All posts in “Startups”

Here are the top schools among founders who raise big dollars


You don’t need a fancy university degree to launch a startup and secure venture capital. But looking at the data on who gets funded, alumni affiliation sure seems to be a big contributing factor.

For this back-to-school series, Crunchbase is taking a look at how top U.S. universities rank in terms of graduating entrepreneurs who go on to launch funded startups. We look at which institutions launch the most startups, as well as the most highly capitalized.

But first, a spoiler alert: If you’re looking for surprises, stop reading now. The results largely confirm what people in venture and startup circles could probably guess. Stanford graduates more founders who raise more money than any other school. The rest of the list is rounded out by large Ivy League schools, prestigious technology institutes and some big state research universities.

Who launched the most startups

First, we ranked schools according to the number of alumni-founded startups that raised $1 million or more in the past year. No big surprises here, though it should be noted that a few universities are seeing some nice year-over-gains. MIT had 134 alum-funded startups that raised over $1 million, up from 108 in the year-ago period. The University of Washington went up from 35 to 41 alum-funded startups, while University of Illinois, Urbana-Champaign had 44, up from 39 in the year-ago period.

Getting down to business

Crunchbase lists business schools separately, so we ranked them here (our search is for Aug. 1 2016 to Aug. 1 2017). Again, not a lot of surprises, unless you were thinking that Stanford would once again be on top. The top spot belongs, instead, to Harvard. (Perhaps it helps that Harvard is the larger business school, with over 1,800 students, compared to a little over 800 at Stanford.)

Who raised the most money?

When you look at which colleges have startup founders who raised the most funding, the results get more mixed-up. Because unicorns and near-unicorns are gobbling up such a big chunk of venture funding, having just one or two heavily funded companies in the mix really skews the results.

Take New York’s Baruch College, for instance. It has just four alum-founded startups that raised a million or more in the past year. But one of them happens to be WeWork, founded by Baruch alum Adam Neumann, which has disclosed fundraising of close to $4 billion this past year. The University of Chicago is another case in point. A single company, South Asian ride-hailing app Grab, accounts for more than three-fourths of all funding for alum-founded startups in the past year.

Nonetheless, it’s still fun to see which schools had the most heavily funded startup founders. Here are some of the top ones we found:

At several schools, a single company accounted for 50 percent or more of total funding. These include Carnegie Mellon (Argo AI), Baruch (WeWork), Harvard Business School (Grab) and University of Chicago (also Grab).

Overall, the data shows that while founders of hot startups don’t need a specific educational background, it helps to attend a school with certain characteristics. In particular, founders tend to study at universities that are prestigious and have well-known programs in STEM and business fields. It also helps to be based in a metro area with a strong tech ecosystem and access to venture capital.

Methodology

Generally, Crunchbase lists business school affiliations in lieu of the university. (For instance, alums who only attended Harvard Business School aren’t listed as Harvard University grads, too.) However, the database isn’t comprehensive in this area, so a few business school grads may be in the main university listing and vice versa. This does not significantly impact rankings, but it does create some margin of error.

Additionally, many business schools grant additional degrees and certifications beyond the traditional MBA, such as Harvard’s AMP (Advanced Management Program). For the first business school chart showing the total number of funded startups, Crunchbase includes recipients of both degree and certification programs who list themselves as alums in our database. However, we dropped short-term degree recipients for the largest rounds in the listing of funding totals.

Featured Image: Li-Anne Dias

Y Combinator-backed VIDA turns artwork into fashion, accessories and more


VIDA, an e-commerce startup that allows artists to upload their designs to be printed on real-world materials – like fabric, leather, metal and more – which are then sold as unique products, has grown its community of artists to over 100,000 members since its launch a few years ago. The company is now participating in startup accelerator Y Combinator, following its recent collaborations with big names, including Cher, Steve Madden, Warner Bros. and others.

The idea for VIDA comes from founder Umaimah Mendhro, originally from Pakistan, a Harvard Business School grad who has worked in the past at Microsoft and San Francisco-based market accelerator West.

Mendhro had once wanted to be an artist, having taught herself to cut, sketch, sew, stitch, screen print, paint, and more. But she was worried that she couldn’t make a living by way of art alone, which eventually led her to take another path.

With VIDA, Mendhro merges her interests in art and technology by offering a platform where artists can submit their designs, which then become clothing through VIDA’s use of direct-to-fabric digital printing and, more recently, other methods to expand printing to harder materials.

With the digital printing technique, the process of transferring a design to fabric is quicker than traditional methods. This allows VIDA to print items on demand at scale, instead of holding inventory. It’s also now using 3D printing to design the molds for its jewelry collections, and plans to soon move into other areas, like 3D knitting and laser cutting.

Once printed, VIDA creates a branded page for its artists which they can promote however they see fit. The artists recoup 10 percent of the net sales of all their products sold on VIDA, as VIDA handles everything else associated with the manufacturing and sale of those items beyond the design.

When it first launched, VIDA had only a couple of types of products available – silk tops and a few styles of scarves.

Today, the company has branched out to numerous areas – tops, bottoms, wraps, bags, scarves, items for the home like pillows and tapestries, pocket squares, bags, jewelry, and more. It has also grown its community to over 100,000 artists and creatives from over 150 countries worldwide. The site hosts over 2 million individual SKUs, and is adding around 5,000 more daily.

[embedded content]

VIDA isn’t sharing customer numbers or sales figures, but it worked with Cher this year, in a collaboration with HSN. It also worked with Warner Bros. on a collection of Wonder Woman-inspired items, also for HSN.

While VIDA’s larger vision is about making a platform where any idea can become a product, Mendhro says it also appeals to a new kind of consumer.

“We’re rejecting the standardized, mass-produced goods that have been dominating in the retail industry. We want something that’s unique, that tells a story, that has a part of us in there, and something that feels authentic and genuine,” she says.

Despite the custom-made nature of the products, many are surprisingly affordable. For example, the custom bags are in the $40 to $50 range – lower than a new Nine West purse or other mass market brand.

The company also appeals to the socially conscious shopper, as it gives back to those manufacturing its goods in factories through initiatives like its literacy programs and women’s empowerment programs in Pakistan, India and Turkey.

The team of just over a dozen is based in San Francisco, and plans to raise additional funds following Y Combinator’s Demo Day to expand beyond fabrics and further scale the business.

The startup is backed by $5.5 million in funding from Google Ventures, Azure Capital, and Slow Ventures. This is a continuation of the $1.3 million seed round TechCrunch previously reported in 2014, when VIDA was in an earlier stage.

Original Tech helps banks offer better loan applications


Americans apply for more than 250 million new financial products each year, but the majority of those applications are completed on paper or over the phone. A startup called Original Tech wants to change that by providing white-label software to improve loan applications completed online.

While many of the big financial institutions have their own in-house engineering teams focused on building better products for consumers, it’s difficult for the mid-market and smaller banks, credit unions and non-bank lenders to compete on the customer-facing user experience. That’s where Original Tech comes in.

It enables borrowers to apply for loans on desktop, tablet or mobile devices without needing to go through the manual process of filling out paper applications or fax documents to the financial institution.

For lenders, Original Tech takes care of the data collection, fraud prevention and compliance enforcement. But its system is designed to work within lenders’ existing workflows and allows them to apply all their own underwriting rules.

Original Tech was founded by Heang ChanSean Li and Chris Blaser, all of whom are former employees of Blend, a B2B fintech company focused on providing technology solutions to mortgage lenders. Like Blend, the Original Tech team wants to take the pain out of the application process for borrowers, while also increasing application completion, and thus increasing the number of loans issued by lenders.

There are a few differences, however: Blend is currently focused almost exclusively on providing white-label tools to process mortgage applications, while Original Tech’s system can be used for multiple different lending products.

In addition, Blend historically has taken a top-down view of customer acquisition, going after some of the largest financial institutions as its anchor clients. Meanwhile, Original Tech is targeting the mid-market and below for its initial customer outreach, as it believes it can best serve financial institutions with limited engineering resources.

Finally, Blend has raised about $60 million since being founded, while Original Tech is angel-funded and just got started. That said, Original Tech is angel-funded and just about to graduate from Y Combinator’s Summer 2017 class.

Though it just launched, Original Tech has signed up 10 customers, including banks like Metropolitan Capital Bank, Rockhold Bank, Conventus Lending, Guarantee Mortgage, Loan Factory, Pacific Private Money and Clear Choice Credit. With Demo Day next week, the company is hoping to attract more funding and maybe also some new customer interest.

‘Airbnb for boats’ startup Boatsetter buys competitor Boatbound


You don’t have to be rich or T-Pain to be “on a boat.” You can rent one plus a captain for the day from Boatsetter. And now it’s got boats in more than 300 locations around the U.S. since it just acquired rival maritime marketplace Boatbound.

Boatsetter will be taking select talent from Boatbound plus logistics tech and its inventory of vessels for rental. A source familiar with the transaction said the acquisition was paid for with Boatsetter stock valued in the low-millions range.

The deal makes Boatsetter the biggest peer-to-peer boat rental service in the States, and possibly the world.

To fund future acquisitions of other competitors, Boatsetter also is announcing it has added $4.75 million in funding to its December 2016 Series A round, bringing the startup to a total of $17.75 million raised.

“The primary uses of the funds are M&A, growth and international expansion,” Boatsetter CEO Jackie Baumgarten tells me. When asked if she’ll go after European counterpart Click To Boat, she said, “I think we’re best poised for a roll-up strategy. There’s an opportunity to acquire and roll up several of the players. It’s ripe for consolidation.”

Everyone’s a captain

Boatbound launched back in 2013, well before Boatsetter, and raised more than $5 million from 500 Startups, equity crowdfunding platforms and boat manufacturer Brunswick.

The company went on to process more than $25 million in booking requests. However, it also faced complaints about safety and insurance after a woman lost her leg in an accident after renting through Boatbound. The startup didn’t require people to rent a captain with a boat as Boatsetter does, which delayed rescue procedures after the renter was sucked into the boat’s propeller.

Boatbound quieted down since moving from San Francisco to Seattle 2016 to cut costs and push towards profitability. Now the nationally available service is somewhat oddly being acquired by a competitor that was only operating in one state.

The combined company hopes things will sail smoothly thanks to Boatbound’s technology for routing rental requests and Boatsetter’s focus on insurance.

Based out of Florida, Boatsetter is a three-party marketplace where private boat owners and professional charter companies, captains and renters meet. Users can pick from nearby boats, rent one with a captain attached or pick a separate captain, and quickly get out on the water at an affordable price. Since the private owners are just trying to make back some of the non-stop expenses of keeping a boat afloat, Boatsetter can be cheaper than going through a traditional rental company.

Baumgarten actually started a peer-to-peer boating insurance company called Cruzin that later merged with Boatsetter. That’s how Boatsetter provides $1 million in liability coverage, $2 million in boat damage coverage, plus additional umbrella coverage to make renters feel safe.

Boatsetter says it has 5,000 vetted boats available, and is poised for 5X growth this year to hit over 10,000 rentals. That’s because Boatsetter has only concentrated on Florida, while Boatbound works with vessels across the country. The business model sees Boatsetter take 28 percent of the rental fee from the owner, 10 percent of the captain’s fee and adds a 7.5 percent booking fee to the renter. Those combine into a healthy margin, considering Boatsetter doesn’t own or upkeep any boats.

Experience > possession

Now the 27-person startup has a new channel to chase the estimated $50 billion yearly total addressable market for boat rentals. Boatsetter has partnered with Airbnb’s new experiences platform to let people pay to learn to sail in the San Francisco Bay, take a lesson from a pro wakeboarder in Miami or have paella cooked fresh onboard by a chef in Barcelona.

Boatsetter’s biggest challenge will be developing awareness. Most people assume they need a ton of money or boating skills to get out on the water. But the world is shifting from a materialistic culture to an experiential culture. It’s why Airbnb is blowing up.

People want to do amazing things they can capture on their camera phones and share on their social networks. They want memories. And it’s hard to top gliding over the waves with friends on your own private boat… even if it’s just for the afternoon.

LiftIgniter raises $6.4M to bring website personalization to the rest of the internet


You’ve probably had the experience of going to a website and seeing a lot of content that’s not really relevant. For the most part, a lot of this is organized in a way that’s either pre-defined or based on a limited number of signals that aims to sort of personalize the experience for a normal user.

But as time goes on and the competition for eyeballs continues to heat up, that light level of personalization probably won’t be enough. Instead, users can go to Facebook or Amazon, which have an enormous amount of data on its users, to get a much more personalized experience. Every other site that wants the attention of users needs to have a better-curated experience, and that’s what LiftIgniter is hoping to help those sites achieve. The company is raising $6.4 million in a round led by Storm Ventures. LiftIgniter has raised $8.25 million to date and was a finalist at TechCrunch Disrupt London 2016.

The goal is that the software will help customize the content on any given page for a specific user, which, hopefully, makes their experience more enjoyable. Those users may then end up either coming back over and over or eventually converting to customers and buying products. It’s all designed to create a more engaging experience, which in the end will help drive additional business to these sites through either more customer conversions or simply more unique visits and page views. LiftIgniter services more than 5 billion page views a month, co-founder Adam Spector said.

“Our view is that there should be a personalization API, just like there’s an API for text messages with Twilio or payments with Stripe,” Spector said. “Every digital property should have personalization built in. Media, e-commerce, enterprise, business-to-business SaaS, it doesn’t matter. If you create an experience for users, you should want to give them something they want. The only way to do that at scale is with machine learning.”

That “machine learning” part is important because the signals that users give to various websites are going to constantly be changing. As more and more users feed more and more data to the internet, having a truly engaging and personalized experience is table stakes to keep someone’s attention. A lot of companies will claim to be AI companies, but Spector says LiftIgniter has its own flavor that looks at a ton of signals that help define a profile of a user. Each signal is dependent on the last, and it’s the sum of those signals — all closely intertwined — that determines the user’s experience.

“Our customers’ websites are living and breathing things, and the connections between every piece of content is changing,” Spector said. “The articles you write today could be super relevant to an article that’s five years old. The relevance may change over time. The world is constantly in flux, the idea of having a hard-coded, static list of connections doesn’t make sense.”

A product like LiftIgniter certainly makes sense: you probably won’t be able to manually update your site fast enough to suit your specific visitors’ needs — especially for each individual user. But the sum of all those individual users is what will drive business, whether that’s through advertising views or purchases. Instead of manually curating a site or a shopping experience and hoping for the best, LiftIgniter tries to convince companies that it can do it at a technical level and drive results immediately.

And that’s one of the core elements of the company. LiftIgniter aims to ensure that the companies are able to get some meaningful metrics of success within 30 days of deploying it. That’s key for many companies, which are looking for some kind of return on any services they employ but may not necessarily get them right away. If you’re going to A/B test and try to personalize your site in order to get users to engage with it more, you’ll want to figure out if the service is actually going to be successful. That means that the companies can, early on, define various objectives and LiftIgniter will try to determine whether it’s able to hit those kinds of targets.

It’s going to be a crowded space — with plenty of competition from companies like Google — as companies race to build these kinds of products for companies. They’re going to become mission-critical tools for the rest of the world going forward as Facebook and other services train users to become completely accustomed to very personalized content. LiftIgniter hopes that creating a sort of blanket tool that any site can employ, as well as very quickly demonstrating some success, will give it a competitive edge to survive.

“We’re literally diverging from ourselves in every moment,” Spector said. “Humans adjust to a changing environment well. Our goals are going to be able to adjust for that and give users what they want. There’s no way I could consume every article. I should find the article I care about with a minimal amount of effort. Without that, they bounce back to Google, or Facebook, and then we outsource their discovery to Facebook and Google.”