Startup Monday: Latest tech trends & news happening in the global startup ecosystem (Issue 101- September 4)
Welcome to the Startup Monday, my weekly newsletter that recaps the week in the global startup ecosystem. To have this newsletter emailed to you, you can sign up here.
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Top startup news to follow this week:
1. Ivy Raises $20M in Series A Funding
Ivy, a Berlin, Germany-based open banking payments startup, raised $20M in Series A funding.
The round, which follows a $7m seed recently raised, was led by Valar Ventures, with participation from Creandum, 10x Founders and Angel Invest, alongside a number of angel investors.
The company intends to use the funds to accelerate its expansion into new markets and its product development efforts.
Founded in 2021, Ivy is building a global API for instant bank payments. The company aims to bring together instant bank payment infrastructures such as Pix, UPI, FedNow and Open Banking, among others, to a unified gateway.
The company says it currently accepts payments from consumers in over 50 countries, with connections to over 500 million consumer bank accounts.
2. Warby Parker co-founder raises nearly $800M for fifth Boston VC fund
A Boston-based venture capital firm that keeps a low profile has raised another fund, surpassing by approximately $200 million the total amount it brought in about two years ago.
Elephant Partners, the eight-year-old firm started by one of the co-founders of Warby Parker, raised $791.5 million for its fifth fund, according to a public filing with the U.S. Securities and Exchange Commission dated Aug. 25. A total of 178 investors participated in the fundraise.
Warby Parker's Andrew Hunt, who co-founded Elephant Partners in 2015 with Jeremiah Daly, did not immediately respond to a request for comment. Daly was not reachable for comment.
The latest fund comes approximately two years after Elephant filed to disclose its $600 million fourth fund.
In 2010, Hunt started Warby Parker with three friends and fellow MBA students from Wharton School of Business. The New York-based eyeglasses firm went public via a direct listing in the fall in 2021.
Both Daly and Hunt worked at Boston-based Highland Capital Partners, which focuses on consumer and enterprise technology.
Elephant listed a Newbury St. address as its principal place of business in the SEC filing. Daly is based in Boston, according to his LinkedIn profile.
Elephant's minimalistic website, which appears to be unchanged in the past two years, says that the firm focuses on enterprise software, consumer internet and mobile markets.
Last year, Elephant led the $7.5 million Series A round of DebtBook, a Charlotte, N.C.-based debt and lease management software company.
Elephant's investments from its first fund include sneaker startup Allbirds Inc., which — like Warby Parker — started as an online retailer before expanding into physical stores. Elephant's $156 million first fund dates back to 2016.
Daly also mentions on his LinkedIn profile he invested in HourlyNerd, which is now known as Boston-based Catalant Technologies.
3. Israeli startup raises $15 million to drive US expansion of clinical trial simulator
QuantHealth says its AI platform can predict results with 86% accuracy and support the success of faster, cheaper drug discovery and development
QuantHealth, an Israeli startup that virtually helps pharma and biotech companies execute thousands of clinical drug trials within minutes, said Wednesday that it has secured $15 million to drive its US expansion.
The Series A funding round was co-led by Bertelsmann Investments, one of Germany’s largest venture capital funds and Israeli venture capital firm Pitango HealthTech. Current investors, including Israel early-stage venture capital fund Shoni Top Ventures, Barcelona-based health tech venture capital firm Nina Capital, and UK-based Nova Capital also joined the financing round.
To date, QuantHealth has raised a total of $20 million in funds from backers such as US private equity firm Boston Millennia Partners, Israeli investment family fund Atooro Fund and US investment firm Renegade Ventures.
Founded in 2020 by CEO Orr Inbar and CBO Arnon Horev, the Tel Aviv-based startup has developed a clinical trial simulator platform for drug discovery harnessing artificial intelligence technology to predict how each patient would respond to treatment. The platform helps trial teams in pharma, biotech and life sciences firms identify how clinical trials will play out in thousands of variations within minutes to optimize trial design and drug development.
The startup says its AI simulator, which is trained on a dataset of 350 million patients and over 700,000 therapeutics, can predict clinical trial results with 86% accuracy, allowing pharma and biotech firms answer critical questions, including cohort optimization, protocol feasibility and commercial viability.
a computer science research laboratory. (iStock by Getty Images)
QuantHealth, an Israeli startup that virtually helps pharma and biotech companies execute thousands of clinical drug trials within minutes, said Wednesday that it has secured $15 million to drive its US expansion.
The Series A funding round was co-led by Bertelsmann Investments, one of Germany’s largest venture capital funds and Israeli venture capital firm Pitango HealthTech. Current investors, including Israel early-stage venture capital fund Shoni Top Ventures, Barcelona-based health tech venture capital firm Nina Capital, and UK-based Nova Capital also joined the financing round.
To date, QuantHealth has raised a total of $20 million in funds from backers such as US private equity firm Boston Millennia Partners, Israeli investment family fund Atooro Fund and US investment firm Renegade Ventures.
Founded in 2020 by CEO Orr Inbar and CBO Arnon Horev, the Tel Aviv-based startup has developed a clinical trial simulator platform for drug discovery harnessing artificial intelligence technology to predict how each patient would respond to treatment. The platform helps trial teams in pharma, biotech and life sciences firms identify how clinical trials will play out in thousands of variations within minutes to optimize trial design and drug development.
The startup says its AI simulator, which is trained on a dataset of 350 million patients and over 700,000 therapeutics, can predict clinical trial results with 86% accuracy, allowing pharma and biotech firms answer critical questions, including cohort optimization, protocol feasibility and commercial viability.
On average, developing a new drug or finding a potential blockbuster medicine takes billions of dollars over almost a decade because of the lengthy trials and lab work involved in the process. Despite these investments and efforts, over 90% of drug candidates in clinical trials fail to make it to market primarily due to lack of efficacy and safety.
4. Novo Nordisk swallows another obesity biotech, paying $16M upfront for its preclinical partner
Novo Nordisk is continuing to seek out obesity assets, paying 15 million euros ($16 million) to snap up Embark Biotech in its second weight loss takeover in quick succession.
The clinical and emerging commercial success of GLP-1 drugs developed by Novo Nordisk and Eli Lilly in diabetes and obesity has turned weight loss into one of the hottest categories in pharma—and sparked a scramble to snap up next-generation candidates. Lillyinkeda deal worth $1.9 billion to buy Versanis Bio last month, and Novo Nordisk struck back in August with the buyouts ofInversago Pharmaand Embark.
Copenhagen-based Embark has been on Novo Nordisk’s radar for years. The biotech spun out of the Novo Nordisk Foundation Center for Basic Metabolic Research at the University of Copenhagen in 2017, was incubated at Novo Seeds and began collaborating with Novo Nordisk in 2018.
Embark is built on research carried out at the lab of Zachary Gerhart-Hines, Ph.D. The lab studied a signaling axis between the adipose tissue, gut and central nervous system, leading to the identification of targets that are involved in fat energy expenditure.
5. Generative AI startup AI21 Labs lands $155M at a $1.4B valuation
AI21 Labs, a Tel Aviv-based startup developing a range of text-generating AI tools, has raised $155 million in a Series C funding round led by Walden Catalyst, Pitango, SCB10X, b2venture, Samsung Next and Amnon Shashua, the founder of Intel-owned Mobileye and an AI21 Labs co-founder. Google and Nvidia also participated.
The tranche, which brings AI21 Labs’ total raised to $283 million, values the company at $1.4 billion — a bit higher than the figure The Information reported earlier today ($1.2 billion).
“AI21 Labs came out of stealth in October 2020 with our first launch of [AI writing tool] Wordtune,” Yoav Shoham, one of AI21 Labs’ co-CEOs, told TechCrunch via email. “Since then, we’ve only managed to grow, more than doubling our workforce with plans to add even more employees.”
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AI21 Labs was founded in 2017 by Shashua, Shoham and Ori Goshen, the startup’s other co-CEO. Shoham, a professor emeritus at Stanford, previously sold two companies to Google, the time management app Timeful and social network friends organizer Katango. Goshen is also a serial entrepreneur, having co-founded and led several Israel-based tech companies, including the telco analytics firm Crowdx.
AI21 Labs’ flagship product is AI21 Studio, a pay-as-you-go developer platform for building custom text-based business apps off of AI21’s proprietary text-generating AI models — including its cutting-edge Jurassic-2 model. The startup also sells access to the aforementioned Wordtune, a multilingual reading and writing AI assistant akin to Grammarly.
5. OpenAI-backed language learning app Speak raises $16M to expand to the US
Speak, an English language learning platform backed by OpenAI’s startup investment fund, the OpenAI Startup Fund, today announced that it raised $16 million in a Series B-2 funding round led by angel investor Lachy Groom.
The co-founders of Dropbox, Drew Houston and Arash Ferdowsi, also participated in Speak’s tranche, which brings the startup’s total raised to $63 million. CEO Connor Zwick says that it’ll be used to support Speak’s launch in more markets, including in the U.S. by the end of the year. (Speak is currently live in around 20 countries including Japan, Taiwan, Germany, France, Brazil and Mexico.)
“It’s been incredible to see that the learning experience we spent years honing in a single market, South Korea, has proven to resonate with almost no modifications needed in markets and cultures across the globe,” Zwick said in a press release. “Looking ahead, we plan on bringing our AI-powered tutor to most major markets around the world by the end of this year, and are gearing up for a launch in the U.S., offering English speakers the ability to learn other languages.”
Speak was founded in 2016 by Zwick and Andrew Hsu. Zwick came from edtech — he sold his first startup, the flashcard app Flashcards+, to Chegg in 2013 — while Hsu has a background in neuroscience.
Zwick and Hsu met through The Thiel Fellowship originally. Prior to starting Speak, the pair spent a year studying and researching machine learning and developing accent detection algorithms using YouTube videos as training data.
6. Space Robot Startup Gitai Raises $15M
Japanese startup Gitai has raised $15 million for its lunar robotics pipeline, three months after closing a Series B funding round with $30 million.
The company, which has offices in Tokyo, Japan and Torrance, California, said the additional funds will be used to accelerate its business expansion in the U.S., as well as for “partial coverage of the lunar surface demonstration.”
The round included investments from Green Co-Invest Investment Limited Partnership, Pacific Bays Capital and Mitsui Sumitomo Insurance Venture Capital, as well as a loan from MUFG Bank.
The company said its lunar robots are designed to provide safe, affordable labor in space, reducing operational costs “by 100 times.”
“Gitai is developing highly capable, safe, and reliable robots to help build and maintain satellites, space stations, lunar bases, and cities on Mars,” the company said in a statement.
The company’s two main robot offerings are a robotic arm, the Lunar Inchworm, and a Lunar Rover. The Inchworm design features grapple end-effectors on both ends of the arm, making it customizable and versatile, while the rover can move autonomously around a lunar surface to help in construction and maintenance tasks, such as building and fixing infrastructure such as solar panels and communication towers.
7. Teale, your mental health companion at work, raises $11 million
French startup Teale has secured a funding round of $11 million earlier this summer (€10 million). The company provides a mental health platform for employees and helps HR managers when it comes to preventing burnout or quiet quitting.
Alter Equity and Bpifrance’s Digital Venture fund are leading the Series A funding round. Existing investors Isai and Evolem are also investing once again in the startup.
Teale is a double-faceted platform. It can be seen as a perk for employees as many people believe their employers should provide some form of support when it comes to mental health. But it’s also been designed so that HR managers can see when there’s something wrong in the organization.
“Our mission is really to ask ourselves what we can do to democratize mental health, destigmatize this topic and really put technology, data and science at the service of mental health, obviously to help employees, but also to build healthier organizations,” Teale co-founder and CEO Julia Néel Biz told me.
When your company sends you an email and tells you that you can use Teale for free, it means that any employee can download and install the app and start using it to better understand their mental health. And it starts with a survey that will be used to rate your mental health based on multiple criteria.
“It’s a proprietary index we created with our scientific advisory board and the psychologists who partner with our team. Our scientific advisory board is made up of psychiatrists and doctors of psychology. This index has been scientifically proven to be a good measure of mental health,” Néel Biz said.
8. Eindhoven-based PhotonVentures raises €60 million to invest in 15 European photonics startups
PhotonVentures, an independent deeptech VC firm that has emerged from PhotonDelta, the pioneering force behind the Dutch integrated photonics ecosystem, has launched a fund aimed at early-stage photonic chip startups and scale-ups. €60 million was raised in its first financing round with PhotonDelta as the lead investor alongside numerous private investors.
PhotonVentures plans to raise a total of €100 to €150 million, with its final close set for the start of 2024. It will prioritise Series A rounds, with the aim of providing investments between €1 million and €2.5 million. PhotonVentures’ investment strategy leverages on the Dutch PhotonDelta ecosystem to accelerate European startups and scaleups. The two organisations are strategic partners with the aim of supporting the rapid growth of Europe’s photonics industry. Photonic chips are critical in a range of applications quantum computing, robotics, sustainable agriculture, and autonomous vehicles.
The fund is planning to initially invest in 15 European deeptech companies that have the potential to grow into international winners in their sectors. The startups should have an integrated photonics-based MVP connected to the European ecosystem.
Joachim de Sterke, General Partner at PhotonVentures, said: “There are hundreds of incredibly promising startups and scale-ups driving development and application of photonic chips that need investment and support to take the next step on their journey. PhotonVentures fulfils this need, it is the only fund geared directly towards photonic chip startups and scaleups. Our aim is to play an instrumental role in making Europe a global leader in integrated photonics. We will continue to expand our fund to enable us to invest in scores of startups over the next few years.”
Founded in 2014, PhotonDelta has made significant investments in photonics companies and R&D over the last five years. In backing the fund, PhotonDelta has taken another step forward in its goal of building a world-leading industry for integrated photonics in the Netherlands and Europe. Last year, PhotonDelta secured €1.1 billion in public and private investment to scale up production, build 200 startups, create new applications for photonic chips and develop infrastructure and talent.
René Penning de Vries, Chairman of the Supervisory Board of PhotonDelta, added: “The integrated photonics industry is growing quickly but is short of investors with the knowledge and funding to back the sector’s ambitions. This is why creating the specialised fund PhotonVentures marks a significant milestone for the photonics industry and one which we are proud to be a part of. By transferring its existing portfolio, PhotonDelta was able to leverage its assets to attract more funds and kickstart the creation of PhotonVentures.”
9. China's Gotion buys 25% stake in Slovak EV battery startup Inobat
LONDON, Sept 1 (Reuters) - Chinese battery maker Gotion High Tech is buying a 25% stake in Slovak battery maker Inobat and will provide supply chain and technology support as the startup scales up production of electric vehicle batteries, the companies said on Thursday.
The companies did not disclose terms for the investment or what it means for Inobat's valuation.
The move by Gotion, partly owned by Volkswagen (VOWG_p.DE), is the first investment by a Chinese battery maker in a European startup and comes after the two companies announced earlier this year that they would explore joint venture opportunities to develop batteries for EVs and energy storage.
Inobat said the investment will provide it access to Gotion's research and development, as well as to the Chinese battery maker's raw materials including lithium, and to cell production and recycling capabilities. This will accelerate the Slovak startup's path to mass production.
"Through our joint efforts, we aim to develop and manufacture batteries that will find their way into countless households in Europe," Gotion CEO Li Zhen said in a statement.
10. Dublin-based UrbanVolt bags €26 million to make solar energy transition cheaper for businesses
UrbanVolt, a Solar-as-a-Service market leader, has announced a €26 million investment from European specialist growth investor Verdane. With operations in Ireland, the UK and eight continental European markets, the company will leverage the partnership with Verdane to drive expansion in their actual markets, and accelerate further entry into Europe.
UrbanVolt helps business customers make a cost-effective transition to clean energy with their Solar-as-a-Service business model, which eliminates the need for businesses to invest upfront capital expenditure in a solar installation. This is especially impactful for industrial customers: 60% of UK manufacturers say that increased energy costs are business-threatening, and 12% have already made job cuts as a direct result of increased energy bills.
UrbanVolt’s model involves financing, installing, and maintaining solar panels for customers, enabling the customer to purchase solar-generated electricity at discounts of up to 40% compared to grid-based electricity providers’ rates. UrbanVolt’s solution allows businesses to lock in their electricity rate for up to 30 years, safeguarding customers against volatile energy costs and guaranteeing a stable supply of electricity for decades to come.
Kevin Maughan, co-founder and CEO of UrbanVolt, said: “Securing this €26 million funding from Verdane marks a pivotal moment for UrbanVolt as we set our sights on an ambitious European expansion. We are thrilled to have the support of Verdane, a renowned specialist growth investor and fellow certified B Corp company, who shares our vision for a sustainable future. This investment will not only fuel our continued growth in the Irish market but also empower us to bring our innovative solar solutions to businesses across the UK and Europe. At UrbanVolt, we remain steadfast in our commitment to providing clean energy solutions that not only drive cost savings for our customers but also contribute to a greener and more sustainable world for generations to come.”
Verdane’s investment comes at a crucial juncture in the European solar market as panel capacity is expected to double by 2030 and more than quadruple by 2050. UrbanVolt is already the Solar-as-a-Service market leader, having signed agreements with more than 150 businesses in Ireland and the UK for their solar and light offering.