release candidates over the last two months and benefits from the contributions of 1,650 different developers. Those that contribute to Linux kernel development include individual contributors, as well as large vendors like Intel, AMD, IBM, Oracle and Samsung. One of the largest contributors to any given Linux kernel release is IBM’s Red Hat business unit. IBM acquired Red Hat for $34 billion in a deal that closed in 2019.

“As with pretty much every kernel release, we see some very innovative capabilities in 5.14,” McGrath said.

While Linux 5.14 will be out soon, it often takes time until it is adopted inside of enterprise releases. McGrath said that Linux 5.14 will first appear in Red Hat’s Fedora community Linux distribution and will be a part of the future Red Hat Enterprise Linux 9 release. Gerald Pfeifer, CTO for enterprise Linux vendor SUSE, told TechCrunch that his company’s openSUSE Tumbleweed community release will likely include the Linux 5.14 kernel within “days” of the official release. On the enterprise side, he noted that SUSE Linux Enterprise 15 SP4, due next spring, is scheduled to come with the 5.14 kernel.

The new Linux update follows a major milestone for the open source operating system, as it was 30 years ago this past Wednesday that creator Linus Torvalds (pictured above) first publicly announced the effort. Over that time Linux has gone from being a hobbyist effort to powering the infrastructure of the internet.

McGrath commented that Linux is already the backbone for the modern cloud and Red Hat is also excited about how Linux will be the backbone for edge computing — not just within telecommunications, but broadly across all industries, from manufacturing and healthcare to entertainment and service providers, in the years to come.

The longevity and continued importance of Linux for the next 30 years is assured in Pfeifer’s view. He noted that over the decades Linux and open source have opened up unprecedented potential for innovation, coupled with openness and independence.

“Will Linux, the kernel, still be the leader in 30 years? I don’t know. Will it be relevant? Absolutely,” he said. “Many of the approaches we have created and developed will still be pillars of technological progress 30 years from now. Of that I am certain.”

The Good, the Bad and the Ugly in Cybersecurity – Week 35

The Good

In response to Biden’s recent Executive Order and ongoing concerns about the poor state of cybersecurity, particularly in relation to critical infrastructure, the good news this week has to be Microsoft and Google pledging to reach into their deep pockets to help fight cybercrime.

Google has said it will stump up $10bn over the next five years after meeting with Biden and other tech leaders on Wednesday. Among projects earmarked for the funding, Google says it will expand the rollout of its SLSA framework, which is aimed at helping fight supply chain attacks through open-source software, and invest in training more people to address the cybersecurity skills shortage.

Meanwhile, Microsoft appears to have seen Google’s hand and raised it by another $10bn, pledging a total of $20bn. Around $150m is allotted to help US government agencies upgrade protections and expand cyber security training. Given that Microsoft software is a prime target in so many cyber attacks, particularly when it comes to ransomware, we hope that a good portion of that funding goes to plugging existing gaps more effectively.

At present, there’s no word from Apple about whether they also intend to contribute funding in response to the government’s call-to-arms. The Cupertino outfit is somewhat preoccupied with defending its plan to run (what some have called) “warrantless searches” on its customers’ iPhones, as well as dealing with other security hiccups with its planned iOS cloud anonymizer service.

The Bad

A critical vulnerability in Microsoft’s Azure cloud platform was revealed this week that lay exposed for months and could have allowed attackers to remotely take over a target’s Cosmos DB instances without authorization.

ChaosDB, as researchers at Wiz have dubbed it, gives any Azure user full administrator access to another MS customer’s Cosmos DB instances. The researchers say that the flaw is trivial to exploit and does not require previous access to the victim’s environment. Fortune 500 companies are among thousands of organizations impacted, it is claimed.

For their part, Microsoft reportedly plugged the vulnerability within days of being notified of the problem. After receiving the bug report on August 12th, the company disabled the problematic feature on August 14th, and rewarded the researchers with a $40,000 bug bounty shortly thereafter. Wiz published details of the findings this Thursday.

While that may sound like a happy ending for all concerned, there is still some concern for affected parties. Microsoft has said that it informed customers who may have been impacted and that “no one exploited it in the wild”. The researchers, however, believe that Microsoft has only notified around 30% of its customers and that the number of affected parties is much higher. To ensure mitigation, Azure users are being advised to regenerate Cosmos DB primary keys as soon as possible.

The Ugly

Zero days are never pretty, and sadly this week saw another one affecting Windows 10, offering a path to a local privilege escalation when plugging in certain peripherals. The story began with a Tweet describing how popular Razer Synapse products prompt Windows 10 to automatically download Razer Synapse software when plugged in. The software provides services to users to manage settings on the associated peripheral. It’s a common enough architecture used by many device manufacturers (much to the chagrin of some) and Razer alone is said to have some 100 million users.

Unfortunately, it turns out that when the installer, which runs with SYSTEM privileges, offers users the option to specify the install location, pressing Shift and right-clicking the dialog throws a prompt to “Open PowerShell window here”. The PowerShell window inherits the SYSTEM privileges of the opening process and thus allows the user to enter commands with the same privileges.

According to one estimate, there’s around 250 or so affected Razer products, but other Twitter users picked up on the vulnerability and quickly disclosed thousands of other devices that may trigger the same behavior.

 

While this is a LPE that won’t help remote attackers, it does open the door to the possibility of an unattended PC being exploited simply by an attacker plugging in a mouse or spoofing tool. Perhaps this will serve as a timely reminder to readers to always lock the screen when not stepping away from the workstation.

It is also worth noting for worried users that the exploit only works if Windows Update runs the installer automatically. Devices that already have the software installed should not be vulnerable, although that assumes there are no other problems with the driver. Unsafe Windows drivers is a bit of a thing at the moment, and we’re sure we haven’t seen the last of such reports.

On the back of the disclosure, Razer announced that they were working on a fix and even offered a bug bounty to the researcher, despite his dropping it as a zero-day on social media. For that, the company at least deserves some credit, for not every bug bounty operator is quite so generous.


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Zeal banks $13M to offer employers a ‘build your own’ payroll product infrastructure

Embedded fintech company Zeal secured $13 million in Series A funding to continue developing its platform for building individualized payroll products.

Spark Capital led the Series A, with participation from Commerce Ventures and a group of individual investors, including Marqeta CEO Jason Gardner and CRO Omri Dahan, Robinhood founder Vlad Tenev, UltimateSoftware executives Mitch Dauerman and Bob Manne and Namely founder Matt Straz. The latest round now gives the company $14.6 million in total funding, which includes a $1.6 million seed round in 2020, CEO Kirti Shenoy told TechCrunch.

The Bay Area company’s origin was as Puzzl, a payment processing startup for the gig economy, founded in 2018 by Shenoy and CTO Pranab Krishnan. It was part of Y Combinator’s 2019 cohort. The pair had to pivot the company after needing to move some of its thousands of 1099 contractors to W2 employee status.

They went looking for payroll processors that could handle high volumes of payroll automatically, like ADP or Paycor, but found they didn’t match some of the capabilities Shenoy and Krishnan wanted, including to pay workers daily and customize earning components.

To ensure other companies didn’t run into the same problem, they decided to build a payroll API that enables their customers to build their own payroll products, even being able to pay their workers everyday. Traditionally, companies would layer together antiquated third-party payroll tools and spend millions of dollars on consulting fees. Zeal’s API tool modernizes the payroll process and takes on the payroll liability while managing the back-end payment logistics, Shenoy said.

Currently, enterprises use Zeal to pay large volumes of workers and keep payment data on their own native systems, while software platforms that sell business-to-business services use Zeal to build their own payroll product to sell to their customers.

“Our mission is to touch every American paycheck with our tax and payment technology, ensuring that American employees are paid correctly and efficiently,” Krishnan said.

And that is a complex goal: there are 200 million American employees, over $8.8 trillion of payroll is processed annually in the U.S. and the country’s 11,000 tax jurisdictions produce over 25,000 income tax code changes a year.

Meanwhile, Shenoy cited IRS data that showed more than 40% of small and medium businesses pay at least one payroll penalty per year. That was one of the drivers for Zeal’s latest product, the Abacus gross-to-net calculator, which payroll companies can use to ensure they are compliant in paying their income taxes.

The co-founders intend to use the new funding to build out their team and strengthen compliance measures to ensure its track record with enterprises.

“We are starting to win more enterprise deals and moving millions of dollars each day,” Shenoy said. “This has been a legacy space for so long, so companies want to work with a provider to move fast.”

Shenoy predicts that more companies will shift to hyper-customized experiences in the next five to 10 years. Whereas the default was a company like ADP, companies will want to control their own data and build products so their customers can do everything payroll-related from one platform.

As part of the investment, Spark Capital’s partner Natalie Sandman has joined Zeal’s board of directors. The firm previously invested in other embedded fintech companies like Affirm and Marqeta, and she thinks there are new experiences in the sector that APIs can unlock.

Sandman felt the payroll-building pain points herself when she worked at Zenefits. At the time, the company was trying to do the same thing, but there were no APIs to connect with. There were all of these spreadsheets to transfer data, but one wrong deduction would trickle down and cause a tax penalty.

Shenoy and Krishnan are both “customer-obsessed,” she said, and are balancing speed with thoughtfulness when it comes to understanding how their customers want to build payroll products.

She is seeing a macro shift to audience-driven human resources where bringing new employees online will mean embedding them into products that will be more valuable versus the traditional spreadsheet.

“To me, it is a no-brainer that APIs provide flexibility in the way wages and deductions need to be made,” Sandman said. “You can lose trust in your employer. Payroll is at the deepest trust point and where you want transparency and a robust solution to solve that need.”

Accounting platform Synder raises $2M to automate e-commerce bookkeeping

As Synder’s two co-founders Michael Astreiko and Ilya Kisel wrap up their time at Y Combinator, they also announced their seed round of $2 million from TMT Investments.

Though the round was acquired before going into the accelerator program, the Belarus-based pair wanted to wait to publicly share the milestone. As they focus their sights on their next journey of growth and expansion, the new funding will go toward attracting more clients, visibility and sales.

The company bills itself as an easy accounting platform for e-commerce businesses. It was originally founded as CloudBusiness in 2016 and developed accounting automation and management of business finances for small and mid-size businesses.

Astreiko and Kisel started Synder, in 2018 and a year later focused on the company full-time to develop an easy way for commerce companies to shift to omnichannel sales, something Astreiko told TechCrunch can be “a huge pain” due to the complexity of different payment systems and high fees.

“There are a lot of solutions on the market, but you still have to have special knowledge to operate within accounting or commerce,” Kisel said. “For us, the simplicity means that it is worth it if you can have access in several clicks to consolidated inventory, profits and liabilities. Small businesses sometimes are not sharing this information due to competition, but if something is working and easy, they will definitely share it.”

Synder does the heavy lifting for companies by connecting sales channels like Amazon, Shopify, eBay and Etsy into one platform that users can manage with one-click operations. It also created a way to help the accounting stream so that all of the different payment methods can still be used, Kisel said.

The company is already working with 4,000 clients, and will now be fast-tracking their expansion, but will need the right people on board to help the company grow, Astreiko said.

Igor Shoifot, a partner at TMT Investments, said he will join Synder’s board after the company graduates from YC. He likes the simplicity of what the company is doing.

“Often the best solutions are economical, succinct and elegant — you can be onboarded in 10 minutes,” he added. “There is really nobody that really provides a similar solution that was that easy or didn’t require downloading or installing something. I also like their focus on growth, the fact they have no burn and they are making money.”

Synder’s business model is a subscription SaaS model that starts off as a free trial, and users can purchase additional services inside the platform to fit small and large companies.

Its more than 15 employees are spread around Europe, and the company just started hiring in the areas of marketing and sales in the U.S.

 

Stonehenge Technology Labs bags $2M, gives CPG companies one-touch access to metrics

Stonehenge Technology Labs wants consumer packaged goods companies to gain meaningful use from all of the data they collect. It announced $2 million in seed funding for its STOPWATCH commerce enhancement software.

The round was led by Irish Angels, with participation from Bread and Butter Ventures, Gaingels, Angeles Investors, Bonfire Ventures and Red Tail Venture Capital.

CEO Meagan Kinmonth Bowman founded the Arkansas-based company in 2019 after working at Hallmark, where she was tasked with the digital transformation of the company.

“This was not a consequence of them not being good marketers or connected to mom, but they didn’t have the technology to connect their back end with retailers like Amazon, Walmart or Hobby Lobby,” she told TechCrunch. “There are so many smart people building products to connect with consumers. The challenge is the big guys are doing things the same way and not thinking like the 13-year-olds on social media that are actually winning the space.”

Kinmonth Bowman and her team recognized that there was a missing middle layer connecting the world of dotcom with brick and mortar. If the middle layer could be applied to the enterprise resource plans and integrate public and private data feeds, a company could be just as profitable online as it could be in traditional retail, she said.

Stonehenge’s answer to that is STOPWATCH, which takes in over 100 million rows of data per workspace per day, analyzes the data points, adds real-time alerts and provides the right data to the right people at the right time.

Dan Rossignol, a B2B SaaS investor, said the CPG world is also about consumerizing our life, and the global pandemic showed that even at home, people could have a productive day and business. Rossignol likes to invest in underestimated founders and saw in Stonehenge a company that is getting CPGs out from underneath antiquated technologies.

“What Meagan and her team are doing is really interesting,” he added. “At this stage, it is all about the people, and the ability to bet on doing something larger.”

Kinmonth Bowman said she had the opportunity to base the company in Silicon Valley, but chose Bentonville, Arkansas instead to be closer to the more than 1,000 CPG companies based there that she felt were the prime customer base for STOPWATCH.

The platform was originally created as a subsidiary of a consulting company, but in 2018, one of their clients told them they just wanted the software rather than also paying for the consulting piece. The business was split, and Stonehenge went underground for eight months to make a software product specifically for the client.

Kinmonth Bowman admits the technology itself is not that sexy — it is using exact transfer loads to extract data from hundreds of systems into a “lake house,” and then siloing it by retailer and other factors and then presenting the data in different ways. For example, the CEO will want different metrics than product teams.

Over the past year, the company has doubled its revenue and also doubled the amount of contracts. It already counts multiple Fortune 100 companies and emerging brands as some of its early users and plans to use the new funding to hire a sales team and go after some strategic relationships.

Stonehenge is also working on putting together a diverse workforce that mimics the users of the software, Kinmonth Bowman said. One of the challenges has been to get unique talent to move to Arkansas, but she said it is one she is eager to take on.

Meanwhile, Brett Brohl, managing partner at Bread and Butter Ventures, said the Stonehenge team “is just crazy enough, smart and driven” to build something great.

“All of the biggest companies have been around for a long time, but not a lot of large organizations have done a good job digitizing their businesses,” he said. “Even pre-COVID, they were building fill-in-the-blank digital transformations, but COVID accelerated technology and hit a lot of companies in the face. That was made more obvious to end consumers, which puts more pressure on companies to understand the need, which is good for STOPWATCH. It went from paper to Excel spreadsheets to the next cloud modification. The time is right for the next leap and how to use data.”

‘No code’ process automation platform, Leapwork, fires up with $62M Series B

Copenhagen-based process automation platform Leapwork has snagged Denmark’s largest ever Series B funding round, announcing a $62 million raise co-led by KKR and Salesforce Ventures, with existing investors DN Capital and Headline also participating.

Also today it’s disclosing that its post-money valuation now stands at $312M. 

The ‘no code’ 2015-founded startup last raised back in 2019, when it snagged a $10M Series A. The business was bootstrapped through earlier years — with the founders putting in their own money, garnered from prior successful exits. Their follow on bet on ‘no code’ already looks to have paid off in spades: Since launching the platform in 2017, Leapwork has seen its customer base more than double year on year and it now has a roster of 300+ customers around the world paying it to speed up their routine business processes.

Software testing is a particular focus for the tools, which Leapwork pitches at enterprises’ quality assurance and test teams.

It claims that by using its ‘no code’ tech — a label for the trend which refers to software that’s designed to be accessible to non-technical staff, greatly increasing its utility and applicability — businesses can achieve a 10x faster time to market, 97% productivity gains, and a 90% reduction in application errors. So the wider pitch is that it can support enterprises to achieve faster digital transformations with only their existing mix of in-house skills. 

Customers include the likes of PayPal, Mercedes-Benz and BNP Paribas.

Leapwork’s own business, meanwhile, has grown to a team of 170 people — working across nine offices throughout Europe, North America and Asia.

The Series B funding will be used to accelerate its global expansion, with the startup telling us it plans to expand the size of its local teams in key markets and open a series of tech hubs to support further product development.

Expanding in North America is a big priority now, with Leapwork noting it recently opened a New York office — where it plans to “significantly” increase headcount.

“In terms of our global presence, we want to ensure we are as close to our customers as possible, by continuing to build up local teams and expertise across each of our key markets, especially Europe and North America,” CEO and co-founder Christian Brink Frederiksen tells TechCrunch. “For example, we will build up more expertise and plan to really scale up the size of the team based out of our New York office over the next 12 months.

“Equally we have opened new offices across Europe, so we want to ensure our teams have the scope to work closely with customers. We also plan to invest heavily in the product and the technology that underpins it. For example, we’ll be doubling the size of our tech hubs in Copenhagen and India over the next 12 months.”

Product development set to be accelerated with the chunky Series B will focus on enhancements and functionality aimed at “breaking down the language barrier between humans and computers”, as Brink Frederiksen puts it

“Europe and the US are our two main markets. Half of our customers are US companies,” he also tells us, adding: “We are extremely popular among enterprise customers, especially those with complex compliance set-ups — 40% of our customers come from enterprises banking, insurance and financial services.

“Having said that, because our solution is no-code, it is heavily used across industries, including healthcare and life sciences, logistics and transportation, retail, manufacturing and more.”

Asked about competitors — given that the no code space has become a seething hotbed of activity over a number of years — Leapwork’s initial response is coy, trying the line that its business is a ‘truly special snowflake’. (“We truly believe we are the only solution that allows non-technical everyday business users to automate repetitive computer processes, without needing to understand how to code. Our no-code, visual language is what really sets us apart,” is how Brink Frederiksen actually phrases that.)

But on being pressed Leapwork names a raft of what it calls “legacy players” — such as Tricentis, Smartbear, Ranorex, MicroFocus, Eggplant Software, Mabl and Selenium — as (also) having “great products”, while continuing to claim they “speak to a different audience than we do”.

Certainly Leapwork’s Series B raise speaks loudly of how much value investors are seeing here.

Commenting in a statement, Patrick Devine, director at KKR, said: “Test automation has historically been very challenging at scale, and it has become a growing pain point as the pace of software development continues to accelerate. Leapwork’s primary mission since its founding has been to solve this problem, and it has impressively done so with its powerful no-code automation platform.”

“The team at Leapwork has done a fantastic job building a best-in-class corporate culture which has allowed them to continuously innovate, execute and push the boundaries of their automation platform,” added Stephen Shanley, managing director at KKR, in another statement.

In a third supporting statement, Nowi Kallen, principal at Salesforce Ventures, added: “Leapwork has tapped into a significant market opportunity with its no-code test automation software. With Christian and Claus [Rosenkrantz Topholt] at the helm and increased acceleration to digital adoption, we look forward to seeing Leapwork grow in the coming years and a successful partnership.”

The proof of the no code ‘pudding’ is in adoption and usage — getting non-developers to take to and stick with a new way of interfacing with and manipulating information. And so far, for Leapwork, the signs are looking good.