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LA Tech Week: NFT Cocktails, Sushi and Networking
Andrew Fiouzi
Andrew Fiouzi is an editor at dot.LA. He was previously a features writer at MEL Magazine where he covered masculinity, tech and true crime. His work has been featured in the Los Angeles Times, Long Reads and Vice, among other publications.
Roughly 13 hours after venture capital kingmaker Andreessen Horowitz announced plans to invest $350 million into WeWork founder Adam Neumannโs new residential real estate company, a handful of fedoras are floating through a room of mostly 20-something startup founders, influencers and tech people hoping to rub shoulders with their angel. Iโm at L.A. Tech Weekโs opening night mixer at Famecastโs creator brand accelerator studio in Santa Monica.
The eventโwhich is hosted by Zeal Reserve, 99 Ventures and Moonshots Capital, among othersโis one of the final get-togethers in a day packed with nearly 40 others. Some of which included: an investor breakfast at Hermรจs, a lunch and fireside chat about the state of the climate hosted by venture capital investment company Blue Bear Capital, a number of crypto-centered happy hours and a yacht cruise.
Upon entering the Famecast studio, 400-some-odd guests step onto a red carpet where they pose for photos in front of a white background littered with names of the companies hosting one of L.A. Tech Weekโs notoriously-difficult-to-get-into events: The running joke on Twitter is that L.A. Tech Week events are โharder to get into than Harvard.โ Which, based on the number of people at the cafe meetup earlier in the day, who tell me their registration was either denied or โpending approval,โ appears, at least anecdotally, to be true.
Inside Famecastโs West L.A. warehouse space, neon lights bounce off red brick walls. In the front of the house a few startup founders and people who are โlooking for a side hustle,โ are sitting in chairs suspended to the ceiling and huddled around a floating conference table covered in yellow, purple and red cans of rosรฉ. To the left, an installation of sorts featuring forward-facing chrome, human-shaped heads wearing headphones. Between the make-shift sushi bar and the bathroom, a woman is selling Bluetooth audio sunglasses for $100 less than the glasses typically retail.
As you make your way to the back of the warehouse, a DJ with shortly cropped bleach hair wearing white sunglasses is spinning records in front of a projector screen illuminated with a miasma of familiar NFT characters. Yes, thereโs an ape. And yes, itโs of the Yacht-Club variety. Throughout the night, Iโll hear people tell me that the project theyโre working on is either an NFT or โlike an NFT.โ
One such individual is Alec Joseph, a musical artist and the co-creator of Conscious Cups which brands itself as, โa society of used coffee cups, awoken by radioactive mycelia in the Great Pacific Garbage Patch.โ The project appears, to me at least, to be a clever way for Joseph to promote his upcoming single โConscious Cups.โ The way it works is that people who purchase one of Josephโs NFTs will have access to an exclusive Discord channel where they can connect and contribute to the project. Per Conscious Cupsโ LinkedIn profile, holders of Conscious Cups NFTs will have the opportunity to get their profile pictures featured in one of Josephโs upcoming music videos.
For better or worse, however, the room isnโt exclusively made up of web3 people. Ann Chan, a former product manager at Meta is the founder of Berry, a frictionless drop-in audio chat app for remote teams that need to discuss and resolve issues. Chan, who I met earlier at the L.A. Tech Week cafe meetup, is at the mixer to network and meet other founders who might be interested in using Berry as they test and develop the product. When I run into her towards the end of the evening, she tells me sheโs struggled to meet founders with large enough teamsโwhich is something she needs since her app is geared toward teams that have enough people to be naturally plagued by conflicts in their schedules.
Yet another non-web3 project is Roman and John Crestoโs Empire ECommerce โ a one-stop, automated service provider for marketplace e-commerce stores. In layman's terms, they use machine learning to help people set up and automate their Amazon stores. When I ask Empireโs CEO Roman Cresto to give me his thoughts about the mixer he seems satisfied with the turnout before adding, โapparently Addison Raeโs dad is here.โ
According to Ace Westwick, chief marketing officer at Zeal Reserve โ an algorithmically powered crypto investment fundโthe idea behind the mixer was to create an environment where investors, founders and people in tech can come together and have a good time. It helps, he quips, that they have enough booze to keep the โ400-person crowd fully sedated for the entire night.โ To his credit, several other people who I meet echo Westwickโs sentiment. They tell me that unlike Silicon Valley networking events, where everyone is just exchanging business cards and trying to differentiate between the posers and the money people, this L.A. Tech Week event is more like a party.
Sam Borghese, CEO and co-founder of Zeal Reserve and a professor at UCLA introduces me to Mack Abbott who works in public relations. โThis is Mack,โ he says. โShe wants to be famous.โ Borghese, whoโs been featured in Bloomberg asks Abbott, what he needs to do to be featured in Forbes 30 under 30. According to Abott, there are two different ways: 1) Go to a bunch of tech conferences and schmooze with reporters, editors and expert judges who decide on these sorts of things. 2) Write a check for $30,000. Neither avenue appears to appeal to Borghese.
As the evening winds down in Santa Monica and the first day of L.A. Tech Week is almost nearly in the books, thereโs an undeniable enthusiasm for the promises of an entire week of networking opportunities. With most of L.A. Tech Weekโs events all but full, thereโs no doubt that as the week progresses, attendees are sure to add to their list of Twitter followers and LinkedIn connections. Iโve made a handful of new LinkedIn connections myself.
While I watch waves of attendees wait for the Ubers that will take them to their hotels or their homes, Iโm struck by the words of the bouncer at the beginning of the night. I asked him, while he was scanning my QR code, why he was using two different phones. First, he said something about iPhones and Androids before he stopped himself, laughed, shook his head and told me, โTechnology is weird these days. But itโs cool.โ
Canโt argue with that.
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Andrew Fiouzi
Andrew Fiouzi is an editor at dot.LA. He was previously a features writer at MEL Magazine where he covered masculinity, tech and true crime. His work has been featured in the Los Angeles Times, Long Reads and Vice, among other publications.
ServiceTitan Reportedly Files for IPO at a Possible $18 Billion Valuation
05:57 PM | January 25, 2022
Photo by Konstantin Evdokimov on Unsplash
ServiceTitanโwhich has parlayed its field service software for contractors into one of Southern Californiaโs most valuable tech startupsโhas reportedly confidentially filed for an initial public offering, Business Insider reported Tuesday.
The Glendale-based firm is said to be pursuing a valuation as high as $18 billion via an IPO sometime this yearโthough the report cautioned that both the timing and valuation could change. At that figure, ServiceTitan would rank among the five-most valuable venture capital-backed businesses in Southern California, according to Pitchbook data.
Reuters previously reported that ServiceTitan had begun preparing for an IPO last fall.
ServiceTitanโs software offers back-office tools for a wide range of service industries, from plumbing and landscaping to pest control and HVAC. It has grown in part by gobbling up other businesses, such as landscaping software provider Aspire and pest control-focused platforms ServicePro and, earlier this month, FieldRoutes.
The startupโfounded in 2012 by Armenian immigrants Ara Mahdessian and Vahe Kuzoyanโhas also secured venture funding at a prolific rate. ServiceTitan has raised a total of $1.1 billion in capital to date, according to PitchBook dataโmost recently a $200 million Series G round that closed last June. At the time, the firm pegged its valuation at $9.5 billion.
ServiceTitanโs investors include prominent venture capital firms Tiger Global and Sequoia, as well as private equity firms Thoma Bravo and Arena Holdings. Santa Monica-based VC firm Mucker Capital is also among ServiceTitanโs backers.
Representatives for ServiceTitan did not immediately respond to a request for comment on the Business Insider report.
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Harri Weber
Harri is dot.LA's senior finance reporter. She previously worked for Gizmodo, Fast Company, VentureBeat and Flipboard. Find her on Twitter and send tips on L.A. startups and venture capital to harrison@dot.la.
LA Venture: Arrowroot Capitalโs Kareem El Sawy On Navigating Structured Equity
09:54 AM | October 13, 2022
courtesy of Arrowroot Capital
In this episode of the LA Venture podcast, Arrowroot Capitalโs founding General Partner Kareem El Sawy discusses how to navigate structured equity.
Founded in 2014, Arrowroot helps enterprise software companies โthat are past the VC stage not quite at [the] buyout stageโ that are looking for capital to help them reach profitability. The private equity firm offers bespoke growth capital options, usually cutting checks between $10 million to $40 million. Itโs now approaching $700 million in assets under management (AUM), El Sawy said.
Structured equity can assist venture capital-backed companies that have fallen off the venture path for one reason or another.
โThe reality is most software companies have burned $300 million, $50 million, $10 million, $70 millionโall over the place,โ he said. โThey're on Series G. They're on Series A. They're on Series C. They're on Series one. It's really never a straightforward path.โ
Arrowroot is looking for these under-resourced โCinderellaโ companies that El Sawy says exist overlooked in many venture portfolios. Arrowroot sifts through a massive pipeline to identify these companies and then offers them capital that may come with liquidation preferences, dividends, warrants or other governance that gives Arrowroot downside protection to their investment.
โA lot of our growth capital goes towards a one-time transition of some sort,โ El Sawy said. โMaybe it's an old product, a new productโmaybe it's an invisible transition where the market finally came.โ
Unlike many private equity investors, Arrowroot is not a control investorโthey often take an ownership stake of around 30% to 35%, El Sawy said. Because their term sheets are not โvanillaโ term sheets, El Sawy says that their investments take some time to talk through with management. Arrowrootโs track record and references are useful for teams trying to understand how to think about what are often unique investment terms.
El Sawy says that they are seeing many more deals in their pipeline nowadays as the gap between venture capital and private equity has gotten wider. There are many companies that donโt exactly fit the model for an investment from either group and that is where Arrowroot is able to step in.
โWe're the bridge,โ he said. โWeโre the tour guide through that bridgeโ.
Prior to joining Arrowroot, El Sawy was in private equity at L.A.-based OpenGate Capital. He joined founder Matthew Safaii in 2014, during Arrowrootโs first few months. Initially, he said the firm focused on providing smaller growth checks, but has grown rapidly. Arrowrootโs portfolio includes mParticle, ParkHub and SocialChorus, and it has guided companies like Evergage to big exits. Overseeing this portfolio has helped the firm gain a reputation for being able to navigate to long-term success, he said.
โWe're known at this point as that kind of guide for these companies and saying, โLook we've done it beforeโ,โ El Sawy said. โโWe've taken it to huge exits. We're gonna do it again for you.โโ
Click the link above to hear the full episode, and subscribe to LA Venture on Apple Podcasts, Stitcher, Spotify or wherever you get your podcasts.
This podcast is produced by L.A. Venture. The views and opinions expressed in the show are those of the speakers and do not necessarily reflect those of dot.LA or its newsroom.
dot.LA reporter Kristin Snyder contributed to this post.
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Minnie Ingersoll
Minnie Ingersoll is a partner at TenOneTen and host of the LA Venture podcast. Prior to TenOneTen, Minnie was the COO and co-founder of $100M+ Shift.com, an online marketplace for used cars. Minnie started her career as an early product manager at Google. Minnie studied Computer Science at Stanford and has an MBA from HBS. She recently moved back to L.A. after 20+ years in the Bay Area and is excited to be a part of the growing tech ecosystem of Southern California. In her space time, Minnie surfs baby waves and raises baby people.
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