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The DL - July 2020 PNW Venture Deals, 31 Portland Startups, Real Estate Tech, and Viral Growth (According to TikTok)

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Welcome to The DL, a weekly newsletter about tech, startups, and investing in the Pacific Northwest.
 
August 10 · Issue #60 · View online
The DL
Welcome to The DL, a weekly newsletter about tech, startups, and investing in the Pacific Northwest.

This week’s issue looks at July 2020’s PNW Venture Deals, a project to launch 31 startups in 31 days, what’s happening in the real estate market, and how to ignite viral growth (according to TikTok)

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July 2020 PNW Venture Deals
Here are the PNW startups that announced new fundraising rounds in the month of June. These 23 companies raised more than $500M last month!

Series B and Later Rounds 🚀
  • Qumulo – File data platform built for the cloud - $125M Series E led by BlackRock
  • Auth0 - Identity and authentication platform - $120M Series F led by Salesforce
  • Remitly – International money transfer platform - $85M Series F led by PayU
  • Puppet - Infrastructure automation and delivery - $40M debt financing led by BlackRock
  • LOGE - Hotels for outdoor lovers - $15M round
  • LumiThera - Medical device intended to prevent vision loss - $14M Series C led by WaterStar
  • Curvafix - Curved medical screws for pelvic fractures - $10.75M Series B led by Sectoral
  • Polyarc - VR action-adventure puzzle game- $9M Series B led by Hiro Capital
  • JetClosing - Mobile-first title and escrow company - $8.57M Series B led by Trilogy
  • Kollective - Enterprise content delivery networking infrastructure - $6.93M Series C1

Series A Rounds 🛫
  • Tasso - Patient-centric blood sampling kits - $17M Series A led by Foresite
  • Wyze - Smart home cameras and devices - $15M Series A1
  • Shelf Engine - Prediction engine for perishable goods - $12M Series A led by GGV
  • Liquid Wire - Stretchable and flexible circuits - $10M Series A led by Deerfield Management
  • AstrumU - Predictive individual learning scores - $7.65M Series A led by Kingdom Capital

Seed Rounds 🌱
  • HighKey - Keto cookies, cereal, and snacks - $9.5M Seed
  • VodaSafe - Sonar water rescue device - $1.4M Seed led by Vanedge and BDC
  • Joe - Mobile coffee ordering app - $1.3M Seed led by Craft Ventures
  • Ideon Technologies - Cosmic-ray muon tomography - C$1.3M Seed led by UBC Seed Fund
  • Killer Creamery - Keto-friendly ice cream - $945K Seed led by Sage Capital
  • MilkRun - Local grocery delivery service - $690K Seed
  • RipeLocker - Containers to extend shelf-life of produce - $676K Seed
  • Drop-in Gaming - Gaming tournament platform - $500K Seed

M&A and IPOs 💥
  • Accolade - Member engagement services for healthcare and benefits providers - $220M IPO
  • Porch - Home services platform - SPAC merger valuing the company at $523M

Thoughts and Observations 🧐
  • July was all about later stage deals, which created three new $1B+ companies (Qumulo, Remitly, and Accolade)
  • There is a slowdown in seed deals, especially for software companies
  • Accolade went public in an IPO, but Porch went public through a merger with a SPAC. With so many people raising SPACs, it will be interesting to see how many SPAC transactions get done this year

31 Portland Startups
Cool project from Portland entrepreneur, Mark Grimes, who is challenging himself to launch 31 startups over 31 days in the month of August.

According to Mark, “Every business I’ve started since 1989 has been cash flow positive in less than 90 days,” so his goal is to see how many of these startups he can get to cash flow positive by the end of November.

Pretty fun to follow along in his (very quirky) stream of consciousness “journal” and read the feedback he is receiving from others at the bottom of the doc. If you want to follow along, you can sign up for his email list here.

Real Estate Craziness
One of my pandemic hobbies is browsing Redfin and Zillow to see what kind of house I could buy if I didn’t live in downtown Seattle. Of course, everyone else had that idea, too, so home sales are going through the roof.

As an investor, one of my pandemic hobbies should have been buying Redfin and Zillow stock. In March, Redfin was trading as low as $10, and Zillow bottomed out at $18. Now, they are both up 4.5x over the last 5 months to ~$44 and ~$80, respectively.

Both companies are saying this is a once-in-a-generation opportunity for real estate tech companies as the pandemic has changed what homebuyers want, where they want to live, and how they use technology. This is definitely a space to watch over the next few years, if only to get more fantastic Glenn Kelmann quotes:
Redfin Q2 Earnings Call: We’re running naked through the jungle with a Bowie knife clenched between our teeth, which is the way Redfin was born to be.

Other stuff Dan's talking about
🔒 Public to Private Equity - PE and VC firms are taking over the investment world. One stat: <1% of Amazon’s value was built in the private market, 3% of Google’s, 17% of Facebook’s, and >100% of Uber’s
📈 How High Frequency Trading Works - Great blog post from the winner of a UChicago Trading Competition on how the code behind trading bots works and how “market makers” make money
☠️ Harbinger Zip Codes - Apparently, there are zip codes where people systematically buy new products that fail, donate to losing political candidates, and pick bad investments. Wish I could buy the list of zip codes!
🔥 How to Ignite Viral Growth - Fantastic interview with Alex Zhu (founder of Musical.ly). Love this bit at 10:22 when he compares building a new community to founding a new country and creating a thriving economy

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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