Hello all, I recently left a business that I co-founded so that I could create a new company. The company I left is very successful, I can proudly use that company as a reference to potential lenders / investors. Unfortunately I didn’t have a big cash out, so I don’t sit with much cash to start my new venture. I am estimating that I will need $ 75,000 year 1, $ 50,000 year 2 and potentially $ 50,000 in year 3.
That $ $ would go towards R&D, materials, marketing, trade show attendance, production and a staff of two employees. I would not be taking pay from the company until it is profitable.
Here are some details about my new venture :
It will be retail company selling a physical product.
My product will have innovations that will make it unique in the market.
It will be in the same industry that I left, so I will be starting my new business with over 8 years of proven success.
I already have a large portfolio of buyers whom I have collected over 8 years of networking in my industry. These buyers would be loyal to me.
I own a house with about $ 100000-$ 150000 in equity which I can use as collateral.
I have another real estate asset I can also use as collateral if needed.
So far here are the 5 methods of startup funding I have seen :
Friends / Family
Traditional Bank Loan
I personally would like to eliminate option 2, I have not had the best experience with friends and family. Too much emotion involved
The SBA sounds attractive, but I have been hearing mixed things. Some people are saying they offer funding for small startups (which I am), and others are saying that they aren’t offering that anyone.
Would the SBA be a good fit for me? If not what would you recommend and why?
Digital financial services can help modernise the European economy across sectors and turn Europe into a global digital player, as per the European Commission. By making rules more digital-friendly and safe for consumers, the European Commission wants to leverage synergies between high innovative startups and established firms in the financial sector while addressing associated risks.
Based on broad public consultations and Digital finance outreach, the European Commission has adopted a digital finance strategy. The strategy has four main priorities; removing fragmentation in the digital single market, adapting the EU regulatory framework to facilitate digital innovation, promoting data-driven finance & addressing the challenges & risks with digital transformation, and lastly enhancing the digital operational resilience of the financial system.
With this thought, Bitpanda, a digital investment platform that wants to remove complicated financial barriers, has raised Europe’s largest Series A funding of $ 52M (approx. €44M) led by Valar Ventures – a venture capital firm backed by Peter Thiel. Speedinvest also participated in this round.
Eric Demuth, co-founder, and CEO of Bitpanda says, “Our goal is to become the leading investment and trading platform in Europe, not only for the people who are already familiar with trading but for everyone. This funding will help us do just that and, crucially, continue to recruit some of the world’s leading talent to our team.”
According to the company, this round is the largest European Series A funding round in 2020.
This year, Bitpanda already expanded to France, Spain, and Turkey. The company now plans to expand in additional European markets by 2021, as it looks to offer its users access to stock markets.
The funds will also help Bitpanda to recruit 70 new employees, bringing the total number of staff to 300 by the end of 2020. As part of the investment, Valar Ventures Founding Partner, Andrew McCormack, will also join Bitpanda’s board.
A bit about Bitpanda
The Vienna-based Bitpanda was founded in 2014 by Eric Demuth, Paul Klanschek, and Christian Trummer. The platform removes complicated financial barriers by harnessing the innovative power of digitised assets and blockchain technology. It also offers low fees, 24/7 trading, and real-time settlements.
In simple terms, the platform wants to make it easier for everyone to start investing and to take ownership of their financial future.
According to the company, it is doubling its revenue annually with over 1.3 million users.
Through its website and mobile apps, users have access to 44 investment assets.
Earlier this year, the company launched payments and savings platforms and now looks to build more innovative ways of trading and investing, to ensure digital investing and trading of all asset classes is made available to everyone in Europe.
Recently, the company also announced that VeChain’s native token, VET, will also be available on its platform for crypto enthusiasts to buy, sell or swap VeChain on its platform.
Airwallex is a global financial services provider for businesses managing their money internationally. It is one of the companies that seem to be faring well this year as it has now announced raising €34.2M in an extended Series D funding round. This announcement comes soon after the company raised a notable €137M in Series D round previously, which was led by some well-known investors such as Horizon Ventures, Sequoia Capital, and DST Global, among others.
Expanding services to new regions
With the fresh amount Airwallex has raised, it plans to work upon its offerings and product suite. Along with plans to strengthen its existing footprint in regions such as Asia-Pacific and UK & Europe, the company plans to expand its global payment coverage and include regions such as the Middle East, Eastern Europe and Africa. Airwallex is also working on entering into the US market by Q1 2021.
Jack Zhang, CEO and co-founder of Airwallex, says, “A major shift in the way businesses operate from offline to online is something Airwallex predicted from our inception. However, 2020 has fast-tracked this transition in a way no one could have foreseen. Businesses are now racing to embrace digital transformation at an unprecedented rate. We are more certain than ever that the digital economy is going to be the centre of the world’s economic structure.”
Accelerated demands for digital payments
There’s no doubt that the coronavirus pandemic has severely impacted 2020. While the global economy is recovering slowly, the pandemic brought along an accelerated digital adoption of almost all services. From education to payments, everything has almost completely migrated online. Airwallex did well this year since it offers services that support digital payments.
The company reports over 50% increase in its global customer base and over a 100% increase in net revenue in Q3 2020 over Q2 2020. The company has reported this in the e-commerce, digital, tech, and logistics sectors. This year, Airwallex also introduced a host of new products such as virtual multi-currency debit cards with Visa, a bank feed integration with Xero, a new rewards program, and card payment acceptance capabilities.
Airwallex is also on the lookout for new team members as it is now hiring for over 100 vacancies, which are available across its global offices.
London-based on-demand wellness app Urban is one of the leading wellness app in Europe, which operates in four cities. The company works with the mission to make it easy to book appointments for wellness and treatments right in the comfort of their home. It empowers practitioners by providing them the tools, information, and community to build their business.
Raises €6.5M funding
Now, Urban has raised €6.5M on Seedrs, an equity crowdfunding platform, thereby tripling the initial target of €2M. This is the third-largest raise on Seedrs this year. Among the 2020 Seedrs investors is BNF Capital, a London investment firm with companies such as AirBnB, Gousto, and Revolut in its portfolio. While the campaign was originally set to campaign until mid-October, the increased investment made Urban close the crowdfunding earlier than expected.
“We’re energised and ready to start making good on the promises we’ve made to investors, which includes longstanding Urban customers and professionals alike. This crowdfund is likely to be our last for a very long time,” says Jack Tang, CEO of Urban.
Urban plans to use the investment to expand to more cities with the help of a new remote onboarding process, which does not require professions to visit a physical office. This COVID-19 secure model will let Urban scale at a much faster rate than ever. It also intends to achieve profitability by the end of 2021 by building on its services such as massage, beauty, osteopathy, physiotherapy, fitness and more.
Staying well during the pandemic
Founded in 2014 by Jack Tang and Giles Williams founded Urban with the intention of starting a massage-at-home service. However, they discovered an industry that was broken: practitioners typically took home only 20% of booking revenue and worked long hours to make ends meet. Meanwhile, customers had little other than a salon’s reputation to go off of before making a booking with a specific practitioner.
Therefore, the duo decided to build a platform that would benefit practitioners and customers alike. According to the company, on Urban, practitioners take home 72% of bookings. And customers are able to choose between trusted, pre-vetted practitioners, thanks to detailed profiles with personal bios, ratings and reviews.
Urban operates in London, Manchester, Paris, and Birmingham. It was founded with the intention of starting a massage-at-home service.
During the pandemic crisis, this wellness app witnessed growing enthusiasm for at-home services, a surge in the number of professionals willing to go mobile to reduce overheads, and less competition in the wellness market. According to the company, as of last year, Urban delivered over 451k treatments and received 91% five-star reviews.
A month after completing Y Combinator’s accelerator program, BukuWarung, an financial tech startup that serves small businesses in Indonesia, announced it has raised new funding from a roster of high-profile investors, including partners of DST Global, Soma Capital and 20VC.
Angel investors in the round include several high-profile founders and executives: finance technology platform Plaid’s co-founder William Hockey; Tinder co-founder Justin Mateen; Superhuman founder Rahul Vohra; Adobe chief product officer Scott Belsky; Clearbit chairman and startup advisor Josh Buckley; former Uber chief product officer Manik Gupta; Spotify’s former head of new markets in Asia Sriram Krishnan; 20VC founder Harry Stebbings; Nancy Xiao, an investor with Bond Capital; and Fast co-founder Allison Barr Allen. Angel investors from WhatsApp, Square and Airbnb also participated.
Launched last year by co-founders Chinmay Chauhan and Abhinay Peddisetty, BukuWarung is targeted at the 60 million “micromerchants” in Indonesia, including neighborhood store (or warung) owners. The app was originally created as a replacement for pen and apper ledgers, but plans to introduce financial services including credit, savings and insurance. In August, the company integrated digital payments into its platform, enabling merchants to take customer payments from bank accounts and digital wallets like OVO and DANA. BukuWarung’s goal is to fill the same role for Indonesian merchants that KhataBook and OKCredit do in India.
One of the reasons BukuWarung launched digital payments was in response to customer demand for contactless transactions and instant payouts during the COVID-19 pandemic. Since introducing the feature, the company said it has already processed several million U.S. dollars in total payment volume (TPV) on an annualized basis. The company says it now serves about 1.2 million merchants across 750 locations in Indonesia, focusing on tier 2 and tier 3 cities.
Digital payments is also the first step into building out BukuWarung’s financial services, which will help differentiate it from other bookkeeping. The payments features is currently free and BukuWarung is experimenting with different monetization models, including making a small margin on fees.
“The reason why we launched payments is also very strategic, because there is a lot of pull in the market. We have already seen several millions annualized TPV in less than a month, because the payments we offer are cost-efficient as well and cheaper than to get from a bank,” Chauhan told TechCrunch.
“If you look at the Indian players, like Khatabook, they have also launched digital payments. The reason for that is because it’s a very essential step for building a business and monetization,” he added. “If you don’t have payments, you can’t do anything like that.”
Chauhan added that building a financial services platform is the difference between providing a utility app that replaces bookkeeping ledgers, and becoming an essential service for merchants that will eventually include lending for working capital, savings and insurance products. The bookkeeping features on BukuWarung will feed into the financial services aspect by providing data to score creditworthiness, and help small merchants, who often have difficulty securing working capital from traditional banks, get access to lines of credit.
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Luckabox, the Winterthur-based VentureKick and KickStart alum recently secured a seven-figure pre-Series A round which will serve to reshape its product aimed at managing the end-to-end last mile logistics process for retailers. The latest round has seen existing investors Alpana Ventures, SICTIC and DAA Capital rejoin and new investors like Bettina Hein, a serial technology entrepreneur…
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Undoubtedly, there has been an increase in funding activities across Europe as the tech startup ecosystem here seems to be eager to pick up the slack after the COVID slump. Several tech startups have started focusing on growing and taking their business to the next level. Many of these companies have started hiring fresh talent and forging strategic partnerships.
European tech startups weekly
As a part of a weekly roundup, here is a list of some of the most important tech startups that have hit the headlines in Europe this week.
Productivity, collaboration tools for healthcare industry
Based out of Belgium, Awell Health bagged £1.9M (nearly €2M) funding from LocalGlobe and Moonfire, London-based investors. With this investment, the startup will bolster its collaboration and productivity tools for the healthcare industry. This is crucial, especially during this COVID-19 crisis, as faster updating and easier implementation of patient guidelines is a priority.
Founded in 2018 by Thomas Vande Casteele, Awell Health enables healthcare organisations to create, implement, and update care pathways continuously to improve patient outcomes. The company believes that it is essential to focus on reorganising paper-based and disjointed processes. Traditionally, healthcare organisations have used text-based PDFs to create clinical protocols and care pathways and this slows down the practice.
In-play ad startup
London-based in-play ad and game monetisation startup Admix secured an additional $ 1.5M (nearly €M) as a part of its Series A funding round. This round comes just three months after the initial funding of $ 7M (nearly €M) funding. This investment comes from Marcus Segal, the ex-COO of Zynga Studios and Nigel Morris, the ex-CEO of Dentsu Aegis in addition to a number of unnamed executives in the gaming and advertising industry.
This investment will be used to accelerate the development of Admix’s stack for game publishers and grow its team by the end of this year. Established by Joe Bachle-Morris, Mohammed Alisrawi, and Samuel Huber in 2017, Admix is a monetisation platform for game developers enabling non-intrusive, programmatic product placements within their content.
SaaS and marketplace VC debuts €100M fund
Germany-based Point Nine, a VC firm focused on Europe and US, has closed a new €100M (essentially €99,999,999) seed funding dubbed P9 V. Since its debut in 2011, this is the fifth fund closed by the VC firm. Point Nine will invest between €500k and €2.5M per startup and take part in Series A funding of all the startups it funds.
The firm was founded by Christoph Janz, Kolja Hebenstreit, Lukasz Gadowski, and Pawel Chudzinski. It will deploy the fresh capital to bring two new partners – Louis Coppey and Ricardo Sequerra Amram. To date, the company has invested in over 100 startups across 28 countries and is an early-stage investor in Delivery Hero, Revolut, Brainly, DocPlanner and more.
Solution to supercharge 5G communications
AccelerComm, a semiconductor research and IP development company and Southampton University spinout has raised £5.8M (nearly €M) Series A funding from IQ Capital, along with participation from previous investors such as IP Group and Bloc Ventures, in order to scale its IP tech business.
AccelerComm debuted in 2016 by University of Southampton professor Rob Maunder. The startup reportedly helps telcos, OEMs and equipment vendors to supercharge 5G satellite and other wireless communications with digital signal processing that reduces latency and increases spectrum efficiency.
Conversational AI for businesses
Danish startup BotXO has pocketed €4M funding in a round led by Seed Capital and The Danish Growth Fund. The investment will be used to bolster conversational AI tech for businesses. BotXO founded in 2017 by Henrik Fabrin in Copenhagen aims to help its customers to reap the benefits of the conversational web as fast as possible.
This startup’s no-code platform enables businesses of all sizes, especially e-commerce companies, to use conversational AI and machine learning to speed up their growth and engage with customers in a more efficient manner. BotXO claims a database of over 24,000 pre-made, industry-specific sentences and over 1 billion variations in a wide range of languages.
European platform for home and garden projects
In a recent development, 3i Group has invested in German startup GartenHaus to build the leading European platform for home and garden projects. The 3i Group announced that it will invest £60M (nearly €65.6M) for a majority stake in A-Z GartenHaus, which is an online leader in garden homes, saunas, and sheds in the DACH region. Also, the management team and board of GartenHaus will invest to become shareholders.
Founded in 2002 by Sebastian Arendt, the German startup offers sheds, garden houses, terraces, carports, and other home and garden related products.
French VC gets new fund and faces
Daphni, a French VC investor has secured its third fund that brings the overall assets to $ 350M. Also, it signals some notable high-profile departures. It has announced that the new fund is called Yellow and is worth $ 100M (nearly €M). Daphni is also working towards adding another $ 50M to the fund and invest in nearly 30 projects and invest between $ 1M and $ 5M.
Notably, Yellow is backed by corporations such as Bouygues and Accord, business angels – billionaire telecoms titan Xavier Niel, Jacques-Antoine Granjon of Veepee, and Romain Niccoli of Criteo. Even the startups that were backed by Daphni in the past such as Devialet and Back Market have invested in this fund.
UK fintech reports annual revenue growth
TransferWise, a UK fintech scaleup that handles over £4M (nearly €M) in cross-border payments each month from over 8 million customers has announced its results for the previous financial year. As per the report, it has reported a 70% growth in revenue reaching £302.6M (nearly €M) and a net profit of £21.3M (nearly €M) for the financial year that ended in March 2020.
Established by Taavet Hinrikus and Kristo Käärmann in 2011, TransferWise has launched new products across the US, Europe, APAC, and the Middle East in 2019. The company supports 2500 currency routes and 54 currencies on the whole. In July 2020, when TransferWise launched its secondary share sale, it reached a $ 5B valuation.
Based out of London, Uncapped is Europe’s first revenue-based finance provider, which lets founders raise growth capital sans compromising control over their business. Uncapped provides business advances without credit checks, personal guarantees, warrants, equity, or compounding interest.
Secures €22.6M funding
Uncapped just announced that it bagged $ 26M (nearly €22.6M) funding in a financing round – including debt and equity – led by Mouro Capital (the $ 400M (nearly €342.4M) successor fund of fintech specialist Santander InnoVentures). The other investors that participated in the financing round are Spanish VC fund All Iron Ventures, existing investors including Global Founders Capital, White Star Capital, and Seedcamp and notable angel investors in Europe including Taavet Hinrikus (Transferwise) and Carlos González-Cadenas (GoCardless).
Notably, this is the first investment by Moura Capital following its recent relaunch as an autonomous VC fund spun out of Banco Santander. The London-based fintech intends to use this investment towards its rapid expansion across Europe, with Spain being its core target market. And, it follows Uncapped’s first investment of nearly €11.7M that it secured last year from Global Founders Capital, White Star Capital and Seedcamp.
“Uncapped was born out of frustrations I faced launching and running my first business. I couldn’t take financing and venture capital wasn’t ideal either as I didn’t want to lose equity, so I repeatedly missed out on growth opportunities. With this further funding Uncapped is ideally positioned to help hundreds of more businesses across Europe and Spain grow to their full potential,” says Asher Ismail, co-founder of Uncapped.:
Founded by Ismail and Piotr Pisarz in 2019, Uncapped is changing the way growing online brands fund marketing and inventory. The company was founded out of frustration with the limited financing options available for UK and European entrepreneurs in order to finance growth.
Uncapped’s technology provides founders with growth finance of between €11K and €1.2M for a flat fee of 6% in a day. Businesses can repay the capital as they make revenue without any predefined repayment date. Uncapped is available to businesses that take online payments, have a minimum of €10,000 of monthly sales, and a trading record of at least six months. It is ideal for companies in various sectors including e-commerce,SaaS, direct-to-consumer (DTC), gaming, and app development.
“As a VC I met hundreds of founders who had great businesses but needed a better funding model. Often founders would give up equity to finance marketing and inventory expenses because they had no other choice. We started Uncapped so entrepreneurs could access funding on their terms and spend their time executing rather than fundraising,” notes Piotr Pisarz, co-founder of Uncapped.