Month: December 2022

Zoe, a startup founded by doctors and researchers out of London and Boston, made its name during the pandemic with a popular — dare we say viral? — self-reporting Covid-19 app. Embraced both by consumers and researchers, it provided early data into how Covid-19 spread and the symptoms associated with the initial infection and its lingering after-effects (Long Covid) — insights that were hard to come by virtually anywhere else.

Then as the virus moved from pandemic to endemic and attention shifted to other ways of tracking, Zoe also shifted, back to its original, pre-Covid mission: using self-reporting tech to track and build a nutrition study of the microbiome, and to provide personalized insights to individual users of its app based on their reporting of what and how they eat and the wider insights gained from the research.

That app is now is taking the next step in scaling its operations, as it looks to onboard 250,000 people off a waiting list it’s had going for over a year: it’s announcing £25 million in funding (around $30 million at today’s rates), an equity investment that CEO Jonathan Wolf said values Zoe at £250 million ($303 million).

U.S.-based venture firm Accomplice is leading the round, with previous backers Balderton Capital, Ahren, Daphni, and new backer L Catterton also participating.

The funding comes on the heels of a Series B of £48 million, which closed with a $20 million injection in May 2021 (a number that bumped up to $25 million after we published our story). Since then, it has onboarded some 50,000 active paying users, alongside the nearly 5 million people who have self-reported nutritional data free of charge. Wolf said that most of the last round in still in the bank; the latest funding is an opportunistic extension, made to shore up capital in the face of potentially stormy waters in the markets next year.

“We are seeing a big acceleration in customer demand so what we want to do is scale our business significantly to be able to meet that demand,” Wolf said. “Given the tough economic environment, we wanted to make sure we have the capital to do this. In fact, the vast majority of the $25 million raised in the last round is still in the company.”

And alongside the venture round, it’s also hoping to bring on more interest through a crowdfunding campaign. Taking into its wider community of interest that Zoe says numbers 2 million (this likely includes many who follow Zoe and have provided contact details by way of its previous Covid work, but it also has a podcast and related content) it will be running a campaign for investing via crowdfunding site Crowdcube. That will open on December 13 to that community and a day later to Crowdcube users, and then to the public at large, with investing starting at £10, “at the same share price as ZOE’s private investors.”

In addition to onboarding more users waiting to join, the plan also is for Zoe to expand beyond diet.

“We are looking to deepen our research into nutrition, the gut microbiome, sleep, mood, activity and other factors to improve long-term health,” said Wolf, who co-founded the startup with Professor Tim Spector of King’s College London and George Hadjigeorgiou. It plans also to expand research and studies in the ZOE Health Study; with a greater number and variety of health and lifestyle studies advocated by our contributors and scientists that will cover areas like menopause and more.

While it does not have plans to build any of its own hardware — it does send out glucose monitors and other physical products as part of its assessment (see below) but these are not made by Zoe — it will be making more integrations with hardware already out in the market, an approach that is essential for triangulating data and getting more complete pictures of each individual reporting in which is essentially a big data analytics exercise.

“I don’t see us dong anything in hardware. So many are already in this area and it’s exciting to take inputs from a variety of them. No single measure is more important or determines something. It will take a combination,” he said. “In the future we’re excited about integrations with Apple Watch and more.”

The reason for the slow movement in bringing those waiting off the list is because of the process involved in doing so — one reason for the funding injection to speed up how it scales.

The 50,000 active users it has have opted to pay £299.99 initially to get a test kit to run an initial analysis of their systems. The price is high, Wolf said, because it includes a gut microbiome test, a blood fat test, standardised test meals of muffins (!), real-time blood sugar sensor (CGM) if opted in to our science study; and then in return a gut health report and a personalised insights report.

Users are then given an option to take on memberships at different price points to continue the work and insights. These start at £59.99/month and go down to £24.99/month if you take out an annual subscription.

In a consumer world of health apps that include free, ad-supported options, it’s a big ask for users to step up and put in hundreds of dollars into a service to improve how they eat. Wolf said that Zoe had found that one of the lasting impacts of the pandemic was that there’s been a shift in how the general public regarded their health and the role that their activities played in it.

“I think the pandemic has had a profound impact on how people think about their health,” he said. “They noticed how what they do and how they eat and exercise impacted on a disease. That doesn’t mean everyone is healthier but now more see that it’s not something you wait to do until you’re sick. You have to take responsibility for it and add to it over time.”

Indeed, Covid-19 saw a boom in activity: people were walking, cycling and running more; some were buying more fitness equipment for their homes when their gyms or sports clubs closed; and generally more people were trying to do more not just to be healthy in case they too got hit by the virus, but because they were no longer coming into work every day and found themselves more sedentary by default. Of course, there’s been a big shift back to old pre-Covid ways, but there has also been a lingering shift, which is something that Zoe hopes to play into — not least because of its traction with users during the peak of the pandemic, when it had amassed more than 5 million users in the U.S. and U.K. for its symptom tracking app.

Zoe has naturally conducted a study on its users — 500 of them — and says that those actively following its program for 12 weeks or more said they felt “healtier” for eating following Zoe recommendations. “Their top improvements were; improved mood & alertness, better bowel habits, improved blood sugar & fat, less bloating and better sleep quality,” said Wolf. Some 85% said they had reduced constipation, reduced bloating, improved mood, and reduced diarrhoea, he said; and 70% said they had more energy and less bloating. It’s running a larger randomized study now to get more insights, which will be ready next year, he added.

Zoe, which went viral with its Covid-reporting app, raises $30M to track nutrition and health by Ingrid Lunden originally published on TechCrunch

Badili, a Kenya-based smartphone re-commerce startup, has raised $2.1 million pre-seed funding to scale its operations within Africa; one of the fastest-growing mobile phone market in the world.

The Venture Catalysts, V&R Africa, Grenfell holdings, and SOSV, participated in the round, as did family offices and angel investors from Kenya, Nigeria, South Africa and India.

Buoyed by the new funding, Badili plans to explore new growth opportunities in West Africa, where it hopes to tap an increasing demand for affordable second-hand smartphones, even as it scales its operations in Kenya, Uganda and Tanzania.

“We are launching in Uganda and Tanzania and have established strong partnerships with original equipment manufacturers (OEMs). Within the next six months, we will be expanding to a few West African markets to get our foot in the door of some of the major markets in Africa,” said Rishabh Lawania (CEO), who co-founded the startup with Keshu Dubey (CTO) early this year.

Badili carries out trade-ins and buybacks on behalf of major OEMs and phone dealers, and has, so far, signed partnerships with key brands like Samsung. It buys devices from individuals too.

Lawania told TechCrunch he launched the startup after noticing that re-commerce did not exist in Kenya as a legitimate and trustworthy industry, yet demand for pre-owned devices was high.

“One of my ex-employees in Kenya got arrested for buying a stolen phone, and it struck me that most people can’t really buy pre-owned electronics here because the only option they have is the grey market, which is risky. That is when Badili idea kicked-in. I thought something really needs to change,” said Lawania, also the founder of Wee Media (parent company of WeeTracker news site) and gadgets Africa.

Lawania said 60% of Badili customers are individuals upgrading from a feature to smartphone, adding that Badili devices cost less than half their original prices.

“We are providing an alternative to people who don’t want to pay full price for a device, and I am more excited about the fact that we are able to help a lot of consumers buy their first smartphone,” said Lawania.

Affordability remains a key barrier to smartphone penetration, which is key to powering Africa’s digital economy, in most countries across Africa including Kenya where feature phones still dominate the handset market. Recent data from the Communications Authority of Kenya indicates that while smartphone penetration is deepening, feature phones market share currently stands at 55.1 percent.

Across Africa, latest data from International Data Corporation (IDC) also shows that consumers opted for cheaper options as feature phones shipments grew by 10.6% while smartphone consignments dropped by 7.9% in the second quarter of the year owing to growing inflation and toughening economic outlook.

While the report predicted that smartphone shipments will recover, affordability and consumers buying power will continue to play a huge role in smartphone penetration in the continent.

Besides, Badili is tapping the growing refurbished and used mobile phones market, which is expected to hit $146 billion by 2030, growing at CAGR of 11%, partly driven by smartphone adoption in emerging nations.

Badili buys the phones through its platform, and network of shops and agents spread across the country. It uses its price estimation algorithm, that takes into account various factors including the age of the phone and model, to calculate the value of the phone. The phones are revamped, repackaged and resold with one year warranty.

Lawania said Badili takes details, including the I.D and mugshot, of the sellers, and also requires them to sign an affidavit stating that they are the rightful owners of the devices. For extra caution, he said, Badili has also setup a system that can flag frequent sellers.

He said he is setting up and scaling technology, systems, partnerships and networks needed to build Africa’s most trusted and biggest re-commerce consumer electronics marketplace.

Smartphone re-commerce startup Badili raises $2.1M pre-seed funding by Annie Njanja originally published on TechCrunch

FTX founder Sam Bankman-Fried talked from an undisclosed location in the Bahamas today with reporter Andrew Ross Sorkin for a DealBook event, a discussion that his legal team “very much” did not approve of, he told Sorkin with a boyish grin.

Hedge fund billionaire Bill Ackman tweeted afterward that he felt “SBF” was “telling the truth.” But we’re not so sure. In fact, having watched the live-stream, we’re still wrestling with whether he was credible.

Throughout the back-and-forth, Bankman-Fried sounded almost studiously amateurish, insisting he didn’t knowingly commingle funds between FTX and the trading firm he controlled, Alameda Research, where it has since been discovered that the exchange had funneled $10 billion in customer assets to Alameda for use in trading, lending and investing activities.

Though between $1 billion and $2 billion appears to be missing, and though company executives reportedly set up a bookkeeping “back door” to circumnavigate red flags, when Sorkin asked about the outfits’ reliance on one another, Bankman-Fried said that he was “frankly surprised by how big Alameda’s position was, which points to another failure of oversight on my part, and a failure to appoint someone to be chiefly in charge of that.”

Notably, Bankman-Fried ultimately used “oversight” nine times, even as he appeared to blame others. Asked if he should have taken money from FTX’s users’ accounts at all, he pointed the finger at Alameda, saying, “I wasn’t running [it], I didn’t know exactly what was going on. I didn’t know the size of their position. A lot of these are things that I’ve learned over the last month that I learned as I was sort of frantically digging into this.” Obviously, he added, “that’s a pretty big mistake. I mark that as a pretty big oversight that I wasn’t more aware of.”

At many points during his back and forth with Sorkin, Bankman came across, too, as delusional. He said that before FTX filed for bankruptcy — a move he authorized grudgingly four days after it was first proposed — “There had been a lot of interest in financing [FTX]. A lot of fairly strong interest, you know, many billions of dollars’ worth.”

It really didn’t seem that way on the outside(!). There wasn’t interest from Binance, as was well-documented. There wasn’t interest from his scorched venture backers, who, by the way, Bankman-Fried spared today in the interview. (Asked by Sorkin whether “Sequoia Capital, Paradigm and some very big venture capital firms” that funded FTX ever asked Bankman-Fried about how much risk he was taking on and “whether they bear any responsibility,” he answered, “I don’t think that they’re responsible . . . most of what they were focused on was . . .what might FTX become . . .”)

Indeed, in many ways, Bankman-Fried behaved today very much like someone who doesn’t comprehend that his life just changed dramatically and who instead believes he can still steer the outcome of FTX, despite the fact that he was forced to resign. (FTX’s new chief executive, a corporate turnaround specialist, has called Bankman-Fried’s stewardship a “complete failure of corporate control.”)

He talked of “a lot of assets that are on hand [still at FTX], although many of them are not liquid. They were worth quite a bit more than the new liabilities a month ago, even, a lot of them a year ago.” Bankman-Fried relatedly suggested that he hasn’t accepted that his customers will lose everything.

He said toward the end of the interview, “I can’t promise you and I can’t promise anyone anything there, and it’s not really in my hands to a large extent. But I would think that it would make sense to be exploring [a pathway forward] because I think there’s a chance that customers could end up a lot more whole — I don’t know, maybe even fully whole — if there was a really strong, concerted effort.”

It was such a strange showing, it made us wonder why some of the most sophisticated investors in the world put him on a pedestal in the first place.

Sure, he has “had a bad month,” as he told Sorkin, to audience laughter. Yet it’s just as likely that Bankman-Fried and his circle are busily making the argument that he was simply inept — in over his head — and never intentionally participated in artifice.

It makes a big difference. U.S. prosecutors can pursue a civil action against someone accused of ineptitude or negligence, and that individual might face significant financial consequences. But if it’s proven that an individual schemed to mislead others, then fraud crimes are on the table, which also means jail time is on the table. It could mean a far bleaker future for Bankman-Fried.

Already, the U.S. Attorney’s Office in Manhattan has reportedly launched an investigation into FTX; the SEC and the Justice Department are also, naturally, poking around and trying to determine whether Bankman-Fried’s maneuverings intended to deceive or were instead an astonishing series of blunders.

It’s tempting to conclude the former, that Bankman-Fried made his decisions knowingly. Given his “crypto genius” status until recently, it’s hard to imagine he was so in the dark. But it was quite a performance today if so.

Was Sam Bankman-Fried’s appearance a performance? by Connie Loizos originally published on TechCrunch

Huel, the European provider of nutritional products, has sold more than 270 million meals across the globe since Julian Hearn started the company in 2015. Now with $24 million in fresh capital, it plans to do even more.

It’s been a while since we covered Huel, which originally launched in the United Kingdom in 2017 with a low-sugar, plant-based and low-carbon-footprint protein powder product and has since expanded into ready-to-drink, snack bars and hot lunch options.

In 2019, we reported on them when they launched their nutritional bars in the U.S. At the time, the company was buoyed by a Highland Europe-led $20 million venture round, at a $260 million valuation, it raised in 2018. There was even talk of Huel going public in 2021.

Today, much of the company’s sales are outside the U.K., with U.S. “Hueligans,” the company’s loyal fans, representing Huel’s second-biggest market, followed by Germany and Japan, CEO James McMaster told TechCrunch.

The company has now grown to 250 people, including a small office in New York. Year over year revenue growth is 40%, up to $170 million, which McMaster attributes to that strong new customer growth, the ready-to-eat hot lunch product launch (among others) and the company’s transition from solely direct-to-consumer to also retail stores.

“We’re at the stage where having this second round of funding allows us to keep focusing on that growth,” he said. “We are going to keep innovating with new products, and are really proud of where we’re heading. We’re now the business that we hope can be a truly global brand.”

Highland Europe is back to lead that new $24 million infusion, which now values Huel at $560 million. Joining the venture fund this time is a star-studded group of new investors, including actor and UN Goodwill Ambassador Idris Elba and his wife, Sabrina Dhowre Elba, also a UN Goodwill Ambassador, television presenter Jonathan Ross and sustainable activewear brand TALA’s CEO Grace Beverley.

“I’ve been a Hueligan for several years now, starting my journey while preparing for my role in ‘Thor,’ so to come on board with Huel was an easy decision,” Idris Elba said in a written statement. “I believe in their mission to deliver nutritionally complete food, sustainably. We have some exciting projects coming up and I look forward to spreading the message and raising awareness around healthy, low carbon food.”

Meanwhile, the new funding will also be deployed in continued international expansion, with a focus on the U.S. The investment will also support new product innovation, and continued expansion online and in retail stores.

As part of the Elbas’s investment, one of the new projects will include Huel working with them on their climate change initiative to help people eat at 1.5 degrees Celsius, the global warming limit the Paris Climate Accord is trying to reach.

Huel meals fit within a diet aligned with supporting that reduction, and the company “is excited to work with Idris and Sabrina as we’re equally trying to be a force for good in the world,” McMaster added.

Plant-based food brand Huel valued at $560M following Idris Elba-backed round by Christine Hall originally published on TechCrunch