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The Briefing: Back Market Bags $335M, Tea Drops Raises Series A, And More

Crunchbase News’ top picks of the news to stay current in the VC and startup world.

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Here’s what you need to know today in startup and venture news, updated by the Crunchbase News staff throughout the day to keep you in the know.

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Back Market bags $335M to value the company at $3.2B

Back Market, an online marketplace for refurbished electronics, raised $335 million in Series D financing led by General Atlantic.

Joining General Atlantic in the round was Generation Investment Management, Goldman Sachs Growth Equity, Aglaé Ventures, Eurazeo and daphni. The new funding comes a year after Back Market brought in a $120 million venture round to give it a total of $511 million in funding, according to Crunchbase data. The investment values Back Market at $3.2 billion, the company said.

The new funding will enable the New York-based company, which says it has more than 1,500 sellers on its platform, to consolidate and build on its position in the refurbished electronics marketplace.

— Christine Hall

Fintech and e-commerce

Copper banks $50M: Copper, a UK-based cryptocurrency custody firm, raised $50 million in Series B funding led by Dawn Capital and Target Global.

Homzmart bags $15M: Egypt-based Homzmart, a furniture and home goods marketplace, announced $15 million in Series A funding led by MSA Capital.

Amount inks $99M: Amount, a Chicago-based digitization platform for banks and financial institutions, raised $99 million in Series D funding, led by WestCap, to value the company at more than $1 billion.

DailyPay raises $500M: On-demand enterprise pay tool DailyPay announced $500 million in capital that included a $175 million Series D round, led by Carrick Capital Partners, and $325 million in credit capital.

Eat Just lands $170M: Eat Just, a San Francisco-based creator of sustainable foods, announced that its GOOD Meat division secured $170 million in new funding by a group of backers, including UBS O’Connor.

Icon Source inks $1.6M: Denver-based Icon Source, a digital marketplace that connects aspiring brands with athletes, closed a $1.6 million seed round from undisclosed investors.

Tea Drops drinks in $5M: Los Angeles direct-to-consumer tea maker Tea Drops raised $5 million in Series A funding led by BrandProject. The new investment brings the company’s total funding to $8.4 million, the company said. Tea Drops offers bagless tea that dissolves in your cup.

Lance banks $2.8M: Lance closed $2.8 million in seed funding to launch a business bank account for freelancers and side hustlers. Round participants included Barclays and BDMI. The capital is intended for product development and marketing. The company says there is no charge for a basic account, but offers a pro version for $12 per month.

— Christine Hall

Health care

Atonarp raises $50M: Tokyo-based Atonarp, a manufacturer of molecular sensing and diagnostics products for the health care, pharmaceutical and semiconductor industries, announced $50 million in Series D financing led by WRVI Capital. Atonarp uses light to test blood and other biological samples to produce a digital molecular snapshot. The new funding will enable the company to expand its operations and expedite the development and commercialization of its molecular diagnostics products.

SymphonyRM lands $25M: SymphonyRM, a Palo Alto-based health care company, announced $25 million in Series B funding led by TT Capital Partners. SymphonyRM enables health systems to transform how they acquire, engage and retain patients by creating an engagement model. The company intends to use the new funds on sales and marketing efforts and expand its use cases.

Artificial secures $21.5M: Artificial, a software company providing a first-of-its-kind lab automation platform, closed a $21.5 million Series A investment round led by M12. The company will use the investment to accelerate product development, hire more employees and further life science partnerships. Palo Alto-based Artificial provides a unifying software platform that orchestrates and captures everything in a lab, including all the manual tasks, so that the lab can turn its previously inefficient and error-prone processes into seamless, reproducible and scalable workflows.

emocha Health inks $6.2M: Digital health company emocha Health secured $6.2 million in Series A funding led by Claritas Health Ventures. The Baltimore-based company uses artificial intelligence to improve medication adherence among patients with chronic and infectious diseases.

Vedere Bio II launches with $77M: Vedere Bio II, a Cambridge, Massachusetts-based company developing treatments for vision restoration and preservation, said it launched with $77 million in Series A financing led by Octagon Capital.

Interius BioTherapeutics lands $76M: Interius BioTherapeutics, a preclinical stage gene therapy company announced $76 million in an oversubscribed Series A round of funding co-led by Cormorant Asset Management and Fairmount Funds.

Sparrow Pharmaceuticals secures $50M: Portland, Oregon-based Sparrow Pharmaceuticals, a clinical-stage biopharmaceutical company developing treatments for disorders of corticosteroid excess, closed $50 million in Series A financing led by OrbiMed.

— Christine Hall

Legal

Uptrust raises $2M: San Francisco-based Uptrust, a civic empowerment technology company working to keep people out of jail who shouldn’t be there, closed $2 million in a seed financing round backed by investors including the De-carceration Fund, Luminate and Stand Together Ventures Lab.

— Christine Hall

Enterprise software

Explorium Closes $75M Series C: San Mateo, California-based data platform Explorium announced a $75 million Series C funding round led by Insight Partners, with existing investors Zeev Ventures, Emerge, F2 Venture Capital, 01 Advisors and Dynamic Loop Capital also participating. The round — which comes eight months after its Series B — brings Explorium’s total investment to more than $127 million. The company’s platform allows companies to digest internal data to predict and model performance.

Styra Announces $40M Series B: Redwood City, California-based Styra has raised a $40 million Series B led by Battery Ventures with participation from previous investors A.Capital, Unusual Ventures and Accel, as well as new investors Capital One Ventures and Citi Ventures. Styra’s platform allows companies to enforce and monitor authorization policy across cloud-native applications.

— Chris Metinko

Climate

Recyclops inks $3M: Sandy, Utah-based Recyclops closed on $3 million in seed funding to develop its technology and expansion into 20 additional states to provide tech-enabled sustainability and recycling programs. Lerer Hippeau and Glad led the round.

Illustration: Dom Guzman

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

Joining General Atlantic in the round was Generation Investment Management, Goldman Sachs Growth Equity, Aglaé Ventures, Eurazeo and daphni. The new funding comes a year after Back Market brought in a $120 million venture round to give it a total of $511 million in funding, according to Crunchbase data. The investment values Back Market at $3.2 billion, the company said.

Source: https://news.crunchbase.com/news/briefing-5-18-21/

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Cryptocurrency Experts Say These 4 Factors Are Driving Change In The Industry

The COVID-19

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The COVID-19 pandemic accelerated acceptance of digital currencies like Bitcoin and the underlying blockchain technologies that power them. And while Bitcoin volatility continues — with the currency hitting its lowest point in months this week — investors are optimistic momentum will continue even as the world slowly starts to return to normal.

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The crypto and blockchain sector has attracted nearly $12.4 billion in venture investment into U.S.-based companies since 2017 and $19.4 billion globally, Crunchbase numbers show. In fact, data so far for 2021 shows dollars were nearly 3x from 2020 for both global and U.S. investments. But the sector also faces continued opportunities and challenges going forward, including more widespread adoption and new regulatory pressures from governments around the world.

Case in point: Earlier this month, El Salvador became the world’s first country to adopt bitcoin as legal tender. At the same time, Thailand’s Securities and Exchange Commission ordered its exchanges to delist meme coins, such as Dogecoin, as well as NFTs, exchange tokens and fan tokens, saying those tokens have “no clear objective or substance or underlying [value].”

Stepped-up efforts by China’s government to rein in the crypto space had the largest impact on valuations. On Friday, authorities in China’s Sichuan province, one of the country’s largest mining centers, reportedly ordered cryptocurrency miners to shut down their operations,

Cryptocurrency experts say these kinds of polarizing events put a spotlight on the space.

“Blockchain was accelerated five years in the pandemic,” according to Alon Goren, founding partner at blockchain fintech venture studio Draper Goren Holm.

Here’s a closer look at four factors that are likely to drive big changes in the cryptocurrency space in years to come.

1) Mainstream adoption

Cryptocurrency startups are working to make the process of using, buying, trading and finding digital currencies easier, driving greater consumer awareness and adoption.

Increasingly, mainstream adoption of cryptocurrencies is “crazy important” to the growth of the sector, according to Goren. Still, some of that adoption has come from less serious applications of digital currencies, including “meme coins” — assets based on jokes but with no real value other than those given to them by social indicators — a phenomenon that also concerns Goren because they reinforce the notion that cryptocurrency isn’t legitimate.

“Publicly traded companies can show quarterly earnings, you can follow the CEO on Twitter and you know their opinions on things,” Goren added. “In crypto, you don’t have those kinds of things to show legitimacy.”

Meanwhile, Hsuan Lee, CEO of Portto/Blocto, said the adoption of NFTs — non-fungible tokens — is one of the biggest factors that has changed the industry in the past year. Portto is a Taiwan-based company that aims to make blockchain simple for users and developers.

Although NFTs have been around since 2017, they were initially not appealing for typical use, but that all changed when they became approachable by retail investors, including when sports organizations got involved in selling digital clips and cards, he said.

“The National Basketball Association doesn’t market itself as a blockchain, but offering collectibles on it appeals to fans,” Lee said in an interview. “With those kinds of applications, even introducing a music NFT would potentially attract existing music fans. With that kind of people joining the party, it will make crypto more mainstream.”

Muneeb Jan, a cryptocurrency and fintech expert operating out of Hong Kong, said the investor base for cryptocurrency is still largely retail investors, while major financial institutions are in the discovery phase.

Still, new companies are announcing on a daily basis that they will accept bitcoin and other cryptocurrencies, and banks are facing crypto investor demand to get more involved in the space, Jan said.

“Crypto funds are increasingly viewed as an asset class,” he said in an interview. “There is not much of a use case currently, but they want to jump onto the bandwagon. If more large institutional investors come in, there will be price stability, and it will improve the legitimacy.”

2) Price volatility

Jan believes two of the biggest headwinds slowing more mainstream cryptocurrency adoption are price volatility and the fact that bitcoin as a mode of payment is not yet completely viable due the current inability to quickly process transactions.

Bitcoin has been particularly volatile in recent days. After surging above $40,000 about a week ago, the currency fell below $30,000 this week, recovering to around $32,400 as of Tuesday afternoon. Over the past year, the price grew to a peak of more than $60,000 before falling back to half that at the end of May.

Just processing transactions is not a sustainable use long-term due to the expensive transaction fees associated with it, even though people want bitcoin to be able to do that, he added.

“Other cryptocurrencies are not volatile because the community investing in them have come to a consensus on the price,” Jan said.

Lee said price volatility will be aided by regulations, especially as cryptocurrency is adopted more broadly. Price volatility will only be fixed with time, he said.

“This is a very young market and it has attracted attention, which makes prices volatile,” he added. “It can be dangerous to get into a space without established regulations. Being at an early stage, there is a lot of imagination that can be had for these cryptocurrencies. At the same time, when bad news comes out, it can easily dump harder on crypto than other companies.”

3) Regulatory pressure

Regulations proposed for cryptocurrency have gained steam since the beginning of 2021.

Among them: The U.S. Department of the Treasury announced in May that it will require any transfer worth $10,000 or more to be reported to the Internal Revenue Service as part of an effort to curb tax evasion.

“I’m happy to see regulations come into place because it will be good for the industry overall,” Lee said. “It will minimize possible scams or malicious use cases and make it better for everyone to get on board.”

The government is also examining possible regulations of cryptocurrency exchanges with a focus on protecting investors and preventing market manipulation, as well as financial account reporting as it relates to cryptoasset exchange accounts and payment service accounts that accept cryptocurrencies.

Goren called a focus on Bitcoin, Etherium and the public markets “a double-edged sword.” Any real value is eroded when inflation occurs, but Bitcoin is a decentralized currency, so its value holds up well against inflation.

And the more institutions that participate, the more legitimacy it creates so regulators are less likely to fight it, he said.

“Most lawmakers know crypto is not used by criminals, but the people who put them in office are large financial institutions that are cheering when they say that happens,” Goren said.

While he understands why there have to be IRS reporting requirements for tax purposes, he disagrees when government regulations don’t consider Bitcoin a currency, but then treats it like cash.

By instead treating cryptocurrency as a capital asset, the IRS is taxing capital gains, which could also have implications on the venture capital world, he added.

Goren said other countries have a bit more clarity, but there is still misunderstanding in the U.S. when it comes to how cryptocurrencies should be reported financially, and it won’t change until there is clear categorization of cryptocurrencies.

4) Beyond Bitcoin

Rocketfuel Blockchain founder Peter Jensen said it will take time for the public to understand and be comfortable with cryptocurrency, much as people had to acclimate to the idea of online banking and ATM cards before that.

Jensen’s company, based in San Francisco, processes crypto payments. He believes people are distracted by the price volatility of Bitcoin, although it is just one out of some 200 cryptocurrencies.

“We need to move people’s minds away from Bitcoin because who knows if cryptocurrency will survive,” Jensen said in an interview. “There are many cryptocurrencies pegged to the dollar, which means they have zero volatility. If you take those and use them for payment, then you get the benefits of that.”

Global developments — such as El Salvador adopting cryptocurrency and both Sweden and Dubai issuing their own digital currencies — bring promise for the future of the industry, and Jensen predicts the U.S. will eventually issue a digital version of the dollar.

He sees a world where when you get a job, you will have the choice of receiving your paycheck in dollars or cryptocurrency, and there will be no volatility because those funds will be guaranteed by the U.S. government.

“We feel that the U.S. has an opportunity to be ahead, even though China is adopting cryptocurrency faster, as well as those with less-efficient banking systems,” Jensen added. “If we don’t stay in front, we are going to be last.”

Crunchbase Pro queries listed for this article

The query used for this article was “Global Cryptocurrency Companies,” in which “Bitcoin,” “cryptocurrency” and “virtual currency” were the organizational industry search terms. The data was then separated out by changing the headquarters location to “United States.”

All Crunchbase Pro Queries are dynamic with results updating over time. They can be adapted with any company or investor name for analysis.

Illustration: Dom Guzman

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

Stepped-up efforts by China’s government to rein in the crypto space had the largest impact on valuations. On Friday, authorities in China’s Sichuan province, one of the country’s largest mining centers, reportedly ordered cryptocurrency miners to shut down their operations,

Source: https://news.crunchbase.com/news/cryptocurrency-experts-say-these-4-factors-are-driving-change-in-the-industry/

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Zenefits Payroll Glitch Results In Delayed Paychecks For Small-Business Employees

Employees of several small businesses weren’t paid Friday after payroll and benefits platform Zenefits closed for the Juneteenth holiday and experienced a glitch, two people affected told Crunchbase News.

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Employees of several small businesses were paid late Friday after payroll and benefits platform Zenefits closed for the Juneteenth holiday and experienced a glitch, two people affected told Crunchbase News.

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Zenefits provides tools for businesses to handle HR, onboarding, benefits and payroll. It’s used by many small and medium-sized businesses. The San Francisco-based company has raised at least $584 million in known venture funding, per Crunchbase data, and was most recently valued at $4.5 billion by private investors when it raised funding in 2015.

On Friday, several people took to the comments section of a Facebook post Zenefits made in honor of Juneteenth, which this week became a federal holiday celebrating the end of slavery in the U.S., to complain that their employees hadn’t been paid, despite their respective companies processing payroll.

The post was soon deleted.

John Bazyk, CEO of Connecticut-based security system company Command Corp., told Crunchbase News that he realized Friday morning that his company’s employees hadn’t been paid after one of them contacted him.

Command usually sees a tax withdrawal and employees’ net pay come out of its bank account on Wednesday, but this week only the tax withdrawal was taken on Wednesday, Bazyk said.

The payroll amount was taken out this morning, but had yet to be disbursed to employees as of 4 p.m. Eastern, he said.

Bazyk said he spent four hours Friday trying to deal with the issue, and hadn’t received any communication from Zenefits such as an email alerting him of the issue.

Some employees have bills that automatically debit from their bank accounts, he said, and not being paid could put them in a bind.

“The employees are upset at me, they think I didn’t run payroll,” Bazyk said. “Some of these are new employees. They’re joining a new company and it’s like, ‘Wait I’m not getting paid?’ ”

Usually preceding a holiday, Zenefits will remind customers to run payroll early, Bazyk said, but that wasn’t the case this week. He noted that he understands it’s a unique situation — with President Biden on Thursday signing legislation that made Friday a new federal holiday in celebration of Juneteenth — but the situation and lack of communication from Zenefits were frustrating.

“Even if they make it right, we’re probably going to leave them because it’s an unacceptable mistake,” Bazyk said.

It’s not clear how many of Zenefits’ customers or their employees were impacted by the error.

Nancy, a controller and HR administrator at a company in the Washington, D.C., area, said she was notified by two employees Friday that they hadn’t been paid. Around 2:15 p.m. Eastern, she saw a notification in the Zenefits portal acknowledging the issue. Nancy did not want to share her full name because she was not authorized to speak on behalf of her employer.

“Businesses can make mistakes,” she said. “Whatever caused the debit to not go out is not good. But then to not be there to answer what happened … that’s bad.”

A Zenefits spokeswoman said in an email to Crunchbase News that the issue causing the payroll delay was resolved, and that employees would receive payment by 5 p.m. Pacific time.

“Today, Zenefits experienced an issue that resulted in a delay for some employees’ direct deposits,” the statement read. “This has been resolved and we can confirm that employees who did not receive their direct deposit this morning will receive it today by 5 PM PT. All employees will be paid and the funds have already been processed. We are currently waiting on the banks to send them out this afternoon.”

Another Zenefits spokeswoman said in an email at 2:40 p.m. Pacific time that the issue was resolved and affected employees had been paid.

Illustration: Li-Anne Dias

Editor’s Note: This story was updated after it was first published to reflect that payment for affected employees had gone through late Friday afternoon, after Crunchbase News first spoke with sources.

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

On Friday, several people took to the comments section of a Facebook post Zenefits made in honor of Juneteenth, which this week became a federal holiday celebrating the end of slavery in the U.S., to complain that their employees hadn’t been paid, despite their respective companies processing payroll.

Source: https://news.crunchbase.com/news/zenefits-payroll-glitch-results-in-small-business-employees-not-getting-paid/

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Curate Brings In $1.25M Seed For Small Business Sales, Operations Platform

The company’s platform provides back office functions so that small businesses can focus on building clientele and maximizing profits.

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After a year of helping small businesses navigate sales and operations during the global pandemic, Curate has raised a $1.25 million seed to continue developing its modern sales and operations platform for florists, caterers and other creative businesses.

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Ryan O’Neil and his wife founded the St. Louis-based company in 2013 after previously owning a wedding and event floral business together. A year in, and their event company was losing customers because it was taking too long for O’Neil’s wife to get proposals back due to the time she put into researching all of the event components and their costs.

“Sitting at the kitchen table, we realized that all of these spreadsheets and lists should be talking to each other,” he said. “We started building a tool for ours and other florist businesses, but then started having catering companies ask us for software.”

Curate’s platform enables businesses to create proposals, process payments, manage supply chains, and maintain communication with customers and suppliers so owners can spend more time on their business. It also has workflow integrations with popular tools such as Square, QuickBooks and Stripe.

The seed round was led by OCA Ventures, which was joined by Jim McKelvey, Cultivation Capital and Stout Street Capital. Prior to this investment, Curate was largely bootstrapped with a small seed round, O’Neil said.

“Coming out of COVID, there were some important opportunities we knew we had to jump on, and we knew if we were going to raise a Series A, we needed all of the pieces in order,” he added. “We ended up finding great partners, like OCA.”

O’Neil intends to use the new funding on technology development, to grow and provide new features and functionalities, especially for catering companies, as well as for a more robust customer relationship management platform for florists.

Tamim Abdul Majid, general partner at OCA Ventures, said he was introduced to O’Neil by another entrepreneur in St. Louis. The firm was looking for solid vertical SaaS solutions and was impressed with how well O’Neil had coordinated Curate’s growth.

“Ryan is the kind of customer-driven CEO that we like,” Abdul Majid said in an interview. “His numbers are really good, he has good economics and churn rates — the right kind of thing you want to see in a SaaS play. In addition, Ryan’s customers are some of the best we have had in terms of fans, who are saying ‘you can’t take this service away from me.’”

Meanwhile, O’Neil said Curate experienced “explosive demand” over the past year, with April 2021 revenue up 700 percent over the year prior. As such, he also expects to double his employee headcount to 32 people and is hiring in infrastructure and product development.

During the global pandemic, the company was working with customers to cancel events and solve supply chain issues. Within six weeks, Curate had also built a brand-new product for customers to see what their workflow would look like for one product versus another. It even hired a full-time employee to answer Paycheck Protection Program questions and help companies apply, O’Neil said.

Next up, the company will round out key roles within the leadership team and work on product development.

“As we look forward, we will be restructuring the application so it is faster and stronger,” O’Neil added. “One of the key things that showed up this year was that we can jump verticals. We are seeing dynamic growth with caterers, but also have landscapers, interior designers and creative small businesses, and we want to be the sales and operations center for all businesses.”

Illustration: iStock

Stay up to date with recent funding rounds, acquisitions, and more with the Crunchbase Daily.

Source: https://news.crunchbase.com/news/curate-brings-in-1-25m-seed-for-small-business-sales-operations-platform/

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