by Eric Peckham | Feb 8, 2016 | Startup Stories |
Food production isn’t keeping up with the global demand, as Earth’s middle class is expected to double - with consumption levels alongside it - by 2030. The population’s demand for nutrients has outpaced production since the mid-1990s, with the most acute shortages occurring in developing economies. Drought and erratic weather conditions from global climate changes have accelerated the problem even further, with estimates that it will reduce crop yields 10-20%. Fortunately over the last few years there’s been a surge of interest from tech entrepreneurs and venture capital firms in confronting this challenge by leveraging the latest advances in technology. In 2016, the modern farm has moved far beyond merely genetically enhanced seeds; it’s becoming a conglomeration of robots, aerial imaging, and data analysis. There is a new wave of innovation to make farms “smart,” ultimately resulting in substantially increased crop production. As Pablo Borquez Schwarzbeck (CEO of our portfolio company ProducePay) points out however, while nearly all the attention and capital is flowing toward improving crop yields, that’s just one piece of the bigger puzzle. As yields improve and overall production increases, there remains a massive financial bottleneck holding back the industry’s ability to actually bring more of those crops to market. … Once a farm has fresh, nutrient-rich produce ready to sell, they get it to market by way of a distributor (a.k.a. a wholesaler), who takes their fresh produce and sells it to retailers like grocery stores and supermarket chains for a commission of 8-12%. It typically takes 45 days from the date a farm ships its produce to when it - and the distributor...
by Eric Peckham | Oct 15, 2015 | Startup Stories |
Growing up in his family’s apartment in the Van Nuys neighborhood of Los Angeles, Bardia Dejban learned at a young age to bounce back from tough times. By the time he turned eighteen, he had survived multiple near-death experiences from which he pulled himself back to full health. Those incidents seared a distinct appreciation for seizing the most of life as a result - he realized more intimately than most that life is precious and time-limited. His father was an Iranian immigrant who had brought the family over to the States, worked three jobs to provide for them, sent them to college, and eventually built his own successful construction company. The context of his family’s work to stake their own claim in a new country and the medical challenges he overcame made Bardia committed to taking risks of his own and devoting his time to making a mark on the communities around him. In his case, the medium for building became software. He learned how to build websites in his teens and by age twenty had fallen in love with creating Visual Basic applications for local businesses (along with some full-featured e-commerce sites). By his mid-twenties, he was creating software for some of the largest financial institutions in the United States. Nowadays, he is building his second company, an “engineering intelligence” platform called Codalytics. It began as a plot to organize information on companies’ tech teams for quick digestion in the way Salesforce organizes the activity of sales teams. Two years ago, running the software development studio Lolay - his first company - he was confronted daily with...
by Eric Peckham | Aug 20, 2015 | Startup Stories |
At Arena, we have been active investors in mobile-first marketplace startups - the sphere of startups using mobile apps to connect consumers with services they need at the press of a button. These marketplaces partner with a network of partners/contractors on the supply side to respond in real-time to customer demand for a given product or service in their city. Laundry and dry cleaning is one of the most active spaces within the so-called “on-demand economy,” with (Arena portfolio company) Rinse as a major player in the market. The San Francisco-based company operates, however, on a unique model from competitors: they are available 7 days a week but have created a route-based model where they typically collect clothes from customers on a regular basis on the same two days each week between 8PM and 10 PM (either Sun / Wed; Mon / Thu; or Tue / Fri). While other laundry startups prioritize speed, rushing through the cleaning process to get clothes back to customers within 24 hours, Rinse found that what consumers care about most is a) the quality of cleaning and b) having a service integrated into their life that picks-up and drops-off on a consistent cycle. With a vision to eventually handle all aspects of clothing care, from dry cleaning to shining shoes, they are staking a claim as the highest quality cleaning service and integrating themselves into the weekly routine of loyal customers (who range from young professionals to busy families). Founded in 2013, Rinse has built a strong initial foothold in San Francisco, and in March they took the jump to launch in their second...
by Eric Peckham | Aug 4, 2015 | Startup Stories |
Michael Schneider started exploring the idea of an “on-demand customer service” app just 60 days ago. Two months in, he has already raised a pre-seed funding round, made his first two hires, helped over 500 customers in 5 countries, and fields inbound inquiries daily from prospective new investors. A startup on this level has achieved so much in a short space of time, and as this progresses even further, the software will advance as well as how it will operate, with an updated business banking account, cloud-based software, etc. being used in a dynamic way. As the fifth company Michael has started since high school, Service is the culmination of the lessons he’s learned about rapid experimentation and execution. While leaving his prior company, Mobile Roadie, and exploring ideas for his next venture, he committed to test different concepts and see which clicked with consumers. The spark for Service itself came on a flight in April from Los Angeles to Miami. Michael witnessed a fellow passenger buy a Gogo wifi pass, only to find out that power outlets on the plane weren’t working. With a dying laptop, Michael watched the passenger waste over 20 minutes navigating American’s website to fill out a complaint form, and then do the same on Gogo’s. In an era when you can get a car, food, and dry cleaning on demand with the press of a button, he found it inefficient that consumers still have to waste hours of their time on hold and dealing with customer service issues themselves. Four weeks later, with the concept still bouncing around his head, he decided...
by Paige Craig | Jul 22, 2015 | Startup Stories |
I discovered Airbnb on August 12, 2008 and six weeks later gave them a term sheet for their entire seed round. But in the (literal) final hour, it fell apart. It’s an unusual story and one of several key experiences that shaped my approach to investing in startups. Over the last seven years, I’ve discovered and invested very early in a handful of highly valuable companies (Wish, Lyft, Zenpayroll, Postmates, AngelList, Plated, Styleseat, Klout, etc.) as well as plenty of disasters. But Airbnb taught me some of the most distinct lessons as an investor. Brian Chesky recently wrote about his 7 Rejections — feedback from a small set of the many investors who turned him down. This is my story as the one guy who didn’t. I was one of the few investors who actively pursued this deal from August through October 2008, and the only among them to agree on a term sheet. Every deal, every interaction with a founder teaches you something and I’ve consistently revisited my performance, my judgements, my biases, my filters and my approach to investing. Like most of you I’m highly critical of myself — this may not be self-evident, but I constantly question myself and engage in my own personal creative destruction. I question my beliefs and my tactics; I tear myself down and try to figure out what I’m missing, what I’m doing poorly, where I’m letting people down. And then I build myself back up again. On a tactical level, I repeat this creative destruction almost weekly as I analyze an individual deal; on an operational level I do it every few months...
by Eric Peckham | Jul 21, 2015 | Startup Stories |
Corey Brundage is dressed in his uniform of dark jeans, purple HONK t-shirt and grey HONK hoodie, sipping coffee from a “Baltimore Towing Company” mug. We’re sitting on the couch in the lobby of his company’s new Los Angeles office - home to a team of 50 with enough space to handle their expected doubling in headcount over the year ahead. Founded only eighteen months ago, HONK is one of the fastest growing technology companies in LA and already competing head-to-head with the dominant player in its industry: the American Automotive Association, better known as AAA. HONK’s mobile app provides on-demand towing and roadside assistance services at the press of a button: open the app, tap the type of issue (accident, dead battery, out of gas, etc.), and a tow truck is dispatched in minutes for a fraction of the typical cost. Most of us don’t think much about towing services, we just pony up for the annual AAA membership alongside our car insurance because it seems like that’s what everyone does, and we hope we never need to use it. We legally have to have insurance and therefore look into auto owners insurance reviews, hoping to find the best rates. But, we don’t legally have to pay for the AAA and how many times has our membership actually come in useful? Since its founding in 1902, AAA has built a near-monopoly over the roadside assistance market in the US, collecting lucrative membership fees that mostly go unused by the members. Still touting a call center, manual dispatching of trucks, and physical storefronts (with paper maps and human travel/insurance agents),...
