The Future 5 of Austin Tech, Q4 2021
Sure, the latest initiatives from the Teslas, Apples and Googles of the industry tend to dominate the tech news space — and with good reason. Still, the big guns aren’t the only ones bringing innovation to the sector.
In an effort to highlight up-and-coming startups, Built In has launched The Future 5 across eight major U.S. tech hubs. Each quarter, we will feature five tech startups, nonprofits or entrepreneurs in each of these hubs who just might be working on the next big thing. You can check out last quarter’s round-up of rising Austin startups here.
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Austin is quickly becoming a tech capital in the U.S., with many tech professionals, entrepreneurs and investors coming to town for a chance to collaborate with the creative professionals who live here.
Austin’s stature in the tech world is only going to rise with Tesla’s announcement that it will relocate its headquarters here. Tesla is just one of at least 10 tech companies that have relocated to Austin this year alone.
Far from the limelight, though, there are plenty of smaller, early-stage startups that are making waves in the local tech scene. Here are five up-and-coming tech companies to watch in the fourth quarter of 2021.
Covid-19 threw almost every industry into chaos, but none quite like the travel industry.
When vaccines started to become available in the U.S., it inspired avid travelers Lindsey Renken, Arie Litovsky and Ivan Vanderbyl to create a tool to help people travel while being mindful of local Covid-19 travel restrictions.
Their company, Airheart, launched a free Explorer tool in May, allowing travelers to learn which destinations are accessible and what’s required for their trip.
We want to help people travel confidently.”
The platform’s data is aggregated from official sources by data partners, including Sherpa. Airheart further distills and organizes the data into a searchable, scannable format.
Airheart CEO and co-founder Lindsey Renken said thousands of people from around the globe use the Explorer tool. One popular route, she said, is from the U.S. to Spain, where travel is allowed and Covid-19 tests are only required for unvaccinated travelers.
In October, the company announced it had raised $250,000 in pre-seed funding. The company, which employs seven people, plans to open a larger seed round as it prepares for the launch of its full Airheart platform in the spring of 2022.
The full Airheart platform will build upon the Explorer tool, while also including a social component that helps travelers draw inspiration from friends, family and influencers. Groups of people can also discover and share travel plans, making it easier to coordinate and collaborate on the details of their trip.
“After a long stretch of lockdowns due to the pandemic, we’re seeing a desire for people to get back into the world and start exploring again with their friends and family,” Renken said. “Airheart’s mission is to bring simplicity to the planning process by helping our travelers share ideas and itineraries with others, while also helping them to navigate the ever-changing Covid restrictions across the globe. We want to help people travel confidently.”
Andes STR (Proptech)
Toronto is cold, especially when you’re from Chile.
Sebastian Rivas’ longing for warmer weather — and more flexible living arrangements in general — inspired him and his childhood friend Matías Duhart to think of a way to expand the availability of fully furnished short-term rental units, which they believe are the future of housing.
“Life is short, so why would you waste your life in a place you don’t want to live,” Rivas told Built In. “I think this is the future and I think this is the path forward.”
Together, they founded Andes STR in 2019. Earlier this year, the business won first place and $666,000 at the University of Chicago’s New Venture Challenge. The company also raised a $1 million seed round in July.
Rivas, who comes from a real estate investment banking background, said the availability of short-term rentals is stifled by the lack of investment.
Why would you waste your life in a place you don’t want to live.”
By making short-term rentals an investable asset, Rivas hopes to accelerate a larger societal transition to fully furnished short-term rentals.
Eventually, Rivas hopes to attract institutional investors, which would make it easier to get mortgages to and to build properties specifically for the purpose of short-term rentals.
“The problem is that, at a structural level, there is not investment flowing into short-term levels because, at an institutional level, people don’t quite buy that this is an investable asset class,” Rivas said. “That’s what we are changing. We are providing investors with fully turnkey access to short-term rentals as an asset class.”
Andes STR uses proprietary machine learning technology to find properties that are most attractive to investors. Then, they help investors secure financing, purchase the property and furnish and decorate the property.
Andes STR also continues to manage the short-term rentals, even though the property is owned by investors.
“We are removing any excuse for investors to not get into this asset class,” he said.
So far, Andes STR has purchased 200 properties in Canada, U.S. and Chile.
The company has four people at the leadership level, three people supporting operations and 11 contractors. The company is hiring 15 people in engineering, operations, marketing and human resources roles.
Lauren Washington is trying to provide more data into the early-stage investment process, with the hope that it will eliminate some of the unconscious biases that women and people of color face in an industry mostly dominated by white males.
When her first startup, a social media management platform called KeepUp, won the 43North business pitch competition in 2015, she thought the $250,000 prize money was just a launching pad for a big funding round.
After two years of fundraising, though, she wasn’t able to top $275,000.
The lingo and other dynamics of the startup world were difficult to navigate as a young founder, she said, but she also felt it was tough to break through as a Black woman in a space predominantly occupied by white males.
“There is an unconscious bias that happens when you present as a woman, particularly as a Black woman,” she told Built In. “There’s so much against you. As soon as you step in the door, you’re seen as a risk, and you have to literally de-risk your company for people to want to invest in you. It’s not intentional; it’s very unconscious.”
There’s a systemic issue that’s happening in the fundraising industry that needs to be changed.”
After two years of frustration, she met two other Black women, Esosa Ighodaro and Regina Gwynn, who were working on their own tech businesses.
Together, the three women created a company called Black Women Talk Tech, which grew to the largest conference in the world for Black women founders. The company also branched off to form Black Men Talk Tech.
The Black Women Talk Tech conversations made Washington realize that her struggle in the startup world was similar to those of other Black female founders.
“It sort of set off a lightbulb for me that it’s not me: It’s not each of these women individually; there’s a systemic issue that’s happening in the fundraising industry that needs to be changed,” she said. “And I didn’t think there was enough incentive internally for investors to make that change themselves.”
That’s how she got the idea for Fundr, which she co-founded in 2019 with Boris Moyston and Jean-Philippe Desmontils.
Fundr attempts to remove bias and maximize returns by automating seed investing.
More than 800 companies are on Fundr’s platform. To be listed on the platform, companies must answer 90 questions about their market traction, annual recurring revenue and even a personality assessment.
Fundr also asks founders about their race, income status and how hard it was for them to start the startup. The algorithm favorably weights those from underrepresented backgrounds, Washington said, as a way to even their odds of receiving investment.
After founders fill out their profile, Fundr’s AI technology sorts through the data of each company and assigns them a score that attempts to quantify their chances for success. The top companies are compiled in a portfolio for investors.
Fundr streamlines the rest of the process with standardized term sheets, automated fund transfers and deal tracking of an investor’s portfolio over time.
Fundr currently has about 300 investors on its platform, and the company has a network of a few thousand that receive its deals.
The company started out targeting angel investors, but now about half of the investors come from venture capital firms, accelerators and other private wealth groups.
“All different types of investment groups are interested in getting into this early stage venture, particularly those who want to do it in a different way, who want to find a way to maximize their returns and create more efficiency in their overall process,” she said.
Fundr isn’t just interested in helping founders, though. The company also wants to open up access to investors who may not typically have access to certain deals. When tech companies use venture capital, they are not going public, which means only a small percentage of people have access to that investment opportunity.
“Now we’re seeing companies stay private for decades, which blocks so many people out of opportunities to create wealth equity,” Washington said. “We want to bring more people to the table that are both on the founders side, so they have the ability to create wealth themselves, as well as on the investor side, so they have the opportunity to be a part of it.”
Fundr is in the middle of raising its first $1 million seed round, which it’s raising on its own platform. Washington said this funding round has been more fruitful than her funding efforts in 2015 because of the quantitative data the Fundr platform provides, as well as the functionality of the platform itself.
Journey Foods (SaaS)
Journey Foods is a software company that aims to make food more nutritious, sustainable and affordable to feed a growing population, with a specific focus on consumer packaged goods found in the middle of the grocery store.
Journey Foods’ cloud-based software can help companies make their products healthier, more sustainable and more affordable by integrating their current supply chain information into an artificial intelligence-driven software featuring 12 billion ingredient insights.
The software shows companies the cheapest, most efficient way of implementing a shift toward a healthier, more sustainable product.
Journey Foods has built integrations with Microsoft SAP, which allows the company to build on top of the existing supply chain networks of its multinational food-producing clients, such as Unilever, as well as some other large companies from Hong Kong and Japan.
Through Journey Foods’ software, a major flour company was able to decrease its water usage by more than 2 percent. Another company was able to reformulate one of its products so that it could launch nationally with Whole Foods, which has different standards than USDA and the FDA.
Journey Foods CEO Riana Lynn founded the company in 2018 after launching three other food startups. Lynn comes from a unique background combining technology, supply chains and food science.
Lynn learned web development while studying biology and chemistry at the University of North Carolina. She started her first food company while studying business and public health in graduate school at Northwestern University and working in a research lab at UChicago Medicine.
While in graduate school, she interned for the Obama administration at the White House, where she focused on supporting women-owned businesses.
Lynn is also an angel investor, a former Google Entrepreneur in Residence and has served as a top consultant to Fortune 500 food companies.
Journey Foods, which has a headcount of 14, has won numerous awards and received nearly $5 million in grants and funding. Lynn said she plans to open up a larger Series A funding round later this year.
Lynn said her goal in the next five years is to help 5,000 companies reformulate several million different food product lines that feed 2 billion people better. They are more than 10 percent of the way to that goal, Lynn said.
“What we love about what we do is focusing on the financial aspects of it. How can we rapidly accelerate the manufacturing and the research or development that makes those changes,” she told Built In. “We really focus more and more on cost data and thinking of the impact that data science and software has in the fintech industry, and how we can translate that into the food industry.”
On Tuesday, the company also announced the launch of JourneyLabs, a new food tech fellowship program created in partnership with at least a dozen universities, including Columbia University, Cornell University and several HBCUs.
A new banking app called Tend launched in Mexico and the U.S. in mid-August with the goal of helping Mexican-Americans achieve financial freedom.
Tend CEO James Dunavant said the all-in-one platform combining debit, checking and credit accounts, combined with a forum to discuss financial topics with other users, will lead to greater convenience and financial literacy.
“We created Tend to eliminate the stress and complexity of managing money across many disparate financial services products, and increase financial literacy through real human conversation,” he told Built In.
About 63 million Americans are unbanked, meaning they don’t have access to a traditional bank account, or underbanked, where they have a bank account but use non-bank alternatives like payday lenders or check cashers, according to a 2020 FDIC report.
About 30 percent of low-income Latinx households are unbanked and 30% are underbanked.
Among African Americans, 50 percent of low-income households are unbanked or underbanked.
Members can try the Tend app for free during a trial period, but after the trial period, subscriptions cost $9.95 per month.
Tend allows members to establish a line of credit without balance minimums and overdraft fees.
The all-in-one platform includes a Visa debit card, checking and savings accounts, shopping rewards such as cash back and retail discounts, and the ability to book global travel with cash back rewards.
In the near future, the company plans to offer real-time, peer-to-peer cross-border money transfers and payments with enhanced messaging capabilities.
The company also offers a revenue share program that pays members cash bonuses and recurring monthly streams, providing increasing yields to those who contribute to the growth and well-being of the Tend community.
The app also includes an online community called “The Green,” where Tend members can share information about financial topics.
The company currently has 30 employees and plans to reach 50 before the end of the year in the U.S., Mexico and Turkey. Tend plans to hire 100 employees by the end of 2022.
The company is also currently hiring for three open positions in Austin.