C2V March Notes From the Trenches
Welcome friends! As regular readers will hopefully have picked up, one of the ways in which we try to differentiate ourselves from the rest of the VC crowd is our reluctance to consistently publicly congratulate ourselves, but with the close of our third exit (more on that below) we hope you’ll indulge a quick update.
Besides, it’s really our founders we’re celebrating, and they deserve it.
Fund I (launched September 2019)
19 initial investments and 90% of follow-on capital deployed
2 exits; 14 additional markups (including 1 exit, 3 Series As, and 1 Series B closing this quarter)
Tracking top quartile (or better) in the alphabet soup of VC performance metrics (IRR, TVPI, DPI) for our vintage
2.5 years into the fund's life (and only 10 months removed from adding our final company), 15 of our 19 companies have either exited or raised substantial follow-on rounds
Fund II (launched June 2021)
5 initial investments and 1 follow-on thus far (target: 20 companies, 50% follow-on reserve)
1 exit; 1 markup
Exclusively focused on
North American companies outside the Bay Area
Seed stage entry points
B2B software and robotics productivity tools for old economy/legacy industries that have seen little to no productivity growth for a decade or more.
Okay, last stop on the victory lap and then we’ll get back to our regular fare…
Another Exit!
Please join us in congratulating Kambr founders Jason Kelly, Martin Kaduc, and Michael Peters, and their team on their acquisition by Amadeus IT Group, S.A., a $30 billion travel and hospitality software company.
The transaction will pair Amadeus’s leading global airline passenger service system with Kambr’s next-generation airline revenue management platform, creating by far the most comprehensive and transformative offering in the trillion-dollar-plus travel market.
The Kambr team did an outstanding job taking Kambr’s RM platform from concept to industry standard in fewer than 4 years, despite a global pandemic that crippled the global travel industry for almost half of that period.
For C2V, this marks our second exit from Fund I and third overall. We’re not only excited for the return, we’re also thrilled with this validation of our investment thesis, selection process, and post-investment support focus, as illustrated by a few highlights from our May 2019 Kambr deal memo.
Thesis & Investment Criteria
An industry struggling to incorporate the explosion in available datasets and rapid evolution in data science into its pricing models
Antiquated legacy systems that were ill-equipped to the task, resulting in both operational inefficiencies and poor end results
Clear and immediate ROI for customers
A founding team with more than 3-decades of experience as airline revenue analysts and multiple prior exits, including as the senior management of a prior generation RM system which they sold to Warburg Pincus in 2016
A product vastly superior in its capabilities – one that would move airlines from pricing seats and ancillary products based on one data stream (their own historical flights) to one that could incorporate an unlimited number of internal and external datasets (competitor’s pricing, event schedules, etc.) and interface with marketing initiatives.
Perhaps Kambr’s biggest competitive advantage – a simple and intuitive UI, specifically tailored to the end-users (airline revenue analysts) by a founding team that once occupied their seats
One more round of applause for Team Kambr, while we move onto another legacy industry in dire need of productivity improvements…
Our Latest Investment
As has been widely reported in recent years, the US power grid is becoming increasingly fragile, with aging infrastructure, spread across a vast geographic footprint, and increasing regulatory pressure on already stretched utility company maintenance budgets.
Our latest portfolio company, Noteworthy AI, (our 25th portfolio company overall and 2nd in our new pre-seed Tributary Fund), has built a SaaS platform for power grid infrastructure maintenance that seeks to drastically lower costs and increase capacity of grid asset inspections, using computer vision to passively geolocate, inventory and identify defects.
Current inspection processes for the 185 million utility poles in the US are entirely manual, requiring dedicated vehicles and crews with binoculars and notepads. The cost and personnel time this requires leaves most utilities only able to inspect 10-20% of assets per year, subsets that are chosen by proximity on predetermined multiyear rotations, and may not cover most or even any of the highest risk assets in any given year.
Noteworthy’s cameras are mounted on each utility’s vehicles, so inspections are conducted passively (on an ongoing basis), as part of routine vehicle operations. This allows utilities to cover the entirety of their assets annually, if not more frequently, and to identify potential issues early so that they can be proactively addressed, at roughly 25% the cost of manual inspections. Noteworthy’s cameras are also being used by utilities to inventory and map their assets, cataloging equipment, tagged pictures, and GPS coordinates of each pole.
The current utility inspection market in the US alone is north of $11 billion and is like to increase substantially as regulators have begun to increase annual inspection coverage requirements.
On Wednesday, March 23rd from 1:00 PM - 1:25 PM PDT, Founder and CEO, Christopher Ricciuti will be speaking at the NVIDIA Conference about computer vision and edge computing.
Women’s History Month
In honor of women’s history month, we are very grateful to be alongside these talented women. Some have shared their story on our Superpowers Podcast; others have trusted us to support them as they build businesses. Each one has a unique story, but they all have one superpower in common - courage.
New In The Trenches Episode
We interviewed Ben Cantey from Rumby and Nick McHenry from Oneshop this month about where old-school retail and new tech intersect. We talk about what it’s like to get buy-in from an industry that is resistant to change. And how these two founders are thinking outside the box to drive progression.
Website Refresh
We got a website refresh. Check it out and let us know what you think.
C2V By The Numbers
Here are this month’s interesting and fun stats across our venture practice.
Portfolio Spotlight
Rumby continues to disrupt the old laundry industry and is rapidly expanding. Rumby was recently featured in Tech Ohio sharing why they believe they’re ready to change the way we take care of our laundry by bringing the process into the 21st century and boosting brick-and-mortar cleaners.
They were also featured in Hotel Business Magazine, which has coined Rumby as the Uber Eats of Laundry.
Finally, this month, Rumby was highlighted in PhocusWire Startup Stage. “I want Rumby to be the first unicorn born out of the Cincinnati startup scene. We’re going to take this public but will wait for the timing to be perfect. Considering our industry, I want our mom‐and‐pop-owned cleaners, our hospitality and channel partners, our investors, and our franchise partners to be able to buy stock for the long haul, and as we become the wind of change in the industry, they thrive along with us.”
Ben Cantey | Founder & CEO.
Phalanx has been selected as the Top Startup of the Year 2021 in the Arlington category by Hackernoon.
Phalanx was also selected as a finalist in the InsurTech NY Early Stage competition at the InsurTech NY Spring Conference.
Olive has a new explainer video to share the way the end-to-end technology evaluation platform works and how it benefits consultants and IT leaders to streamline processes. You can watch the video here.
Job Openings
Blutag
Inside Sales Account Executive.
Paladin - Frontend Engineer
Boostr - Marketing Demand Generation/ABM Director
Techeon - Senior Javascript Developer