sequoia capital

Drive Capital’s investors hit a fork in the road • ZebethMedia

By zebethcontrolPosted on November 19, 2022Posted in Chris Olsen, Drive Capital, Mark Kvamme, sequoia capital, Venture, venture capitalNo Comments

Drive Capital was founded by two former Sequoia Capital Partners looking to start anew in the Midwest. But investors in the Columbus, Oh.-based firm have had a bumpy ride of late, and according to our sources, they aren’t enjoying it. It’s a dramatic turn for Drive, which announced $1 billion in capital commitments back in June, a healthy amount for a 10-year-old firm whose mission it is to invest nearly everywhere in the U.S. outside of Silicon Valley. In fact, in June, the firm — cofounded by veteran VCs Mark Kvamme and Chris Olsen — seemed to be riding high, with a couple of apparent wins and news funds that brought Drive’s assets under management to more than $2 billion. Yet dating back to September — soon after we talked with Olsen about VC doubling back to California — we heard rumblings about a rift, along with separate plans that Kvamme was making. Then came the announcement last month that the team was splitting up. At first, the story was that Kvamme, who logged more than twice as many years at Sequoia than Olsen, was transitioning to “partner emeritus” because, as he told a Columbus Business First, 10 years and four funding cycles was longer than he originally planned to lead Drive Capital. (This was probably a big surprise to the investors who’d just agreed to let Drive invest their capital.) This week, the other shoe dropped. Columbus Business First reported that Kvamme, who races cars, is not zipping off to semi-retirement but instead talking with potential backers about a new fund, the Ohio Fund, which will apparently invest in multiple asset classes, including other funds, public stocks, private companies in Ohio, and infrastructure. The idea is to “focus on the future economic vitality of Ohio,” said an unnamed source to the outlet. Olsen now says that he’s surprised by this development. We obtained a letter that Drive sent out to its limited partners tonight that reads: Dear Limited Partner,This week an article was published indicating that our Partner Emeritus Mark Kvamme is launchinga new investment fund. All of us at Drive were surprised by this news, as we are sure you were too.While we will not send you a note each time a new article about Mark is published, we feel that, inthe spirit of being a good partner, it’s appropriate to provide you with a transparent update aboutthis situation and our relationship with Mark.After the article was published we spoke with Mark and learned that the prospect of him raising anew fund was leaked to a journalist from an unknown source. According to Mark, he has not yetdetermined what he is going to do next. Raising a new type of fund is something he is considering,along with other options in public service and personal endeavors.We have a formal separation agreement with Mark that prevents him from starting a competitivefirm or fund to Drive. Please know that this was a heavily negotiated agreement to ensure that itsubstantially protects Drive, our Limited Partners’ interests, and everything we are building towardat Drive.Again, we do not intend to communicate with you each time a new article is written about Mark,but in this instance, we thought it appropriate to provide clarification. Should you have anyquestions, please do not hesitate to reach out [contact information redacted by ZebethMedia]. Sincerely,The Drive Team Olsen declined to comment for this story; we reached out to Kvamme and did not receive a response. But it’s complicated, to say the least. According to our sources, part of the split traces to a relationship between Olsen and Yasmine Lacaillade, who was Drive’s COO for nearly seven years before leaving the firm in April to launch her own investment outfit. Asked about this, a Drive spokesman downplayed any tensions that may have arisen from a romantic relationship between the two, writing: “Yes you heard right in that Chris and Yas are in a relationship. That’s been public knowledge for some time. No comments beyond that.” Like most venture outfits, Drive also finds its portfolio in rougher shape than a year or two ago. One of Drive’s biggest exits to date has been that of Root Insurance, a now seven-year-old, Columbus, Oh.-based insurance company that specializes in automotive coverage and that staged a traditional IPO in November 2020. Though the shares performed initially, they’ve tanked since, currently priced at roughly $7 each after a reverse stock split, down from $486 per share the day the company went public. Olsen stepped off the board in November of last year. The other big star of Drive’s portfolio currently — Olive AI — is trying to overcome its own challenges. The Columbus-based healthcare automation startup, founded in 2012, has long framed its extensive history of pivots (more than 30 to date) as an inspirational story of trying, then trying again. Olive was rewarded by investors for its willingness to shift gears, too. It has raised a staggering $902 million over the years and said last year that it was valued at $4 billion. But the outfit, a robotic process automation company that aimed to take on hospital workers’ most tedious tasks, was never all that it appeared, according to a series of damning Axios pieces; and by September, the wheels began to come off. Most notably, the company’s chief financial officer and chief product officer were abruptly fired, following out the door numerous C-level executives who also left this fall, including its president, a senior director of operations, its EVP of operations and its SVP of payer product strategy. Olive AI has since said it will sell a portion of its products and services to Rotera, a company built out of Olive’s own venture studio. Limited partners aren’t happy about these developments, but as far as we’re aware, they have not talked in earnest about taking action and it seems unlikely that they will. At least, it’s exceedingly rare for limited partners to cancel their capital commitments and only slightly more common for VCs

Personal carbon-cutting app Joro raises $10M Series A from Sequoia, Jay-Z’s Arrive • ZebethMedia

By zebethcontrolPosted on October 27, 2022Posted in carbon offsets, Climate, climate change, Joro, sequoia capitalNo Comments

Cutting your own carbon footprint isn’t easy, even for the most motivated person. Tracking, tallying, investigating, researching. For Sanchali Pal, though, that was part of the fun. Pal, who had been working in international development, wanted to start trimming her footprint. “I started building an Excel spreadsheet of the carbon emissions in my life, starting with food, and I ended up becoming this massive spreadsheet and ended up using it over six years to lower my emissions by about 30%.” Pal knew, though, that not everyone would go to those lengths. “I found it incredibly satisfying, but I’m a very particular kind of person.” Even still, she said the process was still “difficult and frustrating.” That’s what got Pal started on what would eventually become Joro, an app that helps people track and reduce their carbon footprints. Founded in 2018, Pal raised a $1 million pre-seed in 2019 and another $2.5 million in a 2020 seed round. Sequoia participated in both, leading the second round. Image Credits: Cayce Clifford Those investments have helped Joro triple its monthly active users over the past few months, reaching an average compound monthly growth rate of 25%. Now, ZebethMedia has exclusively learned that Joro raised a $10 million Series A led by existing investors Sequoia Capital and Amasia. They were joined by Norrsken, Nest co-founder Matt Rogers’ Incite, Jay-Z’s Arrive, and Mike Einziger, the lead guitarist of Incubus. The new funding will not only help build the Joro team, but it’ll also help continue the company’s shift from helping people track their footprints to helping them take action on what they learn. While Joro users can get general advice on how to cut their carbon footprint, the real power of the app happens when the user connects their financial records, synced via Plaid. From there, Joro works to estimate their carbon footprint by studying payments and amounts, like how much spending happens at gas stations or on airfare, for example. From there, it offers more personalized suggestions for how the user might cut their own carbon footprint. (Pal said that Joro never sells this data outside the platform “and never will.”) Sometimes those cuts are simple, like eating less meat, while others can be more challenging. For users with family scattered across the country, for example, eliminating air travel would be a difficult thing to ask. In that case, Joro then offers users the ability to offset their emissions. For a fee, users can offset part or all of their emissions. To make it simple, Joro offers a subscription. For users on a budget, they can set a ceiling on how much they’re willing to pay per month. Most people using the app pay about $30 per month, Pal said. Some pay as little as $10, while others with more extravagant lifestyles pay as much as $1,000 per month. Joro takes 17% of monthly subscription fees to help pay for the app’s services and — more importantly from the user’s perspective — for vetting offsets. Finding high-quality offsets is incredibly challenging for individuals. I went down that path years ago and eventually gave up because the ones that I felt were suitably additional, verifiable and permanent were only available to large buyers. I didn’t want to be throwing my money after questionable offsets, so I didn’t buy any. Because Joro aggregates its purchases across users, it can buy the types that I couldn’t access on my own. Pal said that Joro evaluates offsets every few months to ensure they’re living up to the company’s standards. In addition to the usual requirements — additionality, verifiability and permanence — the team also looks for what Pal calls “transformative potential.” “How does this affect local ecosystems? Environmental justice considerations? Especially as a consumer, as a person, if you’re buying into offsets, things you might care about more than a company.” The offsets cost Joro anywhere from $12 to $600 per metric ton. Some are nature-based solutions, while others are technological. The entire portfolio is balanced at an average of $25 per metric ton, Pal said. The startup will use its new funding to build its team and continue the shift from tracking carbon footprints to helping people take action to reduce them. The new focus not only satisfies a frequent request from users — it also should open new opportunities. “We think it could be another path to revenue, where people are actually changing things, switching to lower-carbon vendors or to lower-carbon ways of living. That’s a really great alignment of our impact model and our revenue model,” Pal said, saying that it would likely take the form of affiliate relationships between Joro and the vendors it features in the app. Pal is optimistic that the new infusion of cash and recent growth trends will help broaden Joro’s impact. Already, though, she’s stunned by how the landscape has changed recently. “Even three years ago, it was really hard to explain to people what Joro was,” she said. “The concept of climate tech barely existed, right? There was clean tech, and there was software. But software for climate? It’s been incredible to see how quickly it’s happened.”

Egyptian consumer money app Telda raises $20M from GFC, Sequoia Capital and Block • ZebethMedia

By zebethcontrolPosted on October 12, 2022Posted in block, Fintech, gfc, sequoia capital, Startups, teldaNo Comments

Telda, an Egyptian consumer money app founded by ex-Swvl executive Ahmed Sabbah last April, has raised $20 million in seed funding. The fintech, in a statement, said it wants to “revolutionize finance for the MENAP region.” Its first market, Egypt, is one of the highest consumer spending markets in Africa. The North African market’s private consumption accounts for nearly 85% of its nominal GDP, and only 4% of its overall GDP is cashless. Card usage in the country is still in its infancy in the cash-heavy society, but startups like Telda are banking on their card products to change the narrative, or at least try. When Sabbah spoke with ZebethMedia last year, he said Telda had obtained a license from Egypt’s apex bank, the Central Bank of Egypt (CBE) under its new regulations, allowing the company to issue cards and onboard customers digitally. However, for more than a year following this approval, Telda hadn’t still launched its app and card products to its over 30,000 signups. According to sources who spoke to ZebethMedia, Telda was yet to go live in the Egyptian market after raising that much money because it ran into issues with the apex bank, among them the appropriate licensing it needed to be called a digital bank, which seemed to be Telda’s description at the time. Sabbah denies that there was a scuffle between the two parties. “We are humbled to be the first company to receive the license in Egypt. Egypt’s commitment to shaping the future of finance and establishing itself as a global fintech hub is reflected in the support we’ve received from regulators over the past year,” he added. Telda eventually secured licence approval from the Central Bank of Egypt (CBE) a few weeks ago to launch as a consumer money and payment app in the Egyptian market. The company finally started operations last month and launched its app and a Mastercard-powered card to the public. It has onboarded 25,000 cards so far and has a waiting list of 110,000 customers who have ordered their cards. According to the consumer money app, it wants to “change the way people feel about and interact with their finances in this part of the world: from money transfers to online/offline purchases to saving habits.” In a country where 50% of its 100 million people are active smartphone users, two out of every three individuals have little or no access to formal financial services in Egypt. Telda is one of several fintech apps that have raised marked capital to provide these services such as rewards, cards, buy now, pay later to individual consumers. Other fintechs include Sympl, Lucky and Khazna. Over the past year, Sabbah said the company has learnt that going into the market with a minimum-functioning product doesn’t create a differentiator from the existing big financial institution. He also said that in consumer fintech, investing and over-optimizing in the first version of one’s product is a must, especially on the user experience side. “We’ve also learned that customers are craving an intuitive user experience when it comes to banking, similar to what they see in the daily applications they use, social media. We believe our competition is and has always been Cash and this is the hardest competition to face in MENA. We’re laser-focused towards changing how Egyptians feel about and interact with their money,” the chief executive said on competition. His comments indicate that within the past year, Telda went back to the drawing board to tweak its product before releasing it to the public. The new funding demonstrates continued confidence in what Telda can achieve in the ever-growing Egypt and MENA fintech market. The consumer money app says the investment will allow it to pursue its mission of fully and seamlessly digitizing Egyptians’ use and concept of money, including the crucial social element to sending, spending, and saving money. Telda’s seed investment welcomed venture capital’s most prominent names. They include existing investors Sequoia Capital and Global Founders Capital (GFC), who led the round. New investor Block, formerly known as Square, also participated; it’s the fintech giant’s second investment on the continent after crypto startup Yellow Card. Telda secured a $5 million pre-seed just last May, a month after Sabbah and his co-founder Youssef Sholqamy founded the company. Speaking on the investment, Roel Janssen, a partner at lead investor Global Founders Capital, said, “We are incredibly excited to further strengthen our partnership with Telda. The company has launched a product that is better than most international consumer payments companies, and Ahmed and Youssef have attracted some of the brightest Egyptian talent in product, engineering and GTM. We are confident that Telda will continue to amaze Egyptian customers with an outstanding product experience and exceptional service in the coming years.”