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The DL - April 2020 PNW VC Deals, MSFT, AMZN, and Some Random Bar's Earnings

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Welcome to The DL, a weekly newsletter about tech, startups, and investing in the Pacific Northwest.
 
May 4 · Issue #46 · View online
The DL
Welcome to The DL, a weekly newsletter about tech, startups, and investing in the Pacific Northwest.

This week’s issue covers April’s PNW venture deals, highlights from Microsoft and Amazon’s earnings, and a Seattle restaurant’s actual P&L numbers during quarantine.

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April 2020 PNW Venture Deals
Here are the PNW startups that announced new fundraising rounds in the month of April. Despite the COVID slowdown, these 28 companies raised $220M+ last month!

Series B and Later Rounds 🚀
  • 98point6 – On-demand, text-based primary care platform - $43M Series D
  • Avalyn - Biopharma company developing therapies for idiopathic pulmonary fibrosis - $35.5M Series B led by Norwest
  • Vera Whole Health - Operator of 26 clinics that offer advanced primary care for employers and insurers - $10M round
  • Laird Superfood - Organic food brand producing creamers, mushroom blends, and freeze-dried coconut water - $10M round from Danone
  • Ayogo - Engagement platform designed to measure and monitor perceived self-efficacy - $7.5M Series B led by Merck
  • Blaze Bioscience - Biotech company developing “Tumor Paint” to improve surgical outcomes - $5M Series B2
  • Qorus - Sales enablement platform for building personalized proposals and presentations - $5M round led by WestRiver Group
  • Buurst - Dedicated cloud NAS and hybrid cloud data platform - $5M round

Series A Rounds 🛫
  • OctoML - Platform for optimizing and automating the deployment of ML models - $15M Series A led by Madrona and Amplify
  • Rodeo Therapeutics - Small-molecule therapies for enhancing tissue repair and regeneration - $9M Series A1
  • GrowFlow - Compliance software for cannabis growers, processors, and retailers - $8.75M Series A led by TVC Capital
  • Form - Augmented reality swimming googles - $8.5M Series A
  • Rebellyous Foods - Nuggets made from wheat, soy and other plant products- $6M Series A led by Clear Current Capital
  • AuthorDigital - Storytelling game designed to connect players across disparate genres - $5.5M round from Super.com
  • Intelage - Trade platform for suppliers, buyers, logistics providers, and financial institutions - $5M round led by Blumberg Capital
  • Jenny Life - Exam-free life insurance policies for busy parents - $3.5M Series A led by CMFG Ventures

Seed Rounds 🌱
  • Sila - Banking, digital wallet, and ACH payments API - $7.7M Seed led by Madrona and Oregon Venture Fund
  • Center - Real-time expense software and corporate debit card for mid-market companies - $5M round
  • NextStep - Learning and hiring platform focused on training CNAs and Certified Caregivers - $3.6M round led by SpringRock
  • Gemma Labs - Direct-to-consumer haircare company offering personalized shampoos and conditioners - $3.5M Seed
  • Imperative - Peer-coaching platform to empower leaders and managers - $3M Seed led by Voyager
  • Damon Motorcycles - Electric motorcycle with advanced sensor system to track objects around the motorcycle - $3M Seed
  • Asensys - High-performance blockchain system based on asynchronous consensus zones - $2.7M Seed
  • Megh Computing - FPGA platform for real-time streaming analytics - $2.5M round led by Vulcan
  • Bateau - Compliance software for managing operations at multi-location businesses - $1.5M Seed led by Founders’ Co-op
  • Myosana Therapeutics - Gene therapies that slow skeletal muscle degeneration and heart failure - $1M Seed led by CureDuchenne
  • Unison Migraine - Biofeedback therapy to decrease and prevent migraine pain - $500K Seed

M&A and IPOs 💥
  • Shiftboard – Employee scheduling software - $8M fundraise and merger with Vancouver-based SchedulePro
  • Cloudneeti - Cloud security and compliance software - Acquired by Zscaler

Thoughts and Observations 🧐
  • Not sure if it’s coincidence, but definitely more deals in life sciences, healthcare, and food last month
  • Local VCs are on 🔥! New deals by Founders’ Co-op, Vulcan, Voyager, SpringRock, Oregon Venture Fund, WestRiver Group, and Madrona!

Support Science Education at PacSci!
The Pacific Science Center is one of the leading science museums in the country, so it’s easy to forget that they are struggling right now because they do not receive public funding, and two-thirds of their revenue comes from ticket sales.

Last week would have been their annual fundraiser, but now that we are all virtual, it’s even easier for you to learn about all of their great work…
🤓 If you were (are?) a nerdy kid like me who loves science museums, please support PacSci to help them bring STEM education to more kids.
Earnings Highlights from Microsoft and Amazon
Microsoft: “As COVID-19 impacts every aspect of our work and life, we’ve seen two years’ worth of digital transformation in two months
  • Beat expectations on revenue ($35B) and profit ($10.75B)
  • 75M daily active users on Teams
  • 59% growth in Azure revenue
  • 10M subscribers to Xbox Game Pass
  • Slowdown in sales to SMBs and industries impacted by COVID, consulting projects, and advertising spend

Amazon: “If you’re a share owner in Amazon, you may want to take a seat, because we’re not thinking small
  • Beat expectations on revenue ($75.5B); fell short on profit ($2.5B)
  • Expects to spend $4B next quarter on COVID-related expenses
  • Increased grocery delivery by 60% but still not meeting demand
  • AWS revenue grew to $10.2B, lower than expectations because of less spend from travel and hospitality customers

Actual P&L from a Seattle Restaurant
“Why are you still open? Pride, ego, hope… I believe the harder I work the more successful I will be”
The owner of Some Random Bar posted a very sobering video breaking down his restaurant’s economics during the quarantine and its prospects going forward. Some key stats:
  • They lose more money staying open than closing down
  • From March through May, they are on track to lose more than $30K (how many small businesses have that kind of cash sitting around?)
  • Right now, they are doing $40K in sales, but they need $60K just to break even

So what about all of the COVID relief funds for small businesses? After losing $12K+ in April, Some Random Bar had to raise money on GoFundMe to make rent because their bank - and 17 others - did not have the capacity to process their PPP application.

There are lots of articles on COVID’s impact on small businesses, but it’s surreal to see the numbers and hear the story from the restaurant down the street. Please support your local businesses if you can!

Other stuff Dan's talking about
^ $450B website
^ $450B website
📠 BerkshireHathaway.com - Huh. Didn’t know websites could still look like this. It’s actually very nice to navigate and browse. Designers, what do you think? (btw - check out Warren Buffet’s slides)
⚛️ Quantum Computing - This quantum computing explainer is so cool. It’s a “new kind of book” that is supposed to make it easier to remember what you read. Let’s see if it works!
🎵 Jukebox - So AI can write lyrics and sing now. Pretty mindblowing. Check out the sample explorer and type in your favorite artists. And scroll down to the timeline to see/hear how the system has improved since August
👩‍⚕️ Amish Health Care - As we debate who is going to pay for coronavirus testing, here’s an interesting read on how the Amish pay for healthcare and why their healthcare costs are lower

Please hit reply! (Or subscribe or forward!)
About me: I work as an investor at Madrona Venture Group, a Seattle-based venture capital firm that has been early partners with companies like Amazon, Smartsheet, Apptio, and Redfin.
If you have thoughts, questions, or comments, hit reply! If you’re new, check out some of the DL’s top articles from the last few months:

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