Bean Box's crowdfunding campaign / Educator focused startups getting funded / Diligent raises $25M

Plus, self-driving truck startup Fernride raises $19M Series A extension

Inside Startups For September 21, 2023

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Hey Insiders, Today's newsletter covers:  Bean Box's crowdfunding campaign Educator-focused startups getting funded Diligent's $25M funding round If you find this newsletter useful, please share it with your friends and colleagues. Thank you. Karan p/karan-chafekar

1 Coffee subscription startup Bean Box launched a crowdfunding campaign on StartEngine earlier this week, with a target of raising $1.23M by December. The firm has already raised more than $30,000 within a day. The startup intends to use the proceeds to grow its subscriber base and provide wholesale options to entice new customers.  More: CEO Matthew Berk said, "As venture shifts their focus of opportunity toward new tech or new opportunity, those who have longevity in a particular space like e-commerce or food tech need to think about other forms of liquidity and capital." Previously, Bean Box has raised $3.2M in Seed funding, followed by $2.4M in Series A funding.  The company is backed by several family offices, angel investors, and Seattle-based VC firm Ascend.  Last year, Bean Box reported a net loss of $4M against a revenue of $11M.  The firm's revenue increased 26% compared to the previous year.  Bean Box claims that its valuation is $54M.  Zoom out: Last month, Bean Box's peer Artly, a robotic barista startup, raised more than $1.1M through its crowdfunding campaign on StartEngine.  Other notable startups that turned to crowdfunding to raise capital include Tokki, American-Made Amaro, and Green Canopy Node.  Q: Has your startup raised capital through crowdfunding platforms? Join the conversation here.

2 Educator-focused startups at the intersection of AI and edtech are attracting sizable investments, per Crunchbase.  What the numbers say: AI-powered edtech startups specializing in lesson planning and personalized instruction are experiencing a surge in funding amidst the AI boom. This surge is defying the broader VC funding downturn within the edtech sector, which has caused funding to slump by 60% in the first seven months of this year. The venture funding slump has hit the edtech sector the hardest due to the failures of prominent edtech startups and the reversal in online learning trends.  Relevance: Earlier this month, Ello, an AI-driven platform for personalized child instruction, bagged $15M in Series A funding. Last week, AI-powered language learning startup Elsa raised $23M in Series C funding. MagicSchool AI, which helps teachers plan lessons and write assessments, secured $2.4M in seed funding last week. Copyleaks, a tool to detect plagiarism and AI-generated content, bagged $6M in Series A funding last year.  Where to see the impact: Introduction of AI tools can benefit the education sector, which is grappling with issues such as overworked teachers, inadequate compensation, and a lack of personalization. The AI technology has the potential to bring personalized tutoring to the masses.

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3 Austin-based robot startup Diligent announced a $25M round led by Canaan. The company develops Moxi, a robot system designed to help healthcare providers with tasks such as carrying supplies.  More: Diligent is expecting to have 100 Moxi robots in 22 hospital systems in the U.S. by the end of the year.  "Next year we expect to continue to expand our client base into new health systems, but we also are seeing a demand for considerable expansion to new hospitals within our existing health systems," said the startup's co-founder and CEO, Andrea Thomaz.  Other participants in the round included True Ventures, Northwestern Medicine Innovation, Next Coast, and DNV Ventures.

4 Germany-based self-driving truck startup Fernride raised a $19M Series A extension for a total round of $50M. The company provides autonomous solutions for Volkswagen, Deutsche Bahn's logistics arm DB Schenker, and logistics company HHLA.  More: Fernride focuses on autonomy and remote-controlled operations for yard trucking, such as moving containers from A to B.  "We have a very sound plan with a step-by-step approach. Launching our product first in yards, scaling it there, and then in the future we roll out into open roads," said Hendrik Kramer, co-founder and CEO of Fernride. The extension round included participation from Germany's Deep Tech and Climate Funds, Munich Re Ventures, and Bayern Kapital. Prior investors included 10xFounders, Promus Ventures, and Speedinvest, among others.

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5 Sales technology firm Outreach laid off 120 employees, or 12% of its staff, this week. This is the firm's fourth round of layoffs since the start of 2022. In addition to the layoffs, the firm decided to move "certain limited business functions to Mexico City and India," an Outreach spokesperson informed the Business Journal.  More: The layoffs are aimed at making the company profitable by next year.  Outreach will provide impacted employees with severance, health care, and job support.  The firm laid off 5% of its workforce in Aug. 2022, followed by another 7% in Feb. 2023 and 5% last month.  Zoom out: Outreach was launched in 2014 and entered the unicorn club when its valuation crossed the $1B mark in 2019.  At its last $200M fundraising in Jun. 2021, the firm was valued at more than $4.4B.

6 Generative AI for learning startup, Gizmo, announced it raised a $3.5M Seed round. The company works on generating quizzes from notes saved in PDFs, PowerPoint presentations, YouTube videos, and other media. More: Gizmo uses learning streaks similar to the language learning app Duolingo.  The app runs on a freemium model, with subscriptions to "get unlimited lives." The company claims over 300,000 users, increasing by 50% MoM "mainly through word of mouth." The round was led by NFX, Capital T, and Ada Ventures.

7 Quick Hits: FinOps can be a game-changer for your organization. This guide shares expert tips on efficient cost management. Read now.* Digital asset transfer, crypto payments, and account aggregation fintech Mesh, formerly Front Finance, bagged $22M in funding. Money Forward led the Series A round with participation from Galaxy, Samsung Next, Streamlined Ventures, SNR.VC, Valon Capital, Florida Funders, and Altair Capital.  Chief development officer Steve Papoutsis will take over the CEO role at Striking Distance Studios, vacated by Glen Schofield. The video game developer also confirmed that the firm's COO and CFO are also leaving.  Japanese sector-agnostic seed-stage VC firm Incubate Fund Asia held the first close of its $50M fund.  Japanese legaltech startup LegalOn Technologies expanded its product portfolio with the launch of LegalOn Templates.  With the right process and tools, dev teams can ship gold every week. This guide breaks down a proven approach to product delivery.* *This is sponsored content.

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Karan Chafekar Analyst Karan Chafekar is a Management Consultant, Business enthusiast, and Licensed Pilot.  Nicolas is a Sr. Analyst at Inside, covering startups and transportation trends. He is an avid map maker and data nerd. Nicolas has worked in the shared-scooter space, as well as advised e-bike and moped start-ups.  This newsletter was edited by Vibha Chapparike

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U.S. healthcare costs jump for employers / Survey: Americans to cut back on holiday spending / Amazon unveils AI Alexa, smart glasses, and TV sticks

Plus, FedEx beats earnings despite demand slowdown

Inside Business For September 21, 2023

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Hello Insiders!! Today’s Business newsletter covers: 💼 U.S. healthcare costs jump for employers 🎄 Deep Dive: Americans to cut back on holiday spending 📦 Amazon unveils AI Alexa, smart glasses, and TV sticks If you enjoy reading this newsletter, please share it with your friends and colleagues.  Make sure to continue reading for Quick Hits and the Knowledge Hub. Thank you!! Shriram p/Shriram

1 Employers in the U.S. anticipate the largest health insurance expense increase in 10 years in 2024, with projections ranging from 5.4% to 8.5%. According to Mercer's study and healthcare experts, many businesses aim to absorb the majority of the cost increase themselves or pass on a smaller part to their workers, reflecting the tight labor market and a desire to lessen the impact of inflation on employees. More: About two-thirds of American workers benefit from benefits consultants' assistance in the design of medium and large businesses' insurance plans. Aon estimates that weight-loss medications, including Novo Nordisk's Wegovy, have a 1-percentage-point influence on predicted healthcare expense growth, which is a considerable contribution. Employers may face financial difficulties due to the U.S. government's approval of many gene therapies, most of which cost above $1M. Benefit consultants stated that employers could use artificial intelligence to cut administrative costs, scrutinize insurance coverage for pricey therapies, and look for more affordable hospital networks for particular procedures. Zoom Out: Consumer prices in the U.S. have increased by 3.7% over the past year, with medical cost increases often lagging behind general inflation because of advanced contract arrangements. Q: What specific and innovative strategies can employers explore to manage healthcare costs without compromising quality? Join the conversation here.

2 What the numbers say: According to a Morning Consult & CNBC survey, the current economic situation has affected 55% of households with incomes of $50,000 or less, while 61% of households earning $50,000 to $100,000 and 46% of those making over $100,000 have also felt its impact. Relevance: Consumers are becoming careful with spending due to continuous economic uncertainties and inflation. Clothing and apparel, eating out, and non-home entertainment have seen the most significant spending reductions during the last six months. Spending on groceries, leisure vacations, and electronics all decreased significantly. More data: 92% of American adults have cut back on spending in the last six months, and 76% plan to do the same during the upcoming holiday shopping season. Furthermore, 62% believe that expenditure on necessities will be reduced occasionally or more frequently over the next six months. Higher-income households have shown more optimism; in September, 30% reported a favorable financial impact, up from 21% in June.

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3 Amazon has unveiled new products and several updates for Alexa, with a prominent addition being the "Let's Chat" feature, intended to improve conversational engagement with the voice assistant. This feature strives to achieve human-like interactions with Alexa, fostering more fluid and context-aware conversations and eliminating the necessity for repeated context explanations. More: Amazon showcased how people may converse with Alexa, inquire about their preferred sports teams, and even draft messages for friends. The system learns about its users by comprehending context and ensuring dialogue continuity. Additionally, Amazon revealed the Echo Show 8, a smart home gadget with an enhanced user interface and audio that will debut in October for $149.99. Other announcements include eero Max 7 WiFi routers, redesigned Echo Frames smart glasses, an improved search function for Fire TV, and Emergency Assist for hands-free emergency calls via Alexa. Amazon also unveiled the $179.99 Echo Hub, a wall-mountable gadget for managing smart home appliances and keeping an eye on security cameras.

4 FedEx's most recent quarter saw increased earnings despite lower revenue, primarily due to considerable cost-cutting measures. In addition to working on the integration of its Express and Ground units to achieve anticipated cost savings of $4B over two years, resulting in improved margins during the fiscal first quarter, the company anticipates a relatively quiet "peak" season, typically the busiest time leading up to the autumn holidays and Christmas. More: Due to decreasing cargo volumes, FedEx grounded particular aircraft, changed crews to cut costs, and plans to halt more in 2024. When Yellow, one of the biggest trucking businesses in the nation, discontinued operations in August, FedEx's freight division saw a boost. As a result, FedEx gained about 5,000 more daily shipping volumes. The company beat analysts' predictions with a profit of $1.08B, or $4.23 per share. In the three months that ended on August 31, FedEx's revenue fell by more than 6% to $21.7B. FedEx increased bottom-line earnings despite lower-than-anticipated sales estimates, crediting the gain to its restructuring initiatives.

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5 Goldman Sachs Asset Management (GSAM) has achieved a fundraising milestone, securing $14.2B for its Vintage IX fund. This fund is focused on acquiring stakes in private equity funds and has garnered commitments from various sources, including institutional investors, high-net-worth individuals, and Goldman Sachs personnel. More: The previous secondary fund for GSAM closed in 2020 with $10.3B. In addition to the Vintage IX fund, GSAM has raised close to $1B for its brand-new Vintage Infrastructure Partners infrastructure secondaries fund. Investors increasingly turn to infrastructure investments in toll highways and electricity networks for predictable profits and inflation protection. Although the infrastructure secondary market is still developing, it is expanding quickly as investors view it as an alternative to conventional fund commitments and direct investments.

6 Google DeepMind's researchers have introduced AlphaMissense, an AI tool designed to assess the potential harm of human gene mutations. After analyzing 71 million "missense" mutations, AlphaMissense categorized 32% as probably pathogenic, 57% as benign, and the remainder as uncertain, as detailed in a Science journal publication. More: The Mark Zuckerberg and Priscilla Chan-founded Chan Zuckerberg Initiative revealed ambitions to develop a sizable computing system devoted to non-profit life sciences, with a particular emphasis on applying AI to mimic cellular processes. Only 0.1% of missense mutations have clinical implications determined by human experts, making AI forecasts helpful in allocating resources and expediting research. Clinical scientists are anticipated to use AlphaMissense as a supplemental tool to help them find variations of interest more quickly. Genomics England, a division of the U.K. government, successfully compared AlphaMissense's predictions to its database of genetic variations linked to uncommon diseases. AlphaMissense was made accessible to researchers for free by DeepMind, and the European Bioinformatics Institute will use its forecasts in its Ensembl Variant Effect Predictor.

7 Quick Hits: FinOps can be a game-changer for your organization. This guide shares expert tips on efficient cost management. Read now.* Qantas' ex-CEO got an 872% pay bump collecting deferred incentives when departing, though the airline is now cutting and withholding bonuses amid lawsuits. Textron Aviation signed a 15-year deal potentially worth around $30B, giving NetJets, owned by Berkshire Hathaway, the option to purchase up to 1,500 additional Cessna Citation business jets designed, produced, and delivered by Textron. Safilo and Amazon announced new Alexa-enabled "smart" Carrera glasses launching in the U.S. that integrate Amazon's voice assistant technology. In 2023–2024, Uber will introduce an AI assistant to help users locate bargains and explore menu selections through a new "Sales Aisle" for promotions, as well as more payment alternatives for its food delivery platform. With the right process and tools, dev teams can ship gold every week. This guide breaks down a proven approach to product delivery.* *This is a sponsored listing.

Upcoming Events SEP 28 Join TruEra's Webinar on AI Observability with former CMU professor Anupam Datta. Virtual Register Here OCT 4 Join this free online and onsite event in Amsterdam and you'll hear from industry experts at Meta, Opera, AdGuard, Mozilla, Google, and more. Amsterdam, The Netherlands Register Here OCT 16 Meet Our Fund 5, Building and Investing in AI San Mateo, California Save Your Seat * This is a sponsored event

Knowledge Hub Term of the Day Customer Satisfaction: Customer satisfaction is typically measured through surveys or feedback forms that measure the customer's perception of a company's products. Read More Question of the Week Do you share details about your salary with your coworkers? Join the conversation Today's Knowledge Hub Is Brought To You By Ready to take your career to the next level? Apply to join Sidebar, a highly-vetted and private community of small peer groups designed to support exceptional senior leaders in doing their best work.

INSIDE BUSINESS LEADERBOARD (7 DAYS) 🥇 Phillip Evans (25) 🥈 Divakar Kolhe (20) 🥉 Randall Neff (11)

Shriram Jeevakumar Freelance Writer Shriram is pursuing Master’s in Business with Marketing at Warwick Business School. He worked as a Senior Consultant in Tech and Political Consultancies before his Masters. He is passionate about Tech, Marketing, Strategy, Anthropology and Politics. He is also the Postgraduate Ambassador for Warwick Business School. This newsletter was edited by Aaron Crutchfield

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