Last week was a massive one for Boston innovation with over $800M raised across eighteen companies.
What I’ve Been Reading:
If you’re new to my emails and posts, welcome! My name is Nick Stuart and I write a weekly newsletter on tech VC financing trends in the Boston area. You can learn more about me on my website here and about the micro-VC I help run here.
Last week, I caught up with Ashland Stansbury— CEO and co-founder of Boston-based Because Intelligence, the SaaS Corporate Social Responsibility (CSR) platform helping businesses track the ROI of “doing good.” Because connects enterprise marketing teams with micro-influencers to help businesses capture the attention and value of their socially-conscious customers. They just closed its $400K pre-seed round from Launchpad Venture Group, Accomplice’s BOSS Syndicate, and a handful of angels from Uber, Digitas, ezCater, and more.
Ashland began developing the company as a senior at Babson studying entrepreneurship. She was inspired by the purpose-driven branding of successful companies like Patagonia and wanted to explore how other businesses could do the same. What’s interesting about Ashland’s story is how she went about developing the product using lean methodology-esque customer discovery. She built a product-market-fit engine by talking directly with businesses about how to improve their purpose-driven marketing, developing a customer advisory board, and working directly with her target customers to tailor the perfect SaaS solution. They call it Belief Marketing, and they want to use it to get a business’s story in front of micro-influencers that identify with the causes that business cares about.
Because Intelligence helps its customers (enterprise marketing teams) find an audience that is not only interested in your product, but in the underlying social causes it supports. The platform uses AI to curate a daily list of social media users that are mentioning the social causes your company supports, cross-references that list with your company’s target audience demographics, and helps your marketing team intimately engage with these on-brand micro-influencers. From there, customers can source potential branding partnerships, encourage clients to engage in a call to action on your website, or other deeper engagements than your typical advertisement would yield.
These interactions have the potential to become excellent customer acquisition channels. Once you can organically get influencers to share your brand’s value story, you’ll have a new base of potential customers to target. The Because product then helps businesses track the entire customer journey of these interactions and measure how your value-driven marketing channel metrics differ from those of your regular acquisition channels. The company claims CSR spend by businesses has already reached $15B, yet few know how to track the impact of this spend. Building a product to tackle this could help brands make more relevant decisions when allocating capital to socially-conscious initiatives.
There are product-driven advertisements and there are value-driven advertisements.
Intimate social media connections with customers are the holy grail for many brands. Why? Partially because it’s so easy to botch the listening part of customer engagement on social channels. If you want proof, check out r/FellowKids on Reddit — a channel dedicated to making fun of brands trying to “appeal to young people using their vernacular in a lame, pandering way.” A values-based strategy is no longer a quirky add-on for the more granola-type companies, but something that is shaping up to be a core competence needed to sell to the young, socially-savvy millenial consumer representing $600B in annual spending. Now 81% of millennials expect the companies they buy from to make a public commitment to charitable causes and citizenship. In essence: Sex doesn’t sell anymore, activism does.
Image: Some 52% of all consumers factor values into their purchase decisions,
The company has completed its pilot and is gearing up for their V1 product. They’re about to launch their Partner Program for brands who want to be among the first to lead the next thing in marketing: Belief Marketing. To learn more, reach out to firstname.lastname@example.org.
Iora Health, a nine-year-old healthcare services company, has raised a $126M Series F led by Premji Invest, with participation from eight other investors. They have created a collaborative primary care platform that brings humanity to managing payments of Medicare patients.
Fenway-based restaurant POS technology company Toast just became one of the highest valued tech companies in Boston following a $400M Series F investment from TPG Capital, Tiger Global Management, Greenoaks Capital Partners, and Bessemer Venture Partners. The deal brings Toast’s valuation to a $4.9B post-money, up from $2.7B from their Series E less than a year ago. With $897M in total venture funding and over 2,400 employees, the company is ready to expand into new products and services for the restaurant industry.
Carbon Relay, a five-year-old data center optimization company, just raised $63M from Insight Partners, bringing their total raised to $69M. The company focuses on improving the performance of applications running in Kubernetes, an open-source system for automating application deployment and scaling.
Habu, a MarTech startup out of Concord, MA, just came out of stealth with $15M in Series A Funding from Superset and Ridge Ventures at a $45M post-money valuation. They have developed a modular Marketing Data OS that provides solutions across the marketing value chain.
AgTech company Freight Farms just raised a $15M Series B led by Osparie Ag Science with returned participation from Spark Capital. The company reuses old shipping containers and turns them into efficient hydroponic growing systems so farmers can grow anywhere. This brings their total funding to $28M, which includes their 2012 Kickstarter campaign as well as their MassChallenge and Techstars participation
Image: A Freight Farms re-purposed shipping container.
FinTech giant Flywire has announced a $120M Series E led by Goldman Sachs as well as an acquisition of Simplee. The company creates customized payment solutions across healthcare, travel, education, and more. With a total raised reaching $263M and a $1B post-money valuation, they’re Boston’s newest unicorn.
Shopping rewards company Merryfield has raised a $3.5M Seed Round. The company helps users earn rewards points when they shop for healthy items at grocery stores. It’s a loyalty program that rewards customers for buying brands that are socially conscious or that aren’t on their banned ingredients list. When users buy these brands, they get reimbursed with rewards that offer discounts at other businesses like Adidas and AirBnB.
Duxbury-based TOP Organic Project has raised a $900K Seed Round led by Maroon Venture Partners, with participation from Kathy Battistoni. The company creates eco-friendly feminine hygiene products made of 100% cotton. Their total raised is now $1.6M. (More from BostInno here)
Flare, the creator of a smart bracelet that helps users get out of tricky situations, has raised a $3M Seed Round led by Lerer Hippeau. Other investors included Ludlow Ventures, Bolt, Underscore VC, The Graduate Syndicate, and Able Partners. The company creates $149 bracelets that connect to your smartphone via Bluetooth to trigger phone fake phone calls or alert close friends when you’re in a situation you’d like to get out of. The company was built by a passionate group of survivors addressing the startling statistic that 1 in 6 women have been the victim of an attempted rape in their lifetime in the US alone.
Reggora, the all-in-one appraisal software for mortgage lenders and real estate appraisers just raised a $10M Series A led by Spark Capital, with participation from Boston Seed Capital. For lenders, the product offers payment processing, flexible order allocation, inspection scheduling, and automated underwriting. For appraisers, it offers accounting tools, send and receive tools for orders, company management workflows, and a mobile application. They’ve now raised $14.8M to date.
PartRunner, an application helping contractors like HVAC workers and electricians get parts delivered on-demand, has raised $270K in Angel Funding from unknown investors. Back in 2018, they participated in MassChallenge and Northeastern’s Venture Accelerator Program. Their service currently delivers to the majority of the Greater Boston Area.
Babel Bark, the creator of an application that allows pet owners, pet businesses, and veterinary clinics to connect, has raised $3.4M in what looks to be part of a $20M Series C round of funding. The company raised a $10M Series B back in April of 2019, with total capital raised approaching $17M. Previous investors include Fundable, the Ohio-based crowdfunding website for businesses.
Square Robot, a robotics company for inspecting submerged oil and gas machinery that’s too dangerous for human inspection, closed $12M in financing from undisclosed investors as of now. Back in 2017, they teamed up with Phillips 66 to create a storage tank inspection robot.
Propane tank monitoring company Tank Utility raised $925K from undisclosed investors, bringing their total raised to $8.4M. Previous investors include Array Ventures, Bullpen Capital, Serra Ventures, Blue Fog Capital, Energy Foundry, Generac Power Systems, Shorooq Investments, Bolt Innovation Group, Mass CEC, Startup Next, Greentown Labs. They use IoT devices and a software application to monitor propane tanks in homes to provide data to fuel marketers and homeowners.
Per BostInno, Boston Cloud Startup Architect.io Emerges From Stealth With $1.5M. Architect helps businesses deploy and manage microservice applications. Microservices are an architectural style for applications that enables agile deployment of large and complex applications.
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