Start-Up 2nd Week News Flash of October

Energise Your Energy or Natural Resources Startup with KPMG

KPMG Australia has just opened applications for the second of their Energise accelerator program on October 13, 2016, directed at startups with a focus on energy or natural resources. The program, known as Energise 2.0, is energise-your-nergy-naturalforging a new path in the ENR sector. A three-month intensive program for startups, Energise 2.0 is designed to promote innovation and collaboration across the sector by taking the best startups/early-stage tech companies and connecting them with some of Australia’s leading ENR companies. Successful applicants will receive mentorship and advisory services at no cost or equity while also getting access to major ENR companies for direct customer insight and feedback. The program supports both these companies and Australia’s leading technology startups by helping identify major operational problems and then giving Australia’s best and brightest ENR tech startups the opportunity to present their solutions.

The accelerator program supports Australian companies with: A technology solution applicable to the energy and natural resources sector or to the supporting service businesses supporting the sector; Customer base providing annual revenue of up to AUD 7.5 million in relation to your technology solution; In the absence of customers, seed funding or development spend to date of at least AUD 200,000 with demonstrable evidence of customer validation of the value proposition for your product/service. Each applicant to this accelerator program should be an Australian startup with a founding core team in place (of at least two or more full-time staff); and have the ability to work from the KPMG offices in Perth or Brisbane for one day per week during the 12 week program.


Hyderabad startup Tuplejump was quietly taken over by tech-giant Apple

According to reports, AI startup Tuplejump – from Hyderabad, India – has been quietly acquired by tech giant Apple hyderbad-start-upon last 26th of September, 2016.  Indian media say that the deal went ahead a few months ago and was valued at a so far undisclosed amount. Word on the street is that the acquisition is part of Apple’s exploration into artificial intelligence (AI) as it tries to fend off rivals to iPhone’s Siri. The deal is also being labelled as an acquihire because nearly all of Tuplejump’s 16 employees are in the process of becoming Apple employees. According to the Economic Times of India, an ‘expert’ has roughly estimated that the valuation of Tuplejump could be as high as $20m, based on the total cost of the past few years salaries.

Tuplejump is Apple’s first Indian acquisition and will go someway to adding confidence to an ecosystem that has seen a high number of closures so far this year. Apple declined to comment on the acquisition, only telling TechCrunch (a start-up news site)  that “Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans.” Apple CEO Tim Cook had visited Hyderabad in May – shortly after acqui-hiring Tuplejump – to inaugurate Apple’s first development center in India.


Progressly secures $6m in Series A Funding and lands Silicon Veteran Ruslan Belkin as executive

Progressly secured $6m in Series A funding. The startup hopes to redefine the way companies execute their progressely-6m-funding-silicon-valleyprocesses, offering a single platform that increases efficiencies and productivity.  Progressly is also joined by Silicon Valley veteran and former Salesforce, Twitter and LinkedIn executive Ruslan Belkin as its vice president of product development. The funding round was led by 8VC’s Joe Lonsdale and Drew Oetting, with participation from Bill Malloy and Brian Nugent, General Partners of Accelerate-IT Ventures (AITV) and David Beirne. Progressly is an SaaS platform that enables companies to standardize and centralize processes. The platform provides powerful data-driven insights so teams can benchmark progress, improve the speed of collaboration, remove human error and manual activity and ultimately make better decisions about driving effective business change. Progressly currently integrates with existing productivity and collaboration tools including Outlook, SharePoint, Slack, Google Chrome, Confluence and Jive.

Oetting, a partner at 8VC, said, “Rather than antiquated systems that center around document management solutions, companies need a solution that centralizes their own mission-critical information, delivers real-time operational insights and increases efficiency. “Progressly is at an inflection point, with a solid path to scale and strong product market fit.  They have a steadfast commitment and the best minds in the business to change the way enterprises think about executing their key business processes.” Getting was joined by Belkin, who said he was “excited to join this incredible team” and praised Progressly’s culture of “transparency, execution, and teamwork”. Belkin said, “Progressly is poised to completely transform the way enterprises organize and execute their business processes and gain insights to improve business outcomes.” said Ruslan Belkin, vice president of product development at Progressly.


Levchin’s Affirm secures $100M credit line from Morgan Stanley

This morning, fintech startup Affirm announced a new $100 million credit line from Morgan Stanley. The money levchins-affirmwill go directly to supporting the company’s current financial products that help customers purchase goods and spread their expenses over a period of time. Morgan Stanley is not the first institutional lender to issue a line of credit to the company. In May of 2015, Affirm closed a line with Jefferies as part of a round that consisted of both equity and debt. Affirm disclosed at the time that the capital totaled $275 million but declined to disclose the debt to equity breakdown of that figure. “Today’s credit line is an indication from Morgan Stanley that they believe in our credit and underwriting practices,” said Jeremy Solomon, head of capital markets for Affirm. Solomon noted that the company’s current short-term loans will be the primary benefactor of today’s credit and any new products would need additional debt from diversified institutional investors to propagate. A syndicate was not needed in this round as Morgan Stanley was willing to fulfill the entire transaction.

Like most fintech companies, when Affirm first began issuing credit, the company had to use equity as its primary method for financing until it could prove to larger financial institutions that it had an understanding of its customers’ risk profiles. CEO of Affirm, and former co-founder of PayPal, Max Levchin has steered Affirm since its founding in 2012, raising $525 million along the way. To date, all loans remain on the company’s balance sheet. Solomon explains that this was deliberate to prove to outside investors that the team is fully invested in their idea and willing to bear the risk. Importantly, however, Affirm doesn’t underwrite and service its loans by itself. It works in association with Cross River Bank to provide loans to customers ranging from $50 to several thousand, according to Solomon. The company has tripled its transaction volume over the last year. Affirm also declined to comment on default rates, but insisted that they’re strong.


ComplyAdvantage raises $8.2M Series A to help firms manage compliance

Enter ComplyAdvantage, a London-based startup that claims to use artificial intelligence and machine learning to comply-advantageshelp firms manage compliance obligations and at reduced cost. The young company is announcing $8.2 million in Series A funding led by Balderton Capital, money it plans to plough into growth across Europe and the U.S., including opening a New York office this week. Founded by Charles Delingpole, who previously founded Market Invoice, ComplyAdvantage originally launched to help a small number of businesses meet complex anti-money laundering (AML) and counter financing of terrorism (CFT) requirements. It has since developed its product to also cover things like Politically Exposed Persons (PEPs) lists and other risk and compliance areas that are hard to scale. “The way organizations screen and monitor their customer relationships to comply with sanctions regulations and prevent money laundering and terrorist financing risk is fundamentally broken,” ComplyAdvantage VP of Sales & Marketing Stephen Ball tells me over email. “ComplyAdvantage is here to help compliance and risk professionals fix it”. “Legacy technologies are outdated, expensive and inefficient, typically generating large amounts of manual work in the form of unnecessary risk alerts for the team to review,” he adds, citing as an example a customer having the same name as a completely different Politically Exposed Person. “Furthermore, the criminals are winning, with existing solutions having limited impact on actually reducing financial crime”.

That, argues Ball, has left compliance officers jaded. Originally attracted to the role of fighting crime, they find themselves often doing a box-ticking exercise that is ineffective but designed to keep the companies they work for on the right side of the regulators, even if that often fails too. Meanwhile, regulator fines are kind of expected and baked into the pricing models of financial services. To fix this, ComplyAdvantage is betting that AI and machine learning can help compliance scale properly and says the startup is part of a “regtech revolution” that is coming to financial services. “ComplyAdvantage are at the forefront unleashing the power of AI and ML to change the way compliance is done,” says the VP of Sales & Marketing. Adds Tim Bunting, General Partner at Balderton Capital, in a statement: “We believe that this is one of the few remaining large industries that is still ripe for digital disruption. We are thrilled to be backing Charles and his team, they are well on their way to changing the way companies can understand and monitor risk around their clients. Their mission is truly exciting, and relevant to all businesses.”


Apple Plans Second R&D Center In China's Silicon Valley

Apple will open a new research-and-development facility in China’s technology hub Shenzhen next year, as it seeks appleto beef up its presence in the world’s largest smartphone market. The company announced the plan while Chief Executive Tim Cook was visiting the city for an innovation event held there this week. Apple made an announcement in August that it would build its first China R&D center in Beijing. In September, Zhongguancun Science Park, a government committee overseeing Beijing’s Zhongguancun area, said on its social media account that the center in the city would cost 300 million yuan ($44 million) and have a total of 500 employees. Apple declined to comment on the investment amount and number of people it would hire in the two R&D centers. “We are excited to be opening a new Research and Development center here next year so our engineering team can work even more closely and collaboratively with our manufacturing partners,” a company spokeswoman said in an e-mailed statement. “The Shenzhen center, along with the Beijing center, is also aimed at strengthening relationships with local partners and universities as we work to support talent development across the country,” Apple’s spokeswoman said.

Start-Up 2nd Week News Flash of October
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