Extra Crunch Friday: DoorDash amps its IPO range ahead of blockbuster IPO

Welcome to Extra Crunch Friday

The pandemic is creating misery and suffering on an unprecedented scale, but it’s also creating a lot of wealth.

I struggle with this cognitive dissonance daily while editing our coverage of recent funding rounds and upcoming IPOs.

Many of these companies were doing well pre-pandemic, but for unicorns like DoorDash, Airbnb and GitLab, the last several months of uncertainty have sent valuations soaring.

As Alex Wilhelm wrote in his Monday column, the winter 2020 IPO market is “super-warm and risk-on.”

Today, he analyzed a new S-1/A DoorDash filed which indicates the food-delivery service intends to debut between $90 and $95 per share, “a bump of 20% on the low end and 12% on the upper end of its IPO range.”

Insurtech companies have also raised a ton of money this year; yesterday, Alex covered Metromile’s plans to go public via a SPAC.

After poring over a data analysis of the VC market, he found that insurtech startups raised $2.5 billion in 104 deals during Q3 2020.

“It appears that private insurtech investment is matching the attention public investors are also giving the sector,” he concluded.

Thanks very much for reading Extra Crunch this week!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

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Who's building the grocery store of the future?

One study found that Americans spend about 60 hours each year grocery stores, an average of 43 minutes each week.

The supermarket experience is drudgery and hasn’t improved dramatically in years, but advances in AI, computer vision, robotics and IoT technology are helping consumers shop faster and smarter.

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Extra Crunch members can submit questions ahead of time or during the live discussion!

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Bottom-up SaaS: a framework for mapping pricing to customer value

Nearly a third of Cloud 100 companies allow customers to buy their services without dealing with a sales team.

This bottom-up, product-led sales approach is changing SaaS, but companies need to align value with pricing to promote transparency and retain customers.

“It’s the only way your product can sell itself,” says Caryn Marooney and David Cahn of Coatue Management.

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From surviving to thriving as a hardware startup

In a guest post for Extra Crunch, Minut CEO Nils Mattisson shares six lessons he learned while scaling his smart home hardware startup.

1.  Subscription revenue is the only revenue that counts
2.  Set high margins and earn them over time
3.  Choose your customers wisely
4.  Avoid the launch trap
5.  Decouple the customer experience from the hardware
6.  Innovate on the product, not in the supply chain

“There’s a staggering amount of ways a hardware startup can die,” says Mattisson. “There are also numerous ways to avoid the pitfalls.”

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VCs who want better outcomes can use data to reduce founder team risk

Relying on instinct is useful in many situations, but it’s not a suitable method for investors who are evaluating founder teams.

Janneke Niessen, a partner at CapitalT, uses a computerized selection model her firm developed to analyze each startup’s performance to measure the team’s soft skills.

“By overlaying gut feeling with facts, we can improve our decision-making and make progress in removing bias to foster more diverse — and more profitable — investing,” according to Niessen.

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Now is a good time to start a proptech company

At $277 trillion, real estate is the world’s largest asset class, but “for decades, proptech has received the short end of the stick,” notes Colton Pace, an investor at Fika Ventures.

He suggests that proptech has reached an inflection point as companies in real estate, construction and fabrication increasingly adopt digital technology.

“Persistent founders who have prepared for this time are champing at the bit.”

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Boost ROI with intent data and personalized multichannel marketing campaigns

As marketing budgets shrink, businesses across the board are using automation to squeeze more value out of each dollar.

Tactile marketing automation (TMA) merges direct mail, digital marketing and sales operations to create multichannel brand experiences.

“It’s, simply put, a better strategy than batching and blasting — even when those campaigns are done through a digital channel.”

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