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Cacheflow, a startup building tools for the software sales closing process, announced this morning that it closed $10 million in new capital.

Cacheflow CEO and co-founder Sarika Garg told TechCrunch that the new capital doubled her company’s valuation, added prior lead investor Glenn Solomon (GGV) to its board and brought new investor Crystal Huang (GV) on as a board observer. Huang led Cacheflow’s newest investment — what Garg described as a seed+ round — for GV, while Solomon put in more capital to the round than his pro-rata rights guaranteed, she said.

The venture capital market has slowed, and valuations for startups of all maturities have come down. To see Cacheflow raise a year after it came out of stealth and announced a $6 million roundcaught our attention. How had the company managed a quick raise at an attractive price when so many startups that once found the feat easy are struggling to repeat it today?

Per Garg, her company became commercially available this April, after which point she started to get inbound notes from investors. The startup CEO said that venture investors are still willing to pay for “companies that have momentum or are solving a real problem.”

Easier said than done, yeah? In the case of Cacheflow, after accelerating its sales and marketing efforts a few months ago, it has grown to around a dozen customers, which Garg described as being Series A through C companies. The CEO also said that Cacheflow is talking to larger potential customers today, indicating that her company intends to make the standard pivot upmarket in the future.

If the market for software products is getting a bit steeper than before, and companies are expected to cut back on new tooling in particular during the present economic downturn, how is Cacheflow growing quickly enough to double its valuation in late 2022?

Garg said that she learned that potential customers think of Salesforce as a lead management tool for managers. The CRM giant doesn’t, she argued, map out the last-mile tasks of closing a software deal with a customer. This leads to sales executives — think the CROs of the world — tracking deals manually. Insert blizzard of email here.

Notably, concern regarding sales clarity and speed in the larger software market is helping Cacheflow, well, sell its own software, as its tool helps sales folks track deal closing progress and who’s reading what.

Recall that the original pitch for Cacheflow was that it made buying software simpler. Now, speaking with the company a few days ago, we noticed a greater emphasis on the selling experience versus the buying process. But both sides of the equation orbit around faster, clearer closing steps for the software buying process. As everyone who sells software wants that, especially during the present period of economic angst, you can see why Cacheflow might be able to buck a more conservative market.

(If you, like myself, aren’t super familiar with the use of CRM products in the sales process, don’t worry. The software flow for a startup using, say, Gong and Salesforce and Cacheflow would work something like this: Gong to record sales calls, Cacheflow to close deals, with both services integrating into Salesforce for records management, as I understand it.)

Cacheflow is 16 people today and is unsurprisingly hiring after raising more capital. Garg said that it’s a great time for startups to stack talent because the market is a bit less chaotic than it was during the go-go-go 2021 era. And, she said, there’s less noise in the market. If you are taking a software product to market today, your potential customers are being bombarded with fewer calls and ads, meaning that you might have a clearer run at their attention.

The Cacheflow round is interesting in that it’s a startup we’ve been watching, and seeing it quickly raise more capital at a sharply higher valuation is eye-catching in the present climate. But also because it appears that well-capitalized startups busy selling today are perhaps slogging through less of a miasma than we expected, provided, of course, that customers actually need what they are selling.

Cacheflow doubles valuation while raising $10M, proving that the venture market is far from dead by Alex Wilhelm originally published on TechCrunch

Ledger, a security-focused firm that sells crypto hardware wallets, has partnered with the designer behind the iPod, Tony Fadell, in hopes of creating an easier, more accessible way for users to secure their crypto assets.

Crypto hardware wallets have gained traction in recent weeks, thanks to users wanting to self-custody their digital assets after industry-changing events like crypto exchange FTX exploding and halting customers from withdrawing their assets. Ledger’s chief experience officer, Ian Rogers, said that the company had its biggest sales day ever, which ended its biggest sales week ever, in mid-November after FTX collapsed, which signals the demand for hardware crypto wallets is rising.

The eight-year-old company has sold over 5 million devices to consumers across 200 countries and secures about 20% of the global crypto assets being held to date, it said. The newest product, Ledger Stax, joins existing hardware products like Nano S Plus and Nano X.

“It’s fun and easy to use, which is important,” Fadell said to TechCrunch. “It wasn’t just about the hardware design, but we looked at all the customer journey from opening the website to this and reimagined all this to step up the experience not just for people who understand crypto but to invite more people into the fold.”

Earlier this year, Ledger partnered with $1.5 billion venture capital firm Cathay Innovation to launch a $110 million fund dedicated to securing crypto assets. Last year, it raised $380 million in a funding round led by 10T Holdings, valuing Ledger at $1.5 billion at the time.

“The Ledger Nano is more like the iPod shuffle and we were missing that sexier, better device,” Rogers said to TechCrunch. “The screen gives a much easier onramp and usability. I can set this thing up from box to set up in a minute, which is not as easy to do with [the Ledger Nano.]”

The new credit card-sized crypto wallet can manage NFT collections as well as over 500 coins and digital assets.

“What we’re doing with digital assets is much more complex now,” Rogers said. “People are signing smart contracts, managing digital products and not just sending digital currencies anymore. You need ease of use with screen real estate so you can be more communicative.”

It has an E Ink display similar to a Kindle that can showcase holders’ NFTs even when the device is off. The battery can last for weeks or even months on one battery charge, Ledger stated.

“I was envisioning what the future of digital assets would look like and I came up with this idea of what the next generational [wallet] would look like,” Fadell said. “I was using all these competitor devices, but when they’re all turned off, they’re blank slates like your phone. You don’t know what’s on them. There’s a lot of people who are using multiple devices for NFTs, crypto, etc., but want it in one place.”

The name Stax also relates to the products’ integrated magnets, which makes it stackable for those who own more than one.

“I’m really jazzed that we can expand the audience but we also put emotion into the device,” Fadell said. Stax has sound, wireless charging and communicative functionalities, he added. “All of these little touches make it feel like a true consumer-friendly device.”

The product will be available for $279 in the first quarter of 2023 on the company’s website or at retail stores like Best Buy in the U.S. The first 10,000 products sold will come with a free NFT that can be redeemed, Rogers said.

Here are the nitty-gritty details:

Dimensions: 85 mm × 54 mm × 6 mm (credit card length and width)
Security: Ledger EAL 5+ certified secure element
Screen type: E Ink (up to 16 grays), customizable always-on lock screen, capacitive touch
Screen resolution: 672 × 400 pixels
Weight: 45 g
Connectivity: USB C, Bluetooth 5.2
Magnet array for easy stacking
Qi wireless charging

Ledger’s latest crypto wallet taps iPod designer in bid to boost accessibility by Jacquelyn Melinek originally published on TechCrunch

Coordinating people, projects and their various locations, has become a headache for companies in the post-pandemic world of remote and hybrid working.

There is expensive office space to maintain, logistics to figure out which employees are going to actually be in, and who’s working remotely each day. Let’s face it, earlier, hot-desk management software – if it was ever used – is no longer up to the task.

Into this world, the Chargifi — which we wrote about in 2015 — start-up found itself. They had been building Chargifi for seven years, enabling users to access mobile power using the free app in any public location with a ‘Chargifi Spot’ – such as a bar, stadium, hotel or office. But when the pandemic hit, demand completely dried up, for obvious reasons.

The team decided to repurpose the software and products they had already built for managing wireless charging networks in offices.

Relaunching as Kadence, the startup now coordinates people, places, and projects to enable hybrid co-working inside teams.

It’s now raised a $10M Seed funding round led by Kickstart Fund with participation from Manta Ray, Hambro Perks and Vectr7 as well as Shadow Ventures and Forward VC.

Kadence also attracted angel investors including Cal Henderson, Co-Founder and CTO at Slack, Shaun Ritchie, CEO and Founder of Teem, and Nick Bloom, Stanford professor, research leader, and worldwide authority on remote work.

Dan Bladen, CEO and Founder of Kadence said in a statement: “Companies are now trying to figure out how to move from ‘order’ to ‘optimization’ and make the ‘way’ they work a competitive advantage. Companies that will win in the hybrid age will understand that the office is no longer the platform for work; the platform for work is now time (the working week) – companies that don’t get hybrid right won’t survive.”

He says the company now has now pulled in 300 customers in the last 18 months, among them companies like Collibra and Starling Bank.

It claims its software can reduce office space by 68% while also increasing the number of employees coming into the office to collaborate by 25% month over month, with the consequent environmental benefits.

Nick Bloom, a Stanford Economics Professor, remote working expert and Kadence investor, said in a statement: “There is no doubt hybrid is now the way the world is going to work going forwards, and Kadence has honed in on the most important aspect of hybrid—that hybrid should enable better outcomes for companies as a whole, not just facilities managers. Their focus on the coordination of people is where the market is heading.”

Cal Henderson, Co-Founder and CTO at Slack and a new Kadence investor added: “And as the world goes hybrid, it’s important that teams find a rhythm for meeting in-person for collaboration and creativity. Kadence is an important part of helping companies make hybrid work, and I’m excited to be involved.”

How Chargifi pivoted to Kadence, a platform to enable hybrid co-working, then pulled in $10M by Mike Butcher originally published on TechCrunch

Scoring that high-end, brand-name outfit — but you know, the kind you find from a secondhand store — can be a thrill. Much of that has traditionally been driven by individuals looking to cash in, but companies like Archive are helping brands themselves grab some of that revenue stream through their own resale programs.

We first spoke to the resale operating system startup’s co-founders Emily Gittins and Ryan Rowe in January when they announced $8 million in new funding to not only help brands resell their wares, but divert clothing from landfills.

When Archive launched in February 2021, it was deploying peer-to-peer resale models for brands, essentially facilitating a marketplace for buyers and sellers. However, Rowe told TechCrunch that as he and Gittins spoke more with bigger and bigger brands, they realized there was more that could be done.

Following the initial funding round, the company started building out a warehouse management system that enables what he called “managed resale.” Now brands can, at scale, sell inventory that has been either returned, damaged or exchanged online. Brands, or their third-party logistics partners, can process the inventory, identify if anything needs repair and get it up for sale.

The model has taken off: Archive has seen its revenue increase by nearly 10x in the last 12 months, is working with 32 brand partners and expects to divert hundreds of thousands of items from landfills in the next year. Some of those partners include The North Face, Oscar de la Renta, Cuyana and Marimekko.

This also comes as the luxury resale market is forecasted to double in size to nearly $200 billion over the next three years.

“The market for resale continues to accelerate very quickly,” Gittins told TechCrunch. “We’ve seen very large brands getting very serious about resale and making big commitments on how much of their business they want to be circular in the next few years. We’ve had a lot of positive reception to the resale programs and our existing brand partners continue to scale programs with us.”

Today, the company bags another $15 million, this time in Series A capital. The new investment gives Archive more than $24 million in total funding.

Lightspeed Venture Partners led the round and was joined by Bain Capital Ventures and a group of minority investors. As part of the investment, Alex Taussig, a partner at Lightspeed, will join the company’s board.

Gittins and Rowe intend to deploy the new capital into product development and building out the implementation and success teams to meet demand from customers. They are also looking at new verticals, including home goods and furniture, and with that, new partnerships with different types of logistics providers.

Ultimately, the company would like to move the retail industry toward the manufacture of fewer, but better quality clothing so there is a longer lifecycle for one piece of clothing through resale.

“We see a world where customers can resell something, through a brand, through multiple different ways,” Gittins said. “We are expanding our product internationally and working with brands, particularly in Europe, and will see a lot of expansion opportunities there in the near term. We will also be expanding our partnership network to do things like cleaning, repair and managing the warehouses.”

Archive lands $15M as more clothing brands ‘get serious about resale’ by Christine Hall originally published on TechCrunch

It’s an unprecedented time to be in SaaS.

Long term, the sector’s prospects are strong. The SaaS market could grow almost 10% every year to 2027 — and I think that’s a conservative estimate. In a recent Stripe survey, 63% of B2B recurring revenue businesses said they were confident of their growth in 2023.

But the road ahead is bumpy. Many founders are dealing with the first cyclical economic slowdown their businesses have faced. As budgets tighten, SaaS businesses are reexamining the tools they use every day to achieve what they once took for granted: accelerating their growth without making big capital expenditures.

The good news? New technologies offer more ways than ever to grow revenue. And to many founders’ surprise, one of the easiest ways to do this is one of the least glamorous: the financial stack.

Doing more with less often means making big changes. That’s why recessions define startups: They force generational changes that are only possible when the stakes are high. Nearly 82% of businesses Stripe surveyed said they were concerned about the current state of the economy, and 45% of them are worried about their cash flow position.

But at the same time, nearly 60% of businesses agree a recession is a ripe time to innovate. One of the best, most cost-effective ways for SaaS businesses to do that is using technology to reduce the complexity of financial processes and optimize sales.

The real rate limiter for SaaS businesses’ growth isn’t shipping software — it’s selling it

As a business model, SaaS is inherently global. The internet means a Swedish company can instantly reach customers from Singapore to Mexico.

But actually selling things online is still surprisingly hard. That company would need to charge its customers in Singaporean dollars, work out how to bill them automatically, withhold the right sales tax and reconcile global currencies into Swedish kroner, among other financial gymnastics.

Because there hasn’t been an easy way to do this — even for digitally native SaaS businesses — the revenue stack is a big source of inefficiency.

It means losing money for preventable reasons like customers unnecessarily churning when their payment details expire or transactions being falsely blocked as fraudulent.

It means wasting time and money working out how to support new currencies, keeping up with changing regulations on identity verification or adopting new payment methods.

And it means slower innovation, as patchwork software makes it hard to create and test new product tiers, pricing structures or business models.

As a founder, I spent hours creating customer contracts, manually following up on payments or reconciling different invoices generated by patchwork systems. Those are pain points founders can’t afford in a strong economy, let alone a weak one.

Crucially, fully integrated payments technologies mean these problems are now entirely preventable — with no additional headcount and at practically no extra cost.

There are three main things SaaS founders can do to improve their profitability today.

1. Eliminate avoidable churn to maximize revenue

3 ways SaaS businesses can boost revenue in a recession by Walter Thompson originally published on TechCrunch

Tea, an open source unified package manager for software developers, today announced it has added another $8.9 million in seed funding to its coffer as it builds on recent momentum that has seen some 16,000 developers authenticate their software packages with Tea.

Tea is the brainchild of Max Howell, creator of popular open source package manager Homebrew, and Timothy Lewis. The duo formally founded Tea out of Puerto Rico last November, with the company emerging from stealth in March backed by $8 million in funding from notable backers including the venture capital arm of crypto giant Binance.

The company has made grand proclamations about how it plans to springboard off the blockchain with a new web3 protocol to help open source software creators and maintainers get paid. This will entail “digital contracts” that make it easier for companies to sponsor those responsible for key components in their tech stack. The proposed protocol will see package maintainers receive a non-fungible token (NFT) when they complete a package submission, and which is “used to evidence their work and is the key that directs tea rewards,” according to Tea’s white paper.

For now, though, Tea’s focused on the first incarnation of the product which launched last month to challenge well-established incumbents in the package management space such as GitHub-owned NPM and Homebrew itself.

Flexible

Tea comes with the promise that it will be more than a simple package manager: it will be a “universal” package manager, a universal interpreter, and a virtual environment manager. But over and above all that, it is malleable, with developers and companies able to tailor things to their own needs.

“What we have released so far is what I consider to be the base features that a CLI [command-line interface] tool of its kind should have,” Howell told TechCrunch. “It makes thinking about what packages you need secondary to thinking about what you want to achieve — what you want to build. The future of Tea will be in the extensions the community creates to cater the true power of open source to their individual niches.”

While that future sounds promising, supporting open source developers in their efforts to get paid is arguably the biggest game-changer here. However, Tea’s close alignment with the crypto realm may cause many to pause for thought, particularly in light of the high-profile chaos emanating from the FTX collapse. Besides the involvement of high-profile investors such as Binance, Tea’s proposed protocol will see package maintainers receive a non-fungible token (NFT) when they complete a package submission, and which is “used to evidence their work and is the key that directs tea rewards,” according to the white paper.

But the the issue of payments has been a constant discussion point in the open source sphere, particularly off the back of prominent security flaws such as Log4Shell. Companies ultimately need a robust software supply chain, so any way that this can be supported is likely to garner at least some interest.

There is no firm date in mind for when Tea’s new protocol will be ready for prime-time, but the company says it should be available some time in 2023.

“Much like waiting until November to release our CLI, we’re not going to launch until we understand how it should be best built and have gone through trial and error internally,” Lewis added. “We’re going to take our time and make sure the tool itself is very useful and valuable for developers.”

Lewis also stressed that when the protocol does launch, its core components, which include the blockchain registry, license management, and remuneration features, will be entirely optional for all involved. But it will also serve as the basis for Tea’s own business model.

“We are a multi-faceted services company — we intend to build tools on this protocol that will be revenue-generating, and encourage others to do the same by having an immutable decentralized registry,” Lewis said. “We have a long list of potential revenue-generating outcomes depending on what the community finds most useful.”

More specifically, there will be scope for enterprise-specific services around security and compliance.

“We feel that we can excel in licensing and license management,” Lewis added. “Open source supply chain security is critical for many enterprises today. We’ll have a system to help identify potential threats and operate to monitor license compliance with the thousands of different open source components.”

Tea’s latest seed round was led by Acuitas Group Holdings, with participation from Betaworks Ventures, Percival VC, Round 13 Digital Assets Fund, StrongBlock, and Wax Blockchain.

From the creator of Homebrew, Tea raises $8.9M to build a protocol that helps open source developers get paid by Paul Sawers originally published on TechCrunch

Retail trading app Robinhood is entering the retirement game.

The Menlo Park, California-based company today 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. It is targeting gig workers and contractors, for example, 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.

In an interview with TechCrunch, CEO and co-founder Vladimir “Vlad” Tenev said Robinhood is addressing the current trend away from a single employer model:

There are a lot of people who are contractors or who are working multiple jobs that don’t have access to a traditional safety net pension plan or 401(k)s with a match. Employer-sponsored 401(k)s are a really huge force behind getting people to save for retirement. But not everyone is privileged enough to be eligible for one – either they don’t have full-time employment or if the day, their employer is too small or doesn’t offer a match…We’re building this for them.

The company has “been thinking about what a retirement product could be for Robinhood for a while,” Tenev added, saying the new offering is representative of the company’s focus on expanding products “to meet customers at every stage of their financial journey.” Earlier this year, for example, it also rolled out stock lending and a cash card.

The retail investment behemoth’s plan to diversify isn’t shocking, considering the turbulent year it has had in terms of both its stock and the company’s performance. (It was also previewed earlier this year.)

In early August, Robinhood slashed 23% of its workforcejust three months after it cut 9% of full-time staff in two rounds of layoffs that were believed to have impacted some 1,000 workers. Also in early August, Robinhood was slapped witha $30 million fineby a New York financial regulator, specifically on its cryptocurrency trading arm.

Robinhood’s stock price has been volatile over the past year, as well. Shares closed down 3.2% at $9.67 on December 5, down from a 52-week high of $23.74.

To get the product up and running as soon as possible, Robinhood is inviting anyone with an existing Robinhood account or who is eligible to create a Robinhood account — meaning they are 18 and over and meet other standard criteria — to join the waitlist. (Waitlisting users is a move that Robinhood has used numerous times, including with its crypto product, to both build buzz and ensure a smoother experience for users as they are moved past the figurative velvet rope.)

Robinhood doesn’t charge any fees to maintain an account and says the retirement accounts will have “zero commissions or account minimums,” but that “other fees may apply (referring to any current fees in the company’s fee schedule).

Users will have one login to access both their primary investing and retirement accounts.

Historically, Robinhood has been the target of lawsuits and criticism that it wasn’t doing enough to educate its client base about what they were doing with their money. To head off similar criticism with this new product, the company is taking early steps to provide what Tenev described as in-app guidance, education and guardrails for users.

“A lot of the regulatory backdrop on what makes an IRA different and unique is unclear and opaque . . .” said Tenev. “So we want to make sure that people are not putting money in the wrong way, or taking it out the wrong way, without being fully aware of the tax penalties.”

The plan is for the bulk of customers to be onboarded by the end of January, so that those who are interested in making a contribution can do so before filing taxes. Meanwhile, users who are “really excited to use it early” will get an instant access option — but only if they refer someone, even existing Robinhood customers, to the waitlist using their referral code, said Sam Nordstrom, Robinhood’s manager of product management.

Once onboarded, users will have the choice of investing in stocks and ETFs through either a traditional IRA or a Roth IRA, says Robinhood. Customers can build a “custom” portfolio through “tailored” in-app recommendations or by choosing their own investments — or a mix of both. They also can earn interest on cash stock lending.

Adding to its bottom line

Robinhood needs the product to work. It reported losing 1.8 million monthly active users over the three-month period, 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.

On a positive note, in early November, Robinhood reported third-quarter financials that beat revenue and earnings estimates mainly due to higher interest earned from rising rates. Specifically, it notched revenue of $361 million on a net loss of $175 million, or 20 cents diluted earnings per share versus expectations of $357.7 million on expectations of 27 cents diluted earnings per share.

It’s easy to see how retirement accounts could quickly add to its bottom line. Robinhood has several revenue streams, including through subscriptions via a “Gold” product. But much of the money it makes from its taxable brokerage accounts is through payment for order flow, a controversial practice that last year, the Securities & Exchange Commission threatened to ban, before reversing course this fall.

Layering retirement accounts into the mix will only increase the amount of orders flowing through its platform. Indeed, the expectation is that Robinhood will see a “a significant increase in assets on the platform, and activity, over time,” Tenev says.

Robinhood is also banking on the fact that there are plenty of Gen Z and millennials who are interested in retirement but have not yet started amassing assets toward that end. And it’s hoping to entice them to do so during a down market.

The decision to add a retirement offering, the company claims, is in part based on customer feedback of the desire to have “all their financial investment accounts in one place,” according to Tenev.

“We’re building a product home for all your money,” Tenev said.

TechCrunch’s weekly fintech newsletter, The Interchange, launched on May 1! Sign up here to get it in your inbox.

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.

Robinhood banks on retirement to slow user attrition by Mary Ann Azevedo originally published on TechCrunch