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Gtmhub raises $9M from CRV after posting 400% ARR growth in the last year

This week Gtmhub announced a $9 million Series A led by CRV. The investment was not a large round, even for an A. But the capital found its way into one of the fastest-growing SaaS companies that we’ve spoken with recently, which made it interesting all the same.

And, the firm was willing to talk about its financial performance in some detail. The combination made its Series A impossible to ignore.

TechCrunch caught up with Gtmhub’s CMO Seth Elliott this morning to learn more. 

What it does

Let’s start with OKRs. Objectives and key results, better known as OKRs, are a method for organizational planning. They are famous thanks to their roots in Google’s success, but have since broken free of the technology world and become a well-known planning method for corporations of all sizes and types.

Gtmhub deals with them, providing software and services around OKR implementation, training and tracking. (If you an OKR neophyte, head here for a quick overview of what they are.)

Making OKR software isn’t a differentiator in today’s market. Ally does it (it also raised capital recently), along with WorkBoard, Koan and Lattice, among others.

Given the crowded market, Gtmhub stressed during our call how it thinks of itself as differentiated. The company has three things that it hopes will give it an edge in the market. The first is a focus on enterprise customers. According to Elliot, enterprise-sized clients are his company’s “bread and butter,” from a revenue perspective. Instead of starting with a small or mid-sized business target market and later targeting enterprise-scale customers, Gtmhub is going after the top-end of the market first.

Second, the company’s software is designed to interface with external tooling, allowing for real-time OKR tracking as it ingests information to help teams vet how they are progressing against their goals. And, the firm is working on a marketplace where, over time, customers will be able to learn from existing OKR setups and leverage analytics setups that help with data importation and visibility.

In its own words, Gtmhub is an OKR-centric software company, while “provid[ing] a long-term vision and the execution process necessary to bridge the strategy/execution gap,” according to Elliot.

Notably, Gtmhub, despite its enterprise focus, is not abandoning smaller companies. According to Elliot, the startup is announcing a new, stripped-down, $1 per user per month plan next week called START, aimed at smaller firms.

If START is an attempt to onboard companies when they are small so they can be upsold later, or if it is more a contra-competitor move, isn’t clear. But the new, cheap plan (priced at about 10% of other Gtmhub tiers) could shake up the OKR software space by making table-stakes features worth less than they were before.

Gtmhub’s round

Gtmhub is a distributed company, with offices in Denver, Sofia, Berlin and London for its roughly 60 workers. You might think, given its global footprint and number of employees, that the company had raised lots of capital to fund its operations. The opposite, as it turns out.

The startup’s $9 million Series A dwarfs its preceding rounds, including about $3.2 million in seed capital raised over two rounds (one, two) in February of 2018. Aside from those checks and the new capital, all we know about Gtmhub’s fundraising history is that it picked up $100,000 in angel money in early 2017.

All told, Gtmhub has raised just over $12 million to date, making its Series A about 73% of its known raised capital. That’s not the mark of a company built on burn.

Of course, if Gtmhub kept a lid on its expenses by growing slowly, its parsimony might be more sin than virtue; after all, private companies backed with venture dollars are built for expansion.

The opposite, as it turns out.

Growth

Elliot shared a number of notable metrics with TechCrunch that we’ve prepared for you below, in an ingestible format:

  • ARR growth: Over 400% year-over-year (YoY)
  • Gross margin: Above 90%, up from over 80% YoY
  • ACV trends: +650% YoY

Take a moment and square those results with how much capital Gtmhub raised and ask yourself if the performance matches the raise. It doesn’t. I suspect that Gtmhub could have raised a lot more money than it chose to, given its growth rate and other marks of financial health.

But, after expanding to 60 people on less than $3.5 million in known venture, the company probably isn’t too unprofitable, and can do a lot with just $9 million. (Gtmhub could also raise more if it needed to, given its metrics.)

With Gtmhub and Ally each flush with new cash, it’s going to be enjoyable to watch the OKR and OKR-empowered software space grow over the next few years. There will be eventual consolidation, right?

Photo by Startaê Team on Unsplash

Childcare benefits startup Kinside launches with $4 million from investors including Initialized Capital

Childcare is one of the biggest expenses for American parents and it’s not just families who are taking a hit. Childcare issues cost the United States’ economy an estimated $4.4 billion in lost productivity each year and also impacts employee retention rates. Kinside wants to help with a platform that not only enables families to get the most out of their family care benefits, but also find the right providers for their kids. The startup announced the public launch of its platform today, along with $3 million in a new funding round led by Initialized Capital.

This brings Kinside’s total raised since it was founded 18 months ago to $4 million. Its other investors include Precursor Ventures, Kairos, Jane VC and Escondido Ventures.

Founded by Shadiah Sigala, Brittney Barrett and Abe Han, Kinside began its private beta with 10 clients while participating in Y Combinator last summer. Over the past year, it has signed up over a thousand employers, underscoring the demand for childcare benefits.

“Getting meetings with employers has not been the hard part,” Sigala, Kinside’s CEO, tells TechCrunch. “Any subject line that says ‘do you want childcare for your employees?’ immediately gets a response. We a hit a nerve there and when we talked with them, we found that the biggest pain they expressed was that their employees were having a hard time finding childcare.”

Kinside co-founders SShadiah Sigala, Brittney Barrett and Abe Han

Kinside co-founders SShadiah Sigala, Brittney Barrett and Abe Han

The U.S. is the only industrialized country without a national law that guarantees paid parental leave. Companies like Microsoft, Netflix and Deloitte offer strong family benefits in order to recruit and retain talent, but offering similar packages remains a challenge, especially for small- to medium-sized businesses. As a result, many employees, especially women, leave their jobs to care for their children, even if they had planned to continue working.

“The worst case for bigger, more mature companies is a delayed return to work, which has a real impact on the bottom line because of lost productivity, but the deeper pain is when we lose the women,” Sigala says. “It’s documented that 43% of women in the professional sector will leave the workforce within one to two years of having a baby.”

Other startups focused on early childhood care that have recently raised funding include Winnie, for finding providers, Wonderschool, which helps people start in-home daycares and preschools and London-based childcare platform Koru Kids.

Before Kinside, Sigala co-founded Honeybook, a business management platform for small businesses and freelancers. When she got pregnant, Sigala began developing the company’s family benefit policies and became familiar with the hurdles small companies face.

While in Y Combinator, Kinside focused on streamlining the process of using dependent care flexible spending accounts (FSA), or pre-tax benefits for caregiving costs, after its founders saw that the complicated claims process meant only a fraction of eligible parents get full use of the program. Kinside still helps parents with their accounts by partnering with FSA administrators. Now their app also includes a network of pre-screened early childcare providers ranging from home-based daycares to large preschools across the country.

The startup pre-negotiates reserved spots and discounted rates for its users and gives them access to a “concierge” made up of childcare professionals to answer questions. Parents can search for providers based on location, cost and childcare philosophy. Sigala says the startup’s team found that many childcare providers have a 20% to 30% vacancy rate, which Kinside addresses by helping them manage openings and find families who are willing to commit to a spot. In addition to its app, Kinside also plans to integrate into human resources systems.

Initialized was co-founded by Alexis Ohanian, also a founder of Reddit, and a vocal advocate of paid parental leave. One of the areas the firm focuses on is “family tech” and its portfolio also includes startups like the Mom Project, a job search platform for mothers returning to work.

In an email, Initialized partner Alda Leu Dennis said the firm invested in Kinside because “we have this fundamental problem of gender inequality which can be partially attributed to imbalances in the workplace and at home. We have a gender wage gap and domestic responsibilities, still, largely falling on the mother. By solving a problem that men and women have—access to affordable and high-quality childcare—we can improve this situation.”

Dennis added, “the business model innovation that Kinside brings to the table is to involve employers in the process of bringing peace of mind and stability to their employees’ home lives and in turn making their employees more productive.”

Sigala says Kinside sees itself as part of the benefits equity movement, including paid parental leave and, eventually universal childcare, for all working parents. The platform’s users are split equally between men and women, highlighting that the need for caregiving benefits cross gender lines and impact an entire household.

“It’s a complex issue. Our infrastructure and society is still designed for single breadwinner households and yet the economy means that for most households, being able to pay the bills depends on having two parents working,” she adds. “I see this as a movement. It’s the right time.”

Wotch is building a creator-friendly video platform

The team at Wotch has created a new social video platform — but wait, don’t roll your eyes quite yet.

“Obviously, we’re very used to someone creating a new internet video-sharing platform,” said co-CEO Scott Willson. “It must be very irritating for everyone to hear that.”

And yet Willson and his co-founder/co-CEO James Sadler have attempted it anyway, and they’re competing today as part of the Startup Battlefield at Disrupt Berlin. They’re only 22 years old, but Sadler said they’ve been working together for the past few years, with past projects including the development of e-learning platforms.

They were inspired to create Wotch because of YouTube’s recent problems around issues like demonetization, where many YouTubers lost the ability to monetize their videos through advertising, and other controversies like an attempted overhaul of its verification system.

Willson said YouTube has been “leaving out creators in terms of communications,” and as the controversies grew, the pair thought, “There has to be a better way of doing this.”

The key, Sadler added, is giving video creators a bigger say in the process: “We’re very hands-on with these creators. We’re not just sending them an automated email.”

In fact, they’re giving creators an opportunity to buy equity in Wotch to get a stake in the company’s success. They’re also appointing a creator board that will be consulted on company policy.

Wotch creators will be able to make money by selling subscriptions, merchandise and ads — not the standard pre-roll or mid-roll ads (which Willson described as “irritants”), but instead partnerships where they incorporate brand products and messages in their videos.

Asked whether this might create the same tension between advertisers and creators that YouTube has been struggling with, Willson argued, “What it comes down to is correctly matching advertisers with creators.” Some advertisers don’t mind working with video-makers who are “pushing the boundaries” — they just need to know what they’re getting into.

Sadler also said that Wotch will be providing creators with more data about their viewers, like identifying their most loyal fans, their most engaged fans and their first “wotchers.”

And the site will take a different approach to content moderation, using technologies like video frame analysis to identify “risky” content, as well as relying more on community moderation. Sadler said it will be a “consensus” approach, rather than the “dictatorship” of other platforms.

“We’re rewarding users for helping to cleanse these platforms,” he added.

Wotch isn’t identifying any of the big creators who he says have signed on, but Sadler told me that the company is largely focused on emerging markets and has already recruited 25 of the top creators in Brazil (where YouTube has an enormous audience, to sometimes detrimental effect) and throughout South America. Those creators won’t be posting on Wotch alone, but they will be creating exclusive videos for the service.

Sadler said it’s those creators who will draw the viewers: “Consumers are loyal to the creators and not the platforms.” And once they’re drawn in, they’ll also experience “a more social platform — see the things your friends are ‘wotching,’ see the things that your favorite creators are ‘wotching.’”

The startup has raised funding from Dominic Smales, the CEO of influencer marketing company Gleam Futures; Bidstack co-founder Simon Mitchell; and Melody VR founder and COO Steve Hancock. Smales is also leading the creator board.

While a beta version of Wotch is already live, Sadler and Willson plan to launch a revamped version of the service early next year. You can get an early preview of the changes by using the promotional code “TECHCRUNCH.”

The vast majority of US consumers aren’t spending $1,000+ on phones

Pricing in the smartphone wars has taken a sharp turn in recent years on the premium end of the spectrum. Ever since the arrival of the iPhone X, flagship devices have often arrived in excess of $1,000, as company push toward more premium components in order to remain competitive.

Likely surprising no one, most consumers aren’t spending that much on devices. According to numbers from NPD’s latest Mobile Phone Tracking study, however, the numbers are pretty stark. Less than 10% of U.S. consumers are spending that much on devices. That could foretell some bleak numbers for 5G sales, as early units routinely run around $1,200.

Not an encouraging sign as many manufacturers look toward 5G as the next major driver amid flagging global sales. One thing to consider here is that most phones are good at this point. Even mid-tier smartphones are pretty solid. While the devices have become a commodity, few if any users truly need to spend that much on a product. There’s a reason Samsung, Google and even Apple have been focused on lower cost alternatives of late.

There are, however, reasons for manufacturers to be hopeful. For one thing, the arrival of 5G is often cited as one of the primary sources of slowed sales. Many premium users are likely waiting for more network coverage and devices before purchasing their next phone. NPD says that nearly 3/4ths of consumers are at least aware that 5G is a thing.

Also notable is Qualcomm’s recent 765 announcement, which should help make 5G devices accessible for consumers are a lower price point in the coming year. 

Apple: Use only our special cloth to clean the $1,000 coating on our $5,000 Pro Display

If you thought the saga of the $7,000 Apple Pro Display XDR couldn’t get any more ridiculous, prepare yourself for the proverbial cherry on top: The company insists that you only use the single special cleaning cloth that comes with the monitor. If you lose it, you’re advised to order another.

Apple, already under fire from longtime users for the ever-increasing price of its products, attracted considerable ire and ridicule when it announced the high-end monitor in June. Of course there are many expensive displays out there — it was more the fact that Apple was selling the display for $5,000, the stand separately for $999, and an optional “nano-texture” coating for an additional grand.

Just wait till you see how much the Mac Pro that goes with it costs.

Technically it’s not actually a “coating” but an extremely small-scale etching of the surface that supposedly produces improved image quality without some of the drawbacks of a full-matte coating. “Typical matte displays have a coating added to their surface that scatters light. However, these coatings lower contrast while producing unwanted haze and sparkle,” the product description reads. Not so with nano-texture.

Unfortunately, the unique nature of the glass necessitates special care when cleaning.

“Use only the dry polishing cloth that comes with your display,” reads the support page How to clean your Apple Pro Display XDR. “Never use any other cloths to clean the nano-texture glass. If you lose the included polishing cloth, you can contact Apple to order a replacement polishing cloth.” (No price is listed, so I’ve asked Apple for more information.)

Obviously if you’re cleaning an expensive screen you don’t want to do it with Windex and wadded-up newspaper. But it’s not clear what differentiates Apple’s cloth from an ordinary microfiber wipe.

Do the nano-scale ridges shred ordinary mortal cloth and get fibers caught in their interstices? Can the nano-texture be damaged by anything of insufficient softness?

Apple seems to be presuming a certain amount of courage on the part of consumers, who must pay a great deal for something that not only provides an uncertain benefit (even Apple admits that the display without the coating is “engineered for extremely low reflectivity”) but seems susceptible to damage from even the lightest mishandling.

No doubt the Pro Display XDR is a beautiful display, and naturally only those who feel it is worth the price will buy one. But no one likes to have to baby their gadgets, and Apple’s devices have also gotten more fragile and less readily repairable. The company’s special cloth may be a small, even silly thing, but it’s part of a large and worrying trend.