Dan Laufer vowed to ever start a startup again after selling apartment rental platform RentLingo in 2021, but Laufer also couldn't ignore the potential to solve a problem he saw emerging as head of growth and product marketing at Nextdoor.

“Nextdoor is most commonly used by people searching for providers, particularly HVAC,” Laufer told TechCrunch. “There were these gaps on the consumer side, satisfaction with the experience, it didn’t feel modern. The other big trend I saw was the silver tsunami. All these baby boomers who own these and don’t necessarily have an exit plan.”

The result was PipeDreams, a startup that acquires small and large HVAC and plumbing companies and scales them using its software that helps with planning and marketing. PipeDreams allows business owners to retire when necessary without losing their employees, name or brand, or simply become part of a larger company with more resources, Laufer told TechCrunch.

PipeDreams just raised a $25.5 million Series A led by Canvas Ventures and Plural with additional funding from DoorDash founder Tony Xu and former OpenTable CEO Thomas Layton. PipeDreams has acquired nine companies to date and currently operates in the San Francisco Bay Area, Tucson and Denver with plans to expand.

“The beauty of this industry is that it’s huge. There are over 100,000 plumbing and heating, ventilation and air conditioning companies,” Laufer said of the U.S. market. “We intend to keep their brand. A lot of these people have their names on the truck, it’s very personal.”

PipeDreams' strategy is a variation of the private equity roll-up model, in which PE firms buy smaller companies in a niche (private schools, dentistry, healthcare) and combine them into a larger company with the intent of becoming the larger Selling companies to make profits for investors.

PipeDreams also uses debt to fully acquire the companies, but is not tied to a tight lifecycle timetable to generate returns or exit, such as the four to six years expected with PE. The company has a $15 million credit facility that will be used to purchase businesses and will use the equity raised to improve its software. Laufer said he expects future rounds will need to raise more debt than equity.

Roll-up strategies are not common for venture capital-backed startups. The best comparison for this is Amazon aggregator startups like Perch and Thrasio, which have recently had financial problems. But unlike those aggregators, the underlying companies that PipeDreams buys are not at the mercy of a company like Amazon, which can change the rules at will, and the companies that PipeDreams buys have stronger relationships with its customers than Amazon brands.

However, PipeDreams could face the same growth hurdles that Amazon aggregators face, such as if a new entrant wins more business or if a local plumber improves its SEO or digital marketing strategy.

Laufer said taking over the HVAC companies completely sets PipeDreams apart from other competitors that only want to connect consumers with professionals like Angie and Thumbtack. He said that, like many of its competitors, the marketplace model is not rigid because consumers can search for professionals directly after finding them through a marketplace. Because PipeDreams integrates its technology into each provider's website, it is part of the process every time someone books with that professional.

PipeDreams also addresses the skills shortage in the HVAC and plumbing industries, as Generation Z is less interested in learning trades than the generations before them. The company launched an apprenticeship program in the fourth quarter to provide employees with on-the-job training. So far there have been five students with plans to expand.

While the company still has a long way to go to flesh out its HVAC-focused business, Laufer expects to expand into other categories in the future, including electricians.

“We bought [a company] When the owner had a celebratory dinner a few weeks ago, he described it as: “My company is going to college,” Laufer said. “'I grew it up and it's on its way to the next chapter.' I love this description. We do it like this.”

The post Former Nextdoor exec raises $25 million for PipeDreams, a startup rolling up HVAC corporations appeared first on Los Gatos News And Events.

Photo credit: erhui1979/Getty Images

Dan Laufer vowed to ever start a startup again after selling apartment rental platform RentLingo in 2021, but Laufer also couldn't ignore the potential to solve a problem he saw emerging as head of growth and product marketing at Nextdoor.

“Nextdoor is most commonly used by people searching for providers, particularly HVAC,” Laufer told TechCrunch. “There were these gaps on the consumer side, satisfaction with the experience, it didn’t feel modern. The other big trend I saw was the silver tsunami. All these baby boomers who own these and don’t necessarily have an exit plan.”

The result was PipeDreams, a startup that acquires small and large HVAC and plumbing companies and scales them using its software that helps with planning and marketing. PipeDreams allows business owners to retire when necessary without losing their employees, name or brand, or simply become part of a larger company with more resources, Laufer told TechCrunch.

PipeDreams just raised a $25.5 million Series A led by Canvas Ventures and Plural with additional funding from DoorDash founder Tony Xu and former OpenTable CEO Thomas Layton. PipeDreams has acquired nine companies to date and currently operates in the San Francisco Bay Area, Tucson and Denver with plans to expand.

“The beauty of this industry is that it’s huge. There are over 100,000 plumbing and heating, ventilation and air conditioning companies,” Laufer said of the U.S. market. “We intend to keep their brand. A lot of these people have their name on the truck, it’s very personal.”

PipeDreams' strategy is a variation on the private equity roll-up model, in which PE firms buy smaller companies in a niche (private schools, dentistry, healthcare) and combine them into a larger company with the intent of becoming the larger Selling companies to make profits for investors.

PipeDreams also uses debt to fully acquire the companies, but is not tied to a tight lifecycle timetable to generate returns or exit, such as the four to six years expected with PE. The company has a $15 million credit facility that will be used to purchase businesses and will use the equity raised to improve its software. Laufer said he expects future rounds will need to raise more debt than equity.

Roll-up strategies are not common for venture capital-backed startups. The best comparison for this is Amazon aggregator startups like Perch and Thrasio, which have had financial problems recently. But unlike those aggregators, the underlying companies that PipeDreams buys are not at the mercy of a company like Amazon, which can change the rules at will, and the companies that PipeDreams buys have stronger relationships with its customers than Amazon brands.

However, PipeDreams could face the same growth hurdles that Amazon aggregators face, such as if a new entrant wins more business or if a local plumber improves its SEO or digital marketing strategy.

Laufer said taking over the HVAC companies completely sets PipeDreams apart from other competitors that only want to connect consumers with professionals like Angie and Thumbtack. He said that, like many of its competitors, the marketplace model is not rigid because consumers can search for professionals directly after finding them through a marketplace. Because PipeDreams integrates its technology into each provider's website, it is part of the process every time someone books with that professional.

PipeDreams also addresses the skills shortage in the HVAC and plumbing industries, as Generation Z is less interested in learning trades than the generations before them. The company launched an apprenticeship program in the fourth quarter to provide employees with on-the-job training. So far there have been five students with plans to expand.

While the company still has a long way to go to flesh out its HVAC-focused business, Laufer expects to expand into other categories in the future, including electricians.

“We bought [a company] When the owner had a celebratory dinner a few weeks ago, he described it as: “My company is going to college,” Laufer said. “'I grew it up and it's on its way to the next chapter.' I love this description. We do it like this.”

The post Former Nextdoor exec raises $25 million for PipeDreams, a startup rolling up HVAC corporations appeared first on Los Gatos News And Events.

The San Francisco tech startup that helped popularize a push for a four-day workweek in Silicon Valley, is now laying workers off.

As first reported by the New York Times, Bolt, the payment services startup with offices near San Francisco’s Union Square, laid off around 250 of its around 900 employees Wednesday in a move to “secure our financial position, extend our runway, and reach profitability with the money we have already raised” amid industrywide financial challenges, according to a letter to staff.

A Bolt spokesperson confirmed to SFGATE Thursday that “approximately a third of the company” was laid off.

“It’s no secret that the market conditions across our industry and the tech sector are changing, and against the macro challenges, we’ve been taking measures to adapt our business,” recently appointed CEO Maju Kuruvilla said in the letter, which was made public Wednesday.

One laid-off employee, posting on the anonymous forum Blind, said that they received the news “after getting a pay-raise just a couple of weeks ago.”

The company, already dealing with a rocky 2022, now has to contend with the realities of a challenging period for fledgling tech startups.

Shortly after the wave of good press Bolt received in January for implementing a permanent four-day workweek (and, more crucially, its titanic $11 billion valuation), the company suffered a torrent of bad news. Founder and former CEO Ryan Breslow posted a fiery Twitter thread accusing notable startup accelerator Y Combinator of “Mob Sh*t” and being corrupted by “money, power, and greed.” (Breslow stepped down as CEO for the company just days later.)

In April, Authentic Brands — a fashion retail conglomerate that owns Forever 21 and Reebok and one of Bolt’s most high-level clients — sued the company for its failure to deliver on its promises for a checkout system for the brands in a timely manner.

The New York Times also ran an exposé earlier in May alleging that the company stretched the truth about its services to investors and prospective merchants.

“There’s no good way to share news of a restructure but it’s in our culture to be committed to candor and care, today and always,” Kuruvilla ended the letter. “I can’t thank you enough for all of your past, present, and future dedication to make Bolt what it is. We have an incredible team, great product, and the market needs us more than ever before. But today, my focus is on our people. Please be mindful and caring for your colleagues and yourself.”

It is unclear what severance benefits employees who were laid off will receive.

The post Bolt, San Francisco startup valued at $11B, has mass layoffs appeared first on Los Gatos News And Events.

• Vitaly Alexandrov is the founder of Food Rocket, a food-tech grocery delivery company.
• After launching in San Francisco, Alexandrov decided to move Food Rocket’s HQ to Chicago in 2022.
• He says the move will cut down on operating costs while also expanding to a new market.

Loading Something is loading.

My company initially started as a tech startup called Foody that helped simplify how restaurants order their inventory. Once the pandemic hit, I felt it was time to pivot, and we decided to relaunch as Food Rocket, a 15-minute grocery delivery service.

Since then, we’ve been holding our own in San Francisco against competitors like DoorDash and GoPuff. Despite our growth in Silicon Valley, in December I decided we would relocate HQ to Chicago in 2022.

California put us on the map, but Chicago will keep us there

California is an amazing state. The weather is gorgeous, the people are lovely, and everyone is keen to try the next tech trend, which makes it an ideal place for a startup like ours.

We couldn’t have asked for a better place to get our start than San Francisco, because the city and its people have taught us so much. But as our team of more than 70 continues to grow, we’re ready to expand into new markets.

While San Francisco is still the king of startups, many investors and companies are migrating to other emerging markets like Austin, Tampa, and Raleigh, and I think it’s important to make our move sooner rather than later.

After a lot of research, I decided to move Food Rocket HQ to Chicago

We did extensive market research before settling on Chicago. As one of the largest cities in the US, Chicago is a great place for any emerging business. For Food Rocket specifically as a grocery delivery company, the city’s population density can help us understand how consumers buy groceries and how we can offer delivery services based on their preferences.

Chicagoans have different wants and needs than San Franciscans, which means that we’ll also have an opportunity to learn the demands of a new local market. We want to change the way America grocery shops, so I think it’s essential for our team to experience different areas of the country to learn how to cater to and succeed in various regions.

Real estate is also cheaper in Chicago, which will allow us to open more dark stores for our delivery operations and expand farther than we could have in San Francisco. Our overall operating costs will be lower, so we’ll also be able to offer more competitive pricing for Chicago customers.

Food Rocket riders at one of the company’s dark stores.

Food Rocket

There’s no mandatory requirement for employee relocation with our HQ move, as many of our employees already currently work remotely, but some employees have said they do plan to move with us. Remote employees directly involved in operations understand that I expect them to visit Chicago periodically to become familiar with the people and market, so it will also be a convenient central location.

Overall, Chicago is an important part of our long-term business strategy

Because the city is so different from San Francisco, it’s almost like an entirely new business model, which is exciting for us. Since we’re no longer a startup, we also wanted to explore a non-startup city environment.

For other entrepreneurs considering an HQ move, focus on finding a location that has the most benefits for your business. Choosing some trendy place might sound fun, but in the end if you’re making a big move, make sure it’s to a place where your business will thrive.

Vitaly Alexandrov is the founder and CEO of Food Rocket, a food-tech startup that offers 15-minute grocery delivery.

The post Why I am Transferring My Startup From San Francisco to Chicago appeared first on Los Gatos News And Events.

When entrepreneur and investor Luis Perez saw a gap in the marketplace for a high tech, white glove haul service, he decided to create one—and in 2014, Remoov was launched. Using original algorithms to Automate the appraisal and resale process of pre-owned items quickly and efficiently, Remoov helps homeowners and corporations declutter by picking up unwanted goods, selling what they can for the owner’s profit, donating what can be recycled and responsibly disposing of remaining items. After a successful 2020, due in part to the work from home lifestyle spurred by the COVID-19 pandemic, Remoov more than doubled its profits and is now going national—expanding to Miami from its headquarters in San Francisco.

With this expansion, South Florida residents will get multiple benefits, like a top-of-the-line decluttering service right at their fingertips, the ability to earn 50% of profits from their resold goods and tax benefits for donated items. Goods that can be resold will be done both online and through Remoov’s own showroom. Goods that have been earmarked for donation will be sent to various non-profit organizations in South Florida and clients thereby receive a tax compliant donation receipt. Items that cannot be sold or donated will be disposed of responsibly, in line with Remoov’s commitment to sustainability and the environment.

For consumers, using Remoov’s services is as simple as a three-step process. Customers start by taking photos of the items they want to get rid of, and either texting or uploading them to Remoov’s website with the item name, brand, original price and age. Within one business day, they’ll receive an estimate that includes the cost of the pickup—which is based solely on volume—and, after careful analysis by Remoov’s in-house appraisers, a list of which items can be resold and at what price. Finally, after accepting the estimate, customers will receive a link via text or email where they can schedule a date and time frame for pickup.

Remoov’s expansion to Miami will also come with a third location of its signature showroom, which is purpose-built so consumers can both buy second-hand goods and make money off their own. With the original showroom in San Francisco and a second now taking over a large warehouse in Doral, the company is credited with having the largest collection of quality, pre-owned items for every taste, style and budget. From well-known brands to rare finds, every item there is carefully inspected and valued by Remoov’s team of appraisers and sold at a significant reduction from its original price. Shoppers can pick up their purchases locally or have them delivered throughout the US

“When it came time to grow Remoov and move into a new market, South Florida was the obvious choice,” said Perez. “I am so excited to bring our bespoke service to Miami residents and look forward to making our purpose-built, unique showroom an indelible part of the local community.”

Following its popularity in the Bay AreaRemoov’s showroom is poised to be a hotspot for designers, realtors, commercial other residential buildings and living communities in South Florida that are staging or decorating new spaces. It’s also a top destination for anyone passionate about sustainability and finding rare luxury goods at an affordable price.

Remoov’s Miami office and showroom is located 7457 NW 55th St, Miami, FL 33166, tel: 3053175121. Hours of operation for the Remoov showroom will be MF, 9 am-5 pm, starting on February 14, 2022.

About Remoov

Remoov is a tech-based pickup service that sells, donates, and disposes of a home or office’s pre-owned or used goods. For more information about Remoov, visit www.removit.com or follow @remoovit on Facebook, Twitter, and Instagram.

Connect To Your Customers & Grow Your Business

Click Here

The post REMOOV, A SAN FRANCISCO-BASED, HIGH-TECH HAULING STARTUP, MAKES ITS EAST COAST U.S. DEBUT IN MIAMI appeared first on Los Gatos News And Events.

By Ira Boudway | Bloomberg

California-based drone startup Zipline plans to begin delivering medicines and other supplies to households in Salt Lake City, Utah. The company, whose fixed-wing drones have been transporting medical supplies to rural clinics in Rwanda and Ghana since 2016, has signed a service contract with Intermountain Healthcare of Utah to deliver to its patients in the city. Zipline expects the first deliveries to occur in the spring of 2022 and hit hundreds per day within four years of the service’s launch.

A zipline drone that delivers vaccines. (Zipline Inc.)

“We are excited to help lead the industry beyond the pilot phase and build something that can lead to a large commercial operation,” said Conor French, Zipline’s general counsel, in an interview Tuesday. The company will be able to reach around 90 percent of households in the greater Salt Lake City area with its drones, which navigate autonomously via satellite and parachute payloads of up to four pounds, French said.

Zipline plans to use yards and driveways for drops. Before it can begin, it must be approved by the Federal Aviation Administration. The company has applied for certification under the FAA program, known as Part 135, for unmanned parcel delivery.

“We are very confident that we will receive Part 135 certification in good time,” said French. (FAA spokeswoman Emma Duncan said via email that the administration would not comment on ongoing certification projects.)

Intermountain, a nonprofit founded in 1975 on a gift from The Church of Jesus Christ of Latter-day Saints, operates 24 hospitals and 215 clinics in Utah, Idaho, and Nevada, and serves approximately half of the population of Salt Lake City over 1, 25 million. Initially, the zipline service will focus on homebound and immunocompromised patients. In later stages, Intermountain plans to use drones to fill out routine prescriptions and dispense over-the-counter medications, with patients using online registration to arrange delivery within 15-30 minutes. “We see this as a long-term relationship,” said John Wright, Intermountain’s vice president of supply chain and support services.

Since its inception in 2014, Zipline has said it has flown 15 million kilometers and made more than 215,000 deliveries, including hundreds of thousands of Covid vaccine doses, in Africa. Its drones take off from catapults and can fly back and forth for up to 100 miles – and service up to 8,000 square miles from a single hub. Earlier this year, the San Francisco-based company raised $ 250 million on a valuation of $ 2.75 billion.

Last year Zipline ran a pilot program that delivered personal protective equipment to two health facilities in North Carolina with limited FAA approval. Drone operators supported by Alphabet Inc., Amazon.com Inc. and United Parcel Service Inc. have already been certified as unmanned airlines by the FAA.

(Corrects the number of Covid vaccine doses as per paragraph 6; updates the items Zipline plans to deliver.)

More stories like this can be found on Bloomberg.com

© 2021 Bloomberg LP

The post San Francisco drone startup plans drug deliveries to houses in Salt Lake Metropolis appeared first on Los Gatos News And Events.

“Birmingham has a strong start-up ecosystem to grow MomentMD and the AFF team is a constant source of advice and expertise. You are a partner that you want to have by your side, ”he added.

GROWTH POTENTIAL

“It’s great to see an innovative telemedicine company like MomentMD move to Birmingham, where it will find the support it needs to be a long-term success.”

The AFF’s support for Amtekh Inc., the parent company of MomentMD, marks the 13th investment since the fund was launched in the fourth quarter of 2018. See the AFF portfolio.

Nine of these companies were based outside of Alabama and moved their headquarters to the state after receiving AFF funding. Two of the companies were from San Francisco and Atlanta, and others from New York City, London, Orlando, and Virginia and South Carolina.

In the MomentMD deal, AFF acted as the main investor in the financing round with the participation of other US investors. based in Birmingham Redhawk Advisory LLC acts as AFF’s investment manager and advised the fund on the MomentMD investment.

Redhawk partner Matt Hottle said MomentMD’s novel approach to telemedicine represents a major advancement in the remote delivery of clinical care and other services.

“Most telemedicine solutions focus on addressing minor benefit gaps for large health systems or employer-funded health insurers. MomentMD’s goal is to provide everyone, regardless of their circumstances, with access to high quality, personalized care, ”said Hottle.

“Patients can use the MomentMD platform to find specialists who will become long-term partners for their health, not just transactional practitioners who have traditionally been limited to treating mild or acute illnesses.”

Greg Canfield, Secretary of the Alabama Department of Commerce, said Birmingham is a perfect fit for MomentMD as the city is home to one of the largest academic medical centers in the country, the University of Alabama at Birmingham, and a dynamic healthcare startup community.

“Telemedicine has become an increasingly popular means for people to get quality health care, and remote, personalized care is likely to increase in the years to come,” said Secretary Canfield.

“It’s great to see an innovative telemedicine company like MomentMD move to Birmingham, where it will find the support it needs to be a long-term success.”

NEW APPROACHES

While most remote healthcare providers focus on the employer-funded healthcare market or offer services that primarily focus on acute medical issues, MomentMD has taken a different approach.

Patients using the MomentMD platform can have access to primary care, acute care, mental health services, and even dental care. The company does not require patient insurance and access to the platform can be purchased either by paying a one-time transaction fee or through a monthly subscription.

Unlike many traditional telemedicine offerings, the MomentMD platform provides access to participating health professionals across the country, allowing patients to find health professionals with a specific level of expertise.

In addition, the company provides participating healthcare professionals access to HIPAA-compliant cloud-based medical records for platform users, thereby maintaining continuity of care and delivering better outcomes for patients. Participating doctors can also order laboratories or write prescriptions online via the MomentMD platform.

The post Florida-based telemedicine startup shifting headquarters to Alabama appeared first on Los Gatos News And Events.

SAN FRANCISCO, August 10, 2021 / PRNewswire / – Stuf, a next-generation self-storage company offering easy-to-access and “right next door” storage facilities, announced two new locations today in. famous San Francisco and Oakland, California. Stuf works with commercial property owners to monetize vacant space in buildings, create new cash flow opportunities, while providing neighborhoods with a safe, warm, and welcoming environment to store personal items, business inventory, and more.

“The missing piece in self-storage, especially in densely populated areas like the Bay Area, is reliable and conveniently located options. By using underutilized space, we can provide facilities for all needs of locals and businesses nearby, ”says Co-Founder and CEO of Stuf, Katharine Lau. “On the other side of the same coin, our model enables new ways to monetize commercial real estate. Our mission at Stuf is to work with real estate owners to capitalize on the increasing shift to more flexible living and working, and how it leads to more flexible storage needs. “

Stuf is new San Francisco The self-storage location at 115 Sansome Street is owned by the Vanbarton Group. This will be the startup’s second location in town and act as a neighborhood warehouse for businesses and consumers to store everything from seasonal items and lightweight furniture to easily accessible inventory. Located in the heart of the financial district, Stuf’s newest location is in the basement of the approximately 118,000 square meter office building. The room was previously used as a warehouse for overflow buildings; However, Stuf is now generating a new source of income by using the unused space.

Stuf’s city center Oakland The location at 521 16th Street brings new life to a largely unused basement in an approximately 61,000 square foot office building. Since moving in and renovating, Stuf has been serving office tenants throughout the building, as well as neighboring small businesses and residents who need additional space, with its self-storage offer.

“Before Stuf moved in, our basement was underutilized,” says Westlake Realty Asset Manager, Jeffrey Bak. “Now our building has technology-enabled storage that is both welcoming and easily accessible, and our tenants are actually using it at levels. We believe this is a new and unique amenity that will greatly benefit office owners.”

In addition to new openings, Stuf currently also operates full-service self-storage in Brooklyn, New York, with locations in The angel, Washington, DC, and Manhattan should open at the end of 2021.

About Stuf
Stuf is a next-generation self-storage startup bringing modern, technology-enabled storage solutions to consumers. Stuf works with property owners to monetize basements, garages, and other spaces in commercial buildings, creating new cash flow opportunities while adding new amenities to neighborhoods. Whether you’re running out of space or looking for seasonal storage, Stuf prides itself on being the home for people’s possessions. Further information and team opportunities can be found at https://stufstorage.com.

Media contact
Ryan Bender
Clarity PR
(818) 917-3663
[email protected]

SOURCE Stuf

related links

http://stufstorage.com/

The post Self-Storage Startup Stuf Pronounces New Places in San Francisco and Oakland appeared first on Los Gatos News And Events.

Kunal Gupta and Joe Ahearn, New Yorkers in 2018, began working on a startup called Withfriends. The idea was to help small businesses build revenue through subscription boxes — think monthly payments for merchandise like vegetables, flowers or shirts.

Once they decided the startup was legit, the two headed for San Francisco. When Ahearn finds a place to live and Gupta moves into the  Mission District this weekend, they won’t be the only newcomers. They’re part of a trend, according to more than two dozen people who were interviewed — real estate brokers, property managers, tech investors, tech workers and others with a pulse on the local tech scene. 

There are predictions aplenty on how the ascent of remote work will ultimately change the local scene, now that tech workers can avoid the city’s high rents by toiling remotely. However, despite a year and a half of news about a tech exodus — and with it, the narrative that San Francisco has become unappealing for the tech industry — interviewees said that as California reopens, young tech workers, especially those in startups, are coming to San Francisco.

“You don’t lose the deep roots of Bay Area innovation overnight,” said Danielle Lazier, who’s a been selling real estate in San Francisco since 2002. “Young people are coming back or want to be here, and, anecdotally, that’s what I hear about rentals.”

“You don’t lose the deep roots of Bay Area innovation overnight. Young people are coming back or want to be here, and, anecdotally, that’s what I hear about rentals.”

Danielle Lazier, of Danielle Lazier real estate

Gupta, in fact, won’t be alone in the city or in his Mission District abode. He’s moving in with four other founders or co-founders of new startups. 

The reasons for relocating to San Francisco are not all that different from those that have been drawing tech aspirants since the late 1990s. They range from the general, more universal appeal of San Francisco to those more tech-specific rationales, such as the wealth of venture capitalists here and a network of tech workers to engage with — especially when pursuing a startup.

 “You wake up, go to work, dream about it. Wake up, go to work, dream about it. It’s not work. It’s who we are. I don’t know many other places where you can be what you do in the way that we are besides San Francisco,”  said 22-year-old Mina Mortchev, who is launching a travel start-up after graduating from Duke University in the spring.

Changes In Real Estate

Real estate agent Mia Baldini said she saw an uptick in tenant applications once California’s June 15 reopening was revealed. 

She had two residential tenant applications from tech workers in hand when she picked up my phone call in early July. A real estate agent at Baldini Property Management, which oversees nearly 200 units mostly in San Francisco, she got only one or two applications a month earlier in the pandemic. Now she gets three to five a week. 

Among them, a good portion work in tech, and most are younger, she said; perhaps too young to remember the tech meltdown of 2001. Maybe 70 to 80 percent are working for well-established companies, and the rest are with startups.

“I think [the reopening] definitely jump-started something in people’s minds, like, ‘Hey, there’s an end date in sight — things are going to start going back to normal soon,’” Baldini  said.

Younger people in particular are drawn to urban spaces by jobs and a desire to socialize and experience urban life, said many of those interviewed. There were two classes of college graduates during the pandemic, many of whom have waited to move out. Often, younger residents are more willing to pay the city’s exorbitant rents to live in a small place, given that they usually haven’t started a family yet.

“You wake up, go to work, dream about it. Wake up, go to work, dream about it. It’s not work. It’s who we are. I don’t know many other places where you can be what you do in the way that we are besides San Francisco.“

MINA MORTCHEV, CEO AND FOUNDER OF THE TRAVEL STARTUP PATHBREAKER

“If you’ve been somewhere for a while, you’re sort of done hanging out,” said Ahearn, one of the cofounders at Withfriends. “Not all people are like that, but a lot of people build up their network and know more people than they know what to do with. They don’t need to be able to go out to a bar on a whim or go get a coffee with somebody — they’ve had enough coffees.”

Jamie Comer, a real estate broker at Kindred SF Homes, said that since the end of May she’s heard plenty of discussion in her circles about folks in their 20s to mid-30s planning to move in around August and September — of them, around 60 percent work in tech, 15 percent  in financial services and 15 percent in humanities, the latter often writers hoping to work in tech. So, she expects “a really big boom” of younger people moving in by mid-spring 2022.

“What happens is, Jeffrey, Patty and Shelly come out here, then Victor, Ashley and Kate come later; companies and cultures will develop, where there’s enough people and enough work that there’s the boom,” Comer said. “And then, there’s the echo boom. The echo boom is frequently even bigger than the initial one.”

Interest is brewing

Over the last year and a half, foot traffic at Atlas Cafe — where owner Bill Stone estimated that around half of his customers work in tech — averaged roughly half of what it was before the pandemic. But at the end of June it was back up to 75 percent, with an uptick since the reopening, Stone said.

At Haus Coffee and the Sightglass Coffee shop in the Mission, where workers also estimated that half of their customers work in tech, baristas saw similar returns toward normal levels.

Mike Luangrath, a longtime barista at Haus Coffee, said that business dropped to around 30 percent of what it was prior to the pandemic. But it rebounded after June 15 and increased to around 50 percent as of late June. Jocelyn, a barista at Sightglass Coffee, said the number of customers increased from around 200 a day in early June to around 300 at the end of the month.

“It seems like more people have moved into the city, and it seems like those tech people that have left in the pandemic are moving back as well,” Luangrath said.

Traffic definitely picked up at the Hedge Cafe in May. 498 Alabama St, May 27, 2021 Photo by Lydia Chávez

An Ideal Place For Startup Culture

For Mortchev and her startup chief marketing officer Carmela Guaglianone, also 22 and a recent graduate from Duke University, moving to the Mission went along with expediting the creation of the Pathbreaker, a platform that allows people to map and share their travels. They hope in the future, people can choose their paths using filters, such as “solo woman traveler” or “LGBTQ+ traveler.”

Making it become a reality is a day-in, day-out pursuit. There’s nothing, Mortchev said, that she believes in more. 

And in San Francisco, she’s surrounded by like-minded entrepreneurs. 

Here, there’s serendipity aplenty in a dense 7-mile-by-7-mile space, where it’s normal to bump into other founders as well as the investors and the venture capitalists who fund projects. 

“We talk to anyone we meet, they say, ‘What’s up?’ We talk about Pathbreaker,” Guaglianone said. “It’s not just in San Francisco, but the difference in San Francisco is that people seem to have kind of a better foundational understanding by proxy as to what the process means or what being in a startup means and how that process works and how investments are structured and how your work schedule is going to go.”

“We talk to anyone we meet, they say, ‘What’s up?’ We talk about Pathbreaker.”

Carmela Guaglianone, chief marketing officer at the travel startup pathbreaker

Guaglianone noted that of their graduating class of more than 1,000, she knew very few who were in startups, likely due to the pandemic. But those who were have moved to San Francisco, she said. She’s heard little among her peers about the city’s highly publicized lack of appeal compared to other tech hubs.

Capri Wheaton, the 19-year-old CEO and cofounder of the startup Thryft, has seen interest among her peers and startup founders in moving to San Francisco. 

“A lot of my friends, and other young people and startups that I know and really look up to and have a great time with, are also going to be in San Francisco,” said Wheaton, who’s moving into the Mission with Gupta, one of the tech founders from New York.

A passion for sustainable fashion pulled her off of her path toward law school at UC Berkeley. She returned to her home in Newburg, a suburb near Portland, Ore., when classes went online. Come July last year, she decided to pursue her startup full time.

She attended and graduated from the startup incubator Y Combinator from January to the end of March this year. When the original startup idea proved logistically infeasible, she pivoted to helping microbusinesses turn their Instagram page into a website in under a minute, starting with the secondhand clothing market.

On March 30, she put out a call online for a hackerspace in San Francisco to save money and received much interest from other startup founders, she said.

“The reason why San Francisco was appealing to me is, all of my friends are there,” she said. “And, a lot of the companies that were in the Y-combinator batch before me or in my batch or in this summer ’21 batch that’s coming up, they’re all living in San Francisco or moving to San Francisco right now.”

Here, the vast majority of conversations are tech-oriented, and at their new home, they’ll be able to bounce ideas off each other, she said. She knows of at least one other hacker home with multiple startup founders a 15-minute walk away.

“I think everyone’s craving social connection after the pandemic, so I think that makes sense as to why a lot of people are moving to the city around friends,” she said.

The Mission, she added, seemed like an ideal more affordable place than, say, Noe Valley or Hayes Valley.

So, when it comes to the sun supposedly setting on this city, she isn’t seeing it.

Younger startup founders moving into hackerspaces is something that Comer, the real-estate broker, has seen for a long time.

“You can’t really invent and learn in a vacuum,” Comer said, echoing other interviewees. “You actually have to sort of be in the same space and have small conversations and answer small questions, or observe what other people are doing in order to continue to actually master a craft and also stay at the forefront of invention.”

Gupta, Wheaton’s roommate, said that if anything, he expects the exodus to open up room for early stage startups to move in.

“The more tech exodus there is, the better outcomes are for startups, assuming that the tech exodus is people who are not at the startup stage but at a later stage — people who don’t need to live in the city anymore,” he said. “If later stage people leave and early stage people come in, that’s good for startups.”

“The more tech exodus there is, the better outcomes are for startups, assuming that the tech exodus is people who are not at the startup stage but at a later stage — people who don’t need to live in the city anymore.”

Kunal Gupta, CO-FOUNDER OF THE SUBSCRIPTION BOX STARTUP WITHFRIENDS

Local appeal in a remote world

Being able to meet in-person is exactly why Wheaton relocated from Newburg down to Sunnyvale in February.

She wanted to be closer to her cofounder Sam Yang. He’d drive from Cupertino every day so they could work in person, and though they were doing separate things, it was really helpful working in the same space, she said.

“With Zoom calls and phone calls you’d think it’d be easy to do remote work, but there are still lags in communication,” she said. “You can’t really walk over to someone’s room or walk to their house and brainstorm on something, so you need to schedule in actual time to brainstorm. It just ends up being not the most effective way to work.”

Steve Hoffman, the CEO and chairman of the incubator Founders Space and the author of three books on startups, said he’s long pushed back against the idea that remote work will replace in-person work for startups.

“You won’t have that same degree of bonding and connectedness with remote work in almost every case that you will when people are together in the same physical space,” he said. 

He added that relationships developed online tend to be more transactional, whereas those in-person are deeper and more meaningful — relationships where peers will go further for one another.

“When I’m in China, they won’t do business that requires any sort of trust without multiple meetings at the dinner table,” he said. “It’s all about relationships and meeting people in person, and if you can’t do that, good luck getting done with real business in China.”

That’s true in most cultures, and absolutely the case in the Bay Area, he said. 

Interactions are richer too, he added, as people pick up facial cues and gestures they may not notice over Zoom. Even small talk, he said, tends to be shallower over Zoom than it is in-person.

“Remote connections are more two-dimensional; there’s this barrier in between you because you’re not physically present with all your senses,” he said. “I firmly believe that as animals who have evolved for hundreds of thousands of years, the human species, this intimacy of human interaction is something that is essential to our ability to trust and relate to other people and form really deep connections in groups.”

For example, he said, if someone were to ask him for a connection with a person in tech, those who would come to mind would “almost invariably” be those he spent time with in person rather than met online, even if the time spent with each was the same.

Entrepreneur-turned-investor Santiago Corredoira Jack, a former San Francisco resident who moved to London in May to join the communications services company VEON, said he expects the spread of remote work to help temper the pull of San Francisco to tech workers compared to other viable, new tech hubs. But he still sees the city retaining its allure.

“There’s no other city in the world that is so global, being so intimate.”

Santiago Corredoira Jack, group director investments at veon group

Beyond the restaurants, parks, different cultures and all else, it’s the entry door of Asia in the U.S. and one of the main doors of Latin America, as well as the nation’s premier urban tech hub, Corredoira Jack said. And, it’s uniquely dense — unable to grow further due to being a peninsula, whereas it’s easy to get lost in cities like London, he added.

“There’s no other city in the world that is so global, being so intimate,” he said.

The post Older tech staff could also be leaving San Francisco, however the younger and hungry — together with these with startup goals — are shifting in appeared first on Los Gatos News And Events.

Diving letter:

• Medical billing startup Cedar is acquiring health tech company Ooda Health for $ 425 million in a mixture of cash and equity, thereby entering the insurance market for the first time.
• Cedar, based in San Francisco, works in the complex billing process between patients and providers and can now also integrate insurance bills into its platform.
• The move is intended to help the fintech player expand its products to focus on new functionality built into both the payers and providers, Cedar said, and to more automate the billing workflow. The transaction is expected to close this month, subject to required regulatory approvals.

Dive Insight:

Medical costs in the US have skyrocketed for years, causing more patients to go through a fragmented and complex billing process that is slightly confusing at best and a direct detriment to their financial health at worst. One in ten US consumers says they won’t pay their bills if they don’t understand the administrative process. This comes from a 2020 study that Forrester Consulting conducted on behalf of Cedar.

Streamlining the payment process can then make consumers more likely to pay their bills, which can reduce administrative burdens for payers and providers and contain rising costs. According to studies, administrative costs account for between 8% and 25% of all national health expenditure.

These high costs could be reduced if the numerous routine transactions were digitized, according to a McKinsey report from 2019.

This is a major destination for healthcare fintech startups like Cedar. With the acquisition of Ooda, Cedar will bring both the provider and payer side of the billing process into its payment platform, which is currently used by more than 12 million patients annually to pay a pending bill, review their insurance, or review their copayment before a doctor’s visit.

Ooda enables consumers to receive a single statement from their payer, which includes deductibles and various payment options, rather than a few records of performance, itemized invoices and other documentation.

Ooda’s platform connects workflows for approximately 20 organizations including CommonSpirit Health, Arizona Blue Cross Blue Shield, and Massachusets Blue Cross Blue Shield. Cedar currently works with 35 providers across the country including Summit Health, Yale New Haven Health, Novant Health and ChristianaCare.

Cedar, which was founded in 2016, saw significant growth over the past year during the digital health boom of the coronavirus pandemic. Cedar said the size of its business quadrupled over the course of 2020, and investor interest also increased. Recently, a $ 200 million Series D funding round was closed. That brings total funding to more than $ 350 million and valuation of $ 3.2 billion, the company said.

Florian Otto, CEO of Cedar, will continue to serve as chief executive for the combined company, while Seth Cohen, CEO of Ooda, will continue to serve as President and join Cedar’s Board of Directors. The combined company will be headquartered in New York City with additional offices in San Francisco and Salt Lake City.

The board of directors of Cedar and Ooda and the shareholders of Ooda have already approved the transaction.

The post Medical billing startup Cedar to amass Ooda Well being for $425M, shifting into insurance coverage market appeared first on Los Gatos News And Events.