Kiwi startup raises $15m after Uber win
Auckland software startup PredictHQ has raised US$10m ($15m) in a Series A funding round after signing marquee early customers including Uber, Domino’s and Booking.com.
Chief executive Campbell Brown told the Herald that three years ago he was running Online Republic, a site that offered online car and camper van rentals and cruise ship bookings.
A problem for the Online Republic team was a difficulty predicting demand, being constantly caught out by public events or when several public events happened at once.
Brown was amazed to discover that while there were lots of forecasting tools that mined historic data, there was no global player who aggregated all public events in one, easy-to-access service.
He sensed a business opportunity. Online Republic was flicked off to Webjet for a tidy $85m, and Brown co-founded PredictHQ with fellow Online Republic alumni Robert Kern and Mike Ballantyne.
Brown said he discovered that to get a foot in the door with Silicon Valley investors and customers, and recruit key staff, he would have to relocate to the tech capital.
So while PredictHQ’s core team remained in Auckland, Brown, his wife and children relocated to San Francisco.
While Brown had a solid track record in NZ, in the US he was “chopped liver”. With no credit record, he found he couldn’t even buy a cellphone on tick. But he got a toe in the door at Uber, and was able to help it out with a problem.
The ride-sharing giant signed up with PredictHQ around a year ago.
Brown won’t give any financial details of the deal. But he said it’s “substantial business”. The ridesharing company has built tools on top of PredictHQ’s API (application programming interface, for software to talk to other software), incorporating its service into its core systems.
And the fact PredictHQ has just been able to raise US$10m, on top of an earlier US$2m seed round, indicates it is doing some meaningful business.
“It was an amazing start for us to get someone like Uber,” Brown said.
The new money will be used, in part, to hire more staff. PredictHQ’s Auckland contingent, who are about to move into a new office at Britomart, will increase from 22 to around 60 over the next year, while the US staff will increase from three to around 20. Brown says he’s shooting for $100m annual revenue in the medium term. His longer term target is $1b.
Today, PredictHQ alerts its customers to around 20 million events in 30,000 cities that could cause fluctuations in demand for their products or services, including concerts, sports, conferences, performances, and public holidays.
It also lets customers know about events that will suppress demand, from severe weather to disruption caused by terrorist attacks to the screening date of the first episode of the final series of Game of Thrones.
And PredictHQ serves its data in a format that’s readily digestible by its customers’ AI machine learning systems.
Domino’s is using it to help predict how much ingredients to stock at particular locations and hotels affiliated with Booking.com are using it to help optimise pricing.
The $10m Series A round led by Silicon Valley-based Aspect Ventures with participation from Lightspeed Venture Partners (known for its early investments in Snapchat and Nest) and returning investors Australianbased Rampersand VC, Addventure and Tony Faure. The Series A round also saw Aspect Ventures co-founder Theresia Gouw join PredictHQ’s board. Gouw was a partner at top-tier Silicon Valley venture capital outfit Accel before she struck out on her own to found Aspect.