All posts in “Startups”

Shyft raises $6.5M to help retail and service workers swap shifts

Anyone that has experience in the service or retail industry knows swapping shifts can be a logistical nightmare that leaves employees in trouble with management or stuck working during a friend’s birthday party. As a former Old Navy “sellebrity” myself, I can confirm there’s a huge need for an efficient tool to solve this problem.

That’s where Shyft, a Seattle-based startup that helps connect shift workers, comes in. Using Shyft, employees can message each other, pick up each other’s shifts and ultimately earn more money by picking up available slots that might have otherwise gone unstaffed.

The startup has raised a fresh round of funding — a $6.5 million Series A co-led by Ignition Partners and Madrona Venture Group — to continue developing its workforce management tool. As part of the financing, Ignition managing partner Bob Kelly and Madrona managing director S. Somasegar will join its board of directors.

Shyft co-founder and chief executive officer Brett Patrontasch got the idea for the web and mobile app for workers from his last company, called Scholars at your Service, which employed 250 students-turned house painters. The students had no way of messaging or communicating with one another aside from their personal phone lines.

“It kind of seemed obvious that enterprise social should extend to shift workers,” Patrontasch told TechCrunch. “We are trying to bring a really consumer-friendly mobile experience to the front lines. [Employees] need products that solve their problems and we are really dedicated to helping that worker.”

So far, Shyft has partnered with Gap Inc. to provide the service to workers at its fleet of retail stores, which include Old Navy, Banana Republic and Athleta. Patrontasch says Shyft works with a “handful” of other national retailers, too.

Shyft, a Techstars accelerator graduate, has previously raised $1.5 million in seed funding from Madrona, Flying Fish Partners’ co-founder Heather Redman, former Seattle Seahawks offensive lineman Russell Okung and former Major League Baseball player Edgar Martinez.

Overnight success now requires a little more time

Ten years ago the iOS App Store launched — and the mobile revolution was off. Entrepreneurs everywhere rallied to take advantage, building category-defining consumer companies like Twitter, Uber, Lyft and Square, among many others.

There’s no better time for an entrepreneur to start a company than when a new platform like mobile emerges. The rising tide in these moments becomes a tsunami: Eager customers descend on services through word of mouth and new acquisition channels; there’s outsized press interest; and sales take off in part due to growth of the platform itself.

Now is not one of these periods. Mobile appears mature, and the next great enabling platform is still just past the horizon. That’s why many early-stage VCs have shifted their focus away from consumer and to other new enabling technologies, such as autonomous vehicles, blockchain and AI/ML.

I have a different view. I think now is a great time to build consumer companies, even without a new platform. There are three reasons for this. First, the internet has created big problems for humans, organizations and society, which entrepreneurs can attack at scale. Second, the first wave of mobile-enabled companies have laid a foundation — including processes, seasoned executives and business models — that new entrepreneurs can borrow. And third, mobile technology is still changing and evolving.

Let’s take a closer look at all three.

Solving big problems

The last wave of breakout companies created interactive platforms (Twitter, Snapchat, Instagram, etc.) that have entertained many. They didn’t solve big societal problems. There’s now a big need — and big opportunity — for companies that can help people save time, money and sanity, even as they build great businesses.

Most of us now realize the major problems that a connected, mobile, always-on world has wrought. These include:

  • Income inequality. Lower-income Americans are struggling more than ever. Entrepreneurs should be thinking of ways to help folks where they need it the most: the pocketbook. That might mean unlocking found money, ensuring that available financial resources are being used wisely or saving consumers from the growing number of “gotchas” imposed by financial institutions.
  • Too many choices. When you can buy or choose anything, it’s hard to pick what you actually want. There are wide-open opportunities for concierges, curation and trusted guides.
  • A lack of intimacy. With everything online and available at the touch of a keypad, genuine human interaction has become more rare. There’s a need for companies that can provide real care and curation for matters that affect our daily lives.

Newly available resources

After a decade of building companies for mobile, there are now untold stories, battle scars and people available for future companies to learn from. This makes it easier for startups to assemble playbooks and experienced teams. It also reduces the downside risk for investors, opening new paths to capital for companies that need it.

For instance, it’s now clear that consumer brands must define, own and curate an end-to-end experience. A great new example is GOAT, the online sneakerhead marketplace. Faced with a sneaker market full of rampant knock-offs, the founders invested in a capital- and time-intensive process to manually inspect every shoe for authenticity. The result is an experience that every sneakerhead loves and a breakthrough consumer brand.

Building a breakout consumer platform will be more complex, more challenging and often more capital-intensive than it was for the prior generation.

There are also lots of executives and teams that know how to lead and manage complex operations, especially on the ground. This is crucial to scale logistically complex ideas like Opendoor, Instacart and others.

The other thing needed to help scale these companies is capital. And right now, there are two particularly relevant new kinds of investors: 1) mega equity funds like SoftBank Vision Fund, and 2) alternative lending funds that provide non-dilutive capital to companies to finance the acquisition of traditional assets. Those capital sources enable companies like Opendoor (disclosure: I’m a personal investor) to own and manage a truly delightful end-to-end experience.

Mobile today is not mobile tomorrow

Mobile devices have come a long way over the last decade. And there will be many more meaningful improvements in the near future, allowing for new uses and new companies.

I anticipate breakthroughs that will boost the ability of the chips and subsystems on a phone to perform optimally for far longer. Right now, these are throttled due to heating issues and other problems. As companies solve these issues, they’ll create order of magnitude improvements on what our phones are capable of, bringing technologies like VR and AR, to take two examples, far forward into everyday use.

On the network side, 5G and subsequent buildouts will meaningfully change what kinds of bandwidth we can handle, enabling even more data and compute to be in the cloud.

Mobile today is about one-to-many broadcast platforms like Instagram, Twitter and Facebook. Tomorrow’s great consumer companies will leverage a better vector: one-to-one customer intimacy. Companies like Grove Collaborative (disclosure: Mayfield is an investor) are experiencing hypergrowth in part by using real people connecting with consumers over text to bring a curated, personalized experience to shopping for household staples. I expect this to be a major trend, with the companies that earn the right to communicate more with customers the ones that win.

Building a breakout consumer platform will be more complex, more challenging and often more capital-intensive than it was for certain titans of the prior generation. But for those with the vision and substance to bring a valuable service to the world that solves real problems, the resources and emerging technologies will be there to help create the next groundbreaking consumer brand.

What the FDA’s restriction of e-cig flavors means for Juul

FDA Commissioner Scott Gottlieb has revealed his plans to combat underage use of e-cigs and nicotine, which has grown 78 percent among high school students from 2017 to 2018.

The commissioner today announced a plan that would remove all flavored electronic nicotine delivery system products — with the exception of tobacco, mint, menthol, or non-flavored products — from any store where children under the age of 18 can see them.

So what does this mean for Juul, a company that reached a $10 billion valuation 4x faster than Facebook and currently owns more than 70 percent of the e-cig market?

One result is that Juul Labs is likely now just as desperate for minors to quit vaping as the FDA. The commissioner has made it abundantly clear that if he doesn’t see a significant decrease in underage use, he’s willing to pull the plug on the e-cig industry.

“I could take more aggressive steps,” Gottlieb said in a written statement. “I could propose eliminating any application enforcement discretion to any currently marketed ENDS product, which would result in the removal of ALL such products from the marketplace. At this time, I am not proposing this route, as I don’t want to foreclose opportunities for currently addicted adult smokers. But make no mistake. If the policy changes that we have outlined don’t reverse this epidemic, and if the manufacturers don’t do their part to help advance this cause, I’ll explore additional actions.”

Yes, it seems remarkable that we may live in a world where cigarettes, the country’s leading cause of preventable death, are available at grocery stores but e-cigarettes, which are said to be 95 percent less dangerous, are illegal.

But that’s exactly what might happen if the government, e-cig manufacturers, and consumers don’t work together to end underage use of nicotine.

Though some critics would argue otherwise, Juul has maintained that it never intended to sell to minors. Which doesn’t change the fact that the company’s revenue is largely dependent on the nicotine addicted as a category.

The American economy was essentially created upon the back of Big Tobacco. And 50 years ago, the industry got away with marketing to young people and creating several generations of addicted adults to what may have been the most successful consumer product ever. To say that it was lucrative would be an understatement. It still is.

Fiscally, would Juul enjoy being the next Philip Morris? Undoubtedly. But it would rather be the next Nicoderm CQ or Nicorette than be illegal. Hell yes! Right now, the company is still hanging in there. But the only way to prevent the company from being officially banned in the U.S. is to find a way to get kids to stop vaping.

For this reason, Juul Labs is going a few steps further than the FDA’s new policy. Not only is the company removing non-tobacco flavors from convenience stores or other stores where people under 18 can shop, but it’s also removing all non-tobacco flavors from vape shops and age-restricted specialty stores. From here on out, the only place to buy Cucumber, Creme, Fruit and Mango (the most popular flavor) Juul pods is on the Juul website.

The company will also increase its secret shopper program from 500 visits/month to 2,000 visits/month at the more than 90,000 stores where Juul products are sold.

Juul’s plan, announced Tuesday, also includes removing the company’s Instagram and Facebook channels, and limiting its Twitter account to non-promotional information.

Alongside cracking down on flavored ENDS products, Gottlieb is also looking into banning combustible menthol cigarettes and all flavored cigars from the market. Mint and menthol ENDS products could also be on the chopping block.

“I’m deeply concerned about the availability of menthol-flavored cigarettes,” said Gottlieb in a written statement. “I believe these menthol-flavored products represent one of the most common and pernicious routes by which kids initiate on combustible cigarettes.”

Not only does the masking effect of menthol make combustible menthol cigarettes more attractive to youth, but Gottlieb went on to say that “they exacerbate troubling disparities in health related to race and socioeconomic status” and “disproportionately and adversely affect underserved communities.”

For these reasons, the FDA is taking a hard stance on menthol combustible cigarettes and flavored cigars, a move that will surely mobilize big tobacco in yet another battle in their decades-long war against regulators. Until restrictions can be enforced on these combustible products, however, the FDA is allowing menthol and mint flavored ENDS products to be sold in convenience stores as well as vape shops.

But Gottlieb will be keeping a close watch on it:

“I’m also aware that there are potentially important distinctions even between mint- and menthol-flavored e-cigarette products,” he wrote. “I’m particularly concerned about mint-flavored products, based on evidence showing its relative popularity, compared to menthol, among kids. So, I want to be clear that, in light of these concerns, if evidence shows that kids’ use of mint or menthol e-cigarettes isn’t declining, I’ll revisit this aspect of the current compliance policy.”

In response to the FDA’s announced plan, a Juul Labs spokesperson had this to say:

Commissioner Gottlieb has made it clear that “preventing youth initiation on nicotine is a paramount imperative.” As we said earlier in the week, the numbers tell us underage use of e-cigarette products is a problem that requires immediate action. That is why we implemented our action plan. We are committed to working with FDA, state Attorneys General, local municipalities, and community organizations as a transparent and responsible partner in this effort.

The FDA statement, which is more than 4,000 words, thoroughly explains that the agency is trying to strike a balance between ensuring adult smokers have an alternative through ENDS and protecting a generation of young people from becoming addicted to nicotine.

In light of the FDA’s opposition to menthol, Gottlieb addresses the distinction between allowing menthol/mint and tobacco flavored ENDS into convenience stores opposed to other flavors:

This distinction among flavors seeks to maintain access for adult users of these products, including adults who live in rural areas and may not have access to an age-restricted location, while evidence of their impacts continues to develop. It also recognizes that combustible cigarettes are currently available in menthol in retail locations that are not age-restricted. This approach is informed by the potential public health benefit for adult cigarette smokers who may use these ENDS products as part of a transition away from smoking.

As far as online sales go, the FDA is looking to ensure that all flavored ENDS products sold online go through a rigorous age-verification process.

Gottlieb also addressed the potential for new products to reverse the growth of underage ENDS use, and said that the agency would work to make the application review process more efficient.

“In the coming months, CTP plans to issue additional policies and procedures to further make sure that the process for reviewing these applications is efficient, science-based and transparent,” said Gottlieb. “We’ll also explore how to create a process to accelerate the development and review of products with features that can make it far less likely that kids can access an e-cigarette.”

Juul Labs has briefly discussed its vision for a next-generation e-cig, which the company has been working on for a year. The device would incorporate Bluetooth, letting users monitor and control their nicotine intake. However, Bluetooth might also allow for geofencing to prevent kids from using the product at school, as well as a smartphone-based lock that would only allow the Juul to be used by someone who has verified they’re over 21.

Meet Uber’s newly promoted Chief Product Officer, Manik Gupta

Manik Gupta got his first taste of solving logistics nightmares when fresh out of college, he was delivering Palm Pilots around Singapore. He’d started a precursor to Groupon called BuyItTogether. “We were a full stack marketplace where we were also delivering the goods. That’s what caused us to not have good profit margins. Actually, zero profit margins” he recalls with a laugh.

His new gig isn’t earning profits either. Uber lost nearly $1 billion last quarter. But the company sees Gupta’s experience with delivery and maps as crucial to building an app that caters to people’s every desire so they never stray and keep earning money for Uber. That’s why today Uber announced that it’s promoted its VP of maps and marketplace Manik Gupta to become its new Chief Product Officer.

“We look at ourself at Uber as the starting point of all your transportation needs” Gupta tells me. “Here’s a company that’s causing this interesting change in user behavior. With my own knowledge and capability, I thought I could help the company get to the next level of understanding the real world, which is very different from digital habits.” His first big projects will be augmenting GPS for more accurate pickups and making Uber’s new rider and driver loyalty program work in every market.

From entrepreneurship to the massive supply chain of HP, to the top of Google India and now at Uber, Gupta is one of those technologists who lives to eliminate frustration. He framed nearly every question I asked him in the sense of problems and solutions. In the messy physical realm of clogged streets, that mentality goes a long way.

“I grew up in India and things weren’t always very structured” Gupta says when asked where that philosophy came from. “I learned to manage uncertainty and the importance of having a Plan B at a very early age. I faced a lot of real time micro-problems needing micro-solutions and I guess I’ve honed this skill over time.”

Back in 1999, there were no logistics networks. “We couldn’t get the retailers to do the delivery themselves. So we had to do it” Gupta remembers, seeming like he’s still a bit exhausted by the experience. He eventually sold BuyItTogether to a Norwegian company called CoShopper and spent a few years bringing the service to Europe. “That was my first foray into doing things in the real world and being focused how we can move things from point A to point B as fast as possible.”

Manik Gupta’s first startup, the very 90s “BuyItTogether”

From there he joined Hewlett Packard as it struggled to match Dell’s direct-to-consumer sales model, which he says “required building tons of muscles for HP. ” After getting an MBA, he joined Google India in Bangalore. “My first week, my manager asked me what are things I’m interested in, and told me ‘THere’s something called Maps that no one seems to be owning. Do you want to work on that?”

That opportunity would set him on the path to Uber. He launched Google Maps in India and managed MapMaker, the crowdsourcing tool that gave Google feet on the ground in tiny towns around the world. Gupta moved to Mountain View in 2011 to oversee Google push to make its own maps, which after seven years at Google set him to join as Uber’s VP of maps and marketplace in 2015.

Now after nearly three years, and spending the last five months filling in since Uber’s VP of Product Daniel Graf left, Gupta is in the top product spot at Uber. He’s humble about the new gig, repeating “I’m here to help” rather than to lead or become some tech luminary. He seems content leaving that to Uber’s CEO Dara Khosrowshahi

Knowing that Uber is spread across so many culturally distinct place, Gupta wants his teams to build what’s right for the world around them rather than trying to make Uber the same everywhere. “One of the things I learned back at Google is that you really have to empower teams that are locally situated.” For example, the India team was fully responsible for the development of its new Uber Lite app for emerging markets with slow connections and old phones.

One thing I hope he develops a coherent cross-border strategy for is helmets. With Uber’s bikes and scooters proliferating, people around the world are increasingly hopping on and hopping off. But the spontaneous nature of the experience means many riders aren’t wearing helmets. If that practice continues, major injuries will stack up. Not only is it a moral imperative that Uber develop a helmet solution like something collapsible or that attaches to the vehicle between riders, but its relationship with local governments will depend on keeping citizens safe.

On Gupta’s personal roadmap is rolling out the Uber Rewards rider loyalty and Uber Pro driver loyalty initiatives. “Both of these programs are just getting started, so I’m focused on getting them install the communities we serve.”

Drawing on his Google Maps experience, Gupta is developing a new way to make sure drivers and riders can always find each other.We’re rethinking GPS to solve a major pain point for riders and drivers: pick up location. These locations are particularly tricky for GPS to find when they’re in “urban jungles” or areas with a lot of tall buildings” Gupta explains. “The technology we’re piloting in a handful of cities improves GPS performance in these cities by using maps and satellite signal strengths to help drivers find pick up points more easily.”

But knowing Uber’s history of culture issues, Gupta wants to ensure his team lives by Dara’s new mantra of ‘Do the right thing. Period.’ This is a super important topic as well. I believe that the way you set culture starts at the top. Dara has been a phenomenal agent of change within the company. Over the course of this year we have attracted excellent talent from the product team — from the Facebook’s and Google’s of the world. We have this melting pot of people from all different backgrounds.” To build for everyone, he knows each of those voices must be heard.

Propel accelerates with $18M Series B to manage product lifecycle

We hear so much about managing the customer relationship, but companies have to manage the products they sell too. Propel, a Santa Clara startup, is taking a modern cloud approach to the problem, and today it landed an $18 million Series B investment.

The round was led by Norwest Venture Partners. Previous investors Cloud Apps Capital Partners, Salesforce Ventures, and Signalfire also participated. Today’s investment brings the total raised to over $28 million.

“We are focused on helping companies design and launch products, based on how you go through the life cycle of a product from concept to design to make, model, sell, service where everybody in a company gets involved in product processes at different points in time,” company co-founder and CEO Ray Hein told TechCrunch.

Hein says the company has three core products to help customers track products through their life. For starters, there is the product lifecycle management tool (PLM), used by engineering and manufacturing. Next, they have product information management for sales and marketing and finally they have service personnel using the quality management component.

The company is built on top of the Salesforce platform, which could account for Salesforce Ventures interest in the startup. While Propel looks purely at the product, Salesforce is more interested in the customer, whether from a sales, service or marketing perspective.

These same employees need to understand the products they are developing and selling and that is where Propel comes into play. For instance, when sales people are filling out an order, they need access to the product catalogue to get the right numbers or marketing needs to understand the products they are adding to an online store in an eCommerce environment.

Traditional PLM tools from companies like SAP and Oracle are on-prem or have been converted from on-prem to cloud services. Propel was born in the cloud and Sean Jacobsohn, partner at Norwest Venture Partners, who will be joining the Propel board, sees this as a key differentiator for the startup.

“With Propel’s solution, companies can get up and running faster than with on-premise alternatives and pivot products in a matter of seconds based on real-time feedback gathered from marketing, engineering, sales, customers and the entire supply chain,” Jacobsohn said in a statement.

The company was founded in 2015. It currently has 35 employees, which Hein intends to boost to 50 in the coming months flush with these new funds.