-backed has reportedly shut down operations, according to an by Protocol鈥檚 Biz Carson.

Subscribe to the 附近上门 Daily

Brandless, a direct-to-consumer startup focused on food, beauty and personal care products, had announced it had raised a total of $292.5 million since its inception in 2016, according to .

led its last funding round, , which valued the company at $500 million, according to 附近上门. At that time, our former editor-in-chief Alex Wilhelm pointed out the fact that it was 鈥渁 huge check at a large cost in equity terms.鈥� But it turns out that SoftBank had only provided听about $100 million upfront with a commitment to “fund around another $120 million if certain milestones were met. That final tranche never came,” according to Axios.

led its $35 million Series B in July 2017, a round that also included participation from NBA player , , and , among others.

Back in 2017, 附近上门 News sat down with 听, co-founder and CEO of 听to talk about how the company wanted to eliminate the inefficiency of the brand tax while changing the way people shop and live.

Background

It was bound to happen eventually. With all its misteps over the past couple of years, SoftBank was bound to have a portfolio company shut down.

The news that Brandless has shuttered is not entirely shocking, considering that last June, it got a new CEO amidst 鈥渢urmoil鈥� within the company, according to .

Looks like Brandless鈥� vision of $3 home goods just couldn鈥檛 keep up with the steep competition from rivals like . In fact, soon after it got that big cash infusion from SoftBank, the startup鈥檚 strategy seemed to change. According to TechCrunch鈥檚 Connie Laizos, in January 2019, the 鈥渃ompany added baby and pet products to its stable of offerings, some of them at a 鈥�

In a statement to , Brandless blamed a “fiercely competitive” retail market that was “unsustainable” for its business.

The news is the latest in a string of bad publicity for SoftBank. In January, we reported on how SoftBank-backed Colombian delivery unicorn had been hit with a trade secrets lawsuit. Also in January, we covered how two SoftBank-funded startups were in the news for either confirmed or rumored layoffs: Rappi had , according to Axios. And published an article that discount lodging provider reportedly was 鈥渇iring thousands of staff across China and India.鈥�

That followed pizza-making robot startup , also backed by SoftBank, laying off听 53 percent of its employees.

SoftBank, a Japanese investment conglomerate, has been accused of overinflating valuations with its fat checks, and it鈥檚 not ending well for many companies. But the practice of investing too much, perhaps too soon, may be catching up with SoftBank. Earlier this year, that SoftBank is cutting its ties with startup investments, even after signing term sheets.

In fact, SoftBank’s heavy-handed check-writing is leading investors and startups alike to rethink sky-high valuations in favor of a听path to profitability.

Illustration:

Usually when we talk about startup hubs we鈥檙e referring to metro areas. But the categorization can apply to countries as well. For as long as we鈥檝e been tracking, a handful of nations rake in the vast majority of startup venture funding while others get virtually none.

Subscribe to the 附近上门 Daily

Here, we鈥檙e going to look at the middle ground–a group of roughly 10 countries that bring in between $1 billion and $3 billion a year in early- and late-stage venture funding.* For want of a catchier term, we鈥檒l call them moderate-sized markets.

It鈥檚 a geographically diverse bunch. Three hail from Asia: Indonesia, South Korea and Hong Kong. Two are in Latin America: Brazil and Colombia. Four are from Europe: Spain, Sweden, Netherlands and Switzerland. And then there鈥檚 the lone continent, Australia

Putting it in perspective

You may be wondering how these mid-sized venture regions compare to the really big hubs. As it turns out, even when taken altogether, they鈥檙e rather tiny in comparison.

To put it in perspective, U.S. startups raised over $100 billion in reported financing rounds in 2019. The group of 11 countries we鈥檙e featuring here collectively brought in less than one-eighth that amount.

But while they may be small compared to the big hubs, moderate-sized markets are far more dynamic. To get a better idea of how the countries in this grouping rank, we鈥檝e charted out funding for each in the past two years:

Totals for the moderate-sized markets fluctuate a lot more than the larger ones. If we saw a 236 percent annual increase in U.S. venture funding, or a 74 percent decline, investors would be freaking out. In the moderate-sized markets, it鈥檚 quite common to see increases or declines of 50 percent or more.

Here are some other findings:

Giant deals skew totals: Seeing big fluctuations in national funding totals year over year doesn鈥檛 necessarily signal a more bullish or bearish overall investment climate. That鈥檚 largely听 because really big rounds for one or more companies can really skew the results.

Take Indonesia, for example. In 2018, local ride-hailing wunderkind pulled in over $2.4 billion, which accounted for most of the venture for the entire country. A dip in funding totals for 2019 says less about the national startup investment climate than about Gojek鈥檚 fundraising schedule.

In Colombia, meanwhile, e-commerce unicorn was the main reason funding for the whole country surged in 2019. It closed a $1 billion round backed by .

Reported round counts fall below 150 a year: For this dataset, we looked at how many disclosed venture rounds of Series A or later closed in each country over the course of 2019.

While no one is on track to rival the United States鈥� thousands of rounds per year, the numbers are pretty encouraging in that they point to a solid foundation of funded companies already making it past seed stage.

Most funding increases are due to bigger rounds, not more deals: More than half the countries on our list reported year-over-year funding increases of over 50 percent. Yet when looking at round counts, most countries, based on data to date, were flat to down.

Rounds frequently get reported late, and that may lead to upward revisions. However, the basic trendline is pretty clear: Investments rose more than deal counts. That means backers are putting more money into the startups they like, but not necessarily doing a lot more deals at Series A and beyond.

Wrapping up

So, what area is poised to become the next big venture hub? We鈥檒l study that question in more detail next week, as we hone in on the fastest-growing startup funding markets.

For now, it鈥檚 safe to surmise that countries bringing in a few billion a year in startup funding today have plenty of more room to grow.

* We focused on early and late stage (Series A and beyond) and did not include seed-stage funding rounds. This is due in part to the pattern of seed-stage rounds being reported in 附近上门 weeks or months after they close, which can make results for recent quarters appear lower than warranted. While reporting delays also occur at Series A and beyond, they are less pronounced. Small seed rounds, particularly in non-English-speaking countries, may have a higher likelihood of not being included in the dataset.

Illustration: iStock

Last month, we reported that (SBG) had unveiled plans for , or what it described as 鈥渢he largest-ever technology fund focused exclusively on the fast-growing Latin American market.鈥� The funding marks the first investment from SoftBank鈥檚 new innovation fund and was made alongside SoftBank鈥檚 Vision Fund. SoftBank Group and the Vision Fund will each invest up to $500 million in Bogota-based Rappi, according to a release by the company.

The investment also marks the largest technology financing to date in a Latin America-based company, according to Rappi.

Subscribe to the 附近上门 Daily

Since its inception in 2015, Rappi has now raised a total of about 鈥攎ost recently, bringing in around $200 million in a last August that took it to unicorn status, according to the startup鈥檚 profile. 鈥檚 led that round, which included participation from existing investors including and .

The chart below highlights recent funding rounds for Rappi.

According to the ( Rappi focused on delivering beverages and first, and has since expanded into meals, groceries, tech goods, and medicine. The company also offers a cash withdrawal feature, allowing users to pay with credit cards and then receive cash from one of Rappi鈥檚 delivery agents. To help keep costs efficient, the company鈥檚 fleet of couriers use only motorcycles and bikes, according to LAVCA.

Rappi says that last year, it “expanded the number of products delivered by seven times, and registered a monthly growth of 20 percent” in the seven countries where it operates: Brazil, Colombia, Mexico, Argentina, Chile, Uruguay and Peru.

, ,听and launched the company in 2015, graduating from Y Combinator the following year. A16z鈥檚 initial investment in July 2016 was the Silicon Valley firm鈥檚 first investment in Latin America, according to LAVCA.

, SoftBank Group鈥檚 COO, CEO of SoftBank Group International and CEO of Innovation Fund, said of the company:鈥淩appi鈥檚 founders have a bold vision to create the premiere multi-service 鈥榮uper-app鈥� for Latin America, improving the lives of millions in the region. In less than four years Rappi has become one of the fastest growing start-ups in Latin America. This rapid growth demonstrates the immense opportunity in the Latin American region.”

In general, the Latin American region has seen a surge in VC investment and increased interest from global investors, which you can read more about it here.

Editorial note: The funding round was confirmed after this piece was published. We have revised the headline and the article to reflect this change.

Illustration:听