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Inside Venture Capital (Nov 7th, 2019)

Today's Goldilocks features Ali Moloo, CEO and co-founder of US/Sri Lanka-based myDigitalOffice, which recently raised $4M and provides an end-to-end management platform. Scroll down to reads Ali's thoughts on united disparate teams' goals, and more.

  1. SoftBank Notches a $6.5 Billion Loss on Plunging WeWork and Uber Valuations: Fortune reports.
  2. The evolution of the Spanish VC ecosystem — 2019 edition: Jaime Novoa of the Madrid-based K Fund breaks down the internal numbers and compares them to international norms.
  3. Coveo (Canada), AI-based customer experience platform for scaled companies: $27M led by Omers Growth Equity, participation from Evergreen Coast Capital, FSTQ, IQ.
  4. MaaS Global (Helsinki, Finland), route-planning, booking, ticketing and payment options for various modes of transportation: $59.5M from BP Ventures, Mitsui Fudosan, Mitsubishi Corporation, Nordic Ninja.
  5. Bowery (Kearny, NJ), indoor farming company: $50M B from Temasek.
  6. Immersive Labs (Bristol, UK), on-demand gamified cyber skills training platform: $40M led by Summit Partners, participation from Goldman Sachs.
  7. Eight Sleep (New York, NY), temperature, data, etc.-based sleep health platform: $40M led by Founders Fund, participation from Craft Ventures, Khosla Ventures, Y Combinator, 8VC, Ryan Petersen, Kevin Hartz.
  8. Pops Worldwide (Vietnam), digital entertainment firm: $30M from Eastbridge Partners, Mirae Asset-Naver Asia Growth Fund, Mirae Asset Financial Group, Naver Corporation.
  9. Acticor Biotech (Paris, France), treatment for acute phase of thrombotic diseases: $24.7M led by Go Capital, participation from Newton BioCapital, CapDecisif Management and Anaxago.
  10. Productiv (Palo Alto, CA), SaaS application engagement analytics platform: $20M B led by Norwest Venture Partners, participation from Okta Ventures, Accel.

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Funded companies today include a social network for African American professionals, and more.

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--Goldilocks--

Featuring: Ali Moloo

myDigitalOffice is an end-to-end information management platform for sourcing, processing and storing hospitality data in the cloud. Our SaaS solutions help hotel owners, operators, franchisees and hospitality REITs manage property and portfolio performance to a tee. The visibility, connectivity, and control delivered by our cloud-based dashboards, document management software and integrated data feeds allow teams to reach greater levels of productivity, ensure regulatory compliance, and reduce environmental impact while optimizing profitability.

1. What was the inspiration for myDigitalOffice? Were there any personal situations you encountered that gave you the idea, or was the reasoning something you saw in the market?

Running an office product company, I had quite a bit of exposure to a wide array of business challenges and how companies were attempting to solve them. Companies of all sizes were our core customers, purchasing tons (literally) of paper products. 

To me, massive amounts of paper indicate a weighty reliance on manual processes. From an environmental standpoint, the paper and toner supply chain needs to be cleaner for the health of our planet and its people. All this paper purchasing for paper processes was unsustainable for business growth and for the environment.  I decided I wanted to be part of the solution, and I wanted to do it right. 

I started picking our customers’ brains and learned they truly wanted to go paperless - some were even partially paperless - but available digital systems lacked compliance and security. In this, I identified a need for a formal process. Next, I widened my voice of the customer approach, speaking with many more business owners and managers. From that due diligence, I learned I would need to go deep to provide a meaningful solution in a cost-effective manner. 

I did more research about the differences between industries, including standards and regulations, and realized there was no choice but to pick an industry to start with. I had personal exposure to the hospitality industry and saw a painful need for back-office transformation there. It was shocking and exciting all at once, and it was the clear direction to pursue.

2. You raised a $4M round led by FINTOP,  what were you looking for with your new funding? How has your business plan changed with the fresh capital?

Leading up to our Series A, we experienced significant revenue growth due to a few calculated decisions and some dumb luck. At that point, our Series A was going to be all about scaling sales and marketing. Once we connected with FINTOP - the lead investor for our Series A - and had deeper discussions, our objective evolved. Now we’re more focused on accelerating the product roadmap.

3. Did you find the investors you were looking for, or did you find funding in an unexpected place?

We didn't have any surprises and it was all according to plan in terms of the sources. In addition to FINTOP, we had repeat investors from our seed round who doubled down on their belief in myDigitalOffice for the Series A. It’s a great feeling to know they have strong confidence in the company, the leadership team, the market opportunity, and our technology.

4. How did you pitch your company? - What were the metrics you were most inclined to put forward, which did you think didn’t show you in such a good light? 

We led with the pain that our solutions solve - and we tried to show it in our imagery. We talked about total addressable market, projected EBITDA from the current business at specific growth rates, and potential new revenue streams. We also shared quotes from current customers and illuminated their personas so potential investors could understand our key audience demographics and psychographics. 

5. Were there any ‘I can’t believe that just happened’ moments during your pitches? Was there a moment when you knew that an investor was going to make an offer?

It all happened so fast, which was the biggest ‘I can't believe that just happened’ moment. We pitched a bit, got strong interest with real follow up, and wrapped up the round. The key was that we had a market-validated product by that point. myDigitaOffice solutions were in use at over 700 properties, and we were in the middle of implementation for a global brand with another couple thousand properties. When you have validation like that, the ask to investors becomes much more straight forward because business viability is proven.

6. How is it to operate both in Sri Lanka and the United States? What problems and advantages do you encounter being active in both countries?

The challenge with distributed teams is cultivating shared objectives, accountability and a sense of urgency. We’ve recruited immense talent in both Sri Lanka and the US, and it shows. Our problems are mostly limited to coordinating national holiday schedules between the two countries. The teams in both Sri Lanka and the US have intuitively adopted a rhythm, processes, and tools to collaborate successfully. 

7. What do you feel like your competition is? What sort of plans do you have to further distinguish yourself from other startups?

We compete with legacy tools like spreadsheets, early industry technology from the 1990s, and many homegrown situations - and “situations” is the right word for that. We have direct competitors as well. I take selfies with those folks at tradeshows - it’s friendly competition. We’re differentiated in several important ways. First, we have a defined company culture in service of digital transformation, integrity, diversity, passion, purpose and environmental sustainability. Second, we’re relentlessly lean in the way we operate, invest and spend. Third, we constantly listen to the voice of the customer, consider the input and iterate. It’s working for us.

Today's funding was broken down into 16 categories.

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Inside VC's writer/curator Stephen currently lives in Berlin and is pursuing a Master's degree in philosophy. He otherwise enjoys cooking Indian/Southeast Asian cuisine, received his Bachelors in NYC, and lived almost two years in Bucharest.

Editor: Kim Lyons (Pittsburgh-based journalist and managing editor at Inside).

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