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What Are LA’s Hottest Startups of 2022? See Who VCs Picked in dot.LA’s Annual Survey
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.
In Los Angeles—like the startup environment at large—venture funding and valuations skyrocketed in 2021, even as the coronavirus pandemic continued to surge and supply chain issues rattled the economy. The result was a startup ecosystem that continued to build on its momentum, with no shortage of companies raising private capital at billion-dollar-plus unicorn valuations.
In order to gauge the local startup scene and who’s leading the proverbial pack, we asked more than 30 leading L.A.-based investors for their take on the hottest firms in the region. They responded with more than two dozen venture-backed companies; three startups, in particular, rose above the rest as repeat nominees, while we've organized the rest by their amount of capital raised as of January, according to data from PitchBook. (We also asked VCs not to pick any of their own portfolio companies, and vetted the list to ensure they stuck to that rule.)
Without further ado, here are the 26 L.A. startups that VCs have their eyes on in 2022.
1. Whatnot ($225.4 million raised)
Whatnot was the name most often on the minds of L.A. venture investors—understandably, given its prolific fundraising year. Whatnot raised some $220 million across three separate funding rounds in 2021, on the way to a $1.5 billion valuation.
The Marina del Rey-based livestream shopping platform was founded by former GOAT product manager Logan Head and ex-Googler Grant LaFontaine. The startup made its name by providing a live auction platform for buying and selling collectables like rare Pokémon cards, and has since expanded into sports memorabilia, sneakers and apparel.
2. Boulevard ($40.3 million raised)
Boulevard’s backers include Santa Monica-based early-stage VC firm Bonfire Ventures, which focuses on B2B software startups. The Downtown-based company fits nicely within that thesis; Boulevard builds booking and payment software for salons and spas. The firm has worked with prominent brands such as Toni & Guy and HeyDay.
3. GOAT ($492.7 million)
GOAT launched in 2015 as a marketplace to help sneakerheads authenticate used Air Jordans and other collectible shoes. It has since grown at a prolific rate, expanding into apparel and accessories and exceeding $2 billion in merchandise sales in 2020. The startup sealed a $195 million funding round last summer that more than doubled its valuation, to $3.7 billion.
The Best of the Rest
VideoAmp ($578.6 raised)
Nielsen competitor VideoAmp gathers data on who's watching what across streaming services, traditional TV and social apps like YouTube. The company positions itself as an alternative to so-called "legacy" systems like Nielsen, which it says are "fragmented, riddled with complexity and inaccurate." In addition to venture funding, its total funding figure includes more than $165 million in debt financing.
Mythical Games ($269.4 million raised)
Seizing on the NFT craze, Mythical Games is building a platform that powers the growing realm of “play-to-earn games.” Backed by NBA legend Michael Jordan and Andreessen Horowitz, the Sherman Oaks-based startup’s partners include game publishers Abstraction, Creative Mobile and CCG Lab.
FloQast ($202 million raised)
FloQast founder Michael Whitmire says he got a “no” from more than 100 investors in the process of raising a seed round. Today, the accounting software company is considered a unicorn.
Nacelle ($70.8 million raised)
Nacelle produces docuseries, books, comedy albums and podcasts. The media company’s efforts include the Netflix travel series “Down To Earth with Zac Efron.”
Wave ($66 million raised)
A platform for virtual concerts, Wave has hosted performances by artists including Justin Bieber, Tinashe and The Weeknd. The company says it has raised $66 million to date from the likes of Warner Music and Tencent.
Papaya ($65.2 million raised)
Sherman Oaks-based Papaya looks to make it easier to pay “any” bill—from hospital bills to parking tickets—via its mobile app.
LeaseLock ($63.2 million raised)
Based in Marina del Rey, LeaseLock says it’s on a mission to eliminate security deposits for apartment renters.
Emotive ($58.1 million raised)
Emotive sells text message-focused marketing tools to ecommerce firms like underwear brand Parade and men's grooming company Beardbrand.
Dray Alliance ($55 million raised)
Based in Long Beach, Dray says its mission is to “modernize the logistics and trucking industry.” Its partners include Danish shipping company Maersk and toy maker Mattel.
Coco ($43 million raised)
Coco makes small pink robots on wheels (you may have seen them around town) that deliver food via a remote pilot. Its investors include Y Combinator and Silicon Valley Bank.
HiveWatch ($25 million raised)
HiveWatch develops physical security software. Its investors include former Twitter executive Dick Costollo and NBA star Steph Curry’s Penny Jar Capital.
Popshop ($24.5 million raised)
Whatnot competitor Popshop is betting that live-shopping is the future of ecommerce. The West Hollywood-based firm focuses on collectables such as trading cards and anime merchandise.
First Resonance ($19.4 million raised)
Founded by former SpaceX engineer Karan Talati, First Resonance runs a software platform for makers of electric cars and aerospace technology. Its clients include Santa Cruz-based air taxi company Joby Aviation and Alameda-based rocket company Astra.
Open Raven ($19 million raised)
Founded by Crowdstrike and Microsoft alums, Open Raven aims to protect user data. The cybersecurity firm’s investors include Kleiner Perkins and Upfront Ventures.
Fourthwall ($17 million raised)
When an actor faces the camera and speaks directly to the audience, it’s known as “breaking the fourth wall.” Named after the trope, Venice-based Fourthwall offers a website builder that’s designed for content creators.
The Non Fungible Token Company ($15 million raised)
The Non Fungible Token Company creates NFTs for musicians under the name Unblocked. Its investors include Jay Z’s Marcy Venture Partners and Shawn Mendez.
Safe Health Systems ($15 million raised)
Backed by Mayo Clinic Ventures, Safe Health develops telehealth software and offers tools for enterprises to launch their own health care apps.
Intro ($11.6 million raised)
Intro’s app lets you book video calls with experts—from celebrity stylists, to astrologists, to investors.
DASH Systems ($8.5 million raised)
With the tagline “Land the package, not the plane,” DASH Systems is a Hawthorne-based shipping company that builds hardware and software for automated airdrops.
Ettitude ($3.5 million raised)
With a focus on sustainability, Ettitude is a direct-to-consumer brand that sells bedding, bathroom textiles and sleepwear.
Afterparty ($3 million raised)
Along similar lines as Unblocked, Afterparty creates NFTs for artists and content creators such as Clay Perry and Tropix.
Heart to Heart ($0.75 million raised)
Heart to Heart is an audio-focused dating app that “lets you listen to the story behind the pictures in a profile.” Precursor Ventures led the pre-seed funding round.
Frigg (undisclosed)
Frigg makes hair and beauty products that contain cannabinoids such as CBD. The Valley Village-based company raised an undisclosed seed round in August.
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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.
CrowdStrike CEO Says He Regrets Not Firing People Quicker
03:10 PM | March 04, 2020
Ben Bergman/dot.LA
George Kurtz, co-founder and CEO of the cloud-native endpoint security platform CrowdStrike, says executives should be obsessed with culture. Everyone below him must be fanatical about customer success and outcome and if they aren't fitting in, they need to go quickly. It's one of the biggest lessons he's learned as CEO.
"Not one time have I regretted firing someone too fast," Kurtz told a lunchtime crowd at the first day of the Montgomery Summit in Santa Monica. "It's that I waited too long."
Kurtz founded the company in Sunnyvale, CA, in 2011 and it went public last year. He was joined on a panel by John Chambers, the former executive chairman and CEO of Cisco Systems, who said he bought 180 companies during his tenure. But he did not acquire a company that was not a very close cultural fit.
"I walked on one of the bigger acquisitions we were going to do," Chambers said. "Culture is as important as strategy and vision and I did not understand that when I was a young CEO."
Chambers said he was proud of Cisco's 95% employee retention rate when he was CEO, which is well above the industry average. He oversaw a rigorous hiring process to make sure candidates were right.
"If you're not interviewing through 10 people, you're not doing the screening process properly," Chambers said.
If an executive wanted to jump to a competitor, he would try to find out what was at the root of someone's unhappiness. The number one factor: Dissatisfaction with their immediate supervisor.
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Ben Bergman
Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.
https://twitter.com/thebenbergman
ben@dot.la
Why Scrubs Maker FIGS is Being Sued in California Court
10:59 AM | October 19, 2022
'We've Branded an Unbranded Industry': FIGS Co-CEOs Trina Spear and Heather Hasson on Their Epic IPO
Last August, FIGS, the medical scrub startup based in Santa Monica, was sued for false advertising and misleading business practices. This week, the company is in court arguing it didn’t need to rely on any unsavory marketing tactics and that its products sold more because they were better than its competitors.
The lawsuit, brought forth by Strategic Partners Inc. (SPI), a Chatsworth-based competitor that does business as Careismatic Brands, alleges FIGS co-founders Trina Spear and Heather Hasson violated advertising regulations by falsely claiming their scrubs are made to protect the wearer from bacteria or disease through the use of a chemical called Silvadur. In the lawsuit SPI cited the fact that FIGS said this chemical helps its scrubs reduce hospital-acquired infection rates by 66%, which SPI claimed was untrue and misleading.
The exact amount of money SPI is seeking from the suit isn’t clear. But the company did request numerous damages, including the costs of the suit and attorneys’ fees. SPI also asked for compensatory damages plus punitive damages and disgorgement of profits, which means the court could order FIGS to pay back part of the money it made selling its scrubs if the judge rules against them.
“What [FIGS] did is they came up with these false claims so that health care workers would pay premium pricing based on something that didn't exist,” said Sanford Michelman, attorney for SPI. He also said the company “is a get rich quick scheme.”
Unlike FIGS' direct to consumer model, SPI sells through a middleman, licensing out brands to mainly brick and mortar retailers.
Michelman claimed SPI has sources that used to work for FIGS that will testify FIGS’ 66% infection prevention claim wasn’t accurate, including a former stock boy and an infectious disease expert.
A FIGS spokesperson who was in court Tuesday said, however, he anticipated SPI will need to prove specifically that FIGS’ sales increased because of its allegedly misleading marketing, which could be a difficult task for the plaintiffs.
The suit also called into question other elements of FIGS’ business practices, including the company’s promise to donate “hundreds of thousands of scrubs internationally'' as part of its Threads for Threads program. Per the publication of the company’s first video ad for it, the program appears to have been set up in 2013 to donate one pair for every pair sold: The lawsuit alleged, “these misrepresentations regarding donations are part of FIGS’s broader plan to deceive the public into believing that FIGS and FIGS scrubs are special, when they are not special.”
During opening statements, law firms Bird Marella and Munger, Tolles, & Olson argued on behalf of FIGS that SPI uses a similar chemical in its medical clothing.
Back in 2021, FIGS created an entire website to explain its side of the story. On the site, the medical clothing startup called the lawsuit “baseless attacks” from an older competitor that’s simply angry it lost market share to a new upstart and wants to “thwart competition.”
To that end, FIGS’ chief legal officer said the lawsuit was an attempt by SPI to “stifle” competition and drive it out of the market. He called the litigation “absurd” and said it won’t hold up in court.
This is a developing story. Have a tip? Contact Samson Amore securely via Signal at 401.287.5543 or Samsonamore@dot.LA.
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Samson Amore
Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.
https://twitter.com/samsonamore
samsonamore@dot.la
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