4 Jun 2019
Telstra Ventures goes on start-up investment spree
Investments, Networking, New Technology or Careers?
In recent weeks the fund also participated in a $US103 million funding round by Washington-based “identity-as-a-service” company Auth0 and made a follow-up investment in enterprise security validation company AttackIQ, as part of a $US17.6 million round.
It also invested in Denver-based cyber security company CyberGRX.
Additional product support
Speaking to The Australian Financial Review, Boomtown co-founder Alfred “Chip” Kahn IV said the start-up was introduced to Telstra through tech giant Apple.
“Apple was excited about what we were working on as part of their drive to push more Apple product into small business,” he said.
“They introduced us to Telstra proper, who then connected us with Mark Sherman, the managing director of Telstra Ventures, who is based here in San Francisco.
“This will be the last capital we raise and it takes us to profitability. We’re focused on expanding the number of locations we serve and we’re going to go into new markets through partners.”
As well as Telstra Ventures, Boomtown’s round included investment from Capital One Growth Ventures and returning investors Nyca Partners, Commerce Ventures, Spider Capital and NHN Ventures.
Boomtown’s business model involves doing deals with the big tech companies to offer their customers additional support for their products.
For example, if a cafe owner was having a problem with their point of sale system, or inventory management software, they could press a button on their mobile device and get instant help, utilising computer vision.
It already works with companies such as Square, Elavon, Lightspeed and guest Wi-Fi company Zenreach.
Mr Kahn’s previous company BroadHop was acquired by Cisco in late 2012, and he claimed Relay customers experienced an 88 per cent reduction in product activation times and a 45 per cent improvement in customer service times.
As part of Boomtown’s international growth plans, this capital raise will help it fund an expansion into Australia by the end of this year, and it is also pushing into western Europe in late July.
Telstra Ventures’ suite of fresh investments comes as its part-owner announced $500 million in writedowns on its legacy IT systems, as part of its T22 transformation strategy.
Telstra Ventures managing director Mark Sherman said since the merger with HarbourVest Partners, the fund had been able to operate with more freedom and had recently experienced a pick-up in investment activity.
“Since being established as Telstra’s independent venture capital team last July, we are finding greater agility to target excellent growth opportunities across the USA, China and Australia investment corridor,” he said.
“The technology innovation market remains strong, we review over 1000 companies a year and our track record of introducing our investee companies into the Telstra eco-system has returned some $300 million in revenues to our portfolio companies.
“[This] is why entrepreneurs like to work with us, and why we can select these high-performance opportunities.”