Charlotte Tech News

[wilmore]

5 hours ago, SouthEndCLT811 said:

Tresata in an e-mail newsletter that comes out daily

https://thehustle.co/Tresata-unicorn-funding/

 

It's absolutely ridiculous that Tresata is claiming to have a billion dollar valuation. Without knowing any of the actual goings-on here, and why they'd announce this in such a way, there are a *ton* of red flags here. This newsletter seems to have touched on a lot of what's extremely strange about this. IMO trumpeting this doesn't look good for Charlotte tech. 

1. They have a billion-dollar valuation and yet the best publication to report on it is "siliconangle"? Not even sure what this site is, but no one reputable outside of CLT touched the story. 

2. The investor is a PE firm that generally does control investments. So you're saying they invested for a 5% stake, at the top end of their usual investment number? That's...odd. They also have invested almost entirely in banks, with a couple tech investments - the other tech deal I saw numbers for was a $12.5M Series B. It strains credulity that they'd do a deal for $50M at a BILLION dollar valuation, without some major caveats. 

3. Tresata announced the following numbers as a part of the INC 500, which generally requires legit financials: $11M revenue, 182% 3-year growth rate in 2017 (this is cumulative, so the annualized growth rate is slightly over 40%.) The annualized 40% growth rate is good, sure, but nothing NEAR what would result in such a massive multiple of revenue. In fact, the growth rate is similar to many public SaaS companies (of which, is Tresata really? I don't know, it seems more like a consultancy...almost all their employees are "data engineers"), which average around a 10x revenue multiple. This is all to say a $100M valuation might make sense, given both the PE firm's investment type, and the revenue numbers, and even $200M would be feasible if they have some strong growth potential once they begin scaling with this capital. But a billion? I'd love to see any other startup type person or investor say this is a legitimate possibility, and why, because I am baffled as to why they would make this bizarre claim. 

4. I certainly hope they invest in their marketing materials with this $50M. If they have some legitimate tech advantage, and aren't just implementing big data tech as a consultancy-type upsell model, they should be able to say something more compelling on their website than they do. Like that post mentions, it's truly horrible marketing buzzword bingo. 

Don't believe the hype. 

[KJHburg]

Another Charlotte base tech company Stratifyd raises $20 million to grows it AI business.   Organic tech companies can grow and thrive and attract the talent they need here in Charlotte.

https://www.wraltechwire.com/2018/10/12/charlotte-artificial-intelligence-startup-stratifyd-raises-20m-video/?ssid=112928427

 

As for that about Tresata not sure what to think about their valuations.  

[atlrvr]

To comment blindly on Tresata, as the previous poster did as well, $1B valuations are not un-commonly "manufactured".  And while the post was filled with cynicism, I'll just speculate that like many "unicorn" valuations on high growth/high potential/high risk deals, there are lots of levers.

 

I don't think this puts Charlotte in a bad light, per see, rather it's a bit where we are in the tech cycle, and there are plenty of examples in Silicon Valley where you see deals structured to imply $1B but the investor has far more protections than a big blank check for a small part of the company....also, I'd say that investors push for unicorn valuations more than companies as there is a halo affect and egos at play.

Lastly, I think the skepticism around the actual product reflects their original business model (analytics consulting), but it seems like they have developed an actual software package that takes over passive data collection, warehousing, analytics, and learning.....but I dunno...seems interesting to me.

[wilmore]

Investors push for unicorn valuations when they can get tons of protections, which I would argue is not really a billion-dollar valuation. If your 5% immediately converts into 50% upon some goal not being hit, it's hard to say that was truly a billion-dollar valuation. 

I'm sure they have developed some sort of actual software package, but the website does not really show that. Maybe they'll up their marketing game now that they're a Unicorn and need to be selling to more/larger clients (I'm not sure who they work with besides Harris Teeter, and likely the banks). 

If this was a typical unicorn-investor (large VC firm, etc.) I'd believe the valuation more. But a private-equity firm who usually doesn't invest in tech deals, going for a 5% slice of the company? Also, you'll notice the investor didn't mention anything about the valuation, Tresata is the one throwing this around. So they seem to really care for whatever reason. Being obsessed with your valuation rarely ends well for a startup, due to as you mention, investors being able to build in protections and "use the founders' ego against them" in many cases. 

I hope they live up to the valuation - biggest plus is now that they have $50M, they should end up hiring way more than ~30 employees, good for those looking for tech jobs in CLT. 

[KJHburg]

Queen City Fintech conference is coming soon.  https://www.wraltechwire.com/2018/10/15/queen-city-fintech-vc-conference-to-feature-startups-investors/?ssid=112928427

[KJHburg]

Here is a story about locally based Stratifyd and its $25 million in funding.  The owner is committed to building this tech company here in Charlotte.

https://www.bizjournals.com/charlotte/news/2018/10/16/charlotte-tech-firm-stratifyd-closes-25m-funding.html?ana=e_ae_set2&s=article_du&ed=2018-10-16&u=oAaDx%2B74FoP4qOJ%2By4AU6dhJPpc&t=1539719131&j=84446251

[KJHburg]

I have said this for a long time but finally Charlotte's tech community is getting some national press.   Charlotte is ranked #1 yes I said #1 tech town based on growth, cost of living, projected growth etc    Raleigh is #2   Nashville no where on this list.   Our tech jobs many of them are based in our large financial institutions which are not pure tech plays but tech is a large part of this local economy.  

https://www.wraltechwire.com/2018/10/23/report-charlotte-tops-nation-triangle-as-no-1-tech-town/?ssid=112928427

and straight from the source

https://www.comptia.org/about-us/newsroom/press-releases/2018/10/23/new-comptia-study-identifies-america-s-top-20-tech-towns-based-on-job-opportunities-and-quality-of-life

Edited October 23, 2018 by KJHburg

[KJHburg]

You better believe we are basking in the glow of being named #1 tech town in country.   Read this from the Triangle based WRAL Techwire

 https://www.wraltechwire.com/2018/10/24/charlottes-tech-entrepreneurs-bask-in-glow-of-no-1-tech-town-ranking/?ssid=112928427

Speaking of Charlotte tech here is one company celebrating their 10th anniversary.  SignUpGenius based in Ballantyne.  From the subscriber article 

""What started as a side gig for Chief Executive Dan Rutledge and his co-founder, Mike Vadini, has grown into a business posting 40% year-over-year revenue growth in 2018. SignUpGenius has up to 14 million site users per month, an increase of 25% year over year.  SignUpGenius works with schools, churches, businesses and other organizations to help them coordinate meetings via an online platform.  Located in Ballantyne Corporate Park, SignUpGenius employs 34 people""

https://www.bizjournals.com/charlotte/news/2018/10/23/signupgenius-ceo-looks-back-on-10-years-of-growth.html

[CM2424]

On 10/12/2018 at 9:47 AM, atlrvr said:

To comment blindly on Tresata, as the previous poster did as well, $1B valuations are not un-commonly "manufactured".  And while the post was filled with cynicism, I'll just speculate that like many "unicorn" valuations on high growth/high potential/high risk deals, there are lots of levers.

 

I don't think this puts Charlotte in a bad light, per see, rather it's a bit where we are in the tech cycle, and there are plenty of examples in Silicon Valley where you see deals structured to imply $1B but the investor has far more protections than a big blank check for a small part of the company....also, I'd say that investors push for unicorn valuations more than companies as there is a halo affect and egos at play.

Lastly, I think the skepticism around the actual product reflects their original business model (analytics consulting), but it seems like they have developed an actual software package that takes over passive data collection, warehousing, analytics, and learning.....but I dunno...seems interesting to me.

This doesn't pass the sniff test for me either and their reviews from current and former employees don't help.  I don't have proof but I'd bet that this ends poorly.  This is from Glassdoor for example:

"This company is one massive hoax without a real product. Founders are dishonest and will cheat you of stock and salary on top of trying to humiliate you with inappropriate jokes and comments. They’re not interested in talent, they’re interested in hiring individuals who will do whatever they ask. Turnover is insane.

I’m pretty sure certain things they do are illegal.

This is the Theranos of Charlotte."

[KJHburg]

CBRE one of the largest commercial real estate firms ranks Charlotte as the #8 out of 30 top tech markets but since that includes 2 Canadian cities I will call it #6.

You can download your free copy of the report from here

https://www.cbre.us/research-and-reports/Tech-30-2018?utm_source=comms-ext&utm_medium=email&utm_campaign=Tech-30-2018

Basically as costs of doing business spiral out of control in the Bay area and increasingly Seattle tech is spreading to more markets and Charlotte along with Austin, Raleigh Durham, Dallas and Nashville are mentioned as places where tech is growing rapidly. 

On the other report mentioned above that report is getting lots of press I saw it mentioned in Austin that Charlotte was #1 tech town. 

[KJHburg]

Charlotte upstart tech firm receives $225M investsment.  Ribbon helps buyers buy homes with cash then the buyers get a mortgage loan to pay back Ribbon.  Ribbon gets a fee from the seller for this.   https://www.bizjournals.com/charlotte/news/2018/10/26/charlotte-based-homebuying-startup-nabs-225m.html      This company sounds like it has 2 main offices in NYC and Charlotte.  

Edited October 29, 2018 by KJHburg

[J-Rob]

Here is a CBJ article about PrecisionLender.  The article mentions that on average, the company has doubled their revenue every year since 2010.  This is great news about another home-grown FinTech success story.

https://www.bizjournals.com/charlotte/news/2018/11/02/how-charlotte-based-precisionlender-is-preparing.html

https://precisionlender.com/

 

[KJHburg]

Charlotte named of the top 5 #5 digital cities in terms of how government interacts online.    Many other NC cities on the list as well.

http://www.govtech.com/dc/digital-cities/Digital-Cities-Survey-2018--Winners-Announced.html

[KJHburg]

Charlotte tech startup raises $3.9M from investors.   https://www.wraltechwire.com/2018/11/07/charlotte-software-firm-commerce-signals-raises-3-9m-demo-video/?ssid=112928427

[KJHburg]

Down in Rocket City but still keeping up with Charlotte tech and fintech news

https://www.bizjournals.com/charlotte/news/2018/11/14/photos-fintech-experts-investors-gather-in-uptown.html?ana=e_ae_set1&s=article_du&ed=2018-11-14&u=oAaDx%2B74FoP4qOJ%2By4AU6dhJPpc&t=1542227927&j=85027541

[KJHburg]

Tredata story from the Agenda today explains a little more what they do.  https://www.charlotteagenda.com/147430/tresata-unicorn/

[KJHburg]

In other news Levvel raises $1.5 million from investors to continue its growth

http://www.ncbiznews.com/levvel-holdings-raises-1-5-million-from-15-investors/?utm_source=Business+North+Carolina+Daily+Digest&utm_campaign=ce5a0f5b71-EMAIL_CAMPAIGN_10_19_2018_COPY_03&utm_medium=email&utm_term=0_7ae5defd0d-ce5a0f5b71-122553233#new_tab

[Scribe]

22 hours ago, KJHburg said:

Down in Rocket City

Are you there for the launch that is later today?

[Guest]

1 hour ago, Scribe said:

Are you there for the launch that is later today?

KJ, CEO of Krispy Kreme, Lover of McDonalds, Astronaut

[KJHburg]

I am oldest Space Camp participant but due my status as owner of the KJ Burgers Fantasy Team and other businesses I was invited to participate.  

[KJHburg]

MapAnything another Charlotte tech success story raises $42.5 Million https://www.bizjournals.com/charlotte/news/2018/11/16/charlotte-based-mapanything-closes-42-5m-series-c.html

Keeping up with Charlotte tech scene from the Big A 

[KJHburg]

Yet another Charlotte up and coming tech firm raises money this time Payzer and $9.2 Million.  Based in south Charlotte this firm develops billing software for trades and contractors.  https://www.wraltechwire.com/2018/11/19/charlotte-based-specialty-trade-software-firm-nails-9-2m-c-round/?ssid=112928427

More at the website

https://www.payzer.com/Index/Home

[KJHburg]

Deloitte announces their fastest growing tech companies and guess which company is the highest ranked in NC?  Passport coming in at #98 and also representing Charlotte is AvidXchange at #347

https://www2.deloitte.com/us/en/pages/technology-media-and-telecommunications/articles/fast500-winners.html

3 firms in the Raleigh Durham area but none higher than Passport 

Edited November 19, 2018 by KJHburg

[KJHburg]

In other real estate news relating to tech I am hearing Passport will take another floor in First Citizens Bank that would be 3 full floors.  Tech (and coworking space)  is really helping diversify the uptown tenant base. 

[KJHburg]

NC tech job postings at year high.  Lots of growth in Raleigh Durham and of course Charlotte.  https://www.wraltechwire.com/2018/11/20/number-of-nc-it-job-postings-hits-yearly-high/?ssid=112928427

Tell your techie friends to move here for affordable living and good salaries.