The Brilliant Approach that Allowed Hims to Reach Unicorn Status in One Year
Though founded just over a year ago, Hims' novel approach to issues of a men’s health has already allowed the company to raise more than $197 million at a reported $1 billion valuation.
A Brilliant Approach to Treating ED
The company, which specializes in men’s healthcare products was able to capitalize on Viagra’s patent expiration and developed its own ED medication using the same active ingredient. Customers consult discreetly with an online physician, then the product is sent directly to the customer’s home. In a move away from Viagra’s targeting of the older male demographic however, Hims markets primarily to a much younger demographic, often under the age of forty, and conveys the common nature of the issue through social media and celebrity sponsored ads in an effort to reduce the stigma surrounding ED treatment.
Addressing Other Men's Wellness Issues
In much the same way as its ED treatment, Hims has also taken a similar approach in manufacturing and marketing its men's hair-loss treatment. Once Merck’s patent on Propecia expired in 2014, Hims was again free to repurpose the active ingredient and sell it as its own treatment. It also doesn't hurt that one of the most common side effects of Propecia is impotence. Along with ED and hair-loss, Hims also addresses the embarrassing problem of cold sores which it combats with a pill containing the active ingredient in Valtrex, whose patent expired in 2009. All of these medications, as well as skin creams and supplements and a new women’s line, are all aggressively targeted in fun and clever ways towards a younger consumer.
An Approach That Pays
So far, the approach seems to be working. It was reported yesterday, Hims will be closing a new round of Series C funding for $100 million. The pre-money valuation of this latest round of funding has reportedly pushed the value of the company over $1 billion. This latest round of funding comes less than seven months after the company closed its last round of funding, a Series B round for $50 million. To date, Hims has raised more than $197 million after eight rounds of funding.
An Optimistic Future
While some investors balked at the $1 billion pre-money valuation, company co-founder and CEO Andrew Dudum remained undeterred. In a recent interview Dudum remarked, ‘We think what we’re building is a $10-20 billion company in the next few years.’ Whether or not the company will reach this valuation remains to be seen, but for now, Hims see,s off to a very good start.
The Greatest Single Factor in Startup Success
Bill Gross is the founder and CEO of the business incubator, Idealab. In a recent conversation in Vancouver, Mr. Gross shared his findings on what factors matter most for startup success.
The Power Startups
To begin with, Mr. Gross asserted he believes the startup model is one of the greatest ways we can make the world a better place. According to Mr. Gross, by taking the right group of people and incentivizing them properly you can unlock human potential in a way that has never been possible before. Why then do so many startups fail? And what factors matter most in startup success?
The Five Key Factors for Success
In order to answer these questions, Mr. Gross reviewed the 100’s of startups founded within Idealab and examined what lessons could be learned from both these company’s successes, as well as their failures. In so doing, Mr. Gross identified five factors he felt contributed most to a company’s success or failure. Those five factors are: idea, team, business model, funding, and timing.
A Real Life Case-Study
To determine the effectiveness of these five factors, Mr. Gross examined the impact of each factor across 100 Idealab companies as well as 100 outside companies. Mr. Gross examined companies from Idealab which had gone on to achieve billion dollar valuations, as well as those he considered to have fallen short. Likewise, when examining outside companies, he examined both companies he considered to be wild successes like AirBNB and YouTube, as well as companies which he considered to be failures like pets.com and Friendster. For all of these companies, Mr. Gross measured the impact that each of the five factors had.
The Single Greatest Factor
According to Mr. Gross’s research, across all of these companies, the number one factor was timing (42%). The second biggest factor was execution (32%), then idea (28%), business model (24%), and finally funding (14%).
Two Real-Life Examples
As an example for how these key factors played out, Mr. Gross sited, AirBNB. According to Mr. Gross, at the time of AirBNB’s launch many very smart investors wanted nothing to do with the company. Very few could see the validity in renting out their home to a stranger. The model was new and untested. However, according to Mr. Gross, one of the major advantages AirBNB had was launching during the height of the recession when people really needed extra money. This timing helped people overcome their objections to the new business of renting out their homes to strangers. According to Mr. Gross, this was the same situation which helped to contribute to Uber, which launched around the same time.
To Sum It All Up
In summary, Mr. Gross stated that execution and idea certainly matter a lot, but that it is timing which might matter even more. According to Mr. Gross, the best way to assess timing is to thoroughly determine if customers are ready for what you are offering them. According to Mr. Gross, if you are very honest with yourself about the factor of timing, you will have a better chance of seeing your startup join the ranks of those changing the world for the better as well.
https://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed?language=en
How Flatiron is Improving Cancer Research
Flatiron Health was founded in 2012 after its founders witnessed firsthand how decentralized cancer research information had become. By bringing all of this information into a single repository, the New York City-based Flatiron Health hopes to make such information more readily available and accessible for research of breakthrough cancer treatments.
The Need for Change
Flatiron Health was founded in 2012 by Nat Turner and Zach Weinberg shortly after they sold their first company to Google. The need for Flatiron Health became apparent when Nat’s seven-year old cousin was diagnosed with a rare form of leukemia.
After witnessing firsthand how few hospitals, clinics, and universities were sharing their data with one another, Nat and Zach realized there was an important opportunity to bring all of this information under one single system in order to assist in the discovery of new and improved breakthrough cancer treatments.
Flatiron Health Goes Beyond Mere Treatment
And the need is vast. Beyond merely assisting with the development of new cancer treatments, Flatiron Health also assists with a full range of patient needs. Along with health data, Flatiron Health's shared technology platform assists with visualizing patient populations, determining resource utilization, identifying treatment patterns, overseeing network management, and even allowing health care professionals to match patients with clinical trials among many other beneficial aspects. Coupled with this the company’s ability to streamline the insurance process and manage and make available electronic health records for academic medical centers and hospitals, and you can begin to see just some of the roles Flatiron Health is able to serve.
The Company is Constantly Improving
As an organizational tool for managing the total care of patients, Flatiron Health is unparalleled. According to Flatiron Health's website, currently more than 2.1 million patient records have been entered into their system. Add to this the fact that all 15 of the top therapeutic companies work with Flatiron Health, and over 280 community oncology practices, and seven major academic research centers partner with Flatiron Health as well. The company also sees more than 2,500 clinician users on its OncoEMR service, as well as 55 community oncology practices using its OCM network.
Major Funding and an Enormous Acquisition
Investors have taken notice as well. As of this writing, Flatiron Health has already raised more than $313 million after three rounds of funding. Most recently, Flatiron Health closed a $175 million round of Series C funding in 2016 led by Roche, a Swiss-based company which focuses on bringing targeted cancer treatments to patients. Then, two years later in February of 2018, Roche acquired Flatiron for $1.9 billion.
Today, Flatiron Health and Roche are combining to pioneer a new way to both managing and treating cancer patients. Both companies look to improve the care of patients for many years to come.
Kettlebell Kitchens Makes Eating Healthy Easy
For anyone who wants to eat healthy while maintaining a busy lifestyle the problem is always where to find time to prepare healthy meals. For those facing this dilemma, Kettlebell Kitchens is a great solution. Now, the New York City-based startup is providing healthy, pre-portioned meals for thousands of grateful customers each week.
Kettlebell Kitchens: A Healthy Eating Option for Those with Busy Schedules
Founded in 2013, Kettlebell Kitchens aims to provide healthy nutrition solutions in support of weigh loss, muscle gain, and growth performance goals for those with busy lifestyles. The pre-packages customizable food options come delivered straight to your door and are microwave-ready in just minutes.
A Simple 3-Step Process to a Healthy Meal Plan
By providing healthy meal plans Kettlebell Kitchens looks to help working professionals maintain their fitness goals. In order to do this, the company uses a simple 3-step process. The first steps is to learn what a customers specific fitness goals are. From there, one of the companies registered dietitians customizes a meal plan option for the customer based on their specific fitness goals. Finally, the company delivers a week’s worth of meals at a time directly to the customer to simply heat and eat.
Healthy Options at Fair Prices
Individuals plans usually start at $8.95 for breakfast and between $11.95 and $13.95 for entrees. All meals are soy-free and dairy-free and all ingredients are naturally gluten-free thought the kitchen is not certified gluten-free. The company also offers meals which are higher in carbohydrates as part of their ‘athlete meals’ and also offers vegetarians meals for those with such dietary restriction needs.
Committed to Giving Back
Founded by two former military members, Kettlebell Kitchens is proud to offer discounts for all members of the military and first-responders. The meal containers themselves are made from plant fibers, and are fully recyclable. Kettlebell Kitchens also makes an effort to donate meals to those in need whenever they can.
Supported by Robust Financing
In October of 2018, Kettlebell Kitchens successfully closed a $26.7 million Series B round of funding led by North Castle Partners. Previous to this, the company had closed a round of $2.6 million in Series A funding, as well as a round of $1.1 million in Seed round funding. To date, the company has raised more than a reported $30.4 million after three rounds of funding.
By offering healthy and convenient food options for working professionals, this New York City-based startups is leading the way in keeping working professional performing at their best.
How Squarespace Built a Great Startup
Squarespace is the New York City-based startup that allows clients to easily build their own beautiful websites. Founded in 2003, Squarespace has now grown into one of the hottest startups in NYC.
Squarespace Started in a College Dorm Room
Squarespace was founded by Anthony Casalena in his dorm room at the University of Maryland. The original tool was a way to allow Anthony to easily build his own website. After sharing the tool with his friends and family, Anthony was soon able to raise $30,000 to start the company. For the next four years, Casalena was the only employee at the company. By 2007, the company was generating $1 million in annual revenue.
From Small Beginnings to a $1.7 Billion Valuation
By 2010, Squarespace had raised $38.5 million in Series A funding and had grown to 30 employees. Four years later, the company closed a second round of Series B funding worth another $40 million. The following year in 2015, the company had reached $100 million in annual revenue and had grown to over 550 employees. Then last year in 2017, Squarespace secured an additional $200 million in secondary market funding in a round that saw the company valued at $1.7 billion.
Simplicity is Key
By simply dragging-and-dropping content into pre-arranged templates, Squarespace allows users to easily make their own beautifully designed websites. For more ambitious users, Squarespeace also allows them to create templates which can then be sold to other users who want to purchase the design. Templates come with tutorials on how to optimize for SEO and even include how-to setup guides for e-commerce. As of 2016, the company was hosting more than 1 million pages.
Expanding and Earning Kudos
Since its founding, Squarespace has grown to over 830 employees. The company has also grown from its NYC-based roots to also having offices in Portland, Oregon and Dublin, Ireland as well. As a vote of confidence, Squarespace also hosts its own website on the platform. Since 2012, the company has been voted one of Crain’s Best Places to Work in NYC and last year was named one of Fortune’s 50 Best Workplaces for Parents.
Furthering the Market Share
As of 2016, the company has also started selling domain names. This put the company on an even more head-on trajectory with rivals like GoDaddy. But Squarespace has fared well. Since then, the company has managed to embrace the e-commerce trend and has also found ways to fully integrate both PayPal and Stripe in order to make online transactions across the platform more seamless.
Today, more-and-more Squarespace is making its presence in the web-hosting industry felt. Few would have guessed the company would ever come so far after starting in that university dorm room all those years ago.
How SoFi's Funded Over $30 Billion In Loans
One of the largest obstacles facing Americans today is student loan debt. In 2011, four Stanford Business School classmates set-out to address this issue. Their solution was SoFi: an online personal finance company specializing in student loan refinancing, mortgages, and personal loans.
Beginning at Stanford
In 2011, Stanford Business School classmates Mike Cagney, Dan Macklin, James Finnigan, and Ian Brady set-out to find a solution for the millions of Americans that were taking on crippling student loan debt. Their solution were personal loans made directly to students. In order to fund this pilot program, the group solicited funds from Stanford University recent grads. The group was able to raise $2 million from roughly 40 grads, each of which provided roughly $50,000 to one of 100 Stanford students. The experiment was a success.
SoFi: A Huge Success Right From the Start
Having proven the validity of the program, the following year the team managed to raised over $77 million in Series B funding led by, Baseline Ventures. The year after that, SoFi announced it had raised over $500 million through debt and equity for use in re-financing student loans. By this point the company had already funded more than $200 million in student loans for more than 2,500 borrowers from more than 100 different schools. That same year, SoFi announced it had reached an agreement with Morgan Stanley and Barclays to create a bond, backed by peer-to-peer student lending.
Expanding Beyond Student Lending
In February of 2015, SoFi announced a $200 million round of Series D funding led by, Third Point Ventures. This round would be used by SoFi to offer personal loans. By March of that same year, SoFi had also begun funding mortgages. By the end of the year, SoFi had funded over $4 billion in loans and had closed a $1 billion round of Series E funding led by, SoftBank. By the end of 2016, SoFi had funded more than $12 billion in loans for more than 175,000 lenders. That same year, SoFi also became the first startup lender to receive a triple-A rating by Moody’s.
A Sound Idea
The original model for the company was to connect students with recent recent grads from their specific schools. The program allowed the students to borrow at rates lower than what the federal government offered, and also allowed enders a nominal return on their investment via interest. When moving into mortgages the company examined historical bill repayment, education, and professional work history in order to make an assessment of the borrowers credit worthiness.
A Company on the Rise
According to the company website, to date SoFi has now funded more than $30 billion in loans for more than 600,000 borrowers. Along with lending, the company also offers members free career services, complimentary financial advising, networking events, and additional rate discounts on qualified loans. To date, SoFi has raised more than $2 billion from ten rounds of funding. And it all started less than ten years ago at Stanford.
Luckin Coffee's Amazing Road to Its $4 Billion Valuation
Chinese-based coffee chain Luckin Coffee announced yesterday it raised $200 million in Series-B funding, giving the company a valuation of $2.2 billion.
Luckin Coffee's Explosive Growth
Luckin Coffee is currently the fastest growing coffee chain in China. Founded in 2017, Luckin Coffee has already expanded to over 1,700 and 21 cities across the country. This is a truly stunning expansion considering China’s largest coffee chain Starbucks has just 3,300 stores despite having entered the market over 20 years ago. The round of funding is also the second large round closed by the company this year. In July, the company raised another $200 million round of Series-A funding, which at the time gave the company a $1 billion valuation. Luckin Coffee is currently the fastest startup to reach unicorn status in China.
The Appeal of Luckin Coffee
One of the main draws of Luckin Coffee has been its focus on very fast door-to-door coffee delivery. This is a feature which appeals to many in the urban work setting who can’t get away from their desk. Along with in-store sit-down cafes, Luckin has concentrated on creating pickup booths and delivery hubs where dedicated take-out workers quickly pickup orders. In China's largest cities of Beijing and Shanghai, the company claims there is a Luckin Coffee within 500-meters of anywhere in the city and says it will deliver coffee to customers within 30 minutes.
How Luckin Coffee is Challenging Starbucks
Luckin's explosive expansion does not look to be letting up any time soon. According to company CEO Qian Zhiya, “We will continue to increase capital investment in product research and development, technological innovation and business development, and continue to optimize product and user experience.” According to Euromonitor, Starbucks still maintains an 80% share of the $3.4 billion Chinese coffee shop business, but this may soon be changing. In response to Luckin’s aggressive delivery tactics, Starbucks has since partnered with Alibaba-owned food delivery giant Ele.me in order to compete to delivery coffee to people’s door.
Whether or not Luckin will be able to eclipse the behemoth in China that is Starbucks remains to be seen, but what is certain is it is off to a great start.
ClassDojo Raises Additional $35 Million in Funding
ClassDojo, the messaging app allowing parents and teachers to contact one another, has raised an additional $35 million in Series C funding.
Funding for the Future
The latest round was led jointly by GSV and SignalFire and also saw participation from General Catalyst and Uncork Capital. According to reports, the new round of funding will be used in one of two ways: First, to continue the expansion of the popular messaging app; and second, to develop a new subscription service called 'Beyond School', which provides parents with at-home tutoring lessons to bolster their students’ current lessons.
A Y-Combinator Graduate on the Rise
Founded in 2011, ClassDojo is a platform that allows parents and teachers to remain in communication regarding their students’ schoolwork, projects, and schedule updates. After starting out as part of Y-Combinator, ClassDojo has now expanded to more than 180 countries world-wide. While the company has not revealed an official valuation, reports state the company is now worth more than $400 million; an impressive increase from the $100 million reported valued just back in 2015. To date, ClassDojo has raised more than $65 million after four rounds of funding.
A Global Success
The reason for the impressive jump in valuation is due in part to the seeming ubiquitousness of the app. According to ClassDojo, the app is now used by 95% of K-to-eighth grade schools in the U.S., and is also said to be used by more than 25% of primary schools in the U.K., Australia, Hong Kong, Singapore, and the UAE. According to company CEO and co-founder Sam Chaudhary, “Learning is so much about having strong relationships,” Chaudhary said. “It’s pretty cool to see the effect this can have not just with parents and teachers, but between parents and kids.”
For ClassDojo, it truly appears the sky is the limit.
NYC Startup Funding, Month-end Wrap-up: February 2019
February continued a solid start to the year for NYC-based startup funding. Below are five of the largest rounds of funding closed by NYC-based startups over the course of February 2019.
Aetion - $27M
Date: 2/5/19
Round: Series B
Industry: Healthcare, Enterprise Software
Lead Investor: N/A
Company: Founded in 2013, Aetion is a healthcare technology company that provides analytics and evidence for the improvement of patient care. The company's patented rapid-cycle analytics™ and the Aetion Evidence Platform™ deliver real-world evidence for life sciences companies, payers, and at-risk providers. To date, Aetion has raised over $74.6 million after three rounds of funding.
Chainalysis - $30M
Date: 2/12/19
Round: Series B
Industry: Fintech, Cryptocurrency, Financial Exchange
Lead Investor: Accel
Company: Founded in 2014, Chainalysis is a company designing and developing anti-money laundering software for Bitcoin businesses. According to Chainalysis, its products include, 'REACTOR, an interactive and investigation tool that identifies offenders, visualizes data, and shares results with people and organizations, and API, a transaction based risk scoring solution that contains source and destination of funds to measure risk.' To date, Chainalysis has raised more than $47.6 million after four rounds of funding.
VAST Data - $40M
Date: 2/26/19
Round: Series B
Industry: Data Storage, Software
Lead Investor: N/A
Company: Founded in 2016, VAST Data is an enterprise data storage infrastructure provider. According to VAST Data, their mission is to, 'bring an end to decades of complexity and application bottlenecks that have been caused by mechanical media and by the complex tiering of data across different types of storage systems.' To date, VAST Data has raised more than $80 million after three rounds of funding.
HiberCell - $60.8M
Date: 2/7/19
Round: Series A
Industry: Biotechnology
Lead Investor: ARCH Venture Partners
Company: Founded in 2016, HiberCell is a biotechnology company specializing in the development of novel therapeutics to prevent relapse and metastasis. According to HiberCell, 'We are the first company exclusively focused on therapeutically modulating the biology and mechanisms of tumor dormancy.' To date, HiberCell has raised $60.8 million after one round of funding.
YieldStreet - $62M
Date: 2/26/19
Round: Series B
Industry: Fintech, Financial Services, Wealth Management
Lead Investor: Edison Partners
Company: Founded in 2015, YieldStreet is an investment platform allowing investors to effortlessly participate in curated investments with low market correlation and high yield, across litigation finance, real estate, and other alternative asset classes. To date, YieldStreet has raised more than $178.5 million after five rounds of funding.
Lalamove Officially Gains Unicorn Status
Hong Kong-based delivery startup Lalamove has reportedly raised a $300 million round of Series D funding at a +$1 billion valuation.
A Huge Southeast Asian Presence
Founded in 2013, Lalamove is a ride-haling delivery and logistics company like similar to Uber, which focusing on business and corporate clientele. The company - which operates out of mainland China - has over 2 million drivers across more than 130 cities, and boasts more than 28 million active users. Outside of China, Lalamove operates in seven other Asian countries, including Taiwan, Vietnam, Indonesia, Malaysia, Singapore, the Philippines, and Thailand. The latest round of funding is anticipated to be used to further expansion into southeast Asia and India.
The Latest Large Round of Funding
The latest $300 million round of Series D funding will reportedly be split in to two halves: Hillhouse Capital will lead the ‘D1' portion, and Sequoia China will lead the ‘D2’ tranche. The exact size of each half has not been disclosed. Previous to this, Lalamove closed a $100 million round of Series C funding in 2017. To date, Lalamove has raised more than $460 million after seven rounds of funding.
Firmly in Unicorn Territory
According to reports, the latest round of funding places Lalamove firmly into unicorn status. However, according to company head of international Blake Larson, Lalamove has been, “past the unicorn mark for quite some time [but] we just don’t talk about it.” The company was reportedly just shy of a $1 billion valuation when it closed its $100 million round of Series C funding.
A 21st Century Founder and CEO
Lalamove was founded in 2013 by Stanford graduate, Shing Chow. According to Sequoia China founder and managing partner Neil Shen, “Shing is a role model for Hong Kong’s new generation of innovative entrepreneurs. Raised in Hong Kong and educated at Stanford University, Shing returned and plunged himself in the entrepreneurial wave of ‘Internet Plus,’ becoming a figure of entrepreneurial success.” By all accounts, the future seems very bright for the young CEO.