Recently there’s been a lot of talk about what’s going on in venture. The talk is largely being driven by concerns for what some see as potentially unsustainable growth – growth both in terms of fund sizes but also in terms of valuations, and capital raised. According to Pitchbook, “maybe more than ever before, the first half of 2018 embodied the high level of capital availability throughout the US venture industry. $57.5 billion was invested across 4,000 deals, pacing the year to surpass 2017’s decade-high total for capital invested by the end of next quarter.” Ultimately, this translates to concerns that this kind of growth leads to companies being overvalued and overcapitalized (2018 deal value has already surpassed 6 of the past 10 years).
At Indicator Ventures, we agree that there are many overvalued and/or overcapitalized companies in today’s market. We can talk about why that’s the case, but simply put we believe it’s a result of VC funds raising more capital, growing larger with each fund, and in turn, having to deploy more capital. This not only creates more competition and drives up valuations, but with more capital to deploy there’s also more capital to return. Therefore, companies are raising more money and staying private longer.
While we don’t proclaim to be immune to macro environments, we do feel that our practical approach helps us mitigate some of the risks associated with broader market conditions. Our primary filter of “digital efficiencies” is the first step in helping to add downside protection. Quite simply, any product (or service) that generates massive cost or time savings will in turn have significant inherent value. This means that we spend less time trying to figure out if a product will be valuable (product-market fit risk) and instead focus more on operating the business (execution risk). Generally speaking it also means less time to commercialization, AKA generating meaningful revenues. We also skew more towards capital efficient businesses. The less money a company requires to grow, the less money they need to raise and the lower their bar for optimal returns on exit. We also like to invest in companies that are revenue-generating. It sounds like an obvious thing, but a lot of VC investors aren’t as concerned with revenues as they are with the larger vision, especially at the early stage. The more revenues a company generates the easier it is for them to manage overhead, and ultimately generate realized value. Lastly, we also look for and favor companies that can exit earlier in their life cycle (3-5 years). Starting companies is a hard thing to do (~70% of all start-ups fail on average 20 months after raising a seed round). Selling a company is even harder (of ~35k companies started from 1990 – 2010, 80% failed to achieve an exit). That’s why it’s important for us to invest in companies that can sell, even if it’s a ‘smaller’ exit. Realizations (and returning LP capital) are considered king and that’s what we optimize for, (in our first fund we sold 5 companies in the first 4 years of the fund life).
Larger VCs don’t care about the smaller exits. They have too much capital to return which means the smaller exits don’t move the dial for them. Meanwhile, the smaller exits are naturally the most common. According to industry data, over 80% of acquisitions of venture-backed companies happen below $200M. The other 20% of exits are above $200M but that band shrinks quickly. Less than 1% of all venture-backed companies that exit achieve “unicorn” status ($1B+ valuation). So, statistically speaking we have much greater odds of success by focusing on companies that can sell in the $200M band; and to be abundantly clear, this does NOT mean that our upside is capped at $200M (4 of our companies are already valued north of $200M today) it simply means that we can generate outsized returns within this band. Assuming we stay true to our mandate and guidelines, remain disciplined about entry valuations and that our companies are efficient and don’t raise significant amounts of capital at unreasonable valuations, we can deliver fantastic fund-level returns. This works because our fund is sized appropriately to achieve best-in-class returns from seed stage investing. And that’s really the key here; fund size. While we’ve only been at this for several years (as institutional investors) we can’t envision raising a fund of more than $100M and still being able to produce consistent, risk-adjusted returns.
In closing, we’re not saying that larger VCs such as Sequoia, Accel, A16Z, Kleiner Perkins, etc. are wrong. Instead what we’re saying is that we take a different approach, and we believe that our approach is not only a better way to realize high upside while mitigating some risk, but it’s also a better way to protect from broader market conditions like overvaluation and overcapitalization.
Oh and I’d be remiss if I didn’t call out two people that I respect for validating some of these thoughts in recent conversations. Big thanks to Sarah Anderson and Nick Faulkner at Cintrifuse for offering their thoughts and feedback on our model. Cintrifuse is an incredible Fund of Funds and we share a lot of the same beliefs in terms of the need to build companies that offer real value as well as the need for funds to focus on returning capital. I’d also like to thank Micah Rosenbloom at Founder Collective for similar validation. If there is one fund that I’d say we truly look up to and would like to replicate, Founder Collective is certainly at the top of that list (BTW – their most recent fund was $75M, following their previous fund of $75M – these guys get it when it comes to optimal fund size).
We are excited to announce our recent investment in NYC-based Simplifeye, a leading secure and real-time workflow application suite for medical and dental private practice offices. Indicator led Simplifeye’s seed round with participation from First Round Capital, Felicis Ventures, and Uncork Capital. As part of the investment, Indicator’s Geoff Bernstein joined the Board of Directors.
Simplifeye was founded by Dr. Ryan Hungate and his cousin Zach Hungate, a duo with a unique combination of software, design, finance and dental experience. Ryan previously spent time working on Apple Retail’s personal shopping initiative before going to dental school. After observing the glaring workflow and operational inefficiencies within dental practices, he teamed up with his cousin Zach—who has an investment banking and venture capital background—to build the Simplifeye platform to improve communication and collaboration in medical and dental offices.
The vision for Simplifeye is to serve as an exchange across the patient-practice experience, integrating with existing practice management platforms. The company’s first product helps practices reduce wait times and increase workflow efficiencies, leveraging the Apple Watch and other mobile devices to provide details about each scheduled patient, including medical records, past procedures, and the reason for the day’s visit. Simplifeye’s product suite also includes referral tools, patient acquisition tools, HIPAA-compliant chat for internal and intra-office communication (e.g. between generalists and specialists), voice-based workflow tools on top of Amazon’s Alexa, and more.
Zach, Ryan, and the rest of the Simplifeye team are hard at work bringing the latest technology and workflow products to this archaic industry, and the adoption has been astonishing. We are excited to partner with Simplifeye and look forward to what the future holds.
For more information please visit https://simplifeye.co.
The Supreme Court ruling in May, which deemed that a federal ban on sports betting enacted in 1992 is unconstitutional, allows states to legalize and self-regulate sports betting here in the US. This has created an enormous opportunity for sports and eSports betting companies like Indicator portfolio company Unikrn. Rahul Sood, CEO and Co-Founder of Unikrn, and his team have been prepping for this moment for a long time, acquiring licenses and building out their global betting platform in regulated countries around the world in anticipation of the most recent court ruling (with their forthcoming license to operate in Malta, Unikrn will be able to legally take wagers from 80% of the European market).
Rahul expressed his enthusiasm regarding the Supreme Court ruling in a recent blog post, stating, “In the last few hours, our dream became real, and our company just became substantially more valuable.” He also shared his appreciation for the ruling: “By letting states regulate and offer sports betting, the US government is letting betting experiences become better-regulated and undermining elicit, offshore and black market operations that endanger their users.”
In countries where it is currently licensed, Unikrn users bet on games using cash deposits, Unikrn’s own cryptocurrency, UnikrnGold, as well as the company’s valueless, virtual currency called UnikoinSilver that can be redeemed for prizes (which is also what users have been using domestically until this point). As individual states begin adopting legal sports betting, Unikrn will have the opportunity to implement real-money wagering. Though this won’t happen overnight, Unikrn hopes to soon be able to fully onboard the 40% of its global users which are located in the US. Meanwhile, Unikrn has continued to improve its technology and global partnerships with gaming leaders such as MGM Casino to stay at the forefront of the eSport revolution.
This ruling presents a massive opportunity for sports, eSports and companies operating within these industries. It will be exciting to watch the evolution of sports betting across the US, and we believe that Unikrn will be the leader in the emerging eSports gambling space.
To learn more about the Supreme Court ruling and its impact on eSports, click here.
We’d like to welcome the newest member of the Indicator team, Lisa Shalett, who joins us as an Advisor and brings an extensive background that spans marketing, finance, risk management, and entrepreneurship.
Lisa spent 20 years working at Goldman Sachs, where she was named Partner in 2002. Her career was shaped by taking smart risks, being open to ideas, and seeing opportunities where others did not. This approach enabled her to succeed in leadership roles spanning 5 divisions and 2 regions: Head of International Equities Sales & Trading; Global COO of Compliance, Legal, & Audit (as control functions became growth businesses); and Global Head of Brand Marketing & Digital Strategy in the Executive Office to manage Goldman’s brand and reputation during the financial crisis.
Lisa leverages her unique skillset and operating experience in both large organizations and startups to advise entrepreneurs, evaluate and invest in businesses, and serve on public and private boards. She holds a BA from Harvard College and MBA from Harvard Business School, speaks fluent Japanese, and currently serves on the Board of Directors for Brookfield Property Partners (NYSE: BPY), and private companies PerformLine, and Bully Pulpit Interactive. We look forward to benefitting from Lisa’s experience and the positive impact we know she will have on Indicator’s founders and teams, supporting with anything from broad marketing/digital and strategic initiatives to digging deep to assist with their talent development, culture, and growth goals.
Stella Voutsina recently joined our Venture Partner roster, and we could not be happier to have her on our team. Stella is an AI expert with a breadth of experience working on global operations and business integration issues, and currently serves as CTO at MDC Media Partners (NSDQ: MDCA).
We recently sat down with Stella to talk about how she got to where she is today, her current focus, and where she sees technology in the future.
Stella grew up in a small, coastal town in northern Greece, where summers were idyllic but winters were financially hard because of the economic dependency on tourism. For her, the real escape was school and the dream was to make her way to New York City. She followed the trend of young people leaving Greece, and in 2003 went to Valencia, Spain to work for an EU-sponsored NGO supporting kids with disabilities. Stella—who worked every summer since she was 12 years old—taught herself Spanish and produced a documentary during her three years in Spain. Eventually finding herself ready for a new challenge, Stella then moved to London to pursue a Bachelor’s degree in Digital Media and Communications at London Metropolitan.
Upon graduating in 2008, she worked for various ad agencies, including iProspect, where she advised Nokia as it struggled to respond to the introduction of Apple’s first iPhone. That experience taught her how companies should be strategic in highly competitive environments, and showed her the importance and power of data. When iProspect was acquired by Dentsu in 2012, Stella took the opportunity to move to Detroit and work with General Motors as the Head of Tech and Communications. This was a pivotal time in her career – she traveled all over the world, completed a master’s degree, and learned to prove herself in a new environment all over again. In her own words, “Detroit is probably the best thing that ever happened to me. It made me a self-starter; it taught me that I can take risks”.
In 2015, Stella was recruited by her mentor and former CEO while at Dentsu, Martin Cass, to be SVP of Digital Operations at Assembly, a media agency he had recently founded and had already been named “Media Agency of the Year” by Ad Age. She moved to New York City and found herself immersed in the VC/startup scene where she was able to experiment with broader thoughts and approach new ideas to solve problems. Today, Stella is the CTO at MDC Media Partners, one of the fastest-growing and most influential marketing and communications networks in the United States and does some work with MDC’s venture arm. She also co-founded Born AI, a creative agency that leverages artificial intelligence to deliver highly engaging and intelligent agents for the world’s best brands.
Stella views technology as an approach rather than an end-all solution, and her passion is finding ways to use technology to help the user; “AI is challenging. It is the sense of our future within our present. AI enhances our knowledge of behaviors, moods and desires with the principal goal to improve our life experience”.
Stella appreciates working with the Indicator team because our scope extends beyond media, helping her learn and engage with new and exciting technologies. We are immensely fortunate to be working alongside such an innovative leader in the digital media space.
In her free time, Stella loves to stay active and read. She is a black belt in Karate and her favorite book is Frankenstein; or, The Modern Prometheus by Mary Shelley.
Unikrn, an Indicator Ventures portfolio company, has raised approximately $31M in an ICO (Initial Coin Offering). Unikrn successfully collected over 112,000 Ether – valued at approximately $31. 4 million at press time (and approximately $85M at current trading prices) – in a token sale that lasted 30 days with participation from existing investors AdvancIt Capital, Binary Capital, and Mark Cuban. The token sale was also backed by Ethereum co-founder Anthony Diiorio.
UnikoinGold, the tokens sold by Unikrn in the ICO, will be used by eSports fans to wager on games like League of Legends and CounterStrike.
The ICO follows Unikrn’s recent acquisition of a gambling license in Malta. This represents a significant accomplishment, as it opens the door to ~80% of the European gambling market. Unikrn now has an exceptional team located across three continents that laid the groundwork and investments in 2017 to drive exciting global expansion in the coming years.
Unikrn (www.unikrn.com) is an eSports wagering service for fans and newcomers alike to gather, game and bet on eSports in a safe and legal environment. Unikrn’s mission is to increase the engagement and passion already surrounding eSports.
Pienso, an Indicator Ventures portfolio company, has raised $2.1M in Seed funding led by Eniac Ventures with participation from Uncork Capital, E14 Fund, and strategic angel investors. Indicator Ventures also participated, having supported the team from inception through incubation and pre-seed funding. Pienso co-founder & CEO, Birago Jones, has been a Venture Partner at Indicator Ventures for several years.
Pienso is the leading machine learning platform for non-programmers. Pienso’s end-to-end Intelligent Development Environment allows people with no prior programming or data science background to create and train their own machine learning models without the need for external support. Our conviction in the investment stems from our belief that experts who understand a subject matter can more articulately and accurately “lens” their expertise on a statistical model.
Pienso will use this new funding to accelerate sales into large enterprises, build additional product features and grow their team in Brooklyn. We’re excited to support and follow Birago and his co-founder and CTO Karthik Dinakar as they scale Pienso into a leader in the emerging machine learning industry.
Pienso (www.pienso.com) is a machine learning platform that empowers non-programming analysts, researchers, and domain experts to independently manipulate and manage the interaction between algorithms and their data, without depending on developers.
It has always been our core tenet that in order to succeed we must surround ourselves with the smartest, most well-networked and experienced people. Not only does this enhance our value proposition to our founders and portfolio companies, but it makes us better in every aspect of our work. Our team of Venture Partners and Advisors is the foundation of this belief. We have deliberately built a team comprised of diverse backgrounds to ensure direct alignment with and relevance to the varying needs of our portfolio companies.
Specifically, our Advisors and Venture Partners support three primary aspects of our business: (1) deal flow, (2) due diligence and (3) ongoing portfolio support. Our Venture Partners tend to be more hands on and are typically more technical. Our Advisors are usually more senior and well-networked, particularly within the corporate and enterprise landscape. In concert, the sum of these parts represents much more than a source of capital.
New Venture Partners
Stella Voutsina – Stella serves as CTO at one of the largest media groups in the world, MDC Media Partners (NASDAQ: MDCA). She is co-founder at Born AI, the world’s first AI agency, and was a former Vice President of Digital at Assembly as well as Dentsu (Acquired by GM). Stella has a breadth of experience working on global operations and business integration issues, and she has worked extensively with big brands to help assess artificial intelligence technologies.
Kyle Ellicot – Kyle knows a thing or two about technology and building businesses. He entered the entrepreneurial world at the age of 14 so that he could buy parts to build a computer. He started two businesses after college, and then got into venture capital, mobile apps, big data, and eventually IoT. Today Kyle is the Chief Labs Officer of ReadWrite Labs, an accelerator program for hardware developers in the IoT space that is focused on connecting technological experts, thought-leaders, corporate/startup executives, and investors as they build emerging technologies through fostering dynamic relationships. Kyle spends his time between San Francisco and Asia. Kyle will help Indicator with technical due diligence in addition to helping us better understand and leverage opportunities across Asia (with a focus on China).
Steven Haley – Steven is an enterprise sales expert and operations specialist. He has more than 30 years of experience in building word-class sales and service organizations in the data networking industry. He is the former Executive Vice President at Juniper Networks and former Vice President of Service Providers at Cisco. Prior to these roles, Steven served as the Managing Director and General Manager at StrataCom. Currently, Steven is the Founder and President of SnowsHill & Russel Management LLC, a family office and private investment operation, and serves as Board Member and Advisor for a number of early and growth-stage businesses.
Zack Onisko – Zack has nearly 15 years of experience as a strong growth and product practitioner. He has been influential in scaling multiple high growth startups from early stage to successful acquisition. Currently, Zack is the CEO of Dribbble, a place to show and tell, promote, discover, and explore design. He was formerly the Head of Growth and Marketing at AutoDesk Marketplaces, Chief Growth Officer at Creative Market and VP of Growth at Hired. Zack is a speaker at startup conferences around the globe, and he was recently named a top 50 growth expert.
Neil Gupta – Neil is a frontier technology expert with a passion for design thinking and data-driven decision making. Neil was formerly at Draper Labs, Bridgewater Associates and received his M.S. in Electrical Engineering from Stanford University. Neil works with a variety of large corporations on projects, initiatives, and strategy related to VR, AR, Internet of Things, and the transition from products to services. He is also the founder of BostonAR, a nonprofit augmented reality accelerator dedicated to growing the frontier technology ecosystem in Massachusetts.
Janine Gianfredi – Janine brings a breadth of experience to our Advisor line-up. Prior to working at Google for upwards of ten years, Janine began her career as a Business Analyst. At Google, she held roles such as Creative Lead of Agency Business Development, Head of Marketing & Partnerships at Google Glass, and Head of Marketing at Google[x] to name a few. Following her stint at Google, she served as the Chief Marketing Officer of the United States Digital Service at the White House. Janine now spends her time as a Strategy Consultant at Emerson Collective, a speaker, and an advisor to multiple start-ups.
Elliot Katzman – Elliot has more than 35 years of experience as an investor, founder and senior executive, and is recognized for his expertise in business strategy, strategic business development and company building. As an investor, Elliot has achieved one of the most impressive track records, with over a 6X multiple on invested capital, 35% IRR and a .750 batting average. Some of the market leading investments he’s made include Echo Nest (acquired by Spotify), Vela Systems (acquired by Autodesk), Acacia Communications (#1 technology IPO in 2016) and many others. Elliot has been involved with four businesses as a senior executive and/or founder, two of which went public. He currently serves as a Senior Advisor at Magic Leap and a Board Member at OnShape and Seniorlink, among other engagements.
Facebook has announced that it is acquiring Indicator Ventures portfolio company, TBH, short for “to be honest”. Facebook expressed its excitement following the acquisition in a statement highlighting TBH and Facebook’s aligned incentives: “TBH and Facebook share a common goal of building community and enabling people to share in ways that bring us closer together. We’re impressed by the way TBH is doing this by using polling and messaging, and with Facebook’s resources TBH can continue to expand and build positive experiences”. Facebook will allow TBH to operate independently as it has done with Instagram and WhatsApp. TBH’s four co-creators will join Facebook’s Menlo Park headquarters while continuing to grow their product and user base.
Nikita Bier, Founder & CEO of TBH, had some nice things to say after the announcement: “Indicator was a fundamental part of our story and stuck with us through thick-and-thin. It’s been a long time in the making but it made it all the more rewarding”.
To date, TBH has scored 5 million downloads and 4 million daily active users with its app that lets people anonymously answer kind-hearted multiple choice questions about friends who then receive the poll results as compliments. Users have answered over 1 billion polls since the app’s limited U.S. launch in August.
We want to congratulate Nikita and the rest of the TBH team for all of their hard work, dedication, and for sticking with it through various product iterations and pivots. Their work has clearly paid off, and we wish them continued success in their next journey with Facebook.
To learn more, click here.
Islands, founded by our Venture Partner Greg Isenberg, recently launched out of stealth to allow like-minded individuals from all around the world to collaborate, learn, and stay in touch. Their mobile-first technology allows people to create and customize their own “islands” based on specific interests, topics and behaviors, similar to how Slack has redesigned how people communicate and collaborate in the workplace.
Mobile messaging is the fastest growing sector in consumer mobile and is changing the way people communicate and learn about the world around them. Specifically, messaging is not just about 1:1, it’s about group messaging. People are using messaging platforms to find new friends and communities, yet apps like Slack, Facebook Messenger, and GroupMe are not designed for interacting with people you don’t already know. Islands aims to solve this issue by providing a platform for people to find and create groups for messaging around topics of their interest.
Islands is now live on five campuses, including University of Alabama, University of Florida, and University of Western Ontario. Islands is doing a targeted rollout and plans on launching in additional universities over the next few months.
For more information please visit https://bit.ly/2uc7xBG.
VIDA was accepted to participate in Y Combinator’s Summer 2017 Batch and recently presented at YC’s Demo day. Since Indicator invested in VIDA’s Seed Round last year, the company has grown its community of artists to over 100,000, and has recently collaborated with big names including Cher, Steve Madden, Warner Bros. and others.
Companies are typically very early in product development and traction when entering accelerators like Y Combinator. VIDA entered the program with significant traction and growth, and as a standout company, greatly benefited from YC’s community. It was an invaluable experience for the team.
VIDA’s small San Francisco based team will raise additional funds to expand beyond fabrics and further scale the business. The company previously raised over $5 million from Google Ventures, Indicator Ventures, and Universal Music Group, among others.
VIDA (https://shopvida.com) is an e-commerce platform that leverages direct-to-fabric technology to produce unique apparel from designers around the world. Through VIDA, any submitted design can go from sketch to completion in a week with the company’s global manufacturing partners.
Nimble is now working with Microsoft to modernize their partner community. Nimble’s decision to join the Microsoft community was motivated by Nimble’s belief that reseller partners are uniquely positioned to benefit from the value Nimble provides, and to extend that value to their own customers.
Typically, smaller partners aspire to incorporate some form of social selling into their sales and marketing approach. Dwight Foster, Nimble’s VP of Sales and Business Development, who liaises with these customers and partners, understands that many of them are simply in need of a better tool to get the job done. Nimble’s platform offers a perfect solution because it is built with social selling in mind. Nimble automatically enriches contacts with details from both public and private databases, allowing for speedy segmentation and searches.
Nimble’s simple and easy to use CRM/Social Sales and Marketing platform eases the transition for customers looking to modernize their sales and marketing tools. The platform readily integrates with Office 365 and Nimble’s team provides training to help customers best realize the value of their product. Nimble is offering their add-in to any Microsoft partner at no charge and it is available today. The team at Nimble is confident that once partners have used Nimble to modernize their sales and marketing, they will feel inclined to do the same for their customers.
This partnership presents an incredible opportunity for Nimble to grow their business while promoting their product. According to Dwight Foster, “As people become more connected and the quantity of information grows, users and resellers alike want a single solution to run their business. We have the solution, and we want to be the partner to make good on the promise of sales and marketing modernization for the entire partner community.”
Nimble (www.nimble.com) enables small businesses to attain the same benefits larger companies have achieved with their CRM strategies without the associated costs and complexities. Nimble CRM combines the power of relationship management, unified conversations/communications, social media tools, and team collaboration under one roof.
Indicator Ventures General Partner, Jonathan Struhl, was featured in an interview with AlleyWatch for a new series entitled Inside the Mind of an NYC VC. In the interview, Jon speaks to Bart Clareman of AlleyWatch about various topics including his journey into the venture business, Indicator’s investment thesis, the benefits and downfalls of angel investing, the current VR environment, and much more.
We’re particularly keen on Jonathan’s articulation of Indicator’s practical approach to early-stage investing: “As we look at emerging technologies, which I spend most of my time in, it’s tough to find startups that have a real sustainable business model in the space. One of the other things we look for is an immediate path to revenue. We’re not looking for companies that need 3 years to start charging customers or companies that need to scale to 1M users or 10M users or 100M users before they can start to monetize. We’re looking for businesses that can scale right away.”
To read the full article, click here.
We are pleased to announce that Lob has raised $20M led by Y Combinator’s Continuity Fund with participation from existing investors Floodgate, Polaris Partners, and First Round Capital. Y Combinator’s Continuity Fund has an experienced team that will continue to support Lob as it continues to scale. Ali Rowghani, the CEO of YC Continuity and former CFO of Twitter and Pixar, will join the Board of Directors.
Indicator first participated in Lob’s Seed Round. Lob is now the de-facto infrastructure for any company that wants to automate printing and mailing. The team at Lob has developed a nationwide print delivery network that has delivered mail to 1 out of every 9 households in the US.
With this new capital, Lob plans to expand their print delivery network, build more robust UI tools for teams integrating Lob, and release complimentary APIs that further assist their core users in automating tedious back office workflows. Along with this round of funding, Lob officially announced its new address verification API, which provides customers with access to more than 156 million domestic addresses to avoid improperly addressed mailings.
Lob (www.lob.com), through its API layer, enables enterprises to programmatically send physical mail as easily as sending an email.
We’re thrilled to announce that Mezzobit, an Indicator Ventures portfolio company that empowers digital publishers to safely and confidently allow third party partners to engage with their audiences, was recently acquired by OpenX. Mezzobit was founded by former executives from Newsweek, XM Radio and New York Magazine. The company had considerable traction leading up to the acquisition, having onboarded over 450 clients to their tag management platform. We’re honored to have invested in such a passionate team and are excited for each of them in this next chapter.
Indicator Ventures was an early investor in Mezzobit, having first invested in the business following their graduation from ERA in 2014. While Indicator doesn’t usually invest in AdTech companies, Mezzobit’s product directly fit into Indicator’s investment thesis of ‘digital efficiencies,’ helping digital publishers to save both time and money while solving very real and prevalent problems around data leakage, audience control and site performance. Moreover, the team was led by industry veterans who knew the space cold – something that proved to be a significant factor in OpenX’s decision to acquire their tech platform and top-notch team.
OpenX is one of the world’s largest and fastest growing programmatic advertising companies, helping publishers better monetize their content on any connected screen. The company has developed an integrated technology platform that combines an ad server and real-time bidding exchange with a standard supply-side platform, ensuring the highest real-time value for any trade. OpenX is partnered with companies such as Dentsu and services notable customers including Comcast, Forbes, Samsung, New York Times, Groupon and AMC. OpenX is backed by severable notable investors including Accel Partners, DAG Ventures, Samsung, SAP, Index Ventures, and more.
To learn more about OpenX please visit www.openx.com.
We are thrilled to announce our latest investment in EntryPoint.
EntryPoint was founded by Carissa Flocken and Ben Doyle. About a year ago, the two founders from Michigan quit their jobs at the prominent hedge fund Bridgewater Associates and flew to Los Angeles to make interactive and immersive VR films. The pair soon learned the inherent production difficulties in this medium, and that there’s no one-size-fits-all method. Rather, a developer must manually “stitch” interactive elements into the VR footage. It was then that Carissa and Ben set out to solve this problem and build EntryPoint.
EntryPoint’s mission is to help content creators streamline the currently arduous process of making interactive content with a self-service, “drag and drop” platform. Once an EntryPoint-powered video is completed, the platform simply outputs a unique URL, thus eliminating the need for viewers to download mobile applications. As a result, users can interact with 360-video within the comfort of a web browser.
Additionally, EntryPoint enables more people to experience interactive VR content by eliminating friction points such as needing specialized headgear (HMDs). The platform also makes it easier and less expensive to create quality VR content, which naturally means more VR content will be created. Like most Indicator Ventures portfolio companies, EntryPoint is helping to solve a large problem, and in doing so, is helping VR content creators save time and money, while also making the content more readily available for consumers.
Indicator participated in EntryPoint’s $2 million Seed Round of funding led by Two Sigma Ventures, with participation from Samsung NEXT, Courtside Ventures, KBS Ventures, Virtual Reality Investment, Female Founders Fund, and Social Starts.
For more information please visit www.entrypointvr.com.
We’re excited to announce that Nimble, an Indicator Ventures portfolio company, has raised $9M led by Imagen Capital Partners with participation from Mark Cuban’s Radical Investments and Google Ventures, along with individual angel investors. The investment brings the total raised to $12.5 million. With a deep knowledge of the software industry and a team of experienced entrepreneurs, Imagen Capital Partners is an ideal candidate to lead Nimble’s most recent round of funding. Indicator’s Geoff Bernstein will join the Board of Directors as an observer.
Indicator participated in Nimble’s Seed Round roughly three years ago, and we are excited for the growth and success that the company continues to achieve. Nimble has landed over 10,000 businesses to-date and continues to attract new users with its breadth of unique marketing insight and automation features designed to help people build stronger relationships.
Nimble will use this new capital to accelerate product innovation, secure strategic partnerships and increase customer adoption. Nimble has been extending its pioneering Social Relationship Management Platform to work everywhere that their customers work. Currently, Nimble delivers relationship insights everywhere you work including Office 365, G Suite, Outlook, Chrome, Safari, Firefox, Hootsuite, iOS and Android.
Nimble (www.nimble.com) is the pioneer of social sales and marketing CRM for individuals and teams. It combines the strengths of traditional CRM, classic contact management, social media, sales intelligence and marketing automation into a powerful social selling solution.
Birago is a UI/UX expert with a breadth of knowledge spanning hardware, IoT, VR and AR. Birago earned his Masters of Science from MIT where he focused on artificial intelligence, HCI (Human Computer Interaction) and User Experience. He’s leveraged this unique skill-set working with companies like Google, Motorola, and Cisco, to name a few. Birago is the founder and president of the MIT Media Lab Alumni Association, a mentor at Google’s 30 Weeks accelerator, and speaks regularly at conferences around the world. The culmination of this work and an exciting development for Indicator Ventures is Birago’s latest project, Pienso.
Pienso is a self-serve, enterprise-ready interface for non-technical analysts, domain experts, and knowledge workers to create and manage unbiased insights from complex data sources. The platform provides a user interface to the entire machine learning process, thereby empowering data exploration, editing, modeling and analyzing. While current solutions require data scientists with heavy technical expertise, Pienso gives the knowledge (non-technical) worker the ability to lead the machine learning process. Their first product is a Knowledge Explorer, which allows the non-technical user to add a powerful search engine to large data sets – think Google Search, but with the ability to be easily trained by human knowledge experts, with key features such as parallel document search, multiple and simultaneous natural language search queries and identifying key experts with the data.
To learn more about Birago and his work check out his blog.
Aditya is a machine. He’s dedicated to doing more and it shows. Whether it’s a cross fit workout, a complex product road map or a non-profit for students in need, Aditya is non-stop making things happen. This is just one of the reasons we are lucky to have Aditya as a Venture Partner at Indicator Ventures. Currently he’s the head of Product at Troops, making a whole lot happen.
As the head of product at Troops Aditya runs all things product, design and data. He was their first hire and is an integral part of their executive team. He’s also been an integral part of their fundraising efforts, and having raised ~$10MM in just 18 months between their Seed and Series A round of financing, clearly he’s having a massive impact.
With a mission to make software more human, and easier to use we’re excited to see some seriously cool product launches in the near future. But don’t take our word for it…here’s what Aditya had to say:
At Troops, we fundamentally believe that the future of “getting things done” is going to look a lot less like static fields and forms, and more like a conversation with a human being… an intelligent one for that matter! It seemed crazy to us that in a world with self-driving cars, we are still using software for work that looks like it was from the 90’s. We figured, if we can make this software delightful, people might actually use it and dare I say, enjoy it. And how amazing would it be if tens of millions of people around the world doing work, could actually do so with a little more enjoyment? That seemed like a mission and vision worth pursuing.
For modern sales teams who use Salesforce, Slack, and Google Apps, Troops is a Slackbot that makes it easy to use CRM data and configure workflow to do your job. Unlike trudging through CRM directly, Troops lets you instantly push and pull customer and sales information in and out of Slack, making it the sales hub for both you and your team. It’s “Conversational CRM” and it creates more efficiency and workflow for organizations so that they can spend their time focused on the most important functions like closing deals and making their customers happy.
Outside of Troops, Aditya is the co-founder and president of Intellection Institution, a NJ based STEAM (Science, Tech, Engineering, Art and Math) non-profit that provides students in need with the resources to succeed.
In late September, Indicator Ventures held its second annual Demo Day in partnership with News Corp. The event was an extension of the relationship built with News Corp and is a prime example of the value generated through our corporate partnerships program.
Held at News Corp’s NYC headquarters, the event included presentations from the founders of five companies, and was attended by over 30 directors and executives from News Corp as well as many of its business units including Dow Jones, Harper Collins, and News America Marketing.
Indicator Ventures hand-selected startups building innovative technologies and platforms that have direct applications specific to News Corp business units. Emphasis was placed on digital technologies with the potential to drive efficiencies and new business opportunities across the News Corp ecosystem with a particular focus on Messaging, Artificial Intelligence, and Automation.
Founders showcased their industry knowledge and insights, and spoke about how their companies are providing unique value to their relevant industries. The presentations fostered interactive and thought provoking discussions with the audience. Amanda Greenfield, News Corp’s Vice President of Corporate and Business Development, noted that “it was both educational and inspiring to see founders showcase their companies and talk about the myriad applications relevant to News Corp. We are excited to explore the ideas and opportunities spurred by these presentations.”
We couldn’t be more proud of our founders for the products, services and platforms they have built. Moreover, we are pleased to see our partnership with News Corp continue to flourish in tandem with the growth we are witnessing across the broader Venture Capital ecosystem and within large corporations looking to drive efficiencies through ongoing adoption of emerging technologies.
Msg.ai: Artificial Intelligence for conversational commerce
Speaker: Puneet Mehta – CEO and Founder
Sector: Messaging, Artificial Intelligence
Relevancy: Mobile messaging is exploding. It’s rapidly becoming the number one communication platform of choice for consumers around the world. In fact, 6 out of the top 10 most used apps globally are messaging apps, with Whatsapp and Facebook Messenger leading the way (combined 1.5b users). Msg.ai will be discussing how you should be thinking about personalized conversations with your customers across various messaging apps and how AI can be leveraged to automate at scale.
Quaero: Quaero provides customers with a turnkey automated solution that manages and analyzes audience data to identify pattern behavior and maximize digital advertising revenue.
Speaker: Naras Eechambadi– CEO and President
Sector: Data Management, Automation
Relevancy: With consumers spending increasingly more time across various formats and devices throughout the digital ecosystem granular understanding of the consumer journey is a must. Better understanding of first and third party data enables better targeting, more efficient operations, better campaign results and the opportunity to significantly increase revenues.
Lob: Lob offers a suite of APIs for the enterprise that automates and optimizes direct mail at scale. Lob’s technology generates customized pieces, distributes them based on custom triggers, helps A/B test different variants, and tracks mail as it’s delivered.
Speaker: Harry Zang – Co-founder
Sector: Direct Mail, Automation
Relevancy: Direct mail has one of the highest levels of ROI but the distribution and analytics are antiquated. From customizing recipient fields to running A/B tests on geo-targeted campaigns, there are a number of steps that can be taken to optimize campaign results. Sending physical mail should be as easy as sending email and should have the same level of control, tracking and analytics.
Islands: Islands is a mobile first messaging platform that helps communities to gather, communicate and mange themselves in a modern way.
Speaker: Greg Isenberg – CEO & Founder
Relevancy: There is a fundamental shift happening right now around real time messaging. As one of the largest media companies in the world, NewsCorp should be prepared to understand, adopt and capitalize on the high growth messaging sector.
Wade and Wendy: Wade & Wendy is using Artificial Intelligence to make hiring human. Wade and Wendy is developing AI personalities that grow real relationships and facilitate true understanding through chat, wherever you are. Wade works for job seekers and Wendy works for internal recruiting teams.
Speaker: Drew Austin – CEO & Co-Founder
Sector: HR, Artificial Intelligence
Relevancy: As one of the leaders in enterprise AI, Wade and Wendy will discuss how companies should be thinking about and using Artificial Intelligence within a corporate environment. How can AI make internal business processes, including the hiring process, much more efficient?
We are pleased to announce that IrisVR, an Indicator Ventures portfolio company, has raised $8M in Series A funding led by Emergence Capital with participation from Pritzker Group and Morningside Group, ahead of the company’s Q4 2016 product launch. Kevin Spain, General Partner at Emergence will be joining the Board of Directors, alongside Indicator Ventures’ General Partner, Jonathan Struhl. IrisVR couldn’t have found a better Series A partner to help accelerate growth given that Emergence Capital is arguably one of the world’s best enterprise software investors with investment such as Salesforce, Box, Yammer, SuccessFactors and Veeva Systems, to name a few.
Indicator co-led IrisVR’s seed round over a year ago and we are pleased with the progress they’ve made since then; their software has been adopted by almost 20,000 users in over 100 countries!
IrisVR intends to use its funding to accelerate the company’s growth, with a particular focus on the recruitment of new talent. IrisVR is currently seeking visionary creators and engineers who look forward to the merging of the digital and physical 3D worlds, love data driven design, and want to put groundbreaking technology to use in an industry that constructs the built environment.
IrisVR (www.irisvr.com) provides a suite of enterprise software that enables users to visualize and share 3D models in Virtual Reality. With IrisVR, architects and contractors can walk a client through a space before it’s built, communicate effectively with collaborators on site, and win more projects. IrisVR is headquartered in New York City.
We are excited to announce our latest investment, VIDA!
VIDA was founded by Umaimah Mendhro, a brilliant entrepreneur whose vision is to democratize fashion by leveraging digital efficiencies. The inspiration for VIDA came from Umaimah’s personal experience as an artist, and her frustrations with the need for upfront costs and minimum production requirements when creating products. Having grown up in Pakistan, Umaimah was distinctly aware of the waste and inefficiencies in small manufacturing facilities. She wanted to create a solution that would address the barriers to entry for independent designers who wanted to create beautiful products, while also helping workers in manufacturing facilities increase their utilization and improve their livelihoods.
VIDA enables artists and creatives from around the world to seamlessly create beautiful pieces of custom apparel (with other products coming soon), and sell the items on the VIDA marketplace within minutes. VIDA provides each artist with their own digital storefront, which artists and designers can use to sell products directly to their communities. There are tens of thousands of artist already using the platform, uploading thousands of designs each month. VIDA handles the customer transactions, end to end manufacturing and shipping. Umaimah and her team have built streamlined integrated manufacturing capability that leverages the most innovative digital screen-printing technology to produce customized apparel at positive unit economics, even at a single quantity. These aspects ensure an all-around high quality experience for the end user.
VIDA’s process is simple and efficient:
(1) Artists submit designs, showcasing watercolor paintings, photographs, illustrations, sketches, prints and more.
(2) Artists simply self-design with VIDA’s easy to use upload tool and publish their branded site on VIDA. Artists then reach out to their audience to convert them into customers.
(3) VIDA completes the sale and starts the production process with partner factories around the world using the latest digital screen-printing technology. VIDA then handles all shipping, handling and returns.
VIDA’s management team has a breadth of experience at pioneering fashion companies and large technology companies including Microsoft, Square, Stella & Dot, Threadless, Betabrand, Karmaloop and FlipKey.
VIDA also has a very important social mission to help educate workers at its factory partners around the world. They offer a 3 month crash course in basic literacy, specifically basic reading, writing, and math skills to all factory workers. The program is primarily designed for people who’ve never been inside a school. It costs less than $15 to make someone literate for life – it’s truly remarkable! The VIDA story of combining streamed manufacturing for custom made original products with a strong social mission was the main driving factor behind Indicator Ventures’ investment decision.
For more information please visit www.shopvida.com
NY-based Wade & Wendy has announced $4m in seed funding from Indicator Ventures, Slack, Randstad, FFVC, Converge, and a number of other strategic investors.
Wade and Wendy, is building a talent recruiting platform for both candidates and companies that leverages artificial intelligence to streamline and efficiently manage the hiring process, all while capturing valuable data.
Wade is an artificially intelligent career assistant serving as an always on resource that supports an individual throughout their job search and career. Wendy is an artificially intelligent recruiting assistant, leveraging rich data that cross-references with a company’s organizational chart in order to identify the best possible candidates. Additionally, Wendy is trained as a team member, handling or assisting in the many roles and responsibilities of a hiring manager. Since there is no user interface and all data and analysis is done on the backend, the platform fits seamlessly into the users’ normal conversational workflow, such as Gmail and Slack.
Armed with an incredibly talented team and strategic investments from Slack’s Investment Fund and Randstad, the world’s second-largest HR service provider, Wade and Wendy is poised to bring much-needed efficiency to the recruiting industry.
Click here to learn more about Wade and Wendy’s mission from CEO, Drew Austin.
We recently invested in NYC-based Noble Markets. Through its platform, Noble provides the next generation of prime brokerage services, including real-time clearing and settlement of FX and other OTC assets for the world’s largest market makers, funds and prime brokerage units.
Indicator Ventures’ core thesis revolves around investing in digital products and services that create efficiencies, and Noble Markets does exactly that. Through its trusted platform of connected market participants, Noble facilitates real-time clearing & settlement, centralized collateral management, and custodial services without the need for ISDA/bilateral agreements, with lower counter-party risk, and materially cheaper transaction costs. In other words, Noble saves both time and money in a massive market (FX is $6 trillion daily).
Noble has taken a unique approach to solving a decades-old workflow, beginning with acquiring a state-chartered bank, and opening up direct accounts with central banks in order to move capital on behalf of clients. The bank charter, core IP and partnerships with major market structure institutions have helped Noble build a unique and highly differentiated business.
Aside from the enormous addressable market and the aforementioned competitive advantages, our investment thesis for Noble was driven by three primary Indicators. First, Noble has assembled an amazing team that includes executives, traders, architects and compliance officers from some of the world’s largest and most reputable financial institutions. The second indicator is their early traction. After going live with a handful of market makers to validate and test the platform, they are launching next month with some of the world’s largest trading participants who view Noble as a platform to more efficiently and profitably trade FX. Lastly, we invested alongside some of the world’s most experienced industry veterans, including former investment banking and global asset manager CEOs and Chairmen, as well as strategic investors with experience as regulatory consultants and lobbyists, early backers of major market infrastructure companies and other exchange platforms, as well as the former CEO and Chairman of CLS.
We have a tremendous amount of conviction in the team and idea, and as they execute to their potential, Noble will unlock more value and upside than anything we have seen before.
We are proud to announce that Shibumi has closed their Series A having raised $3.6 million led by Indicator Ventures, with participation from Morningside Technology Ventures and existing strategic angel investors. The deal came together quickly, closing in under 30 days.
Partner lead on the deal for Indicator was Geoff Bernstein continuing his active role working with the company. Geoff will maintain his board seat and continue to work closely with management helping to advise them on strategy, operations and more as they scale their team and business.
This deal is a prime example of the early-stage investing model Indicator Ventures set out to create – invest early on and work closely with the company to bridge them from fragility to stability. In the case of Shibumi, we increased our position along the way as the company hit key milestones and proof points, starting with a small position (originally an angel investment by the GPs), and growing it gradually through the Series A. Like all early-stage businesses, Shibumi struggled at times to accurately convey their value proposition and gain customer traction. This is why investing in rock star founders is so critical, as Shibumi’s management team was able to reposition the business and adapt to feedback and market signals to get to where they are today.
Shibumi is landing and expanding contracts at a rapid pace, (with some of the biggest companies on the planet) and they continue to exhibit some of the most impressive growth metrics (300% QoQ ARR growth) and unit economics (7x ratio sales & marketing spend to revenue) of any SaaS business we have seen. Needless to say, we could not be more proud of what this team has accomplished.
Here at Indicator Ventures we pride ourselves on our team. Therefore, whenever we have an opportunity to showcase their amazing work we do so, proudly.
Greg Isenberg joined Indicator Ventures as an early Venture Partner (literally from day one). Greg is a savvy marketer, growth hacker and accomplished entrepreneur. Greg was the founder of 5by – a video discovery platform that was acquired by StubleUpon less than a year after they launched.
Greg left StumbleUpon in 2015 to begin pursuing more entrepreneurial endeavors once again. While we don’t exactly know what Greg has up his sleeve this time around, we do know one thing for sure. Whatever Greg builds will be an exceptional product delivering true value to its end users. Either way, we can’t wait to see it unfold!
But don’t take our word for it, read what Greg had to say himself, here.
We are happy to report that Bond has been acquired! This comes only 14 months after our first investment into Bond’s seed round and only 6 months following our investment leading Bond’s Series A. While we value all exits, this one is particularly sweet given the quick realization and the fact that Indicator Ventures was the sole venture institution backing the company on a meaningful level. We took a risk on a brilliantly creative and visionary founder in Sonny Caberwal and on an idea that truly embodied Indicator Ventures’ mandate for digital efficiencies. We are proud to see that thesis substantiated by a successful acquisition.
Bond set out on a mission to make personalized communication easier, at scale. They did so by creating a technology to enable real handwritten notes using both hardware and software that learns and recreates human gestures. From self-service to secure API + CRM integrations, Bond integrates into any workflow – enterprise and consumer – to send handwritten notes on personalized stationery, in seconds, on demand.
Therefore, it is no surprise that Bond found their home with Newell Rubbermaid, now Newell Brands (NYSE: NWL) following the $15B merger with Jarden Corporation (NYSE: JAH). Bond will continue to grow their team, product, and customer experience from their current NYC office. Additionally, because Newell sells $2B+ of writing instruments via brands like Sharpie and Paper Mate, Bond will be investing more in exploring how technology, writing, and creative expression come together in the future.
I’m extremely proud to have been on this journey with Bond and its diverse team of 70+ engineers, designers, and dreamers. Together we’ve overcome tremendous odds to build an amazing product and service that enables people to be more thoughtful.
John and Indicator go way back – back to before Indicator’s formation in fact. John was the CTO and co-founder of Buzz Table, one of the first investments made by Indicator Ventures General Partners Ben Luntz and Geoff Bernstein, (Ben was also an advisor to the company). It was a phenomenal experience working with John and his other co-founders. We learned a ton and at the end of the day, we also generated a fantastic return when we sold the business to Sysco (NYSE: SYY).
We enjoyed working with John and his team so much so that when we started Indicator Ventures we asked John to join as our CTO in residence. John helps us to evaluate new investments from a technical perspective and he also helps to advise companies that we’ve already invested in. What we love about John, among other things, is his practicality. For someone who understands tech on such a granular level, John also has a real business sense.
While we could go on about John’s great qualities we might be better served simply by letting John’s work (and life lessons) speak for themselves. Following the sale of Buzz Table to Sysco John took some time to document many ‘business and life lessons’ he learned in his early 20s. While this is in some ways old news, life lessons never really get old.
Here’s to never stopping to learn; thanks for the pointers John!
Welcome to the Indicator Ventures Blog! Though long overdue, we’re happy to finally have a forum where we can share updates on our portfolio, general happenings with the fund, our amazing team and various thoughts on the early stage Venture Capital market at large.
When we set out to build Indicator Ventures almost two years ago to the day, we never could have envisioned being where we are today. For three partners who are younger than the average GP, and none from a big name fund, the odds were against us in many ways. But like a hungry entrepreneur, this is also what gave us our edge. Drawing on core skill sets in marketing, operations and finance, we knew we could build an enduring and impactful Venture Capital fund.
In February 2014 we decided to drop everything we were doing (which meant winding down existing businesses) in order to lay the foundation for what would become Indicator Ventures. We began by taking our best angel investments (8 investments totaling $1.425M of cost) and rolling them into the fund (despite material markups) and at the expense of our own personal dilution – to help build a foundational portfolio that would demonstrate our commitment, highlight our investment thesis and disciplined diligence process, and of course, attract limited partners.
Following several months of planning and building, we set out to raise our fund in July, 2014. By the end of the year and just 6 months later we had raised just shy of $15M, and closed the fund soon thereafter. We did this while continuing to build the portfolio and manage existing investments. As it stands today (just two years later) we have 18 companies in our portfolio and $16M under management.
While the ‘proof is in the pudding’ as they say, and we still have a long way to go, every day we see more and more validation of our thesis; digital efficiencies. Simply put, we invest in digital products and services that create efficiencies for enterprises and/or consumers. It’s a simple view but we believe anything that can truly save time or money, either directly or indirectly, is valuable. Moreover, our approach of investing early on in real business models with real monetization strategies and real path(s) to profitability has proven to be a true differentiator. We did this before it was a trend and we remain steadfast in this approach into the future, despite market conditions.
While we are proud about what we have accomplished, we know we still have a tremendous amount of work ahead of us. Moreover, we also know (and would be remiss if we did not point out) that none of this would have been possible without the support and backing of our investors, (we have a small and incredible roster of LPs!) and our amazing team (17 strong including Venture Partners, Advisors and Resident Experts) and of course, our incredible founders! We are thankful for all who have supported us on this unbelievable journey and we look forward to continuing to build Indicator Ventures.
Ben, Geoff and Jon