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Threads raises $20M for its luxury goods ’boutique’ that exists only in messaging apps

Threads raises M for its luxury goods ’boutique’ that exists only in messaging apps

When you think of e-commerce marketplaces, chances are that the first things that come to mind are storefronts built on websites and apps. But today an e-commerce startup that has never had either — and never plans to — has raised a fistful of cash to continue building out its shopping experience on the platform has been its growth engine: messaging apps.

London-based Threads has raised $20 million in funding for an operation that courts high-end, millennial, mostly female customers with tailored selections of luxury fashion, which it then sells to them on services like WeChat, WhatsApp, SnapchatInstagram and Apple’s iMessage for their primary interactions with a team of human (not AI) shopping assistants.

“We very intentionally didn’t build a website for consumers, just as we haven’t built an app,” founder and CEO Sophie Hill explained in an interview. “The idea behind Threads is curation and convenience. It’s a customer-centric business and it’s built on chat because that is where the customers wanted to be and transact. Chat may not have been used in the way we were using it in 2010” — when the company was founded — “but that was our problem to solve. We had to learn to serve through chat rather than create was for convenient for us as a business.”

The company says that it will be using the new funding — led by fashion and millennial-focused fund C Ventures, with participation from Highland Europe (which invests in Matches Fashion, among other related businesses) — to expand its business across the board: hiring more stylists, more engineers to build tech to help the operation run smoother, and other creative and other staff to bolster the 90 who already work for the business. But even before now, the company has been growing quite impressively.

With customers in 100 countries — 70 percent of them under the age of 35, with Asia one of its fastest-growing regions — Threads says that its average amount people spend in a shopping session (basket size) is a very unshabby $3,000. And because of its success in linking up expensive goods with people willing to buy it, it’s secured relationships with designers and brands like Dior, Fendi, Chopard and some 250 other luxury names to source key items for its clients. As a marketplace, Threads makes commissions from the suppliers when items are sold.

Threads materialised (sorry) as a business when founder and CEO Sophie Hill was still working as a buyer for Topshop owner Arcadia, her first job out of university (where she studied sociology).

The year was 2010, and even though messaging apps had yet to take off, and well before the ones you likely use today really had any functionality at all, with Instagram and the “stories” format nowhere on the scene, Hill started canvassing opinion among the people she hoped to target. She saw that they were already all avidly using messaging clients on their phones to chat to each other.

Messaging in the West was relatively feature-free, but Hill could see what was coming around the corner by looking at WeChat, the Chinese app that was well ahead of its time, and that — plus what her target audience was already using — was enough to convince her of how she needed to build her business.

Threads has a somewhat unconventional cost base as an e-commerce startup.

Without a site and app, its developer team instead is focused on ways of improving the processes that go into the selling that Threads does do: personalized, concierge style services. That means building tech to make tracking items more efficient for customers (that might come in the form of an actual chatbot at some point, Hill said); building a better search engine for the assistants to find specific pieces for Threads clients; and so on.

Another area where Threads’ costs are quite different from the typical e-commerce business is in customer acquisition. Hill says the startup company also has never really had a dedicated marketing budget (nor “someone leading the marketing function”). Instead, Threads has grown mainly by word of mouth among users, and later via social media platforms like Instagram as its own content and that of its customers gets attention.

On the other hand, one area where Threads has potentially weathered significantly more expense than the average e-commerce business is in how it connects clients with products.

Hill says that its chat-based shopping service fits into a wider world of busy activity and travel for a typical customer, who will nonetheless expect a high level of engagement as part of a five-star service, even if it originated in chat. So, Threads has been known to organise designers flying in from one city to another to show off a specific piece to a client, and also pulling together shopping to hand deliver it to a client in whatever location she happens to be, or even organising excursions to actual, physical boutiques when those customers take a trip to a city, either specifically to shop or for another reason.

“It is a complement to what they need and how they want to shop for luxury goods,” she said.

There is something about a business based fundamentally around a team of people serving users, versus a business that has built technology to do that job, which frankly feels very analogue. But Hill and her investors believe that there is scalability in Threads’ future, and tech will be what helps get it there (just as it has been what helped the startup materialise in the first place).

“Just because someone doesn’t have a website or app doesn’t mean we don’t have a direct purchase path,” Hill said. “We are going to be using technology to enhance that personalised experience. Using tech blended with human interaction will be the ultimate service for the luxury industry. We see it as a complement, a way to enhance the personal experience.

“Tech has moved quickly and we are starting to test and how we will integrate more AI,” she added. “You can see where the customers might be happy with that response versus talking to a person. It’s about us seeing how customers will react.”

The mix of a business born in the concept of high-touch customer service, with luxury boutique-style profit margins, but with roots in a very popular technology (messaging) and the potential to bring on even more tech to make it work more efficiently, is the crux of what caught investors’ attention.

“People who are Threads’ customers clearly like to transact like this,” Tony Zappala, a partner at Highland Europe, said. “And both Threads and those customers are getting more responses. It’s much harder to achieve that on a website these days.”

The next stop for Threads will be expanding to more product categories beyond fashion and jewellery — although Hill would not say what — and adding more offices to provide services closer to its customers on both sides of the marketplace. New York and Hong Kong are first on the list.

Threads raises M for its luxury goods ’boutique’ that exists only in messaging apps
Source: TechCrunch

Crypto firm Pantera Capital is looking to raise up to $175 million for a new venture fund

Crypto firm Pantera Capital is looking to raise up to 5 million for a new venture fund

Pantera Capital, which has made its mark in recent years by investing early and often in a wide variety of digital assets, is looking to raise up to $175 million for its third venture fund — an enormous jump from the $25 million it deployed for its second venture fund and its $13 million debut venture fund, which it closed in 2013.

Firm partner Paul Veradittakit says the target amount is a “function of how fast the space is moving, the talent coming in, the opportunities, and the sizing of rounds. With more interesting later-stage investments [on our radar], too, we want to be flexible and able to move with the market.”

Whether the firm closes with $175 million or another number is an open question. A newly processed SEC filing shows it has so far rounded up more than $71 million in capital commitments from 90 investors, an amount that Veradittakit calls a “first close.”

Certainly, Pantera is accustomed to managing meaningful sums of money. In addition to its venture funds, which are structured like most traditional venture funds — they feature a 10-year investing period, similar economics, and involve good old-fashioned checks to startups in exchange for some amount of equity — the firm is also juggling three other strategies.

As we reported last year, one of its newest funds is a hedge fund that’s focused exclusively on initial coin offerings. As firm founder Dan Morehead told us at the time, Pantera buys pre-sale ICOs, “basically getting a discount to the ICO price by getting in early, when it’s just a team and a white paper.” Meanwhile, Morehead had added, “We help provide the right connections, whether in terms of marketing or recruiting or business development.

The vehicle is evergreen, says Veradittakit, meaning it has an indefinite fund life that lets investors come and go.

The other two other funds that Pantera currently oversees are also structured like hedge funds. One is a Bitcoin fund that has attracted plenty of investors over the years, and returned a lot to them, too, according to the calculations of Morehead. In fact, he wrote two weeks ago that the fund, launched five years ago, has enjoyed a lifetime return of 10,136.15 percent net of fees and expenses.

The very last fund invests in cryptocurrencies that are already trading on exchanges — an approach that includes machine learning to algorithmically invest in crypotcurrencies, as well as allows for some discretionary input by Pantera’s top brass, which includes Morehead, Veradittakit, and Joey Krug, who joined Pantera last year after cofounding the market forecasting startup Augur. (It went on to orchestrate the first ICO on the ethereum network.)

Explains Veradittakit of this last pool, it’s for “if you are’t sure that Bitcoin will remain the dominant cryptocurrency, or you’re interested in other use cases that may arise, or you just want to build a diversified portfolio of assets that have asymmetrical returns as bitcoin, or maybe return even more because they feature lower valuations.”

In some ways, the venture efforts of Pantera —   which employs 38 people altogether in San Francisco and Menlo Park, Ca. —  may be its most challenging given the nature of VC. Investors in the asset class are typically willing to wait a handful of years for a firm to produce returns; in Pantera’s case, because it is betting exclusively on ventures, tokens, and projects related to blockchain tech, digital currency, and crypto assets, some of those returns could potentially take even longer.

Veradittakit doesn’t sound concerned. Rattling off some of Pantera’s venture investments to date, including in BitStamp, Xapo, Ripple, and Circle, not to mention more recent investments in Chain, Abra, Veem Polychain, and Z Cash, he sounds more like a proud parent. Pantera has invested in “lots of wallets and exchanges focused around the world, in Coinbases of different geographies, in enterprise-related blockchain companies. More recently, we’ve funded everything from big data to decentralized application platforms.”

It’s still very early days, he acknowledges. But “in terms of returns, there will be companies that create something completely disruptive. There will be M&A [opportunities] more often and that [come together] more quickly than other companies.”

If everything goes as planned, Pantera will be there when they do, and it will have more resources to deploy than ever.

Crypto firm Pantera Capital is looking to raise up to 5 million for a new venture fund
Source: TechCrunch

Uber is on a hiring spree in Singapore despite ‘exiting’ Southeast Asia

Uber is on a hiring spree in Singapore despite ‘exiting’ Southeast Asia

Uber agreed to sell its Southeast Asia business in March, but it isn’t leaving the region. In fact, the U.S. firm is doubling down with plans to more than double its staff in Singapore.

That’s right. Uber is currently in the midst of a major recruitment drive that will see Singapore, the first city it expanded to in Asia, remain its headquarters for the Asia Pacific region despite its local exit. Unfortunately for customers who miss having a strong alternative to Grab, Uber won’t be bringing its ride-hailing app back in Singapore or anywhere else in Southeast Asia.

Uber’s own job portal lists 19 open roles for Singapore, but the company has contacted headhunting and recruitment firms to help fill as many as 75 vacancies, three sources with knowledge of Uber’s hiring plans told TechCrunch.

The new hires will take Uber’s headcount in Singapore to well over 100 employees, the sources claimed.

Ironically, of course, Uber let most of its staff in Southeast Asia leave when it stopped serving customers across its eight markets in Southeast Asia in April — although it was forced to extend into May in Singapore. As part of its exit deal, Grab got first dibs on 500 or so Uber Southeast Asia staff but that strategy didn’t pan out as planned, as TechCrunch previously reported. Indeed, a recent report suggested that fewer than 10 percent of ‘Uberites’ moved over to become ‘Grabbers’.

And yet, here we are, Uber is aggressively hiring in Singapore — but why?

The original plan following the Grab deal was for Uber to relocate its regional headquarters to either Japan or Hong Kong, two sources told TechCrunch, but in recent months that strategy has shifted. Just weeks ago, the remaining Singapore Uber collective — which consists of managers and executives — secured budget to staff up and find a larger office in the name of creating a support team for its remaining Asia Pacific markets.

The plan is for the Singapore-based employees to provide services such as HR, accounting, admin, marketing and PR across Uber APAC, which includes Hong Kong, Taiwan, Japan, Korea, Australia and India — although the latter has more sovereignty with its own president who reports into the U.S..

An Uber spokesperson acknowledged that the company is in the process of hiring in Singapore, but declined to provide further details.

Sources with knowledge of discussions inside the company told TechCrunch that the decision to stay in Singapore is down to a number of reasons.

Hong Kong, which had been a frontrunner to become Uber’s new APAC HQ, was ruled out because Uber’s legal status in the country is unclear — a number of drivers have been prosecuted — while Japan and Australia were deemed to be too remote to be regional hubs. That left Singapore, as an established city for business with an existing Uber staff, as the remaining option.

Sources also told TechCrunch, however, that a degree of self-service was involved. Those executives and managers who managed to remove themselves from the “shame” of being shipped to Grab dug their heels in to avoid relocating their lives and families elsewhere, two sources claimed.

Talking to TechCrunch, some former Uber staff questioned whether the remaining Asian markets require remote services from Singapore, which is one of the world’s most expensive cities. Together the countries are hardly huge revenue generators for Uber and could be handled locally or other global cities. There’s certainly an argument that the continued investment in Singapore is at odds with the widely-held theory that Uber left Southeast Asia, a money-losing market, to clean up its balance sheet ahead of a much-anticipated IPO next year.

One former Uber employee who did transition to Grab noticed that the U.S. firm is now hiring for their previous role. That situation is made worse by a ban that prevented Uber’s Southeast Asia employees from applying to transfer to other parts of the firm’s global business. That’s despite many being allowed to do so in the case of previous Uber exit deals in China and Russia.

The result is that Uber is hiring in Singapore, a market where it no longer offers its service and gave up most of its staff to its rival. Anything can happen in the ride-sharing space!

Uber is on a hiring spree in Singapore despite ‘exiting’ Southeast Asia
Source: TechCrunch