Infra.Market, an Indian startup that helps construction and real estate firms procure materials, has raised $50M from MARS Unicorn Fund.
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Venture firm Shilling has launched a €50M fund to support growth-stage startups in its own portfolio and to invest in startups everywhere else.
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In 2017, Vinod Khosla told CNBC that the job “of the radiologist will be obsolete in five years.” While the founder of Khosla Ventures later revised that timeline to as long as 15 years, he maintained that AI image recognition could soon diagnose disease on scans better than human doctors. Seven years later, radiologists are […]
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Automation continues to be a major theme in the enterprise — underscored not least by the rise of AI as a tool to help fix some of the more routine, resource-intensive and fragmented aspects of how security and other IT functions operate. To capitalize on that trend, one of the bigger startups in the space, the Dublin-founded Tines, is announcing $50 million in funding. Tines started with its roots in security workflow automation but has seen adoption across other parts of the IT landscape. Now, on the back of revenues growing 200% in the last 18 months, it plans to use the new capital to expand its automation platform play deeper into applications in infrastructure, engineering and product.
The funding — co-led by existing investors Accel and Felicis — is being described as an extension of the company’s Series B rather than a Series C.
“We weren’t proactively trying to raise and were focused on building the business,” Tines’ CEO and co-founder Eoin Hinchy said in an interview. “Our existing investors saw our execution and approached us. We went from discussing what a round could look like to it being wrapped up in a couple of weeks.” He confirmed that it is not profitable currently by choice, to focus on growth.
This actually makes this the second extension to Tines’ Series B in three years, with the original round appearing in 2021 (at $26 million), and the first extension coming in October 2022 ($55 million).
But it’s not without a valuation bump. Hinchy declined to disclose the numbers but other sources close to the company confirmed it’s now valued post-money at close to $600 million. (As a point of comparison, PitchBook data notes that it was valued at $423 million at the first extension.) Others in this round include Addition, strategic backer CrowdStrike Falcon Fund and SVCI — all existing investors in Tines.
It has now raised some $146.2 million in total.
As we have previously described, the gap in the market that Tines is targeting comes from Hinchy’s and his co-founder Thomas Kinsella’s own direct experience. Hinchy is a classic technical founder. He and Kinsella (now chief customer officer) both spent around a decade working in leading roles in cybersecurity for companies like DocuSign, eBay and Deloitte, where they found major gaps in the market for tools to help better manage the large number of services they used to track data and network activity for his companies.
All of that was compounded by not just the explosion of new cybersecurity techniques but also hacking risks that grew out of the rise of cloud computing and related innovations. Hinchy estimated to me that the average security team manages some 77 different products, with “some in the hundreds.”
“By 2017 we desperately needed a workflow automation tool, and really nothing out there came close to what we wanted, so we decided to build what we wish we had,” Hinchy said. Tines covers what he describes as “mission critical workflows” which in security include tools to monitor and track security alerts, compliance alerts and increasingly areas that are adjacent to where security teams need to have visibility such as employee onboarding and offboarding, patch management in IT and more.
“We are the plumbing between these systems,” he said.
Although Hinchy is technical himself, he saw that another gap was that a lot of the need for monitoring was best served by not having to be a technical solution in itself. The whole of Tines is conceptualized in a drag-and-drop, no-code framework, building blocks that aim to reduce the amount of time it takes to create and manage workflows on the platform.
That is where the opportunity lies also for Tines’ investors. Although there are definite and very large competitors in the market including Splunk (and now Cisco by virtue of having acquired Splunk this year), Palo Alto Networks, ServiceNow and Microsoft, Tines and its backers and its users would contend that their focused and more context-aware approach are more useful and effective.
“Customer satisfaction is typically abysmally low in security,” Jake Storm, the partner at Felicis who led the deal, said in an interview. He said that he was surprised, when making due diligence calls when weighing up this latest deal, how different that was for Tines. “That’s just unheard of. It was just glaringly obvious that Tines was years ahead of its competitors back in 2022 and we just feel that gap has continued to widen.”
Luca Bocchio at Accel sees workflow as the key missing link, one that gives Tines a lot of potential to position itself further as a platform, not a service.
“If anything over the last few years, the growth of security needs has led to more security products and tools and that boils down to more workflow needs. That means Tines is becoming more relevant. With security being part of broader IT and business operations, it naturally needs to engage with the rest of the organization.”
Two years ago, Jobs for the Future (JFF), a nonprofit dedicated to helping low-wage workers attain upward mobility, established a venture arm, JFFVentures, to back innovative employment tech.
In a move implying that the launch went well, JFFVentures today unveiled its second fund, JFFVentures Fund II, with a target of $50 million — $15 million has been raised so far.
The new fund — furnished in part by the Autodesk Foundation, the Workday Foundation and the American Council on Education — will target founders building HR, education and workforce solutions that “enable economic mobility for workers in middle to low-wage jobs,” said JFFVentures Fund managing partner Sabari Raja.
“We’re looking to invest in 30 to 35 pre-seed- and seed-stage startups, with initial check sizes between $250,000 [and] $1 million, with the ability to lead rounds,” Raja told TechCrunch. “We’ll reserve $1 million to $2 million for follow-on investments into companies that are outperforming from a financial and impact perspective.”
JFFVentures Fund II joins the growing number of impact-focused VC funds stateside, which seek to drive social, economic and environmental change while earning investment returns. Others include Collaborative Fund, Third Sphere, and the nonprofit Acumen Fund.
Impact investing is a massive — and expanding — opportunity. According to the Global Impact Investing Network, an international think tank, the private impact market grew to approximately $1.2 trillion at the end of 2021, up 63% since 2019.
But impact funds face challenges that many traditional startup investment vehicles don’t.
For one, it can be difficult for VCs to measure an investment target’s real-world impacts or progress. Impact funds have historically offered lower returns, according to a 2021 study from Cambridge Associates. And many impact funds have limited track records, since the sector is so new.
So how is JFFVentures Fund II planning to avoid these pitfalls?
Well, Raja says, while the fund is operationally independent from JFF, JFFVentures Fund II will benefit from the wider JFF community, including its connections with government, corporate, education and nonprofit partners. Founders in Fund II will be able to tap at least one dedicated person who is focused on connecting portfolio companies to experts and networks across the JFF ecosystem, Raja added.
“We’re honed in on the journey of the worker in middle- to low-wage jobs, investing in novel technologies that provide them the education, access to quality jobs, tools for employers to support their career growth and wrap-around services that help them outside of work so they can thrive at work,” she said. “We have expertise and experience solving critical workforce problems with technology-enabled approaches.”
Yigal Kerszenbaum, another managing partner at JFFVentures, said that a top priority for Fund II is “economic advancement for the underserved and underrepresented populations.” Kerszenbaum called out women, disabled workers, immigrants, aging populations and communities of color as examples.
“Diversity is embedded into the design and DNA of the fund,” Kerszenbaum said. “Five out of the six team members are female, and we’re majority immigrants and speak seven languages across the team. Many of us are first-gen college students. Additionally, 100% of our ten-person advisory board is female, many of whom are investors, subject-matter experts and operators that come from diverse backgrounds.”
Plenty of funds have diversity goals that they don’t meet. (The DEI backlash hasn’t helped.) But Kerszenbaum says that Fund II has been structured from a legal perspective to ensure it remains true to its mission.
“We’ve committed in our fund docs that at least 50% of Fund II founders will identify as underrepresented in terms of founder backgrounds,” he said. “Additionally, part of the team has been allocated carry, which will be earned by hitting certain social impact goals, some of which are tied to founder diversity.”
A sticking point could be balancing those goals with returns.
The 2021 study from Cambridge Associates found that the typical impact venture fund tends to underperform, faring little better than the S&P 500 over a 21-year period. In the cohort Cambridge looked at, the bottom quartile of funds returned just 2.43% to limited partners.
Kerszenbaum pointed to JFFVentures’ inaugural fund performance as evidence Fund II can succeed, though.
Sixty-five percent of the first fund’s 55 founders — 84% of whom self-identify as underrepresented in the VC space — have gone on to successfully raise capital from late-stage investors, Kerszenbaum says. JFFVentures is also reserving the right to invest up to 20% of Fund II in startups based outside of the U.S., in contrast to the first fund’s exclusively domestic purview — giving the VC an additional lever to boost returns.
“We aspire to be the gold standard for nonprofit-private partnerships that can amplify innovation and impact and unlock value for entrepreneurs, investors and beneficiaries alike,” Kerszenbaum said. “Our goal is to be the first stop for entrepreneurs building at the intersection of innovation and impact because our value-add beyond the check has meaningful, measurable outcomes towards growth.”
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