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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.
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.
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.
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
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.
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 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 produces docuseries, books, comedy albums and podcasts. The media company’s efforts include the Netflix travel series “Down To Earth with Zac Efron.”
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.
Sherman Oaks-based Papaya looks to make it easier to pay “any” bill—from hospital bills to parking tickets—via its mobile app.
Based in Marina del Rey, LeaseLock says it’s on a mission to eliminate security deposits for apartment renters.
Emotive sells text message-focused marketing tools to ecommerce firms like underwear brand Parade and men's grooming company Beardbrand.
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 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 develops physical security software. Its investors include former Twitter executive Dick Costollo and NBA star Steph Curry’s Penny Jar Capital.
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.
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.
Founded by Crowdstrike and Microsoft alums, Open Raven aims to protect user data. The cybersecurity firm’s investors include Kleiner Perkins and Upfront Ventures.
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 creates NFTs for musicians under the name Unblocked. Its investors include Jay Z’s Marcy Venture Partners and Shawn Mendez.
Backed by Mayo Clinic Ventures, Safe Health develops telehealth software and offers tools for enterprises to launch their own health care apps.
Intro’s app lets you book video calls with experts—from celebrity stylists, to astrologists, to investors.
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.
With a focus on sustainability, Ettitude is a direct-to-consumer brand that sells bedding, bathroom textiles and sleepwear.
Along similar lines as Unblocked, Afterparty creates NFTs for artists and content creators such as Clay Perry and Tropix.
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 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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Concerts, performances and other public gatherings are back on come April 15 — that is if attendees can prove they've been vaccinated or recently tested negative for COVID-19.
This announcement came on Friday, with no clear plan of how Southern Californians will prove their credentials.
Experts are worried about initiating this new strategy without a set of single standards or regulations. It raises a host of questions about forgery, health privacy records and accessibility.
"Each jurisdiction is kind of left to their own devices," said Rita Burke, an assistant professor of clinical preventive medicine at USC's Keck School of Medicine of USC. "There's no one set of guidelines which — in a situation like this — would be really, really helpful."
On eBay, she said, scammers are already selling replica vaccine cards for around $200.
The landscape of vaccine passports has evolved into an unregulated, crowded market. At least four Los Angeles entities have created their own, some working with others, including UCLA and health care startups Carbon Health and Healthvana.
President Biden's chief medical adviser Dr. Anthony Fauci said Monday on Politico's podcast that the federal government will not require the credentials for businesses or travelers.
And last week, the Biden administration said it's letting private companies take the reins over vaccine passports, opting out of creating a centralized system for verifications.
How California — and any other state — will use the digital tools is still unknown. And the state has remained quiet on its strategy.
New York officials have launched their own version called Excelsior Pass for concert and event-goers. Meanwhile, a Florida governor on Friday banned digital certifications for vaccines, citing concerns over privacy and "individual freedom."
"It's going to be hard for businesses to require a passport because nobody wants to be perceived as forcing people to take a vaccine," said Ken Mayer, co-founder and CEO of the health tech company SAFE Health.
The L.A. startup is working with IBM and a coalition called the Vaccination Credential Initiative to develop passports for people to show proof of vaccination or recent COVID-19 test via QR code. It's one of several tech companies working behind the scenes for what will essentially be a ticket to freedom for many.
But the system, some worry, could create a have-and-have-not world where those with the vaccination gain access to concerts, offices and international travel.
"I think COVID passports should not be a thing that further divides people and makes it even more difficult for people who are on the margins," said Jakub Hlavka, a fellow at the USC Schaeffer Institute.
Hlavka said that inequitable vaccine distribution — especially in rural areas unable to preserve vaccines at specific temperatures for long — will impact how freely people are able to travel internationally, or how families across borders will reconnect after the pandemic.
It's also raising concern about personal health record keeping.
"This is a new concept so it sounds simple until you get into the security and privacy details," said Eren Bali, the co-founder and CEO of Carbon Health, which runs L.A.'s vaccine appointment website.
Bali said that any digital application should be for a single use and not allow providers to store "random health data" such as diabetes or other personal medical information that is protected and has no bearing on public health.
The company recently developed its own digital certification card called Health Pass, which is automatically provided to individuals who completed vaccination through the city of Los Angeles.
"I think this is only relevant for highly infectious diseases," he said, pointing to yellow fever as another use case for a vaccine passport.
L.A.'s Department of Public Health did not immediately reply for comment, but in March, a spokesperson confirmed that the county was working with Healthvana to send out their own electronic passport.
Even if vaccine passports catch on, people will still receive a white vaccination record card after getting the shot. But it's unclear whether venues or businesses will accept them as proof, or how they'll be verified for authenticity.
Almost a third of California residents have been partially vaccinated. Health officials in Los Angeles County report 1.3 million people have been fully vaccinated, but that data doesn't include Pasadena and Long Beach.
One upside to a digital passport is that it could serve as an incentive for those yet to be vaccinated, said Assemblymember Jesse Gabriel, who represents much of the west San Fernando Valley and sits on the Assembly's Privacy and Consumer Protection Committee.
The committee oversees California's Department of Technology, responsible for partnering with state and local government to deliver digital services like MyTurn, the vaccination appointment portal run by the state.
"Hopefully it's something that'll motivate people who may be on the fence, knowing that they're able to do these things," he said.
But Burke says those who are skeptical about the vaccine are also the people wary of a vaccine passport.
Plus, proving a negative COVID-19 test "does not guarantee that you don't have COVID," she added. Venues and businesses should reconsider accepting days-old negative test results before letting customers inside.
"Showing a negative test is not really a good way of approaching this," Burke said. "Now, as we're opening up, we really need to focus on getting as many folks vaccinated as possible."
This story has been updated.
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