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Steve's ITK: EUnicorn

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Steve's ITK

March 3 · Issue #41 · View online
Steve's In The Know: Everything I published recently, commentary you won't find elsewhere, write-ups of events I attended or spoke at, and industry rumours.

Steve O'Hear
Trying to close a nice European scoop, and looking through the 46 VC contacts I have, weighted by helpfulness, and none can provide me with the second sourcing I need. https://t.co/2zFFxOAmBg
3:22 PM - 1 Mar 2018
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Opening thought: The next EUnicorn
I like to say, ‘I only write when I’m right’ — so let’s hope I’m not wrong. This week, with the help of my TechCrunch colleague Ingrid Lunden (whom BI rightly once described as ‘a veritable scoop machine’), I unearthed what appears to be Europe’s next unicorn (that is, a privately owned tech company that is valued by investors at $1 billion or more).
According to multiple sources, UiPath, a Romania/U.S. startup that builds ‘software robots’ for enterprises to automate legacy and back-office functions, has raised a Series B round of funding of $100 million or more, catapulting it to a valuation of over $1 billion. The company’s last funding round reportedly valued it at $109 million, so that’s a nearly tenfold increase.
We also believe Silicon Valley investor Kleiner Perkins Caulfield Byers may be in on the round – the firm seems to be showing an increasing interest in European startups – along with other household name VCs.
That’s likely also very good news for UIPath’s seed investors who include Earlybird, Credo Ventures (the backer of my now defunct startup) and Seedcamp. Expect official confirmation in the next few days.
Talking of Seedcamp, with UIPath’s new valuation, the London seed investor’s fund III is starting to look pretty decent (remember, it recently flogged fund I and II to Draper Esprit, including its remaining stake in TransferWise).
Here’s a screen grab from Seedcamp’s own fundraising deck listing the new unicorn alongside the rather noisy Revolut, insurtech company Wefox, and digital mortgage broker Trussle.
Seedcamp's fundraising deck from late 2017
Seedcamp's fundraising deck from late 2017
This week also saw me break a fistful of other venture capital news, including personnel changes at BGF Ventures that sees three partners – yes, three! – depart, including Wendy Tan White, who only joined BGF Ventures in late June after leaving Entrepreneur First where she was a General Partner.
She tells me she’s exploring raising a new ‘deep tech’ and AI focused fund of her own, while Harry Briggs and Rory Stirling, who have also left BGF, plan to remain in venture too. Fun fact: Wendy Tan White is believed to previously have begun raising her own fund before ultimately deciding to join EF.
Still reeling from being out-scooped by Business Insider last month with news of Ophelia Brown’s new VC fund Blossom Capital (and despite beating them by 14 minutes to the BGF story), I decided to write a follow up piece after uncovering further details.
According to my sources, while Blossom Capital is targeting early stage tech startups, its remit is Series A not seed, a departure from Brown’s work at LocalGlobe. The new firm wants to plug what it deems a ‘Series A gap’, with investments of $5 million-plus.
The thinking is that in Europe promising and high quality founders often get funded by great angel investors and at seed but sometimes struggle at Series A due to a shortage of capital at that stage. ‘[They’re] trying to push the European ecosystem forward, it’s about true high conviction investing,’ is how one source frames it.
Other VC news I’ve recently covered includes a report on Kindred Capital, an £80 million seed VC firm in London that is giving founders it backs a share of fund profits (nice work if you can get it!), and serial entrepreneur Rodolfo Rosini’s move over to the ‘dark side’.
If you read only one thing: 'Tech companies should stop pretending AI won’t destroy jobs'
I really enjoyed this thought-provoking piece by Kai-Fu Lee, founder and CEO of Sinovation Ventures, published in MIT Technology Review. Lee gives a good summary of the battle between the U.S. and China regards an AI arms race (tl;dr: it’s the data, stupid, of which China has a lot more).
It also echoes an argument I first made in ITK: #1 that we may be living through AI’s honeymoon period whereby the technology is augmenting existing jobs, with a ton of upside, before eventually displacing them on a scale we have never seen before.
Things I wrote
UiPath raising around $120M at $1B+ valuation for its ‘software robots’ for internal business tasks
BGF Ventures leads ticket search engine TickX’s £3M Series A
Rodolfo Rosini enters VC, joins AI and machine learning accelerator Zeroth.ai as Partner
Kindred Capital, an £80M seed VC firm in London, is giving founders it backs a share of fund profits
More details of Blossom Capital emerge, a new fund co-founded by ex-Index VC Ophelia Brown
BGF Ventures in flux as three partners are departing
Triple, the marketplace for local travel experiences, acquires competitor Local Guddy
Tinyclues, the AI-driven campaign marketing solution, scores $18M Series B
ParkBee closes €5M funding to open up private car parks to public bookings
Raisin, the European savings deposit marketplace backed by PayPal, gets dedicated UK launch
Anyfin bags €4.8M Series A to let you refinance your existing loans by taking a photo
StatusToday scores nearly $4M to grow its AI-powered ’employee insights’ service
Tandem launches a credit card that offers cashback and no fees when spending abroad
Homie raises $4M to help London’s ‘Generation Rent’ find their next property
Online estate agency Home Made raises £850K seed at £4.3M post-money valuation
CommonSense Robotics raises $20M for robotics tech for online grocery fulfilment
Monzo given go-ahead to ‘passport’ banking licence to Republic of Ireland
Starling’s marketplace banking rollout adds pensions, savings, travel insurance and mortgages
Zervant raises €6M for its invoicing software for small businesses
Online mortgage advisor Burrow pivots to B2B, cites unit economics issue
Closing thought: Keep your frenemies close
It’s been fun watching the continued rivalry between and progress being made by upstart banks Monzo and Starling (let’s just say, the two challenger banks have history, a story I hope to write one day). In a now familiar ‘anything you do, we can do too’, Starling and Monzo appear to be on a path to feature parity.
Starling has rolled out a feature called ‘Settle Up’ that lets you easily split bills or collect money from friends and resembles Monzo.me. Likewise, Monzo announced integration with roundup savings app Moneybox, which Starling already has, and, like its rival, is ‘passporting to Ireland’ to begin the process of expanding to Europe. It also begun testing its marketplace banking proposition, while Starling has added new partners to its marketplace.
Bonus: Did you know that the two banking startups’ offices are in almost touching distance, at least until Monzo moves to its new swanky HQ? ‘You can look out of the window and literally see Monzo working next door (the buildings are across a narrow road so the windows face each other)’ a Starling employee tells me. You couldn’t make it up!
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Till next time,
Steve
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