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Factor raises seed round to streamline an overlooked part of the supply chain – TechCrunch

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The “last mile” in the supply chain has gotten lots of attention during the pandemic. Even e-commerce giants like Amazon have struggled to surmount the challenges of distributing product fast enough to keep up with demand.

But Factor, a startup created in 2018 by manufacturing industry veterans Doug Shultz and Michael Szewczyk, just raised a seed round to streamline a different part of the supply chain process, which it calls the “first mile.” For Factor’s 250+ customers, mostly manufacturing companies, the “first mile” consists of processes like ordering raw materials, choosing the ideal supplier for each order and paying them on time, Factor CEO Shultz told TechCrunch in an interview.

“Most people look at the supply chain and they think about the shipping containers stuck in LA or the boats outside the port of Long Beach. The exciting thing for us is the problems that we’re solving more upstream in the chain can really help companies avoid getting in those types of bottlenecks in the first place,” Shultz said.

The ventilator shortage at the beginning of the COVID-19 pandemic resulted from inefficiencies in the “first mile” of manufacturing, Shultz said. It took six months for supply to meet demand in that scenario because of “manual and tedious” standard practices across the industry, he added.

“What caused it to take six months, even with Elon Musk and Tim Cook personally involved, was that inside of that process, there are 700 components that are coming from 200 first-tier suppliers, and then hundreds more underneath that first tier. If you think about how companies order stuff and pay each of these suppliers when there are literally thousands of different moving parts, that’s what takes six months,” Shultz said.

Factor cofounders Doug Shultz and Michael Szewczyk

Factor co-founders Doug Shultz and Michael Szewczyk. Image Credits: Factor

Factor’s product helps companies manage transaction infrastructure throughout the “first mile” by leveraging artificial intelligence to automate core supply chain processes. It provides payment tools, data to aid in supplier selection and order tracking and execution features to its customers, who tend to make complex products for industrial use in areas like robotics, medical devices and aerospace and defense, Shultz said. 

Companies using Factor bring their own suppliers onto the platform, and Factor helps them measure data about each supplier’s outcomes — for example, how many times a supplier has delivered goods to them on time. Factor is “less so a marketplace, more so an infrastructure to help you make decisions,” Shultz said.

Companies that don’t use Factor typically use manual tools like spreadsheets to manage their “first mile” processes. Others use enterprise resource planning (ERP) software through providers like Oracle and SAP, which is more easily customizable but often prohibitively expensive for mid-size and small companies to use, Shultz continued.

Factor's parts status tracking feature

Factor’s parts status tracking feature Image Credits: Factor

Factor hopes to provide a more reasonably priced supplier management service for these sorts of companies, but it also sees its payment features as key differentiators from other ERPs. 

The manufacturing industry accounts for over 20% of B2B payments globally, Shultz said, but many of the largest companies in the industry are still transferring vast amounts of money through paper checks. Factor’s platform offers automated payment features built on top of infrastructure from payment processors like Stripe.

“We’re layering on top of that infrastructure applications that can essentially coordinate where the payments are going, and also provide additional value. We have all this data about your order history or suppliers, and we can now pull in the financial services on top of that,” Shultz said.

The company, which has seen customer order volume grow 10x in the past nine months, announced today it had raised $6 million in seed funding to grow its platform. Google’s AI-focused fund, Gradient Ventures, led the round alongside Xfund, Afore and South Park Commons. 

It plans to use the capital to further develop its financial services capabilities by adding new banking partners and offering financing products, Shultz said. It is currently working with a credit provider to develop a credit functionality for companies to fund their short-term working capital needs, he added, though he declined to name the credit provider.

Shultz, who hired Factor’s first head of sales a few weeks ago, said he was excited to receive backing from Darian Shirazi at Gradient Ventures because of Shirazi’s big-picture view of the company’s growth potential.

Shirazi understood that “buyers are always suppliers, suppliers are our buyers, and we can turn on this viral engine to [become] the base transaction layer for all of manufacturing,” Shultz said.

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Down rounds are still rare by historical standards • TechCrunch

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If you thought that the recent venture capital market was tough, let me tell you about 2016, 2017, 2018, 2019 and 2020.

With the first week of December under our belts, we’re not too far away from the end of the year. And that means that 2022’s venture capital story has largely been written. It’s not a single narrative; instead, this year started on a high, with momentum from the monstrous 2021 funding period persisting into the new year. From that point, we’ve seen a slowdown accelerate into what some consider a downturn.


The Exchange explores startups, markets and money.

Read it every morning on TechCrunch+ or get The Exchange newsletter every Saturday.


Startups raised lots of capital this year. Less, yes, than last year, but more than in nearly any year in recent memory. It’s still a good time to build a tech upstart.

Does that perspective feel too sunny when we hear so much doom and gloom on Twitter regarding startup prospects in a more conservative investing climate?

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Howie Mandel gets a digital twin from DeepBrain AI

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Howie Mandel is stepping into the metaverse. DeepBrain AI has created a pretty realistic AI version of comedian and actor Mandel.

Deepbrain AI, based in South Korea and Palo Alto, California, calls its creation “AI Howie,” and it’s an interactive virtual human and digital twin for immersive and personalized fan experiences. AI Howie mentions VentureBeat and talks to me in the attached videos.

Unlike the “deepfakes” of Tom Cruise and other actors, the real Howie Mandel cooperated with DeepBrain AI to create the virtual human AI replica of the famous comedian, actor, host, and technology enthusiast. We used “virtual Paris” AI character at our recent MetaBeat event in San Francisco.

“I am equally thrilled, excited, and terrified to finally have the ability of showing up and doing things without going anywhere or doing anything,” said Mandel, in a statement. “Thank you, DeepBrain.”

DeepBrain AI applies deep learning technology to create hyper-realistic virtual humans through its AI Studios and the AI Human platforms. These virtual humans are digital twins of the real person, with the same appearance, voice, gestures, and subtle mannerisms. The AI Studios platform enables script-to-video software that synthesizes dynamic video content in seconds, producing the quickest and most
realistic AI-generated videos. The script-to-video editor makes it easy for customers to select a model and then make it say something based on a script. Within a minute or so the video is made.

This is a powerful communication and marketing tool for celebrities, professional athletes, news anchors, and even politicians. Before working with Howie Mandel, the DeepBrain AI team created digital twins of Premier League soccer superstar Son Heung-Min, multiple news anchors across Asia, and South Korean president Yoon Suk-yeol.

Joe Murphy, business development manager for DeepBrain AI, said in an interview with VentureBeat that the virtual Howie is a conversational model that you pepper with questions. DeepBrain AI designs and develops these virtual humans for the purpose of creating digital twins (like Howie Mandel), digital people, and avatars.

It takes about four weeks of machine learning work to create a Howie Mandel digital twin.

“We create models of real people,” Murphy said. “We also have completely synthetic virtual humans. That is what we’ll call digital people. And then avatars are just the basic Roblox type of avatars. But where our technology comes in with the digital twins is we go through a deep learning process to clone the person’s voice, their mannerisms, their face, the way their eyes move, the way their lips move.”

He added, “So we create what we call the digital twin of the real person with all the uniqueness of that person. Our mission is to use this technology that we’ve developed throughout Asia and bring it to America.”

In addition to the script-to-video capabilities, the company provides fully conversational experiences with its AI Human software. The AI Human solution enables fans to interact and engage with AI Howie by simply asking questions. For example, when asked, “What was your favorite act on AGT this season?” the AI Howie model responds in real-time to support interactive, fun, and engaging fan experiences.

AI Humans are available within mobile apps, web browsers, or voice-activated kiosks.

“Our vision is to humanize digital experiences and empower creative teams to generate immersive content at scale,” said Eric Jang, DeepBrain AI CEO. “Working with Howie Mandel was a fun experience, and we are excited to see how the AI Howie collaboration will connect with his fans worldwide.”

DeepBrain AI, (formerly Moneybrain), a conversational AI startup based in Seoul, South Korea, has raised $44 million in a series B round led by Korea Development Bank at a post-money valuation of $180 million. The company started in 2016 and it has raised $54 million to date. The company has 130 employees.

The AI is being used for AI news anchors in South Korea and China at four different television networks. The networks flag that the anchor is an AI avatar so that no one gets confused.

The real Howie Mandel spent about a day shooting video with DeepBrain AI.

While multiple companies are working on virtual humans, DeepBrain AI’s avatars are hyperrealistic. One of Asia’s largest insurance companies is also using it, as is a “brand ambassador” for a soccer team.

“When we worked with Howie Mandel, we went down to his studio in Los Angeles, we provided a script, and fed our training data into our neural network,” Murphy said.

It took about a day to do a video shoot with Mandel and about three to four weeks of machine learning time on the computers to generate the first AI model.

Back in January, DeepBrain AI opened its office in Palo Alto, California, and it is talking to partners in Silicon Valley and the rest of the U.S. Over time, Murphy said that the hope is to create AI avatars in realistic 3D for the metaverse. In South Korea, kiosks are appearing in places like banks with both 2D avatars and 3D avatars.

Over time, Murphy said the avatars have gotten better at mannerisms, lip sync, and subtle gestures. The speed of real-time responses in conversations has also gotten faster. The company is talking about doing more with game companies and major brands.

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This Doggy DNA Test Ships Free for the Holidays

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Opinions expressed by Entrepreneur contributors are their own.

Every pet owner wants the best for their animal sidekick. They want to spend as much time as possible with them, even at the office. But being the best dog owner you can be isn’t all about just being present. It helps to understand your dog on a genotypic as well as phenotypic level. That’s one reason why doggy DNA tests have become so popular.



DNA My Dog

If you’re wondering what to get for your pooch this holiday season, look no further than the DNA My Dog Breed Identification Test. If you order by December 8, you’ll get free shipping, but that date is coming up fast so don’t delay.

This simple, painless kit requires just a swab of your dog’s cheek to get a detailed report delivered in two weeks or less. That report includes a custom photo certificate of the breed breakdown found in your dog’s genetic breed composition, a percentage breakdown of the levels found in your dog’s DNA, and a report on the dominant breeds, personality traits, and health concerns that your dog may be genetically predisposed to. All of that information will help you be a better friend to your dog, making smarter decisions about food, training, and healthcare.

The DNA My Dog Kit was awarded at the 2020 GHO Biotechnology Awards and user Bonnie H. writes, “I loved this experience!!! The kit came immediately with great instructions. The results came exactly when promised. When I couldn’t open the attachment with the results, I emailed my concern and got instant help! To find out his DNA has been the coolest experience!”

Lock in free shipping on a unique gift for your dog by December 8. Grab the DNA My Dog Breed Identification Test on sale for 24% off $79 at just $59.99 now.

Prices subject to change.

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