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Individuals or businesses buying furniture in Africa can purchase from local furniture stores or global furniture retailers like IKEA. But both options have pros and cons; for the latter, local furniture stores may lack the quality that clients need, while global retailers, in addition to taking several months to ship their products to Africa, can be too pricey.

Taeillo, a Lagos-based startup innovating around these issues relating to time, quality and cost via its online furniture e-commerce store, has raised $2.5 million in “expansion” funding from Aruwa Capital, a Nigeria-based early-stage growth equity and gender-lens fund.

In a statement, Taeillo said it is an alternative for customers who incur high costs when they import furniture (combined with an unstable exchange rate) and have to endure long wait periods of 3-6 months before the furniture is delivered. “… we provide customers with aesthetically pleasing furniture pieces at a fraction of the importation price and with a 50% reduction in delivery time to about 4-8 weeks,” it continued.

Founded in 2018 by Jumoke Dada, the online furniture seller sources raw materials from local suppliers and manufactures furniture pieces from sofas and beds to chairs and tables, which it sells to individual customers and businesses. The company, which doubles as a manufacturer and retailer, can be likened to Wayfair and now-defunct Made.com. However, because it serves an entirely different market, Taeillo has had to be authentic with its product offerings by infusing cultural elements (it refers to them as Afrocentric furniture).

When Dada launched the platform, its target audience was solely businesses. The initial product brought in $165,000 in seed funding from investors such as CcHUB Growth Capital, Montane Capital and B-Knight. However, in mid-2020, during the pandemic, Taiello, leaning on investors’ guidance and citing a chance in the market after several walk-in stores halted operations, pivoted to a direct-to-consumer approach.

“It was more or less like opportunity met preparation because, at that time, many people were at home, and the leading furniture brands were not online to serve them,” CEO Dada told TechCrunch. “Traditional showrooms were locked up too, so that was an opportunity for brands like us to position ourselves and prove that they could buy furniture online without necessarily going into showrooms.”

The decision proved a masterstroke; up until its pivot, Taeillo had sold under 200 pieces of furniture in Nigeria. Its pivot came with the launch of the “Amakisi” table (₦29,999/~$85) — a work table and one of its best-selling products — which quickly gained popularity and sold over 1,000 pieces in six months. Since then, the online furniture manufacturer and retailer has expanded into 10 additional product categories, moved into Kenya and shipped more than 10,000 pieces of furniture to over 5,000 customers in both countries.

In 2021, Taeillo raised a $150,000 bridge round from CcHUB Syndicate as it tripled its revenue from the previous year. But that growth and progress didn’t come without headaches. Due to the popularity of some of its furniture within the Nigerian millennial and working-class demographic, Taeillo has struggled to meet demand; on various occasions, taking months to deliver products. Though it manages its supply chain to an extent and manufactures about 70% of its products, the startup also relies on third-party manufacturers who make components before they are sent to Taeillo’s warehouse, assembled and shipped to customers. According to Dada, the reasons behind extended wait times – with the company producing as many as 800 pieces of furniture monthly – are due to working with these third-party providers, including suppliers and logistics services.

“Sometimes, as a modern business, you must deal with crude suppliers. But recently, we’ve had to change our suppliers to shorten the time we get the materials. Right now, we’re also working around strategic partnerships with third-party logistics companies and might set up a logistics arm to help us improve our deliveries.” said the CEO on how Taeillo plans to deal with the long delivery times while also admitting that the online furniture manufacturer and retailer could also improve how it handles production.

With the funding, Taeillo intends to reduce delivery times to about 3-5 days by pre-manufacturing some of its best-selling furniture (for instance, the “Amakisi” table) instead of waiting till customers make orders before starting production. The investment will also help scale its “Pay with Flexi” product, where shoppers can buy furniture and pay in installments; over 200 people have used it. Then there’s its augmented reality and virtual reality (AR/VR) tech (powering virtual showrooms), which the startup intends to double down on marketing-wise.

“We’ve done a lot of work with less. So now, we want to get outstanding talent that will take us to the next growth stage. Also, we want to increase our market share, optimize operations, hack our supply chain and ensure that customers have a great experience,” expressed the chief executive of the online furniture retailer, who made over $1 million in annual revenue in 2021.

Adesuwa Okunbo Rhodes, founder and managing partner at sole investor Aruwa Capital, said investing in Taeillo aligns with one of her firm’s investment objectives: backing women founded- and led startups. Last week, the three-year-old growth equity firm, which is one of the few founded and run by an African woman, closed a $20 million+ fund from Visa Foundation and other LPs to invest in 10 startups across fintech, healthcare, renewable energy and essential consumer goods serving the female population.

“In line with Aruwa’s gender lens investing strategy, Taeillo is founded and led by a woman and has a 50% female representation in its management team,” she said in a statement. “… The company [Taeillo] has maintained its innovative model in a traditional brick-and-mortar industry, creating a unique value proposition for its customers in a fast-growing, underserved market. By leveraging technology in its value chain, Taeillo has been able to achieve exponential growth in less than 2 years, achieving results that take traditional furniture companies decades to achieve.”

Nigerian startup Taeillo raises funding to scale its online furniture e-commerce platform by Tage Kene-Okafor originally published on TechCrunch

After years of outsourcing and offshoring manufacturing to countries with cheaper labour and bigger production ecosystems, the U.S. and Europe are on a mission to bring some of that industrial work back to its own shores. Today, a startup that believes it can help with that shift is announcing some funding. Robco, a Munich-based startup that has built a platform for designing low-cost modular robots for small and medium industrial businesses, has picked up €13 million (abut $13.8 million). The round — a Series A — is led by Sequoia, with Kindred Capital, Promus Ventures and Torsten Reil, Christian Reber, and Daniel Dines all also investing.

Roman Hölzl, the CEO of Robco who co-founded the company with Paul Maroldt and Constantin Dresel, said the plan will be to invest the funds both in expanding the capabilities of the existing modules and to continue adding on more clients to its modular-based ‘robotics as a service’ model.

Robco’s current offering is based around three components that focus on lathe turning, laser engraving and palletizing, with its business model based around clients ordering what they need made and that in turn being delivered as a service to them — the robots themselves are not purchased and stay on Robco’s balance sheet with the idea that they can be reconditioned and reused for other clients when needed. The plan is to bring on more modules in milling and quality inspection, as well is to look at further geographical expansion, for example into the U.S. market.

Even with the hundreds of millions of dollars that have been poured into a variety of industrial automation and robotics companies over recent years, Robco believes that it has found a niche in the market by focusing on tricky tasks and building cost-effective solutions to address the needs of smaller manufacturers. In short, SMBs might need to scale up productivity at times but — either due to the economics of the need, or labor shortages, or both — are unable to hire people to fill those jobs on a permanent basis. This is an area that those making larger machines for bigger industrial clients had yet to address, he said.

“When we think about the market we think there are two categories that have dominated,” Höltzl said in an interview. “The first is component manufacturers, and the other is a fragmented market of system integrators building costly and craftsman-like robots where you pay $250k per solution. No company yet has crossed the chasm to [provide] great, delightful technology that could be deployed in days or months. We are not selling robots nor software. We are basically offering an automation service, and solving a concrete problem.”

Höltzl describes the traditional approach of hiring machine operators as “the classic status quo” — something he saw first-hand in his parents’ own small factory, which was the inspiration for founding the company in 2020 — not, as you might have thought, Covid-19 and the pressure it put on in-person work, although that certainly gave it a strong current on which to generate interest and eventually sell its ideas into the market. One reason was that many factors had to lay off rather than just furlough their staff, and then when it came time to get back online, they couldn’t fill out tasks and some of their costly manufacturing machines just sat vacant, and that was before considering the weekends and evenings when staff that was there didn’t work. He cites stats that say there are around 2 million vacant labor positions in Europe, with costs for labor increasing 6.6% annually on average.

The cost comparison with using a Robco robot is big: the company today, he said, charges typically $1,000/month, with costs changing based on length of engagement (costs go down if contracts are longer), with overall charges being as high as $4,000/month depending on the complexity of what the client needs. Typical deployments start at 10 modular machines, he said.

This is taking off massively, he noted, with strong triple-digit revenue growth, “exciting unit economics,” and so far four patents on its hardware and techniques from a founding team spun out of a big research university and thus grounded in AI and engineering expertise — all details that would have attracted investors like Sequoia that have only relatively recently really doubled down on Europe with a shiny new office in London, but like others in the world of VC are facing huge pressure around existing portfolio companies and how they are weathering the significant storms that have hit the tech sector.

All of that spells more prudent, and perhaps less exuberant, investing, which likely means more strict adherence to theses around making returns and less about exploring interesting ideas.

“Robco’s approach is unique [in the SMB manufacturing space] because what they are doing is a little like Lego. They are taking a modular approach,” said Luciana Lixandru, who led the investment for Sequoia. “Whatever your use case is you tell them what machine you need and they create the right format. Implementation times are short, one or two days. Then they have created a software platform where you put the modules together creates a digital twin. Then the configuration and control is easy — something that previously would have required more technical expertise or outside consultants.”

She believes this is a big gap that has yet to be tackled in the market, with out 70% of tasks for SMB manufacturers capable of being automated. “This isn’t a surgical robot, but something that can do repetitive tasks that happen in manufacturing.” In that regard, interestingly, there is a correlation between what a company like Robco is looking to fix and what a company like UiPath (a huge investment in Lixandru’s past, and partly how she established her name in VC) focused on with robotic process automation, at the administrative end of running a business.

“This company got very far so far with very little,” she added, raising one of the other big signals investors are especially relying on these days, pointing out that Robco raised only “a couple of million dollars before this, [and] they have real customers, with a bunch of robots already deployed. We have a lot of data and evidence that it’s working. I’m skeptical of 99% of robotics [pitches] and I can see how it’s hard to build a marketplace around it, but we see the ‘why now’ here and that’s why we think it will take off.”

Robco links up with $14M led by Sequoia to bring modular robotics to industrial SMBs by Ingrid Lunden originally published on TechCrunch

Uber is suing the New York City Taxi & Limousine Commission (TLC), which last month approved a fare hike for ride-hail apps and taxi drivers amid a post-pandemic driver shortage, rising operational costs and higher inflation. The ride-hail company is attempting to prevent an increase in rates it must pay drivers in NYC by December 19.

On November 15, the TLC voted to increase the per-minute rates of ride-hail drivers by 7.42% and per-mile rates by 23.93%, a move by the commission that is meant to attract more drivers to the roads to serve increasing passenger demand. In its petition, Uber called the increases “dramatic, unprecedented and unsupported hikes,” noting that earlier fare increases have ranged from 1.46% to 5.34% and “accurately reflected the impact of inflation.”

Uber accused the TLC of using unsound economic principles to “achieve a predetermined result.” The company said the rule would force Uber to spend an additional $21 million to $23 million per month, a cost from which the company could not recover. Uber could alternatively offset the additional payments by increasing rider fares, but the company said that would result in 10% increase for riders, which would “irreparably damage Uber’s reputation, impair goodwill and risk permanent loss of business and customers.”

The ride-hail giant went on to say that the challenged rule will harm riders, drivers and the ride-share industry as a whole. Uber accused the TLC of not proposing a solution to balance these risks.

“A rate increase of this magnitude may very likely result in higher rider fares,” reads the lawsuit. “Those higher fares, in turn, will depress the number of rides requested through the Uber platform. Fewer requested rides translates into fewer opportunities for Drivers to earn fees. The Challenged Rule could very well have the effect of harming Driver earnings, undermining the purpose of these regulations.”

Uber has asked the court to issue a temporary restraining order and preliminary injunction to block the implementation of the TLC’s rule pending a decision on Uber’s petition to block it entirely.

Taxi & Limousine Commissioner David Do said in a statement that the city must “stand behind our workers without traditional employment protections.”

“New York City leads the nation in protecting drivers, and this important rule reflects that reality,” Do said. “We are confident that we are well within our legal authority in implementing this important rule, and we are vigorously fighting this lawsuit.”

Uber has challenged rulings in the past that are designed to protect gig workers. A California superior court last year ruled Proposition 22 — a ballot proposal that was passed in 2020 and defines ride-hail and gig workers as independent contractors, not employees, and thus not eligible for certain labor protections — was unconstitutional and unenforceable. Uber in turn filed an appeal to invalidate AB-5, California’s controversial law on the employment status of gig workers, as unconstitutional and block its enforcement. This continual volley in the courts buys Uber time by clogging up the legal system so the company can continue to operate without making changes.

Uber sues NYC Taxi & Limo Commission to block rate increase for drivers by Rebecca Bellan originally published on TechCrunch