Personal blog of Yzmir Ramirez

Digital transformation has been one of the big enterprise themes of 2020: Organizations are doubling down on cloud services both to link up suddenly remote teams and centralize apps, documents and data in a more efficient way. Today, one of the startups that has filled out that story with a cloud-based suite of accounting services is announcing a major round of funding on the back of massive growth.

Tipalti, which helps businesses manage suppliers, invoices, purchase orders, tax compliance, payments and billing and other accounting services from a single cloud platform, has raised $150 million at a valuation that the company says is now over $2 billion.

The plan is to use the funding to continue enhancing Tipalti’s accounts payable suite with more tools; hire across all departments; and for business development. Tipalti’s aim, according to founder and CEO Chen Amit, is to provide easy to integrate accounts payable services to a base of fast-scaling businesses, which need AP services to function well, but would never consider them core functions of their businesses in themselves.

“Accounts payable is the last area that companies in the mid market would want to invest in,” said founder and CEO Chen Amit, speaking to me from Israel, where the company was founded (it is now headquartered in San Mateo). “They will invest in literally anything else other than building software to pay or manage suppliers.”

The round, a Series E, is being led by Durable Capital Partners (the firm founded last year by Henry Ellenbogen, previously a star at T. Rowe Price), with participation also from Greenoaks Capital and existing investor 01 Advisors, the firm co-founded by Twitter alums Dick Costolo and Adam Bain.

Tipalti’s growth comes as the result of a perfect storm of sorts for the startup.

The COVID-19 health pandemic has led to a global economic crunch, and businesses are especially focused now on watching where money is coming in and where it is going.

But at the same time, even before the coronavirus pandemic, Tipalti had been seeing a lot of inbound business from organizations that were scaling fast and looking for solutions that could integrate easily into their current systems.

The backstory and necessity around accounts payable can be told in a few words: it’s a boring but necessary area, and if it goes wrong, it can potentially bring a whole company down because of the tax, fraud and auditing implications.

Tipalti describes accounts payable as “the most time-consuming function in finance”, noting that 47% of finance organizations in a recent survey said they still spend around 520 hours per year on manual accounts payable tasks, with 27% of respondents indicating that their teams dedicate up to 80 people-hours per month on AP tasks, or 1,040 hours annually.

Tipalti, which fittingly means “I’ll handle it” in Hebrew, is positioned as a helper in this context. By way of an API, it integrates with a number of other accounting and tracking platforms that its customers use, including NetSuite, Sage, QuickBooks, Affise, Cake, Everflow, HitPath, LinkTrust, Paladin, Tune (HasOffers) and Vidooly, and lets companies run and track how payments are being made relative to actives within the organization, all with relatively little input from the companies themselves, essentially giving them time and other resources to focus on other areas.

The pandemic has hit some of Tipalti’s customers hard. But overall, Chen said that it’s seen more business as a result, not just from companies suddenly growing much faster (as in the case, for example, for e-commerce businesses, or those catering to people spending much more time at home and on screens), but from businesses that simply need to pay much more attention to how money is moving around.

In 2020 so far, Tipalti has seen transaction volume on its platform balloon to $12 billion, up 80% from a year ago. It now has some 1,000 customers on its books, with a specifically strong emphasis on fast-growing tech companies. The list includes Amazon Twitch, Amplitude, Roku, Duolingo, GitLab, Medium, ClassPass, Toast, Automattic, Twitter, Business Insider, GoDaddy, Zola, Boston Globe Media, Noom, Roblox, Headspace, Fiverr, Vimeo, Stack Overflow, ZipRecruiter, AppLovin, Canva, Indeed and Foursquare.

Indeed, as we have described before, it was Tipalti’s initial work with Twitter on its own accounts payable services (central to how it can make money on its ad business) that served as its first introduction to Costolo and Bain, who went on to invest in it after they left the social network and started 01 Advisors.

“We are pleased to have the opportunity to increase our investment in Tipalti during a time in which organizations have been focused on rapidly transforming and modernizing the way they operate,” said Dick Costolo, founding partner of 01 Advisors and former chief executive officer of Twitter, in a statement. “When I ran Twitter, I saw first-hand the importance and value of Tipalti in automating financial operations. Tipalti transformed our processes and opened up our expansion, growth, and scalability strategies.”

It’s worth pointing out that the rise in valuation is a huge spike for Tipalti, a sign not just of its growth but investors’ bet that there will be more of that to come.

Chen Amit, the company’s founder and CEO, said it is four times the size of its valuation in its previous round (it raised $76 million in a Series D round led by 01 Advisors a little over a year ago, which would have been at around a $500 million valuation), and a whopping 14 times what Tipalti was valued in 2017). Indeed, even with other competitors like Bill.com and Coupa also targeting the same users as Tipalti, Amit estimates that between them all, they have just 3-4% of the addressable market.

“The accounts payable automation space has an extremely large total addressable market with significant growth potential,” explained Henry Ellenbogen, founder, managing partner and chief investment officer of Durable Capital Partners LP, in a statement. “We believe that Tipalti has the potential to become a much larger company within the Midmarket space due to its differentiated holistic platform, superior global capabilities and management team. This has resulted in leading retention and customer satisfaction.”

As Nvidia continues to work through its deal to acquire Arm from SoftBank for $40 billion, the computing giant is making another big move to lay out its commitment to investing in U.K. technology. Today the company announced plans to develop Cambridge-1, a new £40 million AI supercomputer that will be used for research in the health industry in the country, the first supercomputer built by Nvidia specifically for external research access, it said.

Nvidia said it is already working with GSK, AstraZeneca, London hospitals Guy’s and St Thomas’ NHS Foundation Trust, King’s College London and Oxford Nanopore to use the Cambridge-1. The supercomputer is due to come online by the end of the year and will be the company’s second supercomputer in the country. The first is already in development at the company’s AI Center of Excellence in Cambridge, and the plan is to add more supercomputers over time.

The growing role of AI has underscored an interesting crossroads in medical research. On one hand, leading researchers all acknowledge the role it will be playing in their work. On the other, none of them (nor their institutions) have the resources to meet that demand on their own. That’s driving them all to get involved much more deeply with big tech companies like Google, Microsoft and, in this case, Nvidia, to carry out work.

Alongside the supercomputer news, Nvidia is making a second announcement in the area of healthcare in the U.K.: it has inked a partnership with GSK, which has established an AI hub in London, to build AI-based computational processes that will be used in drug vaccine and discovery — an especially timely piece of news, given that we are in a global health pandemic and all drug makers and researchers are on the hunt to understand more about, and build vaccines for, COVID-19.

The news is coinciding with Nvidia’s industry event, the GPU Technology Conference.

“Tackling the world’s most pressing challenges in healthcare requires massively powerful computing resources to harness the capabilities of AI,” said Jensen Huang, founder and CEO of Nvidia, in his keynote at the event. “The Cambridge-1 supercomputer will serve as a hub of innovation for the U.K., and further the groundbreaking work being done by the nation’s researchers in critical healthcare and drug discovery.”

The company plans to dedicate Cambridge-1 resources in four areas, it said: industry research, in particular joint research on projects that exceed the resources of any single institution; university granted compute time; health-focused AI startups; and education for future AI practitioners. It’s already building specific applications in areas, like the drug discovery work it’s doing with GSK, that will be run on the machine.

The Cambridge-1 will be built on Nvidia’s DGX SuperPOD system, which can process 400 petaflops of AI performance and 8 petaflops of Linpack performance. Nvidia said this will rank it as the 29th fastest supercomputer in the world.

“Number 29” doesn’t sound very groundbreaking, but there are other reasons why the announcement is significant.

For starters, it underscores how the supercomputing market — while still not a mass-market enterprise — is increasingly developing more focus around specific areas of research and industries. In this case, it underscores how health research has become more complex, and how applications of artificial intelligence have both spurred that complexity but, in the case of building stronger computing power, also provides a better route — some might say one of the only viable routes in the most complex of cases — to medical breakthroughs and discoveries.

It’s also notable that the effort is being forged in the U.K. Nvidia’s deal to buy Arm has seen some resistance in the market — with one group leading a campaign to stop the sale and take Arm independent — but this latest announcement underscores that the company is already involved pretty deeply in the U.K. market, bolstering Nvidia’s case to double down even further. (Yes, chip reference designs and building supercomputers are different enterprises, but the argument for Nvidia is one of commitment and presence.)

“AI and machine learning are like a new microscope that will help scientists to see things that they couldn’t see otherwise,” said Dr. Hal Barron, chief scientific officer and president, R&D, GSK, in a statement. “NVIDIA’s investment in computing, combined with the power of deep learning, will enable solutions to some of the life sciences industry’s greatest challenges and help us continue to deliver transformational medicines and vaccines to patients. Together with GSK’s new AI lab in London, I am delighted that these advanced technologies will now be available to help the U.K.’s outstanding scientists.”

“The use of big data, supercomputing and artificial intelligence have the potential to transform research and development; from target identification through clinical research and all the way to the launch of new medicines,” added James Weatherall, PhD, head of Data Science and AI, AstraZeneca, in his statement.

“Recent advances in AI have seen increasingly powerful models being used for complex tasks such as image recognition and natural language understanding,” said Sebastien Ourselin, head, School of Biomedical Engineering & Imaging Sciences at King’s College London. “These models have achieved previously unimaginable performance by using an unprecedented scale of computational power, amassing millions of GPU hours per model. Through this partnership, for the first time, such a scale of computational power will be available to healthcare research – it will be truly transformational for patient health and treatment pathways.”

Dr. Ian Abbs, chief executive & chief medical director of Guy’s and St Thomas’ NHS Foundation Trust Officer, said: “If AI is to be deployed at scale for patient care, then accuracy, robustness and safety are of paramount importance. We need to ensure AI researchers have access to the largest and most comprehensive datasets that the NHS has to offer, our clinical expertise, and the required computational infrastructure to make sense of the data. This approach is not only necessary, but also the only ethical way to deliver AI in healthcare – more advanced AI means better care for our patients.”

“Compact AI has enabled real-time sequencing in the palm of your hand, and AI supercomputers are enabling new scientific discoveries in large-scale genomic data sets,” added Gordon Sanghera, CEO, Oxford Nanopore Technologies. “These complementary innovations in data analysis support a wealth of impactful science in the U.K., and critically, support our goal of bringing genomic analysis to anyone, anywhere.”

 

A deep tech startup building cryptographic solutions to secure hardware, software, and communications systems for a future when quantum computers may render many current cybersecurity approaches useless is today emerging out of stealth mode with $7 million in funding and a mission to make cryptographic security something that cannot be hackable, even with the most sophisticated systems, by building systems today that will continue to be usable in a post-quantum future.

PQShield (PQ being short for “post-quantum”), a spin out from Oxford University, is being backed in a seed round led by Kindred Capital, with participation also Crane Venture Partners, Oxford Sciences Innovation and various angel investors, including Andre Crawford-Brunt, Deutsche Bank’s former global head of equities.

PQShield was founded in 2018, and its time in stealth has not been in vain.

The startup claims to have the UK’s highest concentration of cryptography PhDs outside academia and classified agencies, and it is one of the biggest contributors to the NIST cybersecurity framework (alongside academic institutions and huge tech companies), which is working on creating new cryptographic standards, which take into account the fact that quantum computing will likely make quick work of breaking down the standards that are currently in place.

“The scale is massive,” Dr Ali El Kaafarani, a research fellow at Oxford’s Mathematical Institute and former engineer at Hewlett-Packard Labs, who is the founder and CEO of PQShield said of that project. “For the first time we are changing the whole of public key infrastructure.”

And according to El Kaafarani, the startup has customers — companies that build hardware and software services, or run communications systems that deal with sensitive information and run the biggest risks from being hacked.

They include entities in the financial and government sectors that it’s not naming, as well as its first OEM customer, Bosch. El Kaafarani said in an interview that it is also in talks with at least one major communications and messaging provider exploring more security for end-to-end encryption on messaging networks. Other target applications could include keyless cars, connected IoT devices, and cloud services.

The gap in the market the PQShield is aiming to address is the fact that while there are already a number of companies exploring the cutting edge of cryptographic security in the market — they include large tech companies like Amazon and Microsoft, Hub Security, Duality, another startup out of the UK focused on post-quantum cryptography called Post Quantum and a number of others — the concern is that quantum computing will be utilised to crack even the most sophisticated cryptography such as the RSA and Elliptic Curve cryptographic standards.

This has not been much of a threat so far since quantum computers are still not widely available and used, but there have been a number of signs of a breakthrough on the horizon.

El Kaafarani says that PQShield is the first startup to approach that predicament with a multi-pronged solution aimed at a variety of use cases, including solutions that encompass current cryptographic standards and provide a migration path the next generation of how they will look — meaning, they can be commercially deployed today, even without quantum computers being a commercial reality, but in preparation for that.

“Whatever we encrypt now can be harvested, and once we have a fully functioning quantum computer people can use that to get back to the data and the sensitive information,” he said.

Thinking about and building for the full spectrum of applications is central to PQShield’s approach, he added. “In security it’s important to understand the whole ecosystem since everything is about connected components.”

Some sectors in the tech world have been especially negatively impacted by the coronavirus and its consequences, a predicament that has been exacerbated by uncertainties over the future of the global economy.

I asked El Kaafarani if that translated to a particularly tricky time to raise money as a deep tech startup, given that deep tech companies so often work on long-term problems that may not have immediate commercial outcomes.

Interestingly, he said that wasn’t the case.

“We talked to VCs that were interested in deep tech to begin with, which made the discussion a lot easier,” he said. “And the fact is that we’re a security company, and that is one of the areas that is doing well. Everything has become digitised, and we have all become more heavily reliant on our digital connections. We ultimately help make the digital world more secure. There are people who understand that, and so it wasn’t too difficult to talk to them and understand the importance of this company.”

Indeed, Chrysanthos Chrysanthou, partner at Kindred Capital, echoed that sentiment:

“With some of the brightest minds in cryptography, mathematics and engineering, and boasting world-class software and hardware solutions, PQShield is uniquely positioned to lead the charge in protecting businesses from one of the most profound threats to their future,” he said. “We couldn’t be happier to support the team as it works to set a new standard for information security and defuse risks resulting from the rise of quantum.”

M&A activity has generally slowed down in the weeks since the novel coronavirus took a grip on the world, but there have been some pockets of activity in the tech industry when the price is right or when the divestment/acquisition just makes sense.

The world of messaging brings us the latest development in that theme: SAP, the CRM and enterprise software giant, is selling its Digital Interconnect messaging business to Sinch, a Swedish cloud voice, video and messaging company.

Sinch said it is paying €225 million (around $250 million) on a cash and debt-free basis for the business, which has 1,500 enterprise customers that use it for various messaging services, such as the now-popular option of running “omnichannel” conversations with customers over SMS, push, email, WhatsApp, WeChat and Viber; and messaging technology for carriers.

The deal will give Sinch, based in Sweden, a foothold in the US market — the Digital Interconnect business is headquartered in Silicon Valley — and access to a trove of customers using the kind of messaging technology that Sinch develops and sells.

The significance here is that messaging continues to be a very popular and high-volume, but low-margin (or even no-margin in some cases), business. So it makes sense for Sinch to pursue a bigger strategy for more economy of scale, a trend that I think will continue to play out. As a case in point: Sinch has been on an acquisition spree in the last month, and other deals have included Latin American messaging provider Wavy ($119 million, announced March 26), and ChatLayer ($6 million, announced April 20).

“With SAP Digital Interconnect now becoming a part of Sinch, we build on our scale, focus and capabilities to truly redefine how businesses engage with their customers, throughout the world,” comments Oscar Werner, Sinch CEO, in a statement. “The transaction strengthens our direct connectivity globally. Plus, it enables us to expand and accelerate a range of business-critical services to mobile operators, including products for person-to-person messaging, reporting and analytics.”

The news caps off nearly a month of speculation that SAP was gearing up for a sale of the legacy unit as part of a bigger strategy to focus more squarely on its CRM and newer enterprise IT services. It comes amid a particularly challenging economic environment, and that’s before considering all the IT, security and other challenges companies were facing even before COVID-19. SAP also has other fish to fry. It acquired Qualtrics in November 2018 for $8 billion, spearheading a stronger move into employee and customer experience, surveys and research; and other SAP exits this year have included shuttering travel business Hipmunk, which was part of Concur (another acquisition made by SAP), back in January.

Between then and now SAP has also seen a very notable personnel change. Its co-CEO Jennifer Morgan stepped away from the company by mutual agreement with the board, leaving Christian Klein as sole CEO (the two had been in the co-CEO roles for only six months). At the time, the company said that the abrupt change — a mere 10 days between late-Friday announcement and departure — was in response to “the current environment [which] requires companies to take swift, determined action which is best supported by a very clear leadership structure.”

It would appear that this sale is an example of the kind of swift and determined action that the board was hoping to see.

SAP’s messaging unit has been around in one form or another for years. It became a part of SAP in 2010 as part of its acquisition of Sybase, but even before that Sybase acquired Mobile 365, which had developed the messaging technology that ultimately became SAP Digital Interconnect, back in 2006.

At the time, the messaging business was the primary part of Mobile 365, and Sybase paid $417 million for that company. In that regard, it might look like SAP is now selling it for a loss, although you could also argue that 15+ year-old technology in the fast-moving world of messaging would have depreciated at this point.

The business itself is very typical of messaging: huge volumes but not huge revenues.

In 2019, SAP said that the enterprise messaging business processed 18 billion messages, while its carrier services processed 292 billion carrier messages. The Bloomberg report that broke the news about the intent to sell the division said that it made $50 million in EBITDA and $250 million in revenue last year. But actually this is small relatively speaking: SAP altogether had revenues of nearly $30 billion in the same period. In other words, it’s an okay business but not really core to SAP and where it’s going. 

On the other hand, it’s a better fit for Sinch. The company originally spun out from low-cost IP calling company Rebtel, was then acquired by publicly-traded CLX, which subsequently rebranded as Sinch. It is a much smaller company than SAP — market cap of about $3.1 billion (30.82 billion Swedish krona), versus SAP’s market cap of $139 billion — but is squarely focused on messaging services similar to those that the former SAP division offers.

“SAP Digital Interconnect is a leader in its area showing profitable growth and reaching 99 percent of the world’s mobile subscribers. Looking at Sinch’s innovation and investment strategy in the area of cloud communication platforms, we welcome them as the new owner of SDI. Sinch is perfectly positioned to unleash further growth potential we see in SDI,” said Thomas Saueressig, member of the Executive Board of SAP SE, responsible for SAP Product Engineering, in a statement.

M&A continues on in the wider European region even while so much else has slowed down or stopped in the current market. This deal follows on the heels of Intel acquiring Israel’s Moovit for $900 million this week, and Avira in Germany getting acquired by Investcorp at a $180 million valuation several weeks ago.

Getting your work wages on a monthly (not weekly nor biweekly) basis has become a more widespread trend as the price of running payrolls has gone up, and organizations’ cashflow has gone down. That 30-day shift may be a boost to employers, but not employees, who may need access to those wages more immediately and find it a challenge to stretch out their income month to month.

Now, a startup based out of London has raised a large round of funding for service that’s aiming to plug that gap. Wagestream — which works with employers to let employees draw down a percentage of their income in the month for a small, flat fee — today said that it has closed a Series A round of £40 million ($51 million).

The funding is coming in the form of equity and debt, with Balderton and Northzone leading on the equity side, which makes up £15 million of the raise, and savings bank Shawbrook investing £25 million on the debt side to finance employee draw-downs. Other investors in the round include QED, the Rowntree Foundation, the London Co-investment Fund (LCIF) and Village Global, a social venture firm backed by Bill Gates and Jeff Bezos, among others.

The company is not disclosing its valuation, but this brings the total raised to just under £45 million, and “the valuation is definitely higher now,” according to CEO and co-founder Peter Briffett.

The list of investors is proving to be a useful one for Wagestream as it grows. I asked if Bezos’ company, Amazon, was working with Wagestream. Briffett confirmed it is not a customer currently, “but we are talking to them.” It does, however, have a number of other customers already signed up, including pest removal service Rentokil PLC, Camden Town Brewery, the Slug & Lettuce pub chain and Carluccio’s chain of eateries, along with the NHS and Hackney Council — covering some 120,000 workers in all.

Amazon is an indicative example of one of the big opportunities for the company, which today is active in the U.K. but aiming to expand across Europe and the rest of the world.

While it is one of the biggest employers in the tech world, where it might typically pay out six-figure salaries in senior management, operational and technical roles, it’s also building out its business by being one of the biggest employers of hourly workers in its warehouses, wider logistics operations and similar areas. It’s employees like these who might be considered the first wave of employees that Wagestream is initially targeting, some of whom may be earning just enough or slightly more than enough to get by (at best), and face being victims of what Briffett referred to as the “payday poverty cycle.”

Getting paid monthly accounts for some 85% of all paychecks in the U.K. today, and the proportion is similar in Europe and also getting increasingly common in the U.S., Briffett — who has also worked at Microsoft, LivingSocial (when it was still backed by Amazon, and where he started the U.K. operation and ran it as the CEO for years) and YPlan (acquired by Time Out) — said in an interview. You might ask: Why don’t the workers just budget better? But it doesn’t always work out that way, especially the longer the gap is between paychecks, and if you, for example, have an unexpected expense to cover.

Because of that ubiquity, and the acuteness of the problem (if you’ve ever earned just about enough, or been a child in a family whose parents did, you may understand the predicament quite well), Wagestream is not the first time we’ve seen a financial services startup emerge to target that demographic.

Some other attempts have been scandalously disastrous, however: recall “Payday Loan” provider Wonga, backed by an illustrious set of investors but ultimately accused of, and hit hard by regulators and the public for, preying on people who were in need of funds with loans that were not transparent enough in their terms and led the borrowers into deep debt.

Wonga itself paid a big price for its practices, and the company is now bankrupt (and apparently still unable to replay creditors, as of the last report in March).

It was the disaster of Wonga — and an article in the WSJ about alternatives to payday loans — that Briffett said got him thinking about the possibilities and building Wagestream. (Ironic note: if you use PitchBook as I do, Wonga is listed among Wagestream’s backers, which Briffett assures me is an error.)

Wagestream positions itself as a “social impact” startup for targeting a very real problem that impacts financial inclusion for a proportion of the population, and it says this represents one of the highest rounds ever for a startup in the U.K. aimed at social impact.

“We fell in love with the strong product-market fit of Wagestream. We very rarely hear such universal positive feedback from all who have tried a product,” said Rob Moffat, a partner at Balderton, in a statement. “Companies used to take an active role in supporting the financial health of their users but this has slowly been eroded, to the extent where employees paid at the end of the month are effectively subsidising their employer for 29 days a month. Wagestream starts to restore the right balance.”

Wagestream operates by striking deals with employers to offer its services to its workers, who download an app and link up Wagestream with their salary and banking details. Businesses are able to set limits for what percentage of their wages employees can draw down each month, and how often the service can be used. Typically the limit is around 40% of a monthly wage, Briffett said.

Employees then can get the money instantly by paying a fee of £1.75 per withdrawal. “We are funding all of the withdrawals up front,” Briffett said. “We are the first company to marry workforce management and financial data.”

Down the road, the plan will be to expand to Europe as well as to the U.S., where there are already some other services that are trying to tackle the same problem, such as Instant Financial and DailyPay. There are also a number of areas the company could move into, such as working with companies that employ contract workers, and providing additional financial services to workers already using the app to draw down funds.

More expansion, Briffett said, will inevitably also mean more funding, particularly on the debt side.

For now, the emergence of Wagestream is an encouraging sign of how VCs are not just interested in tapping their coffers to bet on tech companies that they think will be hits. They also want to hunt for those whose returns may well be strong, but ultimately are made stronger by the longer-term effect they might have on the wider landscape of consumers, how they interface with fintech, and continue their own progress in the world.

Design and engineering are two sides of the same coin when it comes to building software and hardware, and yet — unlike engineers, who can use services like GitHub, Bitbucket, GitLab or many others to help manage their development process — it has traditionally been slim pickings for designers when it comes to tools to manage the iterations and collaborations that are a part of their workflow.

Now, we are seeing a rising wave of startups responding to that vacuum in the market. In the latest development, Abstract, which has built a platform to help manage versioning and workflow for design projects, is announcing $30 million in funding led by Lightspeed Venture Partners with participation from previous investors Scale Venture Partners, Amplify Partners and Cowboy Ventures.

Abstract is not disclosing valuation, but I understand from sources that it is now $190 million, a decent leap from the $76 million valuation (according to PitchBook) it reached in its last round. Abstract has raised around $55 million since 2016.

This latest round, a Series C, comes at a time when we are seeing a number of other startups that are building tools for designers — some competing with Abstract, and some significantly larger — also raising big money.

In December, InVision (which has an ambition to be the “Salesforce of design”), raised $115 million at a $1.9 billion valuation. Last month, Figma (building both design development and collaboration tools) raised $40 million at a $440 million valuation. Last week, Sketch (which also makes design tools) raised its first outside round of $20 million after a long track record as a very popular bootstrapped startup.

Abstract fits very much in the middle of this spread. The problem that it has identified is that many designers still work in an inefficient way compared to their engineering counterparts (as well as those in other parts of an operation, including people who collaborate on creating documents or presentations). Designers still typically sling around multiple versions of the same file, or try to handle all passing around and working on one single file. That loose structure makes for many errors and lost changes, not to mention an inability to track who has done what and when.

To address this, Abstract offers a number of features. First and foremost, it provides a way for designers to track versions of files — it automatically uploads the most recent copy even if you are working locally, so that whoever works next will use the most updated version. It also lets a project manager task different people with different parts of a project and manage the reviewing system. When a project is in progress or already completed, there is a way to present it and also gather feedback. And then, importantly, the design team can also use Abstract to interface with engineering teams that are building the tech underneath and around that design.

The funding is going to help Abstract expand that with more features, including a better and more streamlined way to export the most current files, as well as more security integrations for better control over who can access materials and when.

It started with a hashtag…

Abstract was co-founded by Josh Brewer and Kevin Smith — the former a designer, the latter an engineer who has also headed up design teams. Brewer, the CEO, said in an interview that his own past experience — his track record includes a period as Twitter’s principal designer — was the kindling that eventually led to the building of Abstract. One example he gave was the rebuild of Twitter back in 2011, which needed a redesign across web, mobile web, iOS and Android with a consistent navigation pattern, and new behavioral/usage patterns. (Not a small task.)

“We had only 12 designers at that time, a relatively small crew, but also a short timeline,” he recalled. “We decided to try to standardize on one tool to manage everything, but didn’t really have much to work with.” He and the team decided to “hack some of the tools we were using at the time,” which included Apache Subversion and GitHub for software development, “to solve the problem.” This helped him identify that there was a clear opportunity to build something that spoke specifically to designers’ needs.

That something has indeed started to find some traction: there are now more than 5,000 design teams using Abstract, with companies using it including Shopify, Cisco, Intuit, Spotify, Salesforce, Zappos and Instacart.

“As design becomes an increasingly significant competitive advantage, the tools designers use have to become more sophisticated, collaborative, and transparent to the broader organization. At Lightspeed, we invest in the sort of exceptional teams that are poised to transform a market,” said Nakul Mandan, who is also joining the board. “Josh, Kevin and the rest of the Abstract team have reimagined a design workflow that is quickly becoming the professional standard for how growing design teams work together and with functional stakeholders. We are excited to partner with Abstract to help the company continue its explosive growth.”

Abstract’s first efforts have been to support Sketch, the design tool that raised money just last week. The two are often associated with each other, it seems: many tend to use Abstract and Sketch together as an alternative to using Figma. But in addition to adding more versioning tools, the plan will be to add more design software to the list Abstract supports, starting with Adobe XD and Illustrator (it has currently opened early access waitlists for both). But even in the effort to be the go-to platform for all kinds of design projects, there are lines being drawn. It seems there are no plans, for example, to support Figma.

Another thing Abstract does not plan to do, Smith added, is to start building and offering many of those design tools itself.

“We are focused on expanding support for other file formats and bringing all your design files, whether it’s for a font or data to populate a design,” he said. There might be exceptions down the line, however: the company launched an SDK last fall, which Smith described as “our first step to exposing data to developers and design engineers, and that is part of our vision, which may or may not involve other kinds of tooling on the Abstract platform.”

He noted that “one of the things we’re been hearing about is the need for light-weight editing,” so that might be one area where Abstract might build or offer a third-party tool. “If we understand the data we are storing it’s not outside the realm of possibility to expose that. From a tooling perspective, it would be coming from the needs of our customers.”

The Europas Unconference & Awards is back on 3 July in London and we’re excited to announce more speakers and panel sessions as the event takes shape. Crypto and Blockchain will be a major theme this year, and we’re bringing together many of the key players. TechCrunch is once again the key media partner, and if you attend The Europas you’ll be first in the queue to get offers for TC events and Disrupt in Europe later in the year.

You can also potentially get your ticket for free just by sharing your own ticket link with friends and followers. See below for the details and instructions.

To recap, we’re jumping straight into our popular breakout sessions where you’ll get up close and personal with some of Europe’s leading investors, founders and thought leaders.

The Unconference is focused into zones including AI, Fintech, Mobility, Startups, Society, and Enterprise and Crypto / Blockchain.

Our Crypto HQ will feature two tracks of panels, one focused on investing and the other on how blockchain is disrupting everything from financial services, to gaming, to social impact to art.

We’ve lined up some of the leading blockchain VCs to talk about what trends and projects excite them most, including Outlier Ventures’ Jamie Burke, KR1’s George McDonaugh, blockchain angel Nancy Fenchay, Fabric Ventures’ Richard Muirhead and Michael Jackson of Mangrove Capital Partners.

Thinking of an ICO vs crowdfunding? Join Michael Jackson on how ICOs are disrupting venture capital and Ali Ganjavian, co-founder of Studio Banana, the creators of longtime Kickstarter darling OstrichPillow to understand the ins and outs of both.

We’ve also lined up a panel to discuss the process of an ICO – what do you need to consider, the highs, the lows, the timing and the importance of community. Linda Wang, founder and CEO of Lending Block, which recently raised $10 million in an April ICO, joins us.

We are thrilled to announce that Civil, the decentralised marketplace for sustainable journalism, will be joining to talk about the rise of fake news and Verisart’s Robert Norton will share his views on stamping out fraud in the art world with blockchain. Min Teo of ConsenSys will discuss blockchain and social impact and Jeremy Millar, head of Consensys UK, will speak on Smart Contracts.

Our Pathfounders Startup Zone is focused purely on startups. Our popular Meet the Press panel is back where some of tech’s finest reporters will tell you what makes a great tech story, and how to pitch (and NOT pitch them). For a start, TechCrunch’s Steve O’Hear and Quartz’s Joon Ian Wong are joining.

You’ll also hear from angels and investors including Seedcamp’s Carlos Eduardo Espinal; Eileen Burbidge of Passion Capital; Accel Partners’ Andrei Brasoveanu; Jeremy Yap; Candice Lo of Blossom Capital; Scott Sage of Crane Venture Partners; Tugce Ergul of Angel Labs; Stéphanie Hospital of OneRagtime; Connect Ventures’ Sitar Teli and Jason Ball of Qualcomm Ventures.

Sound great? You can grab your ticket here.

All you need to do is share your personal ticket link. Your friends get 15% off, and you get 15% off again when they buy.

The more your friends buy, the more your ticket cost goes down, all the way to free!

The Public Voting in the awards ends 11 June 2018 11:59: https://theeuropas.polldaddy.com/s/theeuropas2018

We’re still looking for sponsor partners to support these editorially curated panels.

Please get in touch with Petra@theeuropas.com for more details.

SPEAKERS SO FAR:

Jamie Burke, Outlier Ventures

Jeremy Millar, ConsenSys

Linda Wang, Lending Block

Robert Norton, Verisart

George McDonaugh, KR1

Eileen Burbidge, Passion Capital

Carlos Eduardo Espinal, Seedcamp

Sitar Teli, Connect Ventures

Michael Jackson, Mangrove Capital Partners

Min Teo, ConsenSys

Steve O’Hear, TechCrunch

Joon Ian Wong, Quartz

Richard Muirhead, Fabric Ventures

Nancy Fechnay, Blockchain Technologist + Angel

Candice Lo, Blossom Capital

Scott Sage, Crane Venture Partners

Andrei Brasoveanu, Accel

Tina Baker, Jag Shaw Baker

Jeremy Yap

Candice Lo, Blossom Capital

Tugce Ergul, Angel Labs

Stéphanie Hospital, OneRagtime

Jason Ball, Qualcomm Ventures

The Europas Awards
The Europas Awards are based on voting by expert judges and the industry itself. But key to the daytime is all the speakers and invited guests. There’s no “off-limits speaker room” at The Europas, so attendees can mingle easily with VIPs and speakers.

Vote for your Favourite Startups

Public Voting is still humming along. Please remember to vote for your favourite startups!

Awards by category:

Hottest Media/Entertainment Startup

Hottest E-commerce/Retail Startup

Hottest Education Startup

Hottest Startup Accelerator

Hottest Marketing/AdTech Startup

Hottest Games Startup

Hottest Mobile Startup

Hottest FinTech Startup

Hottest Enterprise, SaaS or B2B Startup

Hottest Hardware Startup

Hottest Platform Economy / Marketplace

Hottest Health Startup

Hottest Cyber Security Startup

Hottest Travel Startup

Hottest Internet of Things Startup

Hottest Technology Innovation

Hottest FashionTech Startup

Hottest Tech For Good

Hottest A.I. Startup

Fastest Rising Startup Of The Year

Hottest GreenTech Startup of The Year

Hottest Startup Founders

Hottest CEO of the Year

Best Angel/Seed Investor of the Year

Hottest VC Investor of the Year

Hottest Blockchain/Crypto Startup Founder(s)

Hottest Blockchain Protocol Project

Hottest Blockchain DApp

Hottest Corporate Blockchain Project

Hottest Blockchain Investor

Hottest Blockchain ICO (Europe)

Hottest Financial Crypto Project

Hottest Blockchain for Good Project

Hottest Blockchain Identity Project

Hall Of Fame Award – Awarded to a long-term player in Europe

The Europas Grand Prix Award (to be decided from winners)

The Awards celebrates the most forward thinking and innovative tech & blockchain startups across over some 30+ categories.

Startups can apply for an award or be nominated by anyone, including our judges. It is free to enter or be nominated.

Instead of thousands and thousands of people, think of a great summer event with 1,000 of the most interesting and useful people in the industry, including key investors and leading entrepreneurs.

• No secret VIP rooms, which means you get to interact with the Speakers

• Key Founders and investors speaking; featured attendees invited to just network

• Expert speeches, discussions, and Q&A directly from the main stage

• Intimate “breakout” sessions with key players on vertical topics

• The opportunity to meet almost everyone in those small groups, super-charging your networking

• Journalists from major tech titles, newspapers and business broadcasters

• A parallel Founders-only track geared towards fund-raising and hyper-networking

• A stunning awards dinner and party which honors both the hottest startups and the leading lights in the European startup scene

• All on one day to maximise your time in London. And it’s sunny (probably)!

That’s just the beginning. There’s more to come…

WeWork — the co-working startup valued at $20 billion with some 200,000 members across 200 locations globally — is continuing with its strategy of expanding into a wide array of adjacent operations to grow its business. Today the company announced that it will be expanding the coding-focused Flatiron School abroad, starting in London this June.

Alongside this, it’s also launching a scholarship program, offering £1 million in fees to people from underrepresented groups in tech to enrol in Flatiron classes, working with existing local groups like AllBright, Code Bar and Women Who Code to spread the word.

This is the Flatiron School’s first move outside of the U.S. for its physical classes — it had already offered online courses internationally before this — and notably it is also WeWork’s first significant educational effort since acquiring the New York startup last October for an undisclosed sum.

Since acquiring Flatiron, WeWork’s chief growth officer Dave Fano — who himself joined WeWork when the company acquired his own startup, building infomation modelling firm Case, heralding the start of the company’s acquisition spree — said that the idea has been to let Flatiron run business as usual, offering a variety of online and in-person coding and related courses. That is now changing as WeWork puts the acquisition to work, so to speak.

Expanding the kinds of services that it offers in European markets specifically is an interesting move for WeWork. When it first opened for business here in London, for example, people hiring out desks in other people’s offices, or working out of dedicated co-working spaces, was already a standard practice.

“There was lots of co-working already, so there was no need to educate the market on it,” Fano said in an interview. Hence, adding in more services and offerings is a way to help differentiate WeWork from the rest of the productivity pack. Education sits alongside a number of other services that WeWork has been developing, from offering all-in, optimised office spaces (complete with the ever-present glass decanter of fruit-infused water in the kitchen) both for individuals and running then on behalf of other companies, through to event planning (by way of its Meetup acquisition), and likely more down the line.

On the other side, this move is also an indication of how Flatiron, which had raised a modest $14 million in funding in its five years of life before getting acquired, is using the acquisition by the well-capitalised WeWork to upsize and compete against the likes of General Assembly and others who have doubled down on international expansion to build out their coding education businesses.

Flatiron School’s London operation will be based out of Finsbury Pavement, one of WeWork’s multiple London locations, and it will kick off with two courses, one a full-time software engineering immersive course that will last 15 weeks; and the other a part-time front-end web developer course that will run 10 weeks.

There have been a lot of efforts, both private and public, to help raise tech literacy among the workforces of the world, as industries and economies hope to train people for the next generation of employment as more legacy roles and processes tip into obsolescence, and all signs point to a more digital, connected and technological future.

Not all of these have been home runs, though, with many programmes failing to connect the dots between learning new skills and then applying them in actual jobs. And of course there remains a big digital divide between those who are already socially or economically challenged ever getting access to either the training or the subsequent work opportunities.

The company claims to have a strong success track record for its educational program.

“In the US, Flatiron School has set the benchmark for programming education with its community-first learning platform, market-aligned open-source curriculum, and outcomes-focused approach to education,” claims Adam Enbar, Flatiron School’s co-founder and CEO. “Since 2012, Flatiron has maintained a 99 percent graduation rate for its Software Engineering Programs in NYC and more than 2,000 students have graduated from Flatiron School to date, across both the on-campus and online programs. With our new Flatiron London location, we’ll be able to give more people access to attain the skills they need to create their life’s work.”

Meanwhile, a spokesperson for the school said that it also has a 99 percent placement rate for those looking for jobs in NYC in the area of the immersive program, and 97 percent placement overall in software engineering, iOS development and the fellowship program.

It’s a small start, but offering £1 million in scholarships alongside the launch can offer at least a small boost in trying to fix that problem. And for WeWork, which has now raised $7.3 billion in funding — including backing from the seemingly bottomless coffers of Softbank’s Vision Fund — a $1 million scholarship fund is small change, so hopefully it prove to be successful and it might consider how it can dole out more.

Updated with more stats.

 WeWork — the co-working startup valued at $20 billion with some 200,000 members across 200 locations globally — is continuing with its strategy of expanding into a wide array of adjacent operations to grow its business. Today the company announced that it will be expanding the coding-focused Flatiron School abroad, starting in London this June.
Alongside this, it’s also… Read More

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