Quick note: We’re nearing the point of selling out seats at our upcoming event, September 27, in San Francisco. We can still accommodate some of you (and want to!), but don’t wait too long (really). You can nab your seat here.
Much thanks again to our partners in the evening: Bolt, the hardware-focused venture firm, Ballou PR, the firm that many startups and VCs rely on to navigate the European media landscape, and Rosebud Communications, a scrappy L.A.-based firm that’s getting results for a number of young startup clients.
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Rothy’s, Whose Ballet Flats are All Over Social Media, Has Raised $7M in Funding
You’ve likely seen them plastered across your social media accounts, if not on someone’s feet in San Francisco, where the company is based: attractive women’s flats in bright red with black soles, or bright red with pink stripes and blue detailing, or a gray camo pattern with a red sole.
Rothy’s, available online only at the company’s site, suddenly seem to be everywhere.
What’s the appeal? In addition to their aesthetics, the shoes are highly eco-friendly. Founders Roth Martin and Stephen Hawthornthwaite — a former gallery owner and investment banker, respectively — say the company has now used more than five million plastic water bottles to create an undisclosed number of shoes. How? After sourcing the bottles from recycling centers, they are “hot-washed” and sterilized, chipped into tiny flakes, then shaped into pellets that are then melted into malleable, thread-like fibers that get weaved into shoes by car-size knitting machines.
Right now, the shoes are available in two silhouettes — a rounded and a pointed-toe version. Shoppers further have 20 patterns from which to choose.
Yesterday, TechCrunch talked with Martin and Hawthornthwaite about how, given their very different backgrounds, they came together to form this modern shoe company. We also talked about the company’s funding picture, including the $5 million that it quietly raised from Lightspeed Venture Partners in April. (The company had earlier raised $2 million in convertible notes, including from Finn Capital Partners, M13 and Grace Beauty Capital.) Our chat has been edited for length.
Neither of you worked in retail. How did Rothy’s come into being?
SH: I’d spent around 18 years focused on M&A [at various banks]. A lot of what I’d worked on was in e-commerce and highly relevant, and by 2010, I was ready to make a change and really wanted to build something on my own. Roth and I have been friends for about 10 years, and professionally, he was in the same place. He’d been running a gallery and wanted to bring his design aesthetic [to something new].
RM: We were at a dinner and started kicking ideas around. We both have a passion for consumer goods and discussed a number of ideas but settled on footwear based on a number of trends we saw developing, including women wearing workout clothes whether or not they were working out. We wanted to create a front-of-the-closet shoe that she [the customer] can gravitate toward, without knowing what’s happening on a particular day.
How did you decide to create knitted footwear, specifically?
RM: What drew us to knitting was the ability to create shaped art. Instead of cutting a circle from a square, one could knit a circle and eliminate waste in doing so. In typical manufacturing, 30 percent of materials can end up as waste. So we innovated by being able to program shaped parts. That drew us to knitting, then that drew us to footwear. [I will add that] the requirements of footwear in terms of fit and standardization is really complicated; we had no appreciation for that at the time.
Where are the shoes made?
SH: We have 100 employees in southern China, working in a 65,000-square-foot factory that we own. The shoes are made by knitting machines that are about the size of a car, and which we’ve been adding to quickly to keep up with demand. We have waitlists for certain items; demand is still outstripping our expectations, but we’re catching up.
What’s your marketing strategy? I can’t open Facebook without seeing a Rothy’s ad.
Altaeros, a seven-year-old, Boston-based startup that develops autonomous aerostats, has raised $7.5 million in new funding from SoftBank Group, which had also backed the company in 2014. TechCrunch has more here.
CarDash, a year-old, Menlo Park, Ca.-based startup offers an end-to-end concierge service for car owners who don’t have time to drop off their vehicles at a service center or pick them up at day end, has raised $5.3 million led by Index Ventures and Felicis Ventures. Y Combinator — in whose accelerator program CarDash is currently enrolled — also joined the round, along with Afore Capital, NextView Ventures and NextGen Venture Partners. TechCrunch has more here.
Careem, a five-year-old, Dubai-based Uber rival in the Middle East that’s valued at more than $1 billion, has raised an undisclosed amount of funding from the Chinese ride-sharing giant Didi Chuxing. TechCrunch has more here.
Guideline, a two-year-old, Burlingame, Ca.-based company that wants to make it easier for small and medium-size businesses to offer 401(k) retirement accounts, has raised $15 million in funding led by Felicis Ventures. The company has now raised $25 million altogether. TechCrunch has more here.
Jetty, a two-year-old, New York-based platform for rental insurance, has raised $11.5 million in Series A funding led by Valar Ventures, with participation from earlier backers Ribbit Capital, SV Angel, BoxGroup and Red Swan. AlleyWatch has more here.
Oryx Vision, an eight-year-old, Israel-based company at work on LiDAR tech that’s designed to be as simple as a digital camera, with greater reliability and sensitivity than existing LiDAR, has raised $50 million in Series B funding led by Third Point Ventures and WRV. TechCrunch has more here.
Pro.com, a four-year-old, Seattle-based company that formerly connected homeowners with home improvement and renovation professionals and today has its own teams in place in the cities where it operates, has raised $10 million. The growth round was led by DFJ, with participation from earlier backers Maveron, Madrona Venture Group and Two-Sigma Ventures. TechCrunch has more here.
Innovations Endeavors, the Silicon Valley venture firm funded by Eric Schmidt, has merged with Israeli venture firm Marker LLC. More here.
Travis Kalanick will not again be appointed CEO of Uber, according to an e-mail to staff from co-founder and chairman Garrett Camp. Recode has more here.
Kraken, a digital currency exchange, is looking to hire a head of corporate development. The job is in San Francisco.
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Tile Pro. We need so many of these.