The Retail Resurgence Goes AR
By Alan Soclof
3 BIG STORIES
1. The Retail Resurgence Goes AR
Scandit, a smart data capture company, announced a $150M Series D at a $1B+ valuation. They specialize in cutting edge smartphone scanning technology to improve the in-person shopping experience. For example, if a shoe retailer uses Scandit, shoppers can scan a shoe with their phone and see all the features, reviews, etc in AR.
The company raised an $80M Series C in 2020 and has been crushing it since:
- ARR has 2x’d in the last year and a half
- 1,700 B2B and B2C customers
- 8/10 of the biggest retailers in US use the service
But who even shops in-person anymore anyway? Well…
Actually, a whole lot of people. There might even be a resurgence.
Younger generations love shopping in person. In a 2019 study, 81% of GenZers shared that they love shopping in stores – a desire the pandemic only strengthened.
The tech giants are already investing in in-person commerce, just look at Apple and Stripe’s “Tap to Pay” partnership. And technologies like Scandit will be a massive catalyst for the resurgence of shopping IRL.
Scandit has many competitors, but in my eyes, no one is close for two reasons:
- Quality of Scandit’s tech
- Massive war chest from funding
Prediction: Apple, who already works with Scandit, will make a push to buy the company, however, Scandit will decide to stay solo and go for this thing on their own.
The resurgence of retail is real, and Scandit is just getting started.
2. Science Is Shifting the Spirits Industry
Endless West, a foodtech company, announced the closing of a $60M Series C.
They entered the market in 2018 with a “molecular whiskey” product called Glyph. It’s a whiskey made in days, but tastes like it’s been barrel-aged for years — all at a fraction of the cost.
Endless West will use the funds to launch a new business unit, Blank Collective – a research and manufacturing business that will enable other spirits brands to create their own “molecular spirits” that are less expensive and more sustainable.
How big can Endless West become?
Capital M Massive.
First, anyone who can cut production time and costs while increasing sustainability is on the right track.
Second, the spirits industry is quickly creating some of the most valuable brands in business – especially for celebs:
- George Clooney – Sold his Casa Amigos tequila brand for $1B in 2017 and in 2020 the brand sold over 1M cases
- Lebron James – Lobos 1707 whiskey brand has already won awards even though they just launched in 2020
- Dwayne the Rock Johnson – Teremana tequila brand sold over 640K+ cases in 2021 and is on track to sell billions more
While Endless West isn’t celeb-backed, my bet is that many celebs will use their “Blank Collective” platform to launch their own brands — especially celebs passionate about environmental sustainability.
Maybe someday you’ll be able to pour a glass of Just Raised Gin…
3. Airbnb Wanders Into War
Wander, the smart home Airbnb-like service, announced the official launch of their platform along with a $20M Series A led by QED investors and included participation from a16z, Vibe Capital, and Kevin Durant’s Thirty Five Ventures.
Wander wants to be “the Tesla of home rentals”:
- All houses are owned and operated by Wander
- Each property is a smart property that can be controlled from an iPhone
- Every house gets a Tesla with it
- No hidden fees
My question is, can Wander take down Airbnb?
No, but they WILL be one of the companies that do.
The competition Airbnb is facing is off the charts:
- VRBO – Expedia Group owned, did ~$2B in revenue last year and is growing fast.
- Marriott – Launched Homes and Villas, a direct Airbnb competitor that’s owned, operated, and guaranteed by the Marriott brand – which means no Airbnb anxiety.
Another startup to watch? Launch House.
Launch House last week announced a $12M Series A to recreate the old-school Silicon Valley “Hacker Houses” on a national scale — think the TV show Silicon Valley, but in nicer places, in every state, and led by much smarter folks than Erlich Bachman.
Simply put, Airbnb has peaked. Innovative companies like Wander and Launch House are going to win big.
Interesting Note: the solo capitalists are present! Packy McCormick and Sahil Bloom are investors in the Wander deal as well.
CHART OF THE DAY
VC investments in crypto/blockchain have exploded.
- Very interesting to see the increasing amount of investments going into Series A vs. Later Stages
- The 2022 numbers and beyond are going to dwarf even the numbers of a massive 2021
- Who were the people investing in crypto/blockchain in 2016 and why did they not tell me to hop in?
What They Do: Education in the metaverse
Amount Raised: Seed round valued at $33M
Notable Investors: Top executives at top companies like Microsoft, Meta, Google, Coinbase, etc.
Why It Matters:
College and education as we know it is being disrupted – and rightfully so. But I’m skeptical of Metaversity for two main reasons:
- Desire of individuals to learn in the metaverse
- Negative impacts of mental health from metaverse – something that students are already experiencing in classical education format
One model that I do see having significant success is Morning Brew’s Accelerator Program – a multi-week deep dive into specific areas of focus from industry experts.
This is what the people want.
That said, I do think Metaversity can win if they do one key thing: Get good jobs for students which appears likely based off of their investor lineup.
What They Do: High-quality biodegradable cutlery, straws, and packaging
Amount Raised: $3.25M seed round
Lead Investors: N/A
Why It Matters:
Because we might get our straws back. That is why it matters.
PlantSwitch is crushing it with their agave extract based straws and cutlery.
In September of 2021, the company shared that they had 300 customers and $1M in annualized revenue.
The company has big aspirations and will be using the funds from this round to launch cups, plates, food takeout containers, and more — but they have a ton of competiors, like Loliware.
Loliware is a kelp based plastic alternative company that raised a $6M seed round in 2020 and was recently accepted to the NEXUS Impact Accelerator.
TL;DR PlantSwitch has a chance, but expect the big news from this space to be a Series A from Loliware later this year.
What They Do: Looking to provide real time coaching and data analysis for sales and customer service calls
Amount Raised: $610K pre-seed
Lead Investors: Angel investors in Nebraska, Arizona, and Georgia
Why It Matters:
This company has two of the traits I love to see in pre-seed companies:
- A launched product
- Customers – and in this case serious ones including publicly traded fintech companies
But there are already massive players that make me a bit skeptical of Abstrakt’s chances:
- Big boys, like Salesforce & Five9
- Hot sales assistance/coaching platforms, like Apollo.ai and Atrium
Can’t imagine competitors like these aren’t already working on a similar product.
What They Do: Health focused meal delivery service
Amount Raised: $12M Series B
Lead Investors: Nicoya
Notable Investors: Alexis Ohanian (Reddit), Jennifer Fleiss (Rent The Runway)
Why It Matters:
Historically, meal delivery services have struggled to succeed – even the big ones.
Remember Blue Apron? Since its IPO in 2017, they’ve seen their equity value collapse by ~93%
Splendid Spoon has cracked the code through launching a health focused subscription model where all meals are delivered ready to eat.
This model has seen significant success:
- 50 plant based smoothies, soups, and grain bowls
- Presence in 50 states
- 20,000 subscribers
- 2X growth rate since 2020
With the Online meal kit delivery industry ready to explode from $7.7B in 2022 to $24B by 2027, Splendid Spoon has a lot of green coming their way.
What They Do: Digital microscopy company
Amount Raised: $30M Series C
Lead Investors: Our Crowd, Aurum Ventures
Why It Matters:
You would not believe how archaic one of the most common blood tests, Peripheral Blood Smear, is.
A human literally sits there and counts white blood cells on their own which requires significant time and leads to error.
Scopio Labs finally has a solution for this where the Blood Smear is digitized and AI does the rest – meaning a lot less time and hundreds of more healthcare data points from each test.
The most important question with any medical device is whether they have made it through the FDA approval process. With Scopio Labs that is a big time yes as they received FDA approval in 2020!
The world is a better place due to Scopio Labs and many lives will be saved because of it.