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There’s one slide that almost every founder gets wrong when they are putting together a pitch deck to raise money from venture capitalists. The slide is usually known as “the ask,” and it typically lives toward the end of the pitch deck.

It is meant to do something pretty straightforward: Explain how much money a startup is raising and for what. It shouldn’t be rocket science, but it’s almost universally a struggle to get right.

Here are the most common mistakes:

Forgetting to include the slide altogether.
Not naming a specific dollar amount you are raising.
Including a valuation on the slide.
Omitting what the funds will be used for.
Listing a specific runway, i.e., “This will keep us running for 18 to 24 months.”

Let’s explore in detail why these mistakes are so detrimental to your fundraising process and how you can best include these points in your deck.

The one slide 99% of founders get wrong when fundraising by Haje Jan Kamps originally published on TechCrunch

For companies aiming toward net zero, tracking scope 3 carbon emissions is a key challenge. Scope 3 are emissions along a supply and value chain, which means they have to account for a large number of partners. Avarni automates much of the process and says it can cut down the amount of time spent on carbon reporting from months to minutes. The Sydney, Australia-based startup announced today it has raised $3 million for its carbon management platform. The funding was led by deep tech venture firm Main Sequence, with returning investors Vulpes Ventures and Common Sense Ventures.

Avarni’s platform aggregates supply chain and spending data into one comprehensive dataset, and it uses that and AI to help clients report and forecast their carbon footprint. Since its launch last year, Avarni has analyzed more than $100 billion in corporate spending data and 100 million tones of carbon dioxide equivalents in supply chains, from public and private markets. Its clients include consulting firms like KPMG Australia and Point B, and solar energy startup 5B.

Avarni was founded by CEO Tony Yammine, previously a management consultant at KPMG Australia, CPO Misha Cajic, a former Atlassian product manager and CTO Anuj Paudel, who was a cloud network engineer at Macquarie Telecom Group. Yammine told TechCrunch that the team’s experience with their former employers gave them the opportunity to speak to hundreds of enterprise companies about the challenges they faced tracking and reporting on scope 3 emissions.

A CDP report shows that scope 3 emissions account for as much as 75% of total corporate emissions. But they are hard to track because companies need to get emissions data from their supply chain, and that is often incomplete or inconsistent and requires a lot of organization. Avarni deals with that challenge by using its dataset to help identify emissions hotspots in supply chains, and is able to do so regardless of the structure or taxonomy of input data, Yammine said.

KPMG Australia used Avarni to progressively map climate risk in its supply chain by asking its 20 largest vendors, who account for 40% of total annualized goods and services on spend, to provide carbon performance data. Point B, meanwhile, is working with Avarni to provide quicker greenhouse gas emissions insights to its customers.

The startup monetizes by charging professional services and consultancies a flat fee each month based on licenses. Enterprises pay a flat fee based on the amount of procurement data analyzed by Avarni. The company doesn’t price by supplier, Yammine said, because it doesn’t want to disincentivize emissions forecasting based on the size of a supply chain. It also recently launched modular pricing that will let clients pay by the components they need, including researching, benchmarking and carbon forecasting.

Most of Avarni’s competitors are in the U.S. and include Persefoni, SINAL Technologies and Watershed. Yammine said it differentiates by using AI to speed up the decarbonization process. “Carbon reporting companies claim to automate data, but it’s not possible to automate data if you don’t have AI technology and comprehensive dataset to begin with.”

The company will use its new funding to develop its platform. It will also hire more employees and open an office in the U.S.

In a statement, Vulpes Ventures managing partner Field Pickering said, “What Avarni has achieved over the last year has been phenomenal and they are on a strong trajectory despite a challenging economic environment. The team is rapidly building one of the biggest datasets available on corporate emissions. This is the intelligence businesses need to inform their decarbonization strategies—and Avarni is at the forefront of rapidly collecting this information.”

Avarni is building a comprehensive dataset to analyze supply chain emissions by Catherine Shu originally published on TechCrunch

Canada’s venture market isn’t immune from the global market downturn, but unlike the U.S. — where everything seems increasingly bleak — there are quite a few bright spots in Canada’s ecosystem this year.

Data from the Canadian Venture Capital and Private Equity Association (CVCA) found that C$7.2 billion ($5.28 billion) was invested across 520 deals in the country through the third quarter of this year. This compares to C$15 billion deployed through 786 deals in 2021 (more on Canada’s last year here). Through Q3, the Canadian market had already surpassed its 2020 numbers. It’s also worth noting that, unlike in the U.S., the fourth quarter is not the slowest investment period each year in Canada.

A lot of recent Canadian venture investment has been concentrated in the early stages. So far this year, 88% of the known venture deals in Canada were seed or early stage, compared to 67% in the U.S., according to PitchBook.

CVCA’s manager of research and product, David Kornacki, said that despite the investment totals being lower than last year, there have been a lot of signs this year that the Canadian venture market is growing closer to maturity. For one, he thinks the proliferation of seed deals will create a good pipeline of later-stage opportunities in the region in a few years, something Canada has struggled with.

There are a lot of reasons to be excited about Canada’s venture market by Rebecca Szkutak originally published on TechCrunch

Welcome toThe Interchange! If you received this in your inbox, thank you for signing up and your vote of confidence. If you’re reading this as a post on our site, sign uphereso you can receive it directly in the future. Every week, I’ll take a look at the hottest fintech news of the previous week. This will include everything from funding rounds to trends to an analysis of a particular space to hot takes on a particular company or phenomenon. There’s a lot of fintech news out there and it’s my job to stay on top of it — and make sense of it — so you can stay in the know. —Mary Ann

One of the biggest news stories last week was that Plaid laid off 260 employees, or about 20% of its workforce. This may have come as a surprise to many, but not to all of us.

Rumblings about Plaid laying off some 200 people started as far back as late May. At that time, when asked, the company denied it was letting go of any workers. But as the year wore on, and the macro-environment grew more challenging, it felt like it was inevitable that Plaid — which was valued at $13.4 billion last year — would join the long list of fintech giants letting go of workers.

Notably, when outlining the decision to reduce staff, CEO and co-founder Zach Perret said he “made the decision to hire and invest ahead of revenue growth, and the current economic slowdown has meant that this revenue growth did not materialize as quickly as expected.”

It’s become a common refrain as of late — CEOs taking responsibility for over-hiring and well, in way, being too optimistic about revenue growth. Optimistic or short-sighted? It seems there is a fine line.

I think one of the most startling things about the recent group of layoffs in the fintech space, though, is how many of them are taking place at some of the highest-valued startups out there. Klarna was valued at $45 billion last year. This year, it saw a huge drop in valuation and slashed jobs more than once. Brex was valued at $12.3 billion earlier this year. Then a layoff. Stripe was valued at $95 billion last year. Then amass layoff. Chime was valued at $25 billion last year. Then amass layoff. Now Plaid.

Did they all get ahead of themselves? Were they trying to do too much too fast? (Brex co-CEO and Henrique Dubugras admitted as much onstage at Disrupt.) Did they all think the pandemic-fueled boom would last indefinitely? Did they all think the venture money would just flow freely forever?

Also, maybe some of these companies really just believed they would need so many workers. I mean, who knew a downturn of this magnitude was coming?

Maybe it was a combination of all of the above. Obviously, each company’s circumstances are different and I am not privy to their internal discussions (as much as I would like to be!). But it’s clear that a reset may be in order.

Hearing and writing about so many high-profile companies laying off workers is sobering for me as a tech journalist. I can only imagine how sobering it is for other startups in the space. My humble opinion is that we all should learn from the mistakes of others. And I’m not pointing fingers specifically at the companies mentioned above. I mean generally.

Of course, I’m not a founder or CEO and likely never will be. But here is some unsolicited (and probably obvious) advice from someone covering startups for years:

Stay focused. It’s easy to get caught up in the competitive landscape and want to outdo your rivals. But really, before you start expanding into new segment after new segment, make sure you’ve really nailed the ones you’re already working in.
Hire responsibly and carefully. No, that does not mean you should have the people on staff doing the work of two to three employyes. It means that each open position should have been thought through carefully. Is it really needed? Can this hire wait until we’re further along? Would it make more sense to hire a contractor for the time being?
Stay humble. Don’t boast. Kicking ass and taking names? Good for you. Don’t beat your chest too loudly. Being confident is one thing. Being arrogant is another.
Limit/cut the trash talk. It’s easy, especially on social media, to get caught up in discussing how or why you think your company is better than others in your space. It’s fine to talk about why you think your offering is better in a general sense from what else is out there. But to name names and try to make others look bad? Most of the time that has the opposite effect and just makes you look bad.
Be real. Whether it be on social (Twitter or Mastodon or LinkedIn or Post — wherever you are more likely to share) or when talking to the media. Authenticity is huge, and speaking for myself and my fellow TC reporters, it is very much appreciated and valued — especially considering it’s not as common as we’d like it to be. Transparency goes hand in hand with that, especially internally. Don’t leave your employees in the dark, or mislead them.
Oh, and don’t lie and commit fraud.

While I didn’t start this newsletter thinking I would come up with a list of CEO dos and don’ts, here we are. Thanks for indulging me.

Weekly News

“Fintech was hot in 2021, but looking back on it … maybe too hot? The sector exploded last year, seeing record investment — $132 billion globally, according to CB Insights — with many startups reaching lofty valuations, including Stripe at $95 billion, Klarna at $45 billion and Plaid at $13 billion. While these companies have very real customer bases and products, it is not hard to imagine that at least some of these valuations were propped up by hype.” Rebecca Szkutak reports on just how hard fintech valuations have fallen this year.

Robinhood last week launched a waitlist for its new offering, Robinhood Retirement, which it describes as the “first and only” individual retirement account (IRA) with a 1% match on every eligible dollar contributed. The move is a big bet on the part of the fintech giant that the traditional 9-to-5 employee is no longer the norm, as it is targeting gig workers and contractors, who have historically found it challenging to save for retirement without the benefit of a full-time job and access to an employer-sponsored plan. It is also likely a strategy designed to help retain users considering the company reported losing 1.8 million monthly active users in the third quarter, a quarterly decrease of 12.8% to 12.2 million, “the lowest level since it listed as a publicly traded company,” according to Yahoo News. More by me here.

Tage Kene-Okafor reported that “Chipper Cash, an African cross-border payments company valued at $2.2 billion last year, has laid off a portion of its workforce. Last week, a few affected and non-affected employees took to LinkedIn to reveal the news. TechCrunch has learned from sources that more than 50 employees were affected across multiple departments; the engineering team took the biggest hit, with around 60% of those laid off coming from the department, according to people familiar with the matter.”

From Manish Singh: “Indian financial services firm Paytm is considering repurchasing its shares, following a tremulous year that has seen its stock price fall by over 60%. Paytm said it will discuss with the board on December 13 the proposal to buy back the fully paid-up equity shares of the company, the Noida-headquartered firm disclosed in a stock exchange filing.” More here.

Fintech-focused Gilgamesh Ventures has named Paula Youas its newest (and third) partner and chief operating officer, overseeing platform growth. The move comes as the firm approaches the two-year anniversary of its inaugural fund. Since its founding in 2020, Gilgamesh has raised over $10 million and invested in nearly 30 early-stage fintech companies across the Americas, including Xepelin, Klar, Pomelo, Glean and Modern Life.

From Finextra: “Mobile-only UK bank Kroo has launched its flagship current account, offering customers two percent in interest on amounts up to £85,000. Kroo’s analysis of Bank of England data shows that there was £271bn sitting idle in UK households’ non-interest-bearing sight deposits as of the 30th of September 2022. Aimed at Millennials and Gen Z, Kroo says it will plant two trees for every new customer who opens a current account, through its charity partner, One Tree Planted.”

Adam Neumann’s latest startup, residential real estate upstart Flow, is partnering with fintech startup Bond to create a digital wallet for Flow’s residents. A variety of financial products will be embedded in the planned digital wallet with specific capabilities being announced at a later date. In case you somehow missed it, Neumann — you may remember him from his days at a little ol’ proptech called WeWork — in August made headlines (and a lot of people angry) when he raised $350 million at a $1 billion valuation, making Flow a unicorn before it even began operating.

Earlier this year, Mastercard launched the Start Path Open Banking program in an effort to give open banking startups “access to a combination of hands-on mentoring, co-innovation opportunities and engagement with Mastercard’s global network of banks, merchants, partners and digital players to help scale their business.” On Friday, Mastercard selected the following eight open banking startups to join the program: AIS Gateway (Poland); Currensea (United Kingdom); Fego.ai (India); Floid (Chile); Kaoshi (United States); Level (United Kingdom); Percents (United States) and Railz (Canada). More here.

As reported by Reuters: “dLocal (DLO.O), the Uruguayan fintech facing allegations of potential fraud from a short-seller, has applied for a UK regulatory license, the company’s chief executive told investors in a recent call reviewed by Reuters, amid claims it dodged rigorous regulatory oversight by relying on Maltese regulators.”

Brazilian fintech startup Matera, which has built instant payment and QR code technology for financial institutions, has moved its headquarters to San Francisco. The move, the company told me via email, “comes amid tremendous adoption of Pix, the instant payment system implemented by the Central Bank of Brazil in 2020 and used by 70% of Brazilians.” Specifically, Matera provides instant payment software for banks leveraging Pix in addition to providing core banking services to over 250 global banks, credit unions and digital banks — serving over 55 million accounts. The company says its jump into the U.S. market “will enable it to empower far more financial institutions to extend their payments capabilities.”

From Forbes: “During a year of steep losses in financial markets, these entrepreneurs, traders and investors are skillfully navigating choppy waters and making an outsize impact.”

Funding and M&A

Seen on TechCrunch

Ocho wants to rethink (and rebrand) personal finance for business owners

Andreessen Horowitz leads $43M Series A for Setpoint, which aims to be the ‘Stripe for credit’

TripActions secures $400M in credit facilities from Goldman Sachs, SVB

SBM Bank India, building BaaS platform, seeks funding at $200 million valuation

And elsewhere

Hotel payment software platform Selfbook announces a strategic investment from Amex Ventures. TechCrunch covered its previous raise here.

SME-focused challenger bank Allica brings home £100 million Series C led by TCV

Avant secures $250 million in funding from Ares Management Corporation

Fintel Connect, which has built marketing software for the financial industry, raises seed funding led by BankTech Ventures

Uplinq raises $5.6M for bookkeeping and analysis platform for SMBs

Syncfy raises $10 million in seed funding led by Point72 Ventures to build open finance platform in Latin America

Mortgage infrastructure platform Pylon raises $8.5M in seed round

Carputty wins investor millions to dull auto financing pain point

And with that, I will sign off. I’ll only publish one more newsletter before year’s end and then will be taking a break over the holidays. Until then, have a wonderful week. xoxoxo, Mary Ann

Got a news tip or inside information about a topic we covered? We’d love to hear from you. You can reach me at maryann@techcrunch.com. Or you can drop us a note at tips@techcrunch.com. If you prefer to remain anonymous, click here to contact us, which includes SecureDrop (instructions here) and various encrypted messaging apps.)

Fintech giants face uphill battle by Mary Ann Azevedo originally published on TechCrunch

This month, we’re five years into building Contrary. Along the way, we’ve raised hundreds of millions from some of the world’s top institutions and have been fortunate to back startups like Ramp, Anduril and many others.

But just like the stories of the startups we back, the journey has taught us a number of lessons the hard way.

I’ve been reflecting on our history as we hit this milestone and wanted to share a few things that I wish I knew five years ago.

Early logos are important

One of the few regrets I have is that we didn’t go logo-hunting early. We didn’t chase hot companies that were raising rounds led by household name firms. Instead, we stuck to our knitting on Fund I, leading rounds in startups and teams we were convinced in and had sourced via our own infrastructure. I was under the impression that if we did precisely what we said we’d do — lead rounds, back great talent, bring a unique model to market — we’d stand out.

Turns out, when you’re building a venture firm from scratch (limited track record, didn’t work in venture prior, etc.), logos matter. They matter for prospective LPs, who use them as a proxy for access; they matter for your peer set, who use them as a proxy for how sharp you are; and they matter for founders, who will immediately head to your website and see if you’ve backed name-brand startups.

Fast-forward to today. Ironically, our Fund I is one of the best of its vintage year, according to Cambridge Associates benchmarks. But that performance took five years to blossom, and it made raising Fund II more difficult. I once had an LP ask, “Have you invested in any startups I’ve heard of?”

It’s long stopped being an issue, but there’s no doubt in my mind that logo- hunting would’ve saved us time in the early years.

Reputation is critical

In an industry where your reputation and brand are the most important parts of building a firm, getting started from day zero is critical. Early logos are just one piece of the puzzle.

Invest heavily in building meaningful relationships with well-respected partners, founders and LPs. Send them relevant, high-quality deals for free; become Twitter friends; go to events; co-invest in firms; and cold email them and grab coffee. Do whatever it takes, because relationships are currency in more ways than one.

As an example, one of the primary ways LPs will evaluate you and your fund is by aggressively checking references with their existing venture managers. They’ll ask if partner X has heard of you, if they’ve worked with you, and if they’d bring you into deals.

This requires brand awareness at the bare minimum and ideally includes years of collaborating and producing stellar results. The best way to build your reputation is by sending deals to investors that ultimately make them lots of money.

5 lessons we’ve learned from building a venture fund from scratch by Ram Iyer originally published on TechCrunch

Hello again! Greg here again with Week in Review. WiR is the newsletter where we take the most read TechCrunch stories from the last seven days and wrap them up in as few words as possible — no fluff, no nonsense,* just a quick blast of everything you probably want to know about in tech this week.

*Maybe a little bit of nonsense.

Want it in your inbox every Saturday morning? Sign up here.

most read

Tip your Amazon driver (on Amazon’s dime): If you’ve got an Alexa device at home, Amazon will pay your delivery driver an extra $5 if you say, “Alexa, thank my driver” after a delivery. Amazon could, of course, just pay drivers more to begin with…but that, depressingly, probably wouldn’t be a move that would get Amazon one of the most read headlines of the week.

Slack’s CEO to depart: Last week Salesforce CEO Bret Taylor stepped down; this week, Stewart Butterfield, CEO of (Salesforce-owned) Slack, announced he’ll also step down come January. Ron Miller shares his insights on inbound Slack CEO Lidiane Jones and her decades of product experience.

The “Twitter Files”: “Elon Musk reminded his followers on Friday that owning Twitter now means he controls every aspect of the company — including what its employees said behind closed doors before he took over,” writes Taylor as an array of once-private internal Twitter communications is made public.

Lensa AI goes viral: Do all of your social media friends suddenly have avatars that make them look like sci-fi gods and action heroes? It’s probably because of Lensa AI, a photo editing app that went viral this week after adding support for Stable Diffusion’s AI-generated art tools. Popularity didn’t come without controversy, though — many continue to debate the ethics of selling something generated by an AI trained on the works of real people; meanwhile, others noted that the AI could be “tricked” into generating otherwise disallowed NSFW imagery.

More tech layoffs: This week Airtable laid off about 20% of its staff — over 250 people. Plaid also laid off 20%, which for them works out to 260 people. African fintech unicorn Chipper Cash let go of 50 people, and the U.K. drag-and-drop e-commerce platform Primer let go of 85 (about one-third of the company).

Google combines Maps/Waze teams: When Google bought the navigation app Waze for over $1 billion back in 2013, Google said they’d keep the Waze and Google Maps teams separate “for now.” Turns out “for now” meant about 9.5 years, but Google confirmed this week that the two teams will be merged. Google says it expects Waze to remain a stand-alone service.

Twitter Blue might cost more on iOS: Twitter’s $8 “Blue” subscription plan (which comes with a blue “verified” checkmark) is still on pause for now after a few false starts, but when it returns, it’ll reportedly cost a few bucks more if you subscribe through the iOS app in order to offset Apple’s cut.

audio roundup

Found — our podcast about founders and the companies they build — has a new co-host! Becca Szkutak stepped into the role this week, joining Darrell Etherington in a chat with Daye CEO Valentina Milanova. Meanwhile, the Equity crew tried to make sense of 2022 in a year-end look back, and Taylor Hatmaker hopped on The TechCrunch Podcast to explore what the sudden explosion of AI-generated art means for actual human artists.

TechCrunch+

Here’s what subscribers were reading most on TechCrunch+:

Investors sound the alarm about possible private equity tech deals: “Who wants to sell when prices are low?” Ron Miller and Alex Willhelm ask.

Rootine’s $10M pitch deck: “If you told me that a company that’s charging $70 per month for multivitamins would be able to raise a $10 million round, I’d demand to see the receipts,” writes Haje. With that in mind, he dives deep into the pitch deck that helped make it happen.

Another week of layoffs, executive departures and AI-generated everything by Greg Kumparak originally published on TechCrunch