We’ve all embraced video calls, whether it is with our work colleague or our physician, but for developers, it remains a challenge to build both real-time audio and video features into products.
That’s where Daily comes in. The company provides APIs so developers can add those features into products or websites using just two lines of code. Use cases include video calls, audio-only apps, webinars, live classes, interactive collaboration, e-commerce, customer support, IoT and robotics.
Since being founded in 2015, the company has amassed a customer list that includes AppFolio, HotDoc, Pitch, Kumospace and Teamflow, and its customers report seeing up to 80% fewer video call errors after using Daily, Kwindla Hultman Kramer, co-founder and CEO of Daily, told TechCrunch via email.
Following an 18-month time period of rapid growth, which included seeing from 10 times to 30 times increase in all the metrics the company tracks — overall traffic volume, freemium sign-ups, paid usage and the number of customers scaling applications on top of the platform — Daily today announced $40 million in Series B funding.
“The most interesting trend we’re seeing is that new use cases for video and audio are showing up every week,” Hultman Kramer said. “We’ve seen the growth of events platforms, new social/spatial video environments, live commerce, live classes, fitness and workout applications, and a huge amount of experimentation in education and tutoring, just to name a few.”
Renegade Partners led the round, which included new investors Heritage Group, Cendana Capital and Sean Rose, and participation from existing investors including Lachy Groom, Tiger Global, Freestyle Ventures, Slack Fund, Root VC, Moxxie, Haystack Ventures, Todd & Rahul’s Angel Fund, David Eckstein and Aston Motes.
The latest round brings total funding to over $60 million, which includes a $4.6 million round raised in May 2020. The company is not sharing its valuation, but Hultman Kramer revealed that valuation stepped up three times with each of the three funding rounds the company raised in the last 18 months.
The global video conferencing market was valued at $5.8 billion in 2020 and is expected to be $6.28 billion by the end of this year, then double in seven years. Healthcare is one of the areas Daily, which is HIPAA-compliant, is seeing accelerated growth in as startups introduce new apps and tools so that patients can more easily access things like primary care, mental health services and standard prescriptions.
“Equally, we’re seeing really interesting things happening with large, traditional healthcare organizations and with government leadership,” Hultman Kramer added. “HIPAA legislation in the U.S. pushed providers to get better at both patient privacy and data interoperability, and that’s bearing fruit. Medicare and other federal programs now reimburse for telehealth services on a par with reimbursement for in-person visits, while many rural health networks are investing heavily in telehealth tools to extend high-quality care to more people than ever before.”
Gearing up to meet future demand, Hultman Kramer intends to use the new funding to build Daily’s team and expand its global infrastructure. The company recently hired Varun Singh as chief product technology officer and Sarah Milstein as vice president of engineering.
“Real-time video is a specialized area,” he said. We think we have an unfairly good engineering team from a competitive perspective. Raising another round of funding helps us extend that lead and be able to push our infrastructure out closer to the edge of the network, everywhere that our customers see traffic.”
As part of the investment, Roseanne Wincek, co-founder and managing director of Renegade Partners, and Lee Edwards, partner at Root Ventures, joined Daily’s board.
Hultman Kramer says the company did not intend to raise a round in 2021 — it had “plenty of runway and no immediate need for new capital.” However, when investor Jenny Lefcourt introduced the company to Wincek, Hultman Kramer said the company didn’t want to miss the opportunity to bring her onto Daily’s board. Same with Edwards, who introduced Daily to Lachy Groom, which led to Lachy leading Daily’s Series A.
Wincek said via email that Renegade invests in companies that have found product market fit and are ready to scale. She feels the pandemic showed that lowest-latency, high-performance video “is an incredible way to interact,” but that experience is locked in standalone apps that offer video communication and little else.
Daily is bringing innovation, creativity and rich experiences through its API tools that were created with developers in mind and are easy to use and build on, while also being secure.
“In the future, video calls will not look like Zoom, and they will be powered by Daily,” she added. “Daily has real platform potential — it’s a great product with stellar engineering culture, coupled with Kwin’s experience building video for the enterprise. Video has become ubiquitous in the way we work, live and interact online, and Daily is going to create a sea-change in the way we use video on the internet.”