With people spending more time at home during the last couple of months, home refurbishment projects moved up on the to-do lists.
Benjamin Kuna, co-founder of Tylko, a Polish next-generation furniture company can certainly testify to that. In the first eight months of this year, the number of their customers doubled and further growth is on the radar. Under the motto ‘design your own furniture’, Tylko (founded in 2015) combines modular design with cutting-edge technology, allowing customers to create their perfect piece of furniture conveniently via the brand’s online configurator and AR App.
We decided to talk to Benjamin and hear more about why personalized furniture means people hold on to their pieces for longer, sustainability approaches, the use of AR in retail and the next tech trends in home retail. Enjoy the interview!
Tylko is offering a new approach to furniture design. In one sentence, what is the new approach?
We improve customers’ quality of life by providing high-quality storage furniture that they can design down to the last detail, catered exactly to their individual needs, through the use of our intuitive online configurator and augmented reality Tylko App.
So Tylko turns consumers into furniture designers. Tell us how you do it?
We do believe that people should be free to create their space according to personal needs, without compromising function or style. But it would be overstating it to say that we turn consumers into furniture designers. Rather, we let everyone co-create their individual storage furniture based on a multitude of curated options, making sure that customers never face difficult choices that could compromise the final design. Our online configurator and Tylko AR App enables customers to intuitively create their own Tylko product from approved options, all based on parametric design principles, whilst making sure that the final product is ergonomically and visually sound. No experience is needed from the customer to create a perfectly fitting shelf, sideboard or chest of drawers.
Today’s consumers are less concerned about fitting in, and more concerned about standing out. It’s more about owning things that reflect your personality, values, and tastes. Personalization is the new norm, but can it be translated into the furniture design market?
We all know that the space we live in has an impact on our life. This is why it is so important that your home is personalized and tailored to your individual needs. And we shouldn’t forget that a long time ago, our ancestors lived with customized furniture, before the furniture industry even came into being. Our latest numbers speak for the relevance of personalized furniture and homes: since our founding in 2015, we’ve served over 40,000 satisfied customers, and sold over 50,000 shelves across the world. So yes, personalization can be translated into the furniture design market today. And although it is not the norm in the industry yet, we believe that including customers in the design process, and ultimately democratizing the design industry, is the future. Personalization ensures that homes are better suited to their owners, making them hold onto pieces for longer. This benefits the environment, and sustainability is an increasingly important criteria in the decision-making process by customers. Our business model caters to that, being lean, efficient, and direct.
Let’s say I have used the app to create my shelf design and I make an order. What happens next?
It’s very simple actually: we have developed our own production software that translates the data of every individual design into production files that can be accessed from the factories that we collaborate within Poland. We only produce furniture to order, which can be shipped in just a few weeks directly from the factory to the customer – often using freight exchange to reduce its footprint. Since our supply is strongly correlated with the demand, we don’t have nor need storage facilities. Our direct process cuts out unnecessary costs and makes our supply chain a lot more transparent and sustainable.
Augmented reality is increasingly being used to enhance retail experiences. In your case, it enables us to visualize the final design in its future place in the room. Why is this technology the best choice for Tylko?
For the very reason that you mentioned: AR is the technology that allows customers to test and fit their design in their space. We know that buying furniture online – especially custom-made ones – can be stressful. But also, during the lockdown, lots of shopping shifted online, with people unable to or feeling unsafe about leaving the comfort of their homes. We want people to feel comfortable and certain about the choice they make. Thanks to AR, they can see their product in their space before they order anything. They can also adjust it in real-time and see how different designs appear in the same interior. This is not only the best choice for us but the best that we can offer to our customers.
Making use of the most commonly available technological invention – a smartphone – to help people design the furniture they need is only a logical evolution for the furniture industry in our opinion. Additionally, for those who would still like to touch and feel their future shelf – unfortunately, AR cannot offer that yet – we can send material and colour samples to customer’s doorsteps within a few days.
We want to make sure that what a customer sees on the app screen, becomes a reality in just a few weeks. We also have a 100-days return policy – but of course, we do all we can to spare the customer any extra hassle.
Tell us more about your product portfolio. What is currently on offer and what’s next in the pipeline?
First and foremost, we offer made-to-measure storage furniture for private and public spaces. A customer can self-design a personalized shelf for all kinds of purposes, like a media unit, bookshelf or chest of drawers. To date, we have launched two product lines, Type01 and Type02. The Type01 is the original one, known for its timeless style and natural materials, and is available in plywood with two fresh finishes of veneer: oak or ash. Designed with the modern home in mind, the Type02 places focus on a selection of contemporary colors. It’s the bolder and more experimental product. Both lines share the same personalization options. We have also just started to expand our portfolio towards more specific categories. Earlier in September, we launched the Type02 Sideboard – a reinvented furniture classic.
We will certainly continue our journey, offering personal and smart storage solutions combining innovation, style, and functionality. Besides, we keep challenging ourselves in the mission to reduce our negative impact on the planet and provide solutions that answer and foresee future needs.
From day one, Tylko has held nature at its heart. What’s the company’s view on sustainable furniture?
Our goal to revolutionize the furniture industry means taking a holistic approach. From employee to customer to the planet at large, our day-to-day practices are founded on values of transparency, care, and long-term thinking. It’s a process. We’ve set our personal targets high and while there’s a long way to go, we hope that, by rethinking the traditional business model, we can be a part of the new standard-setting generation, committed to doing better.
We are proud of the progress we made in the last five years. Our mission is to reject a fast, throwaway furniture culture and create long-lasting, durable pieces that will remain parts of people’s homes for years. For us, acting responsibly is manufacturing our products in Europe to keep our carbon footprint low and our local economies in good health. It’s using solar panels at our factories, avoiding wasteful plastics, and using recyclable packaging wherever possible. It’s ensuring that each and every shelf we create has a specific owner, so we make only what’s needed. We understand that our actions have an effect on our customers, the industry, and the planet, and with that in mind, we’re determined to make our impact a positive one, on all fronts. And since we want to always better understand the impact of our choices and actions, and base our decision-making on scientific findings, we are in the process of recruiting sustainability experts to help us go the next steps in this mission strategically and efficiently.
In your opinion, what is the most important trend in home retail for the next decade?
Over the last months, we have all spent a lot of time at home. Our private spaces have become our offices, gyms, schools and universities. Remote is now the ‘new normal’ and has turned out not only to be a necessity but a good alternative to traditional ways of living, meeting and working. Our homes now get our full attention, and solutions that make it possible for people to design, test, and shop furniture without having to venture out to physical stores have proven successful – our revenue has almost tripled compared to the year before.
The lockdown has sped up the shift towards online shopping mostly for home retail. Previously, customers were hesitant to shop for bigger pieces – like a shelf – online. But tools that give customers control over the process – such as our online configurator, AR-enhanced Tylko App or our free return policy – limit both the associated fears and risks.
We also believe that tech-empowered models in the furniture industry are a trend that will stay with us for a long time, mostly because they benefit the efficiency of the process, the usability of the product as well as the sustainability of the industry at large. Conscious consumerism needs to be mentioned in this context too. Identification with brands on an emotional level is becoming central in the decision-making process of consumers, including when buying furniture. I don’t want to say that sustainability is a trend. It’s more. But it impacts the furniture industry massively. All of us, active in the field, need to take responsibility and rethink the lifecycle of a product, from design down to recycling, reuse and remanufacturing, to remain relevant in the future and to make sure we do our best to bring the planet back to better health for future generations.
Enterprise investor Jason Green on SPAC hopefuls versus startups bound for traditional IPOs
Jason Green has a pretty solid reputation as venture capitalists go. The enterprise-focused firm he co-founded 17 years ago, Emergence Capital, has backed Saleforce, Box and Zoom, among many other companies, and even while every firm is now investing in software-as-a-service startups, his remains a go-to for many top founders selling business products and services.
To learn more about the trends impacting Green’s slice of the investing universe, we talked with him late last week about everything from SPACs to valuations to how the firm differentiates itself from the many rivals with which it’s now competing. Below are some outtakes edited lightly for length.
TC: What do you make of the assessment that SPACs are for companies that aren’t generating enough revenue to go public the traditional route?
JG: Well, yeah, it’ll be really interesting. This has been quite a year for SPACs, right? I can’t remember the number, but it’s been something like $50 billion of capital raised this year in SPACs, and all of those have to put that money to work within the next 12 to 18 months or they give it back. So there’s this incredible pent-up demand to find opportunities for those SPACs to convert into companies. And the companies that are at the top of the charts, the ones that are the high-growth and profitable companies, will probably do a traditional IPO, I would imagine.
[SPAC candidates are] going to be companies that are growing fast enough to be attractive as a potential public company but not top of the charts. I think [sponsors are] going to target companies that are probably either growing slightly slower than the top-quartile public companies but slightly profitable, or companies that are growing faster but still burning a lot of cash and might actually scare all the traditional IPO investors.
TC: Are you having conversations with CEOs about whether or not they should pursue this avenue?
JG: We just started having those conversations now. There are several companies in the portfolio that will probably be public companies in the next year or two, so it’s definitely an alternative to consider. I would say there’s nothing impending I see in the portfolio. With most entrepreneurs, there’s a little bit of this dream of going public the traditional way, where SPACs tend to be a little bit less exciting from that perspective. So for a company that maybe is thinking about another private round before going public, it’s like a private-plus round. I would say it’s a tweener, so the companies that are considering it are probably ones that are not quite ready to go public yet.
TC: A lot of the SPAC fundraising has seemed like a reaction to uncertainty around when the public window might close. With the election behind us, do you think there’s less uncertainty?
JG: I don’t think risk and uncertainty has decreased since the election. There’s still uncertainty right now politically. The pandemic has reemerged in a significant way, even though we have some really good announcements recently regarding vaccines or potential vaccines. So there’s just a lot of potential directions things could head in.
It’s an environment generally where the public markets tend to gravitate more toward higher-quality opportunities, so fewer companies but higher quality, and that’s where SPACs could play a role. In the first half of next year, I could easily see SPACs being the more likely go-to-market for a public company, then the latter half of next year, once the vaccines have kicked in and people feel like we’re returning to somewhat normal, I could see the traditional IPO coming back.
TC: When we sat down in person about a year ago, you said Emergence looks at maybe 1,000 deals a year, does deep due diligence on 25 and funds just a handful or so of these startups every year. How has that changed in 2020?
JG: I would say that over the last five years, we’ve made almost a total transition. Now we’re very much a data-driven, thesis-driven outbound firm, where we’re reaching out to entrepreneurs soon after they’ve started their companies or gotten seed financing. The last three investments that we made were all relationships that [date back] a year to 18 months before we started engaging in the actual financing process with them. I think that’s what’s required to build a relationship and the conviction, because financings are happening so fast.
I think we’re going to actually do more investments this year than we maybe have ever done in the history of the firm, which is amazing to me [considering] COVID. I think we’ve really honed our ability to build this pipeline and have conviction, and then in this market environment, Zoom is actually helping expand the landscape that we’re willing to invest in. We’re probably seeing 50% to 100% more companies and trying to whittle them down over time and really focus on the 20 to 25 that we want to dig deep on as a team.
TC: For founders trying to understand your thinking, what’s interesting to you right now?
JG: We tend to focus on three major themes at any one time as a firm, and one we’ve termed ‘coaching networks.’ This is this intersection between AI and machine learning and human interaction. Companies like [the sales engagement platform] SalesLoft or [the knowledge management system] Guru or Drishti [which sells video analytics for manual factory assembly lines] fall into this category.
The second [theme] is going deep into more specific industry verticals. Veeva was the best example of this early on with with healthcare and life sciences, but we now have one called p44 in the transportation space that’s doing incredibly well. Doximity is in the healthcare space and going deep like a LinkedIn for physicians, with some remote health capabilities. And then [lending company] Blend, which is in the financial services area. These companies are taking cloud software and just going deep into the most important problems of their industries.
The third theme [centers around] remote work. Zoom, which has obviously has been [among our] best investments is almost a platform, just like Salesforce became a platform after many years. We just funded a company called ClassEDU, which is a Zoom-specific offering for the education market. Snowflake is becoming a platform. So another opportunity is is not just trying to come up with another collaboration tool, but really going deep into a specific use case or vertical.
TC: What’s a company you’ve missed in recent years and were any lessons learned?
JG: We have our hall of shame. [Laughs.] I do think it’s dangerous to assume that things would have turned out the same if if we had been investors in the company. I believe the kinds of investors you put around the table make a difference in terms of the outcome of your company, so I try to not beat myself up too much on the missed opportunities because maybe they found a better fit or a better investor for them to be successful.
But Rob Bernshteyn of Coupa is one where I knew Rob from SuccessFactors [where he was a product marketing VP], and I just always respected and liked him. And we were always chasing it on valuation. And I think I think we probably turned it down at an $80 million or $100 million valuation [and it’s valued at] $20 billion today. That can keep you up at night.
Sometimes, in the moment, there are some risks and concerns about the business and there are other people who are willing to be more aggressive and so you lose out on some of those opportunities. The beautiful thing about our business is that it’s not a zero-sum game.
Remote-controlled delivery carts are now working for the local Los Angeles grocer
Robots are no longer the high-tech tools reserved for university labs, e-commerce giants and buzzy Silicon Valley startups. The local grocer now has access too.
Tortoise, the one-year-old Silicon Valley startup known for its remote repositioning electric scooters, has taken its tech and adapted it to delivery carts. The company recently partnered with online grocery platform Self Point to provide neighborhood stores and specialty brand shops with electric carts that — with help from remote teleoperators — deliver goods to local consumers.
The companies have launched the product offering in Los Angeles with three customers. Each customer, which includes Kosher Express, has two to three carts that can be used to make deliveries up to a three-mile radius from the store. Unlike the network models used by some autonomous sidewalk delivery companies, grocery stores lease the delivery carts and are responsible for storage, charging and packing it up with goods that their customers have ordered.
The initial Self Point/Tortoise launch is small. But it has the makings of expanding far beyond Los Angeles. More importantly for Tortoise, it’s a validation of the company’s larger vision to make remote repositioning a horizontal business with numerous applications.
Tortoise started by equipping electric scooters with cameras, electronics and firmware that allow teleoperators in distant locales to drive the micromobility devices to a rider or deliver it back to its proper parking spot. Now, it has taken that same hardware and software and used it to build its own delivery cart.
Tortoise co-founder and president Dmitry Shevelenko has said the company’s remote repositioning kit can be used for security and cleaning bots as well as electric wheelchairs and other accessibility devices. He’s even fielded inquiries from farmers interested in using remote repositioning scooters to monitor crops.
“From a practical point of view we’re not trying to not be everywhere overnight, but there’s really no technological constraint for us,” Shevelenko said in a recent interview.
The emergence of COVID-19 and its effects on consumer behavior prompted Tortoise to home in on delivery carts as its second act.
“We kind of quickly realized that we’re living in a once-in-a-generation change in consumer behavior where now everything is online and people are expecting it to be delivered same day,” Shevelenko said. Tortoise was able to go from the first renderings in May to a delivery cart launch by the fourth quarter because of its ability to repurpose its hardware, software and workforce.
The company still remains bullish on its initial application in micromobility. Earlier this year, Tortoise, GoX and and tech incubator Curiosity Labs launched a six-month pilot in Peachtree Corners, Georgia that allows riders to use an app to hail a scooter. The scooters are outfitted with Tortoise’s tech. Once riders hail the scooter, a Tortoise employee hundreds of miles away remote controls the scooter to the user. After riders complete trips, the scooters drive themselves back to a safe parking spot. From there, GoX employees charge and sanitize the scooters and then mark them with a sticker that indicates they have been properly cleaned.
While partnership with Self Point is Tortoise’s next big project, Shevelenko was quick to note that the company is only focused on one slice of the on-demand delivery pie.
“Low speeds and hot foods don’t work too well,” he said. Startups such as Kiwibot and Starship have smaller robots that focus on that market, Shevelenko added. Tortoise’s delivery carts were designed specifically to hold large amounts of groceries, alcohol and other goods.
“We saw kind of a big opening in grocery,” he said, adding that relying on remote operators and its kit is a low-cost combination that can be used today while automated technology continues to develop. “We’re doing for last-mile delivery what globalized call centers did for customer support.”
Insurtech’s big year gets bigger as Metromile looks to go public
In the wake of insurtech unicorn Root’s IPO, it felt safe to say that the big transactions for the insurance technology startup space were done for the year.
After all, 2020 had been a big one for the broad category, with insurtech marketplaces raising lots, rental insurance startup Lemonade going public, Root itself debuting even more recently on the back of its automotive insurance business, a big round to help Hippo keep building its homeowners company and more.
So let’s talk about why Metromile might be plying the public markets, and why Hippo may have have decided to pick up more cash. Hint: The reasons are related.
A market hungry for growth
The Lemonade IPO was a key moment for neoinsurance startups, a key part of the broader insurtech space. When the rental insurance provider went public, it helped set the tone for public exit valuations for companies of its type: fast-growing insurance companies with slick consumer brands, improving economics, a tech twist and stiff losses.
For the Roots and Metromiles and Hippos, it was an important moment.
So, when Lemonade raised its IPO range, and then traded sharply higher after its debut, it boded well for its private comps. Not that rental insurance and auto insurance or homeowners insurance are the same thing. They very most decidedly are not, but Lemonade’s IPO demonstrated that private investors were correct to bet generally on the collection of startups, because when they reached IPO-scale, they had something that public investors wanted.
Slack’s stock climbs on possible Salesforce acquisition
Slack shares are up just under 25% at the moment, according to Yahoo Finance data. Slack is worth $36.95 per share as of the time of writing, valuing it at around $20.8 billion. The well-known former unicorn has been worth as little as $15.10 per share inside the last year and worth as much as $40.07.
Inversely, shares of Salesforce are trading lower on the news, falling around 3.5% as of the time of writing. Investors in the San Francisco-based SaaS pioneer were either unimpressed at the combination idea, or perhaps worried about the price that would be required to bring the 2019 IPO into their fold.
Why Salesforce, a massive software company with a strong position in the CRM market, and aspirations of becoming an even larger platform player, would want to buy Slack is not immediately clear though there are possible benefits. This includes the possibility of cross-selling the two companies products’ into each others customer bases, possibly unlocking growth for both parties. Slack has wide marketshare inside of fast-growing startups, for example, while Salesforce’s products roost inside a host of megacorps.
TechCrunch reached out to Salesforce, Slack and Slack’s CEO for comment on the deal’s possibility. We’ll update this post with whatever we get.
While Salesforce bought Quip for $750 million in 2016, which gave it a kind of document sharing and collaboration, Salesforce Chatter has been the only social tool in the company’s arsenal. Buying Slack would give the CRM giant solid enterprise chat footing and likely a lot of synergy among customers and tooling.
But Slack has always been more than a mere chat client. It enables companies to embed workflows, and this would fit well in the Salesforce family of products, which spans sales, service, marketing and more. It would allow companies to work both inside and outside the Salesforce ecosystem, building smooth and integrated workflows. While it can theoretically do that now, if the two were combined, you can be sure the integrations would be much tighter.
What’s more, Holger Mueller, an analyst at Constellation Research says it would give Salesforce a sticky revenue source, something they are constantly searching for to keep their revenue engine rumbling along. “Slack could be a good candidate to strengthen its platform, but more importantly account for more usage and ‘stickiness’ of Salesforce products — as collaboration not only matters for CRM, but also for the vendor’s growing work.com platform,” Mueller said. He added that it would be a way to stick it to former-friend-turned-foe Microsoft.
That’s because Slack has come under withering fire from Microsoft in recent quarters, as the Redmond-based software giant poured resources into its competing Teams service. Teams challenges Slack’s chat tooling and Zoom’s video features and has seen huge customer growth in recent quarters.
Finding Slack a corporate home amongst the larger tech players could ensure that Microsoft doesn’t grind it under the bulk of its enterprise software sales leviathan. And Salesforce, a sometimes Microsoft ally, would not mind adding the faster-growing Slack to its own expanding software income.
The question at this juncture comes down to price. Slack investors won’t want to sell for less than a good premium on the pre-pop per-share price, which now feels rather dated.
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