posted 7 days ago on techcrunch
It’s only been a few months since Lili announced its $10 million seed round, and it’s already raised more funding — namely, a $15 million Series A. The startup, founded by CEO Lilac Bar David and CTO Liran Zelkha, is creating a bank account and associated products designed for freelancers, with features like early access to direct deposit payments and the ability to set aside a percentage of income for taxes. The account (and associated Visa debit card) is free of overdraft fees or minimum balance requirements; Bar David said the company only makes money from card processing fees. She also said that the platform has seen rapid growth this year, with transactions up 700% since the beginning of the pandemic and nearly 100,000 accounts opened since the launch in 2019. Bar David suggested that the economic turmoil caused by COVID-19 has prompted (or forced) more skilled workers — such as programmers and digital marketers — to turn to freelancing. Meanwhile, she’s also seen “a big shift from part-time freelance to full-time freelance.” Lili CEO Lilac Bar David Bar David predicted that the recent growth of the freelance economy won’t simply disappear once the pandemic is over, because workers are discovering the benefits of freelancing. “If you have a 9-to-5 job, you’re dependent on one employer,” she said. “If something happens you’re out of a job … If you’ve got a diversified customer base, you’re not dependent on just one source of income.” In recent months, Lili has added new features like automatically generated quarterly income and expense reports, a digital debit card (which customers can use before the physical card arrives in the mail) and the ability to send and receive money via Google Pay (Lili already supported Cash App and Venmo). Bar David said the startup decided to raise more funding to expand its engineering team and further accelerate its growth. Apparently she was preparing for a traditional Series A fundraising process (albeit one that was conducted in the middle of a pandemic), but “our current investors were so tremendously impressed by the product-market fit and the growth” that they were willing to fund almost all of the new round. So the Series A was led by previous investor Group 11, with participation from Foundation Capital, AltaIR Capital, Primary Venture Partners and Torch Capital — along with new backer Zeev Ventures. “As the global workforce evolves at a rapid pace, we are excited to lead another round of funding to help Lili capitalize on unprecedented demand and offer an entirely new solution to help freelancers seamlessly save time and money,” said Group 11’s Dovi Frances in a statement. Lili raises $10M for its freelancer banking app

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posted 7 days ago on techcrunch
Six years ago, Amazon essentially created a new consumer electronics category. Expectations weren’t particularly high when the first Echo device debuted in November of 2014. Amazon, after all, has never shied away from throwing a new device against the wall to see what sticks — if anything, that’s become a defining characteristic of the last half-dozen years of Alexa devices. The Echo stuck. In 2019, 146.9 million smart speakers were shipped globally, according to figures from Strategy Analytics. That figure marked a 70% increase over the year prior. Of that figure, Amazon owned a 26.2% market share. Amazon’s Echo gets a decent-sounding refresh That’s a success story by any measure. Of course, any competition present is also a knock-on effect of Amazon’s success. Google’s original Home speaker was released two years later, and Apple’s HomePod came out the year after that. While each certainly offered their own unique take on the category, it’s hard to imagine them making the same mark had Amazon not helped define the smart speaker category way back when. Along with being the smart speaker grandaddy, Amazon’s also updated its devices with the most frequency. Google Home just got its second iteration (now Nest Audio) and the original HomePod is still on its first version. Last month, we got the fourth generation versions of both the Echo and the Echo Dot. The refreshes are about more than just getting people to buy new devices (of course, that’s a big part of it, too) — they’re also about adapting to learnings about how people use these sorts of devices. Image Credits: Brian Heater After all, the original Echo had little to go on beyond internal testing. Take audio. The initial Echo was smart first and a speaker second. Sure it could play music, but that was really just a secondary feature. First and foremost, the product was about conversing with Alexa. In 2017, however, Apple showed everyone the importance of focusing on audio quality with the HomePod. For many consumers, it made a lot more sense to purchase a quality speaker with an assistant built in, rather than a purpose-built smart speaker with lousy audio quality. Image Credits: Brian Heater Subsequent versions of the Echo started to prioritize audio. Of course, the company never really did so to such a degree that the entry-level product could stand toe to toe with, say, the HomePod (though the Echo Studio is an attempt to approximate that on a somewhat tighter budget), but audio has increasingly become less of an afterthought across the company’s product line. Amazon Echo Dot with Clock review: A mostly aesthetic update This year’s redesign centers on an audio upgrade yet again, along with an aesthetic overhaul that attempts to focus some of that newfound sound. The fourth-generation Echo is, in a word, round. Eschewing generations of cylinders, the company has gone with a design that is perfectly spherical (except the flat bottom to stop it from rolling off your table top). I suspect one learning that lead to the new design was where users place speakers in their homes. Image Credits: Brian Heater Previous generations have been focused on a more three-dimensional listening experience, assuming, I suppose, that people are sticking these speakers in the middle of a room, rather than up against the wall. While the new Echo is round, however, the hard plastic bottom arcs upward, monopolizing about two-thirds of the device’s back. This time out, the company’s opted for a pair of front-firing 0.8-inch tweeters (one more than gen-three), coupled with a three-inch woofer (same as last year). The speaker leans a but too heavily on the bass by default for my tastes, though you can adjust those setting via the Alexa app (I took it down about two notches). The sound quality is solid for the size and price point. I was able to get pretty decent playback listening to Spotify. Head to head, I think the Nest Audio delivers a richer, fuller sound — and if you’re currently assistant-agnostic, that’s the one I’m recommending based purely on sound. Of course, the sound is much fuller if you’ve got a pair of the $99 devices in stereo mode. Amazon thoughtfully sent along two for testing that feature specifically. A similar feature is available for both Google’s Nest devices and Apple’s HomePod and HomePod Mini. Given that two Echos are roughly the price of one Echo Studio, the math might make sense, depending on your home setup. Image Credits: Brian Heater I do like the design here. Though sitting next to the Nest Audio, it’s hard to shake a sense of convergent evolution with all of these smart speakers. As it happens, both of my review devices are the same color, and really look like they could have sprung out of the same product line, with their dark fabric coverings. I do, however, appreciate the design work that’s being done to make them feel a bit more subtle than previous generations — and in a sense part of the furniture. As I mentioned in my recent review of the Echo Dot (which is physically identical to the Echo in all but size), I’m a bit less thrilled with the design to move the light ring to the bottom. I understand practically why the company did this: it wouldn’t have made sense to slice up the round design with a light ring. But the new design only makes sense if the Echo is close to eye level. Otherwise you’re reliant on its reflection from the surface on which the device sits. Image Credits: Brian Heater The biggest upgrade here, however, may be the inclusion of a Zigbee hub, which negates the existence of the Echo Plus. It was only a matter of time before the Echo became a smart home hub, and it’s nice that Amazon’s found a way to incorporate that into a device at this price point. It’s a big part of the company’s push to corner the smart home control market. Notably, the new Nest Audio also offers the feature. An interesting surprise addition is the temperature sensor. In addition to local weather, asking “Alexa, what’s the temperature in here?” it will offer up an average temperature for the room where the Echo resides. Not exactly necessary, but helpful information, I suppose. Image Credits: Brian Heater Amazon’s nearly annual updates to the line ensure that no new generation represents as radical an upgrade as the one we just saw between Google Home and Nest Audio. But all in all, Amazon’s presented us with a nice little refresh here. Nearly 70% of US smart speaker owners use Amazon Echo devices

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posted 7 days ago on techcrunch
Facebook has been making a big play to be a go-to partner for small and medium businesses that use the internet to interface with the wider world, and its messaging platform WhatsApp, with some 50 million businesses and 175 million people messaging them (and more than 2 billion users overall), has been a central part of that pitch. Now, the company is making three big additions to WhatsApp to fill out that proposition. It’s launching a way to shop for and pay for goods and services in WhatsApp chats; it’s going head to head with the hosting providers of the world with a new product called Facebook Hosting Services to host businesses’ online assets and activity; and — in line with its expanding product range — Facebook said it will finally start to charge companies using WhatsApp for Business. Facebook announced the news in a short blog post light on details. We have reached out to the company for more information on pricing, availability of the services, and whether Facebook will provide hosting itself or work with third parties, and we will update this post as we learn more. Update: Facebook responded and we are putting the replies below, in-line where it makes sense. Here is what we know for now: In-chat Shopping. Companies are already using WhatsApp to present product information and initiate discussions for transactions. One of the more recent developments in that area was the addition of QR codes and the ability to share catalog links in chats, added in July. At the same time, Facebook has been expanding the ways that businesses can display what they are selling on Facebook and Instagram, most recently with the launch in August of Facebook Shop, following a similar product roll out on Instagram before that. Today’s move sounds like a new way for businesses in turn to use WhatsApp both to link through to those Facebook-native catalogs, as well as other products, and then purchase items, while still staying in the chat. At the same time, Facebook will be making it possible for merchants to add “buy” buttons in other places that will take shoppers to WhatsApp chats to complete the purchase. “We also want to make it easier for businesses to integrate these features into their existing commerce and customer solutions,” it notes. “This will help many small businesses who have been most impacted in this time.” Although Facebook is not calling this WhatsApp Pay, it seems that this is the next step ahead for the company’s ambitions to bring payments into the chat flow of its messaging app. That has been a long and winding road for the company, which finally launched WhatsApp Payments, using Facebook Pay, in Brazil, in June of this year only to have it shut down by regulators for failing to meet their requirements. (The plan has been to expand it to India, Indonesia and Mexico next.) Facebook Hosting Services: These will be available in the coming months, but no specific date to share right now. “We’re sharing our plans now while we work with our partners to make these services available,” the company said in a statement to TechCrunch. No! This is not about Facebook taking on AWS. Or… not yet at least? The idea here appears that it is specifically aimed at selling hosting services to the kind of SMBs who already use Facebook and WhatsApp messaging, who either already use hosting services for their online assets, whether that be their online stores or other things, or are finding themselves now needing to for the first time, now that business is all about being “online.” “Today, all businesses using our API are using either an on-premise solution or leverage a solutions provider, both of which require costly servers to maintain,” Facebook said. “With this change, businesses will be able to choose to use Facebook’s own secure hosting infrastructure for free, which helps remove a costly item for every company that wants to use the WhatsApp Business API, including our business service providers, and will help them all save money.” It added that it will share more info about where data will be hosted closer to launch. This is a very interesting move, since the SMB hosting market is pretty fragmented with a number of companies, including the likes of GoDaddy, Dream Host, HostGator, BlueHost and many others also offering these services. That fragmentation spells opportunity for a huge company like Facebook with a global profile, a burgeoning amount of connections through to other online services for these SMBs, and a pretty extensive network of data centers around the world that it’s built for itself and can now use to provide services to others — which is, indeed, a pretty strong parallel with how Amazon and AWS have done business. Facebook already has an “app store” of sorts of partners it works with to provide marketing and related services to businesses using its platform. It looks like it plans to expand this, and will sell the hosting alongside all of that, with the kicker that hosting natively on Facebook will speed up how everything works. “Providing this option will make it easier for small and medium size businesses to get started, sell products, keep their inventory up to date, and quickly respond to messages they receive – wherever their employees are,” it notes. Charging tiers: As you would expect, to encourage more adoption, Facebook has not been charging for WhatsApp Business up to now, but it has charged for some WhatsApp business messages — for example when businesses send a boarding pass or e-commerce receipt to a customer over Facebook’s rails. (These prices vary and a list of them is published here.) Now, with more services coming into the mix, and businesses tying their fates more strongly to how well they are performing on Facebook’s platforms, it’s not surprise to see Facebook converting that into a pay to play scenario. “What we’ve heard over the past couple years is how the conversational nature of business messaging is really valuable to people. So in the future we may look at ways to update how we charge businesses that better reflect how it’s used,” the company told us. Important to note that this will relate to how businesses send messages. “As always, it’s free for people to send a business a message,” Facebook added. Frustratingly, there seems so far to be no detail on which services will be charged, nor how much, nor when, so this is more of a warning than a new requirement. “We will charge business customers for some of the services we offer, which will help WhatsApp continue building a business of our own while we provide and expand free end-to-end encrypted text, video and voice calling for more than two billion people,” it notes. For those who might find that annoying, on the plus side, for those who are concerned about an ever-encroaching data monster, it will, at the least, help WhatsApp and Facebook continue to stick to its age-old commitment to stay away from advertising as a business model. Doubling-down on SMBs The new services come at a time when Facebook is doubling down on providing services for businesses, spurred in no small part by the coronavirus pandemic, which has driven physical retailers and others to close their actual doors, shifting their focus to using the internet and mobile services to connect with and sell to customers. Citing that very trend, last month the company’s COO Sheryl Sandberg announced the Facebook Business Suite, bringing together all of the tools it has been building for companies to better leverage Facebook, Instagram and WhatsApp profiles both to advertise themselves as well as communicate with and sell to customers. And the fact that Sandberg was leading the announcement says something about how Facebook is prioritizing this: it’s striking while the iron is hot with companies using its platform, but it sees/hopes that business services can a key way to diversify its business model while also helping buffer it — since many businesses building Pages may also advertise. Facebook has also been building more functionality across Facebook and Instagram specifically aimed at helping power users and businesses leverage the two in a more efficient way. Adding in more tools to WhatsApp is the natural progression of all of this. To be sure, as we pointed out earlier this year, even while there is a lot of very informal use of WhatsApp by businesses all around the world, WhatsApp Business remains a fairly small product, most popular in India and Brazil. Facebook launching more tools for how to use it will potentially drive more business not just in those markets but help the company convert more businesses to using it in other places, too. Smaller businesses have been on Facebook’s radar for a while now. Even before the pandemic hit, in many cases retailers or restaurants do not have websites of their own, opting for a Facebook Page or Instagram Profile as their URL and primary online interface with the world; and even when they do have standalone sites, they are more likely to update people and spread the word about what they are doing on social media than via their own URLs. Facebook’s also made a video to help demonstrate how it sees these WhatsApp Business in action, which you can here:

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Buildings are the bedrocks of civilization — places to live, places to work (well, normally, in a non-COVID-19 world) and places to play. Yet how we conceive buildings, architect them for their uses, and ultimately construct them on a site has changed remarkably little over the past few decades. Housing and building costs continue to rise, and there remains a slow linear process from conception to construction for most projects. Why can’t the whole process be more flexible and faster? Well, a trio of engineers and architects out of MIT and Georgia Tech are exploring that exact question. MIT’s former treasurer Israel Ruiz along with architects Anton Garcia-Abril of MIT and Debora Mesa of Georgia Tech have joined together on a startup called WoHo (short for “World Home”) that’s trying to rethink how to construct a modern building by creating more flexible “components” that can be connected together to create a structure. WoHo’s Israel Ruiz, Debora Mesa, and Anton Garcia-Abril. Photo via WoHo. By creating components that are usable in a wide variety of types of buildings and making them easy to construct in a factory, the goal of WoHo is to lower construction costs, maximize flexibility for architects, and deliver compelling spaces for end users, all while making projects greener in a climate unfriendly world. The team’s ideas caught the attention of Katie Rae, CEO and managing director of The Engine, a special fund that spun out of MIT that is notable for its lengthy time horizons for VC investments. The fund is backing WoHo with $4.5 million in seed capital. Ruiz spent the last decade overseeing MIT’s capital construction program, including the further buildout of Kendall Square, a neighborhood next to MIT that has become a major hub for biotech innovation. Through that process, he saw the challenges of construction, particularly for the kinds of unique spaces required for innovative companies. Over the years, he also built friendships with Garcia-Abril and Mesa, the duo behind Ensamble Studio, an architecture firm. With WoHo, “it is the integration of the process from the design and concept in architecture all the way through the assembly and construction of that project,” Ruiz explained. “Our technology is suitable for low-to-high rise, but in particularly it provides the best outcomes for mid-to-high rise.” So what exactly are these WoHo components? Think of them as well-designed and reusable blocks that can be plugged together in order to create a structure. These blocks are consistent and are designed to be easily manufactured and transported. One key innovation is around an improved reinforced cement that allows for better building quality at lower environmental cost. Conception of a WoHo component under construction. Photo via WoHo We have seen modular buildings before, typically apartment buildings where each apartment is a single block that can be plugged into a constructed structure (take for example this project in Sacramento). WoHo, though, wants to go further in having components that offer more flexibility and arrangements, and also act as the structure themselves. That gives architects far more flexibility. It’s still early days, but the group has already gotten some traction in the market, inking a partnership with Swiss concrete and building materials company LafargeHolcim to bring their ideas to market. The company is building a demonstration project in Madrid, and targeting a second project in Boston for next year.

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Three months on since the former founders of SoundCloud launched their e-bike subscription service, Dance they are today announcing the close of a $17.7 million (€15 million) Series A funding round led by one of the larger European VCs, HV Holtzbrinck Ventures. Founded by Eric Quidenus-Wahlforss (ex-Soundcloud), Alexander Ljung (ex-Soundcloud) and Christian Springub (ex-Jimdo), Dance has ambitions to offer its all-inclusive service subscription package into expanded markets across Europe and eventually the US. Dance is currently operating the invite-only pilot of its e-bike subscription in Berlin, with plans for a broader launch, expanded accessibility and availability and new cities next year.  Rainer Märkle, general partner at HV Holtzbrinck Ventures said in a statement: “The mobility market is seeing a huge shift towards bikes, strongly fueled by the paradigm shift of vehicles going electric. Unfortunately, the majority of e-bikes on the market today have some combination of poor design, high upfront costs, and cumbersome maintenance. We analyzed the overall mobility market, evaluated all means of transport, and crunched the numbers on all types of business models for a few years before we found what we were looking for. Dance is by the far the most viable future of biking, bridging the gap between e-bike ownership and more ‘joyful’ accessibility to go places.” E-bikes tend to be notoriously expensive to purchase and a hassle to repair. That said, startups like VanMoof and Cowboy have brought an Apple -esque business model to the market which is fast bringing the cost of full ownership down. After lockdowns lead to an e-bike boom, VanMoof raises $40M Series B to expand globally Electric-bike maker Cowboy raises $26 million Most commuters are put off cycling the average 10 kilometers (6.2 miles) commute but e-bikes make this distance a breeze. Dance sits in that half-way house between owning an expensive bike and having to hunt down a rentable ebike or electric scooter close to your location. Additionally, the COVID-19 pandemic has brought individual, socially distanced, transport into sharp relief. UK sales of e-bikes have boomed, seeing a 230% surge in demand over the summer. This has happened at the same time as EU governments have put in more than 2300km of bike lanes, with the UK alone pledging £250 million in investment. Quidenus-Wahlforss said the startup has been “inundated with positive responses from around the world since we announced our invite-only pilot program.” Dance’s subscription model includes a fully assembled e-bike delivered to a subscriber’s door within 24 hours. This comes with maintenance, theft replacement insurance, a dedicated smartphone app, concierge services, GPS location tracking and unlocking capabilities. Review: Handsome and nippy, new VanMoof e-bikes could be the shape of cities to come

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Smartphone shipments reached an all-time high in India in the quarter that ended in September this year as the world’s second largest handset market remained fully open during the period after initial lockdowns due to the coronavirus, according to a new report. About 50 million smartphones shipped in India in Q3 2020, a new quarterly record for the country where about 17.3 million smartphone units shipped in Q2 (during two-thirds of the period much of the country was under lockdown) and 33.5 million units shipped in Q1 this year, research firm Canalys said on Thursday. Xiaomi, which assumed the No.1 smartphone spot in India in late 2018, continues to maintain its dominance in the country. It commanded 26.1% of the smartphone market in India, exceeding Samsung’s 20.4%, Vivo’s 17.6%, and Realme’s 17.4%, the marketing research firm said. Image Credits: Canalys / But the market, which was severely disrupted by the coronavirus, is set to see some more shifts. Research firm Counterpoint said last week that Samsung had regained the top spot in India in the quarter that ended in September. (Counterpoint plans to share the full report later this month.) According to Counterpoint, Samsung has benefited from its recent aggressive push into online sales and from the rising anti-China sentiments in India. The geo-political tension between India and China has incentivised many consumers in India to opt for local brands or those with headquarters based in U.S. and South Korea. And local smartphone firms, which lost the market to Chinese giants (that command more than 80% of the market today) five years ago, are planning a come back. Indian brand Micromax, which once ruled the market, said this month that it is gearing up to launch a new smartphone sub-brand called “In.” Rahul Sharma, the head of Micromax, said the company is investing $67.9 million in the new smartphone brand. In a video he posted on Twitter last week, Sharma said Chinese smartphone makers killed the local smartphone brands but it was now time to fight back. “Our endeavour is to bring India on the global smartphone map again with ‘in’ mobiles,” he said in a statement. India also recently approved applications from 16 smartphone and other electronics companies for a $6.65 billion incentives program under New Delhi’s federal plan to boost domestic smartphone production over the next five years. Foxconn (and two other Apple contract partners), Samsung, Micromax, and Lava (also an Indian brand) are among the companies that will be permitted to avail the incentives. Missing from the list are Chinese smartphone makers such as Oppo, Vivo, OnePlus and Realme.

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Geocoding startup what3words — which chunks the world into 3mx3m squares, giving each a unique three-word label to simplify location sharing — has nabbed another in-vehicle integration, via a partnership with Here Technologies. The pair said today that OEMs using Here’s navigation platform can include what3words as an in-car nav feature directly through the Here Search API, instead of needing to integrate itself. Existing users of the platform will be able to be given access to what3word’s addressing tech via an update. Here says its map data services can be found in 150 million vehicles worldwide at this point. It’s by no means the first such integration for what3words which has found cars to be a natural fit for its simplified, ‘rolls-off-the-tongue’ addressing system. The 2013-founded startup inked a partnership with Ford last year, for example. It also counts Daimler as an investor. Letting drivers speak or type three words to input a location into their car’s GPS system has clear benefits vs requiring they correctly specify a full address. what3words also pinpoints a more specific location than a typical postcode — and works for destinations that don’t have a street address (the start of a hiking trial or specific lay-by; a particular entrance for a campus etc). what3words further notes that its tech has been adopted by global car companies, logistics providers and mobility apps, including Mercedes-Benz, Tata Motors, DB Schenker, Hermes and Cabify. In recent years the novel addressing system has also found favor with Airbnb as a way of simplifying location sharing for less traditional types of stays. Commenting on its latest partnership in a statement, what3words CEO and co-founder, Chris Sheldrick, said: “We are seeing increasing demand from automakers and mobility services. Now that we are embedded in Here, we can enable our address system simply and easily in both new and legacy vehicles.” “Automotive OEMs and Tier 1 suppliers can now provide the what3words service to their customers through the Here Search API instead of having to integrate it themselves,” added Jørgen Behrens, SVP and chief product officer at Here Technologies in another supporting statement. “This will allow drivers to navigate easily in dense, urban environments with non-standard addressing schemes or seamlessly get to any location, be it a local pub or a trailhead.”

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posted 7 days ago on techcrunch
The trial of Samsung leader Jay Y. Lee, who is accused of accounting fraud and stock price manipulating, held its first hearing today at the Seoul Central District Court. The Seoul Central District Court denied prosecutors’ arrest warrant request for Lee in June, stating that even though they had secured a “considerable amount of evidence,” it was still not enough to detain Lee. Lee was not present for the hearing. Vietnamese state media reported that he was in Vietnam earlier this week to discuss investments with Prime Minister Nguyen Xuan Phuc. South Korean court denies prosecutors’ arrest warrant request for Samsung heir Jay Lee Prosecutors allege that the value of electronics materials provider Cheil Industries was artificially inflated before its merger with Samsung’s holding company five years ago to create a more favorable rate for Lee, who was then Cheil’s largest shareholder. Lee is also one of eleven current and former Samsung Executives indicted by South Korean prosecutors last month over charges that they inflated the assets of Samsung BioLogics, which Cheil held a major stake in. During the hearing today, Lee’s attorney said that the merger and accounting process were part of normal management activities, reported Channel News Asia. If found guilty, Lee may face a jail sentence. Lee has already spent time in jail, after he was charged with bribing former President Park Geun-hye to secure support for the merger. Lee was released from prison in 2018 after serving almost a year. Park was impeached in 2017 and sentenced to a 25-year prison term for bribery, abuse of power and embezzlement. Samsung Vice Chairman Jay Lee is out of jail after his bribery sentence is suspended

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Silverflow, a Dutch startup founded by Adyen alumni, is breaking cover and announcing seed funding. The pre-launch company has spent the last two years building what it describes as a “cloud-native” online card processor that directly connects to card networks. The aim is to offer a modern replacement for the 20 to 40-year-old payments card processing tech that is mostly in use today. Backing Silverflow’s €2.6 million seed round is U.K.-based VC Crane Venture Partners, with participation from Inkef Capital and unnamed angel investors and industry leaders from Pay.On, First Data, Booking.com and Adyen. It brings the fintech startup’s total funding to date to ~€3 million. Bootstrapped while in development and launching in 2021, Silverflow’s founders are CEO Anne-Willem de Vries (who was focused on card acquiring and processing at Adyen), CBDO Robert Kraal (former Adyen COO and EVP global card acquiring & processing of Adyen) and CTO Paul Buying (founder of acquired translation startup Livewords). “The payments tech stack needs an upgrade,” Kraal tells me. “Today’s card payment infrastructure based on 30 to 40-year-old technology is still in use across the global payment landscape. This legacy infrastructure is costing everyone time and money: consumers, merchants, payment-service-providers and banks. The legacy platforms require a lengthy on-boarding process and are expensive to maintain, [and] they also aren’t fit for purpose today because they don’t support data use”. In addition, Kraal says that adding new functionality is a lengthy and expensive process, requiring the effort of specialised engineers which ultimately slows down innovation “for the whole card payments system”. “Finally, every acquirer provides its customer with a different processing platform, which for a typical payment service provider (PSP) means they have to deal with multiple legacy platforms — and all the costs and specialised support each entails,” adds de Vries. To solve this, Silverflow claims it has built the first payments processor with a “cloud-native platform” built for today’s technology stack. This includes offering simple APIs and “streamlined data flows” directly integrated into the card networks. Continues de Vries: “Instead of managing a complex network of acquirers across markets with dozens of bank and card network connections to maintain, Silverflow provides card-acquiring processing as a service that connects to card networks directly through a simple API”. Target customers are PSPs, acquirers and “global top-market merchants” that are seeing €500 million to 10 billion in annual transactions. “As a managed service, Silverflow provides the maintenance for connections and new product innovation that users have typically had to support in-house or work on long-term product road maps with suppliers,” explains Kraal. “Based in the cloud, Silverflow is infinitely scalable for peak flows and also provides robust data insights that users haven’t previously been able to access”. With regards to competitors, Kraal says there are no other companies at the moment doing something similar, “as far as we are aware”. Currently, acquirers use traditional third-party processors, such as SIA, Omnipay, Cybersource or MIGS. Some companies, like Adyen, have built their own in-house processing platform. Accel VCs Sonali De Rycker and Andrew Braccia say European deal pace is ‘incredibly active’ So, why hasn’t a cloud-native card processing platform like Silverflow been done before and why now? A lack of awareness of the problem might be one reason, says de Vries. “Unless you have built several integrations to acquirers during your career, you are not aware that the 30 to 40-years-old infrastructure is still in use. This is not typically a problem some bright college graduates would tackle,” he posits. “Second, to build this successfully, you need to have prior knowledge of the card payments industry to navigate all the legal, regulatory and technical requirements. “Thirdly, any large corporate currently active in card payment processing will be aware of the problem and have the relevant industry knowledge. However, building a new processing platform would require them to allocate their most talented staff to this project for two-three years, taking away resources from their existing projects. In addition, they would also need to manage a complex migration project to move their existing customers from their current system to the new one and risk losing some of the customers along the way”.

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Facebook’s dating bolt-on to its eponymous social networking service has finally launched in Europe, more than nine months after an earlier launch plan was derailed at the last minute over privacy concerns. From today, European Facebook users in Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Croatia, Hungary, Ireland, Italy, Lithuania, Luxembourg, Latvia, Malta, Netherlands, Poland, Portugal, Romania, Sweden, Slovenia, Slovakia, Iceland, Liechtenstein, Norway, Spain, Switzerland and the UK can opt into Facebook Dating by creating a profile at facebook.com/dating. Among the dating product’s main features are the ability to share Stories on your profile; a Secret Crush feature that lets you select up to nine of your Facebook friends or Instagram followers who you’d like to date (without them knowing unless they also add you — triggering a match notification); the ability to see people with similar interests if you add your Facebook Events and Groups to your Dating profile; and a video chat feature called Virtual Dates. Image credit: Facebook Of course if you opt in to Facebook Dating you’re going to be plugging even more of your personal data into Facebook’s people profiling machine. And it was concerns about how the dating product would be processing European users’ information that led to a regulatory intervention by the company’s lead data regulator in the EU, the Irish Data Protection Commission (DPC). Back in February Facebook agreed to postpone the regional launch of Facebook Dating after the DPC’s agents paid a visit to its Dublin office — saying Facebook had not provided it with enough advanced warning of the product launch, nor adequate documentation about how it would work. More than nine months later the regulator seems satisfied it now understands how Facebook Dating is processing people’s personal data — although it also says it will be monitoring the EU launch. Additionally, the DPC says Facebook has made some changes to the product in light of concerns it raised (full details below). Deputy commissioner, Graham Doyle, told TechCrunch: “As you will recall, the DPC became aware of Facebook’s plans to launch Facebook Dating a number of days prior to its planned launch in February of this year. Further to the action taken by the DPC at the time (which included an on-site inspection and a number of queries and concerns being put to Facebook), Facebook has provided detailed clarifications on the processing of personal data in the context of the Dating feature. Facebook has also provided details of changes that they have made to the product to take account of the issues raised by the DPC. We will continue to monitor the product as it launches across the EU this week.” “Much earlier engagement on such projects is imperative going forward,” he added. Since the launch of Facebook’s dating product in 20 countries around the world — including the US and a number of markets in Asia and LatAm — the company says more than 1.5 billion matches have been “created”. In a press release about the European launch, Facebook writes that it has “built Dating with safety, security and privacy at the forefront”, adding: “We worked with experts in these areas to provide easy access to safety tips and build protections into Facebook Dating, including the ability to report and block anyone, as well as stopping people from sending photos, links, payments or videos in messages.” It also links to an update about Facebook Dating’s privacy which emphasizes the product is an “opt-in experience”. This document includes a section explaining how use of the product impacts Facebook’s data collection and the ads users see across its suite of products. “Facebook Dating may suggest matches for you based on your activities, preferences and information in Dating and other Facebook Products,” it writes. “We may also use your activity in Dating to personalize your experience, including ads you may see, across Facebook Products. The exception to this is your religious views and the gender(s) you are interested in dating, which will not be used to personalize your experience on other Facebook Products.” One key privacy-related change flowing from the DPC intervention looks to be that Facebook has committed to excluding the use of Dating users’ religious and sexual orientation information for ad targeting purposes. Under EU law this type of personal information is classed as ‘special category’ data — and consent to process it requires a higher bar of explicit consent from the user. (And Facebook probably didn’t want to harsh Dating users’ vibe with pop-ups asking them to agree to ads targeting them for being gay or Christian, for example.) Asked about the product changes, the DPC confirmed a number of changes related to special category data, along with some additional clarifications. Here’s its full list of “changes and clarifications” obtained from Facebook: Changes to the user interface around a user’s selection of religious belief. Under the original proposal, the “prefer not to say” option was buried in the choices; Updated sign-up flow within the Dating feature to bring to the user’s attention that Dating is a Facebook product and that it is covered by FB’s terms of service and data policy, as particularised by the Supplemental Facebook Dating Terms. Clarification on the uses of special category data (no advertising using special category data and special category data collected in the dating feature will not be used by the core FB service); Clarification that all other information will be used by Facebook in the normal manner across the Facebook platform in accordance with the FB terms of service; Clarification on the processing of location data (location services has to be turned on for onboarding for safety and verification purpose but can then be turned off. Dating does not automatically update users’ Dating location in their Dating profile, even if the user chooses to have their location turned on for the wider Facebook service. Dating location does not use the user’s exact location, and is shown at a city level on the user’s Dating profile.).

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French startup Alan is building health insurance products. And 100,000 people are now covered through Alan . I caught up with the company’s co-founder and CEO Jean-Charles Samuelian-Werve so that he could give us an update on the product. Alan has obtained its own health insurance license and is a proper insurance company. It doesn’t partner with existing insurance companies. The company primarily sells its insurance product to other companies. In France, employees are covered by both the national health care system and private insurance companies. So Alan convinces other companies to use its product for all employees. Over the years, Alan has diversified its offering with high-end coverage, partnerships with CNP Assurances, Livi and Petit Bambou, a focus on new verticals, such as companies in the hospitality industry or retired individuals. “We’ve kept shipping, and I even think that our pace has increased. We’ve released some exciting stuff in recent months, for our members, for companies and for us internally,” Samuelian-Werve told me. The biggest change isn’t visible to the end user. The company has built a service that lets them generate a new insurance package on demand. It uses historical data to figure out pricing on the fly. And it opens up some market opportunities as big companies want a custom insurance product depending on their needs. The biggest Alan customer is a company with 1,000 to 1,500 employees. But the startup is currently selling its product to bigger companies. The idea is that companies above 100 employees can get a custom insurance package. For the customer, pricing remains transparent as Alan shows you how much it costs to cover your medical needs depending on what you’re asking for. Alan adds a membership fee on top of that to access the platform and related services. Alan is also introducing a new messaging feature. You can start a text discussion with a doctor whenever you have a question about your health — it’s included in your insurance package. Alan doesn’t want to replace your general practitioner. But having a doctor that you can text is always helpful when you’re not sure what to do next. On the other side of the screen, there are actual doctors answering your questions. “We’ve hired a full-time doctor and we’re working with a bit under 10 doctors on a part-time basis,” Samuelian-Werve told me. Alan’s app has been redesigned with a bigger emphasis on your health instead of your insurance. The company shows you all your interactions with health professionals. You can add documents and notes to consolidate information in the same place. It sounds a bit like France’s DMP, which acts as a personal repository for all your health-related documents. And Alan doesn’t want to replace the public initiative. The startup would like to take advantage of the service to upload and download data at some point down the road. If you give your consent, Alan can also proactively nudge you about your health. For instance, given your child’s age, Alan can notify you when they’re supposed to get vaccinated. Or if you haven’t been to the dentist in a year, Alan can tell you that it’s time to get a routine checkup. Finally, the company has improved efficiency when it comes to reimbursements. “74% of reimbursements are issued within an hour. And we’re using instant transfers to send money to your bank account,” Samuelian-Werve told me. As you can see, Alan is releasing incremental updates. They slowly add up and change the product. In the coming years, the company plans to offer its product in multiple European countries.

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Acapela, a new startup co-founded by Dubsmash founder Roland Grenke, is breaking cover today in a bid to re-imagine online meetings for remote teams. Hoping to put an end to video meeting fatigue, the product is described as an “asynchronous meeting platform,” which Grenke and Acapela’s other co-founder, ex-Googler Heiki Riesenkampf (who has a deep learning computer science background), believe could be the key to unlock better and more efficient collaboration. In some ways the product can be thought of as the antithesis to Zoom and Slack’s real-time and attention-hogging downsides. To launch, the Berlin-based and “remote friendly” company has raised €2.5 million in funding. The round is led by Visionaries Club with participation from various angel investors, including Christian Reber (founder of Pitch and Wunderlist) and Taavet Hinrikus (founder of TransferWise). I also understand Entrepreneur First is a backer and has assigned EF venture partner Benedict Evans to work on the problem. If you’ve seen the ex-Andreessen Horowitz analyst writing about a post-Zoom world lately, now you know why. Former Andreessen Horowitz partner Benedict Evans joins EF as Venture Partner Specifically, Acapela says it will use the injection of cash to expand the core team, focusing on product, design and engineering as it continues to build out its offering. “Our mission is to make remote teams work together more effectively by having fewer but better meetings,” Grenke tells me. “With Acapela, we aim to define a new category of team collaboration that provides more structure and personality than written messages (Slack or email) and more flexibility than video conferencing (Zoom or Google Meet)”. Grenke believes some form of asynchronous meetings is the answer, where participants don’t have to interact in real-time but the meeting still has an agenda, goals, a deadline and — if successfully run — actionable outcomes. “Instead of sitting through hours of video calls on a daily basis, users can connect their calendars and select meetings they would like to discuss asynchronously,” he says. “So, as an alternative to everyone being in the same call at the same time, team members contribute to conversations more flexibly over time. Like communication apps in the consumer space, Acapela allows rich media formats to be used to express your opinion with voice or video messages while integrating deeply with existing productivity tools (like GSuite, Atlassian, Asana, Trello, Notion, etc.)”. In addition, Acapela will utilise what Grenke says is the latest machine learning techniques to help automate repetitive meeting tasks as well as to summarise the contents of a meeting and any decisions taken. If made to work, that in itself could be significant. “Initially, we are targeting high-growth tech companies which have a high willingness to try out new tools while having an increasing need for better processes as their teams grow,” adds the Acapela founder. “In addition to that, they tend to have a technical global workforce across multiple time zones which makes synchronous communication much more costly. In the long run we see a great potential tapping into the space of SMEs and larger enterprises, since COVID has been a significant driver of the decentralization of work also in the more traditional industrial sectors. Those companies make up more than 90% of our European market and many of them have not switched to new communication tools yet”. How Dubsmash revived itself as #2 to TikTok

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European entrepreneurs who want to launch startups could do worse than Switzerland. In a report analyzing Europe’s general economic health, cost of doing business, business environment and labor force quality, analysts looked for highly educated populations, strong economies, healthy business environments and relatively low costs for conducting business. Switzerland ended up ranking third out of 31 European nations, according to Nimblefins. (Germany and the UK came out first and second, respectively). According to official estimates, the number of new Swiss startups has skyrocketed by 700% since 1996. Zurich tends to take the lion’s share, as the city’s embrace of startups has jump-started development, although Geneva and Lausanne are also hotspots. As well as traditional software engineering startups, Switzerland’s largest city boasts a startup culture that emphasizes life sciences, mechanical engineering and robotics. Compared to other European countries, Switzerland has a low regulatory burden and a well-educated, highly qualified workforce. Google’s largest R&D center outside of the United States is in Zurich. But it’s also one of the more expensive places to start a business, due to its high cost of living, salary expectations and relatively small labor market. Native startups will need 25,000 Swiss Francs to open an LLC and 50,000 more to incorporate. While they can withdraw those funds from the business the next day, local founders must still secure decent backing to even begin the work. This means Switzerland has gained a reputation as a place to startup — and a place to relocate, which is something quite different. It’s one reason why the region is home to many fintech businesses born elsewhere that need proximity to a large banking ecosystem, as well as the blockchain/crypto crowd, which have found a highly amenable regulatory environment in Zug, right next door to Zurich. Zurich/Zug’s “Crypto Valley” is a global blockchain hotspot and is home to, among others, the Ethereum Foundation. Lawyers and accountants tend to err on the conservative side, leading to a low failure rate of businesses but less “moonshot innovation,” shall we say. But in recent years, corporate docs are being drawn up in English to facilitate communication both inside Switzerland’s various language regions and foreign capital, and investment documentation is modeled after the U.S. Ten years ago startups were unusual. Today, pitch competitions, incubators, accelerators, VCs and angel groups proliferate. The country’s Federal Commission for Technology and Innovation (KTI) supports CTI-Startup and CTI-Invest, providing startups with investment and support. Venture Kick was launched in 2007 with the vision to double the number of spin-offs from Swiss universities and draws from a jury of more than 150 leading startup experts in Switzerland. It grants up to CHF 130,000 per company. Fundraising platforms such as Investiere have boosted the angel community support of early funding rounds. Swiss companies, like almost all European companies, tend to raise lower early-stage rounds than U.S. ones. A CHF 1-2 million Series A or a CHF 5 million Series B investment is common. This has meant smaller exits, and thus less development for the ecosystem. These are the investors we interviewed: Jasmin Heimann, partner, Ringier Digital Ventures Katrin Siebenbuerger Hacki, founder, Medows Philipp Stauffer, partner, FYRFLY Venture Partners Claude Donzé, partner, Tomahawk.VC Lucian Wagner, partner, Privilège Ventures Maximilian Spelmeyer, partner, SIX Fintech Ventures Olaf Hannemann, partner, CV VC AG Andreas Iten, partner, F10 Michael Blank, partner, investiere Ninja Struye de Swielande, partner, Lakestar   Jasmin Heimann, partner, Ringier Digital Ventures What trends are you most excited about investing in, generally? Consumer-facing startups with first revenues. What’s your latest, most exciting investment? AirConsole — a cloud-gaming platform where you don’t need a console and can play with all your friends and family. Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now? I really wish that the business case for social and ecological startups will finally be proven (kind of like Oatly showed with the Blackstone investment). I also think that femtech is a hyped category but funding as well as renown exits are still missing. What are you looking for in your next investment, in general? I am looking for easy, scalable solutions with a great team. Which areas are either oversaturated or would be too hard to compete in at this point for a new startup? What other types of products/services are you wary or concerned about? I think the whole scooter/mobility space is super hyped but also super capital intensive so I think to compete in this market at this stage is hard. I also think that the whole edtech space is an important area of investment, but there are already quite a lot of players and it oftentimes requires cooperation with governments and schools, which makes it much more difficult to operate in. Lastly, I don’t get why people still start fitness startups as I feel like the market has reached its limits. How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less? Switzerland makes — maximum — half of our investments. We are also interested in Germany and Austria as well as the Nordics. Which industries in your city and region seem well-positioned to thrive, or not, long term? What are companies you are excited about (your portfolio or not), which founders? Zurich and Lausanne are for sure the most exciting cities, just because they host great engineering universities. Berne is still lagging behind but I am hoping to see some more startups emerging from there, especially in the medtech industry. How should investors in other cities think about the overall investment climate and opportunities in your city? Overall, Switzerland is a great market for a startup to be in — although small, buying power is huge! So investors should always keep this in mind when thinking about coming to Switzerland. The startup scene is pretty small and well connected, so it helps to get access through somebody already familiar with the space. Unfortunately for us, typical B2C cases are rather scarce. Do you expect to see a surge in more founders coming from geographies outside major cities in the years to come, with startup hubs losing people due to the pandemic and lingering concerns, plus the attraction of remote work? I think it is hard to make any kind of predictions. But on the one hand, I could see this happening. On the other hand, I also think that the magic of cities is that there are serendipity moments where you can find your co-founder at a random networking dinner or come across an idea for a new venture while talking to a stranger. These moments will most likely be much harder to encounter now and in the next couple of months. Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times? I think travel is a big question mark still. The same goes for luxury goods, as people are more worried about the economic situation they are in. On the other hand, remote work has seen a surge in investments. Also sustainability will hopefully be put back on the agenda. How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now? Not much. I think we allocated a bit more for the existing portfolio but otherwise we continue to look at and discuss the best cases. The biggest worries are the uncertainties about [what] the future might look like and the related planning. We tell them to first and foremost secure cash flow. Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic? Totally! Some portfolio companies have really profited from the crisis, especially our subscription-based models that offer a variety of different options to spend time at home. The challenge now is to keep up the momentum after the lockdown. What is a moment that has given you hope in the last month or so? This can be professional, personal or a mix of the two. What gives me hope is to see that people find ways to still work together — the amount of online events, office hours, etc. is incredible. I see the pandemic also as a big opportunity to make changes in the way we worked and the way things were without ever questioning them.   Katrin Siebenbuerger Hacki, founder, Medows

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“I have to choose my words carefully,” says Joe Castelino of Stevens Creek Volkswagen in San Jose, California, when asked about the management software on which most car dealerships rely for inventory information, marketing, customer relationships and more. Castelino, the dealership’s service director, laughs as he says this. But the joke has apparently been on car dealers, most of whom have largely relied on a few frustratingly antiquated vendors for their dealer management systems over the years — along with many more sophisticated point solutions. It’s the precise opportunity that former Tesla CIO, Jay Vijayan, concluded he was well-positioned to address while still in the employ of the electric vehicle giant. As Vijayan tells it, he knew nothing about cars until joining Tesla in 2011, following a dozen years of working in product development at Oracle, then VMware. Yet he learned plenty over the subsequent four years. Specifically, he says he helped to build with Elon Musk a central analysis system inside Tesla, a kind of brain that could see all of the company’s internal systems, from what was happening in the supply chain to its factory systems to its retail platform. Tesla had to build it itself, says Vijayan; after evaluating the existing software of third-company providers, the team “realized that none of them had anything close to what we needed to provide a frictionless modern consumer experience.” Tesla is a chain of startups, Elon Musk explains It was around then that a lightbulb turned on. If Tesla could transform the experience for its own customers, maybe Vijayan could transform the buying and selling experience for the much bigger, broader automotive industry. Enter Tekion, a now four-year-old, San Carlos, California company that now employs 470 people and has come far enough along that just attracted $150 million in fresh funding led by the private equity investor Advent International. With the Series C round — which also included checks from Index Ventures, Airbus Ventures, FM Capital and Exor, the holding company of Fiat-Chrysler and Ferrari — the company has now raised $185 million altogether. It’s also valued at north of $1 billion. (The automakers General Motors, BMW and the Nissan-Renault-Mitsubishi Alliance are also investors.) Eric Wei, a managing director at Advent, says that over the last decade, his team had been eager to seize on what’s approaching a $10 billion market annually. Instead, they found themselves tracking incumbents Reynolds & Reynolds, CDKGlobal and Dealertrack, which is owned by Cox Automotive, and waiting for a better player to emerge. Then Wei was connected to Tekion through Jon McNeill, a former Tesla president and an advisory partner to Advent. Says Wei of seeing its tech compared with its more established rivals: “It was like comparing a flip phone to an iPhone.” Perhaps unsurprisingly, McNeill, who worked at Tesla with Vijayan, also sings the company’s praises, noting that Tekion even bought a dealership in Gilroy, Calif., to use as a kind of lab while it was building its technology from scratch. Such praise is nice, but more importantly, Tekion is attracting the attention of dealers. Though citing competitive reasons, Vijayan declined to share how many have bought its cloud software — which connects dealers with both manufacturers and car buyers and is powered by machine learning algorithms — he says it’s already being used across 28 states. One of these dealerships is the national chain Serra Automotive, whose founder, Joseph Serra, is now an investor in Tekion. Another is that Volkswagen dealership in San Jose, where Castelino — who doesn’t have a financial interest in Tekion — speaks enthusiastically about the time and expenses his team is saving because of Tekion’s platform. For example, he says customers need only log-in now to flag a particular issue. After that, with the help of an RFID tag, Stevens Creek knows exactly when that customer pulls into the dealership and what kind of help they need, enabling people to greet him or her on arrival. Tekion can also make recommendations based on a car’s history. It might, for instance, suggest to a customer a brake fluid flush “without an advisor having to look through a customer’s history,” he says. As important, he says, the dealership has been able to cut ties with a lot of other software vendors, while also making more productive use of its time. Says Castelino, “As soon as a [repair order] is live, it’s in a dispatcher’s hand and a technician can grab the car.” It’s like that with every step, he insists. “You’re saving 15 minutes again and again, and suddenly, you have three hours where your intake can be higher.” Interestingly, the steepest competition, should it come, might eventually be from Tesla itself. In an earnings call earlier today, Musk told analysts that there are essentially a dozen startups housed inside of Tesla, including one centered on vehicle service. It’s the very business that Vijayan helped to create. As for whether Musk might spin out any of these, he said Tesla currently has no plans to do so, suggesting it has enough on its plate for the time being. Longtime Tesla Motors CIO Jay Vijayan has formed a stealth startup

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Today during a call with investors and journalists, Tesla CEO Elon Musk was asked to expand a tweet from yesterday. In it, he stated: “Tesla should really be thought of as roughly a dozen technology startups, many of which have little to no correlation with traditional automotive companies.” Tesla wows on latest numbers In short, he explained there are over a dozen startups in Tesla, and he views every product line and plant as a startup. It’s an interesting point of view from the top of Tesla, a car manufacturing company that also builds batteries, home solar panels, and among other things, is looking to offer car insurance, too. Outside of vehicle manufacturing, Musk points to insurance when asked about the growth potential. He says the insurance business could grow into 30-40% of Tesla’s car business. This strategy seemingly works well for Tesla, which constantly rolls out updates to existing products at an unusual pace. New features arrive without much warning, and it makes sense when Tesla is treating different vehicle component divisions as a collection of companies instead of a collection of divisions. According to Musk, some of the so-called startups include autonomy, chip design, vehicle service, sales, designing a drive unit, motors, supercharger network, and soon insurance. “The thing people don’t understand about Tesla is [the company] is a whole chain of startups,” Musk said. “And then people say, ‘well, you didn’t do that before.’ Yeah, well, we’re doing it now. I think we may have been a bit slower than other startups, but I don’t think we’ve really had anything fail.” He concluded there are no plans to spin out any business, noting there’s no need to add complexity. Tesla wows on latest numbers

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The end is in sight for Quibi, PayPal adds cryptocurrency support and Netflix tests a new promotional strategy. This is your Daily Crunch for October 21, 2020. The big story: Quibi is shutting down The much-hyped streaming video app led by Jeffrey Katzenberg and Meg Whitman, which raised nearly $2 billion in funding, is shutting down, according to reports in The Information and The Wall Street Journal. Katzenberg, a longtime Hollywood executive, had blamed the coronavirus pandemic for a lackluster launch in May — an app designed for on-the-go viewing didn’t have much appeal when people were largely stuck at home. And whatever the reason, none of Quibi’s shows ever became a breakout hit. Quibi executives confirmed the news in a post on Medium. The tech giants PayPal to let you buy and sell cryptocurrencies in the US — In partnership with Paxos, PayPal plans to support Bitcoin, Ethereum, Bitcoin Cash and Litecoin at first. Facebook is working on Neighborhoods, a Nextdoor clone based on local groups — Facebook said that Neighborhoods currently is live only in Calgary, Canada. Netflix to test free weekend-long access in India — The streaming service recently stopped offering a month of complimentary access to new users in the United States. Startups, funding and venture capital Syte, an e-commerce visual search platform, gets $30M Series C to expand in the US and Asia — Launched in 2015 to focus on visual search for clothing, Syte’s technology now covers other verticals, like jewelry and home decor. June’s third-gen smart oven goes up for pre-order, starting at $599 — It’s been two years since the smart oven’s last major update. Mine raises $9.5M to help people take control of their personal data — Mine scans users’ inboxes to help them understand who has access to their personal data. Advice and analysis from Extra Crunch Founders don’t need to be full-time to start raising venture capital — John Vrionis and Sarah Leary of Unusual Ventures told us that lightweight investing matters in the early days of a company. Dear Sophie: What visa options exist for a grad co-founding a startup? — The latest edition of immigration lawyer Sophie Alcorn’s column answering immigration-related questions about working at tech companies. Lessons from Datto’s IPO pricing and revenue multiple — How do you value slower, more profitable software growth? (Reminder: Extra Crunch is our membership program, which aims to democratize information about startups. You can sign up here.) Everything else Sam’s Club will deploy autonomous floor-scrubbing robots in all of its US locations — Sam’s Club parent company Walmart is already using robotics to perform inventory in its own stores. AOC’s Among Us stream topped 435,000 concurrent viewers — The purpose of the stream, which drew a massive crowd, was to get out the vote as we head into the general election. Coalition for App Fairness, a group fighting for app store reforms, adds 20 new partners — The coalition claims that both Apple and Google engage in anti-competitive behavior. The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

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In memory of the death of Quibi, here’s a quick sendoff from four of our writers who came together to discuss what we can learn from Quibi’s amazing, instantaneous, billions-of-dollars failure. Lucas Matney looks at what the potential was for Quibi and how it missed the mark in media. Danny Crichton discusses why billions of dollars in VC funding isn’t enough in competitive markets like video. Anthony Ha discusses the crazy context of Quibi and our interview with the company earlier this year. And Brian Heater looks at why constraints are not benefits in new products. Lucas Matney: A deadpool company before it was even launched

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Here we sit in the valley of predespair, 2 weeks ahead of the election and God knows where we are in the pandemic. As my partner Tina says to me on this once glorious sunny day (the view formerly known as the Pacific Ocean has been replaced by the fog like a Zoom background) we seem to be better prepared for something to go wrong than right. We’ve learned how to stay socially distant, half-learned to wear a mask, unlearned how it might be a good idea to stay home and let things just happen. The last four years seems like a bizarre experiment in what not to do, the triumph of the worst of our instincts and fear of the other. For my generation, the thought that we would be tested so apocalyptically had never entered our mind. Free love, social media, mind-altering drugs — all ideas that seemed good at the time. Too good to be true, it turned out. In the stampede to enjoy the fruits of our labors, we turned success into the failure of others. The space race may have spawned the computer industry, but it also reinforced the notion that we beat them to save us. And the tech boom saw us undermine the very soul, the soundtrack of how we marked our lives. Thanks, Napster. Today, East v. West is Apple v. Android, a detente that Washington distorts into trust v. loyalty. Which is worse, the silence of the social giants or making mistakes in the open? I’m sick of beating up on Twitter for our failures, even more so our toothless tut-tutting of Facebook for spreading the lies we support by staying put. So, let’s try something going right for a change. Take Spotify and their new plan to embed full versions of our musical heritage in podcasts. This is a complicated offer, to be sure. You can’t use partial versions of songs, talk over any portion of the song, or place ads within 60 seconds of music. Ads must have at least 10 minutes of non-music content between them. More importantly, these shows are only available on Spotify’s Anchor podcasting service. But what really stands out is the attempt by one of the two major music streaming services to create a composite product reconstituting a post digital radio business. If Apple Music were nudged to support the idea, it would resuscitate a major platform of the tech crowd with a mashup of DJ and playlist content. This in turn would create new leaderboards or charts in old record biz terms that would jumpstart new and catalog music in media. Already we see some of that energy in Saturday Night Live clips where audience numbers are shifting to mobile and online viewing. Composite ratings of broadcast and digital are growing fast. This evolution from broadcast to online ratings success may presage how live entertainment venues and audiences obliterated by the pandemic adapt with hybrid live/digital events. We’re seeing this act out in real time with the election, where early voting and election day registration have produced record turnout for both the safety of mail and absentee voting (mostly Democrats) and more traditional party switching (mostly Republicans or former Democrats more engaged by Trump.) This “new normal” in politics may not bear immediate fruit, but it’s at a minimum a harbinger of things to come. Fast forward to a future dinner party in an AR/VR augmented version of our favorite restaurants, with autotesting and contact tracing making it safe enough to reconstitute weekly gettogethers not just of local friends but virtual guests from around our town and beyond. Courses are served by delivery and robot waiters as we watch party our favorite artists and comedians both professional and amateur. Election night becomes a vote-from-home proposition, with the electoral college results calculated in realtime. As the concession speeches wind down, a vanquished candidate references the Paul Simon song: When something goes wrong I’m the first to admit it I’m the first to admit it But the last one to know When something goes right Well it’s likely to lose me It’s apt to confuse me It’s such an unusual sight I can’t get used to something so right Something so right __________________ The Gillmor Gang — Frank Radice, Michael Markman, Keith Teare, Denis Pombriant, Brent Leary, and Steve Gillmor . Recorded live Friday, October 16, 2020. Produced and directed by Tina Chase Gillmor @tinagillmor @fradice, @mickeleh, @denispombriant, @kteare, @brentleary, @stevegillmor, @gillmorgang For more, subscribe to the Gillmor Gang Newsletter and join the backchannel here on Telegram. The Gillmor Gang on Facebook … and here’s our sister show G3 on Facebook.

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posted 7 days ago on techcrunch
Tesla’s latest quarterly numbers beat analyst expectations on both revenue and earnings per share, bringing in $8.77 billion in revenues for the third quarter. With the report that Tesla had already beaten Wall Street’s expectations for deliveries earlier this month, the question for today’s earnings call was how much efficiency (and by extension, profit) the electric car and battery company was able to wring out of its manufacturing processes. Now we have the answer, as Tesla reported profits of $809 million on revenues of $8.77 billion for the third quarter. That’s up 39% from the year-ago period. Wall Street had expected $8.36 billion in revenue for the quarter, according to estimates published by CNBC. Revenue grew 30% year-on-year, something the company attributed to substantial growth in vehicle deliveries, and operating income also grew to $809 million, showing improving operating margins to 9.2%. And while the automotive business is clearly still the star of the show, both Tesla’s solar and storage businesses showed marked improvements in the third quarter. Energy storage reached a company record 759 Megawatt hours in the quarter, and the company said that megapack production for its large-scale batteries is growing while Powerwall demand remains strong. “We continue to believe that the energy business will ultimately be as large as our vehicle business,” the company said. And the solar business is also improving, according to Tesla. “Our recently introduced strategy of low-cost solar (at $1.49/watt in the U.S. after tax credit) is starting to have an impact. Total solar deployments more than doubled in Q3, to 57 MW compared to the prior quarter, with Solar Roof deployments almost tripling sequentially.” Operating expenses for the company were also up. New factories in Austin and Brandenburg, Germany mean additional expenses, and Tesla poured $1.25 billion into operations, up 33% from the previous quarter. Earlier this month, the company tipped its hand on the good news around deliveries, saying that it had already delivered 139,300 vehicles in the third quarter, slightly above Wall Street’s expectations, and a notable improvement from last quarter, as well as the same period a year ago. Tesla delivers 139,300 vehicles in Q3, beating expectations The delivery beat marked a 43% improvement from the same quarter last year, when the company reported deliveries of 97,000 electric vehicles. And delivery numbers were up 53% quarter on quarter, as the globally spreading COVID-19 pandemic took its toll on sales and production operations for Tesla at its main U.S. factory. The quarter also saw Tesla unveil a sweeping new vision for its battery manufacturing plans. During the shareholder presentation Tesla chief executive Elon Musk said that he expected to deliver up to 40% more electric vehicles than in 2019 and laid out the road map for better battery manufacturing efficiency. Tesla introduces its tabless battery design on the road to 10 terawatt hours of production Tesla’s earnings beat comes amid mounting competition from some of the world’s largest automakers. Yesterday GMC unveiled its Hummer EV and, in September, Ford announced that it would be slashing the price on its Mustang Mach E to “stay fully competitive.” Ford drops the price of its all-electric Mustang Mach-E to stay ‘fully competitive’ Meanwhile startups like Lucid Motors are proving that they could be serious contenders to Tesla’s market dominance. Lucid’s recent pricing for its Air sedan was enough to force Tesla chief executive and head of public relations, Elon Musk, to parry back with a (creatively selected) price cut on the company’s own models. Elon Musk tweets the Model S will be priced at $69,420, because he’s a child This story is developing and will be updated. 

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posted 8 days ago on techcrunch
Plagued with growth issues, Quibi, a short-form mobile-native video platform, is shutting down, according to multiple reports. The startup, co-founded by Jeffrey Katzenberg and Meg Whitman, had raised nearly $2 billion in its lifetime as a private company. Quibi did not respond to requests for comment from TechCrunch. The company’s prolific fundraising efforts spanned prominent institutions in private equity, venture capital and Hollywood, all betting on Katzenberg’s ability to deliver another hit. The startup’s backers included Alibaba, Madrone Capital Partners, Goldman Sachs and JPMorgan, as well as Disney, Sony Pictures, Viacom, WarnerMedia and MGM, among others. Their pitch was highly produced bite-sized content, packed with Hollywood star power, and designed to be “mobile-first” entertainment. For the YouTubes and Snaps of the world, producing mainstream content on a shoestring budget, Quibi wanted to be an HBO for smartphones. Investors and pundits questioned the firm’s ability to monetize this vision, and it became clear soon after launch that the company had miscalculated. Rumors that Quibi was shutting down began early this week. The Information wrote that Katzenberg has told people within the industry that the company might need to shut down, after unsuccessfully pitching itself as an acquisition to Apple, Facebook and Warner Media. In its first few months, Quibi was downloaded 3.5 million times and had 1.5 million active users. While those figures aren’t too shabby, the company had to adjust its original projections, which put the service on a trajectory to reach 7 million users and $250 million in subscriber revenue in its first year. Admitting that the launch hadn’t gone as planned, Katzenberg blamed the coronavirus for the streaming app’s challenges. The company expanded in Australia in August with a free ad-supported tier for users. It is unclear if the tweak in the business model brought Quibi success, or if the problems for the app had to do with the business model in the first place. Netflix earnings from earlier this week suggest that the pandemic entertainment boom is slowing. The consumer video service disappointed on new paying customer numbers, and shares were down sharply yesterday after it released its earnings report. Those numbers also potentially showcase just how crowded the market for subscription video content has gotten in the past 12 months, with players like Apple, Disney, HBO and NBC each launching new services and collectively spending billions to acquire rights to past television hits. Quibi founder Jeffrey Katzenberg blames coronavirus for the streaming app’s challenges

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posted 8 days ago on techcrunch
The Coalition for App Fairness (CAF), a newly-formed advocacy group pushing for increased regulation over app stores, has more than doubled in size with today’s announcement of 20 new partners — just one month after its launch. The organization, led by top app publishers and critics including Epic Games, Deezer, Basecamp, Tile, Spotify and others, debuted in late September to fight back against Apple and Google’s control over app stores, and particularly the stores’ rules around in-app purchases and commissions. The coalition claims both Apple and Google engage in anti-competitive behavior, as they require publishers to use the platforms’ own payment mechanisms, and charge 30% commission on these forced in-app purchases. In some cases, those commissions are collected from apps where Apple and Google offer a direct competitor. For example, the app stores commission Spotify, which competes with Google’s YouTube Music and Apple’s own Apple Music. The group also calls out Apple more specifically for not allowing app publishers any other means of addressing the iOS user base except through the App Store that Apple controls. Google, however, allows apps to be sideloaded, so is less a concern on that platform. The coalition launched last month with 13 app publishers as its initial members, and invited other interested parties to sign up to join. Since then, CAF says “hundreds” of app developers expressed interest in the organization. It’s been working through applications to evaluate prospective members, and is today announcing its latest cohort of new partners. This time, the app publishers aren’t necessarily big household names, like Spotify and Epic Games, but instead represent a wide variety of apps, ranging from studios to startups. The apps also hail from a number of app store categories, including Business, Education, Entertainment, Developer Tools, Finance, Games, Health & Fitness, Lifestyle, Music, Navigation, News, Productivity, Shopping, Sport, and Travel. The new partners include: development studio Beonex, health app Breath Ball, social app Challenge by Eristica, shopping app Cladwell, fitness app Down Dog Yoga, developer tool Gift Card Offerwall, game maker Green Heart Games, app studio Imagine BC, business app Passbase, music app Qobuz, lifestyle app QuackQuack and Qustodio, game Safari Forever, news app Schibsted, app studio Snappy Mob, education app SpanishDict, navigation app Sygic, app studio Vertical Motion, education app YARXI, and the Mobile Marketing Marketing Association. With the additions, CAF now includes members from Austria, Australia, Canada, France, Germany, India, Israel, Malaysia, Norway, Singapore, Slovakia, Spain, United Kingdom, and the United States. The new partners have a range of complaints against the app stores, and particularly Apple. SpanishDict, for instance, was frustrated by weeks of rejections with no recourse and inconsistently applied policies, it says. It also didn’t want to use Apple’s new authentication system, Apple Sign-In, but Apple made this a requirement for being included on the App Store. Passbase, a Sign In With Apple competitor, also argues that Apple applied its rules unfairly, denying its submission but allowing its competitors on the App Store. While some of the app partners are speaking out against Apple for the first time, others have already detailed their struggles publicly. Eristica posted on its own website how Apple shut down its seven-year old social app business, which allowed users to challenge each other to dares to raise money for charity. The company claims it pre-moderated the content to ensure dangerous and harmful content wasn’t published, and employed human moderators, but was still rejected over dangerous content. Meanwhile, TikTok remained on the App Store, despite hosting harmful challenges, like the pass out challenge, cereal challenge, salt and ice challenge and others, Eristica says. Apple, of course, tends to use its policies to shape what kind of apps it wants to host on its App Store — and an app that focused on users daring one another may have been seen as a potential liability. That said, Eristica presents a case where it claims to have followed all the rules and made all the changes Apple said it wanted, and yet still couldn’t get back in. Down Dog Yoga also recently made waves by calling out Apple for rejecting its app because it refused to auto-charge customers at the end of its free trial. Wow! Apple is rejecting our latest update because we refuse to auto-charge at the end of our free trial. They can choose to steal from their customers who forget to cancel, but we won't do the same to ours. THIS IS A LINE THAT WE WILL NOT CROSS. pic.twitter.com/s9HwD4ay4h — Down Dog (@downdogapp) June 30, 2020 The issue, in this case, wasn’t just that Apple wants a cut of developers’ businesses, it also wanted to dictate how those businesses are run. Another new CAF partner, Qustodio, was among the apps impacted by Apple’s 2018 parental control app ban, which arrived shortly after Apple introduced its own parental control software in iOS. The app developer had then co-signed a letter asking Apple release a Screen Time API rather than banning parental control apps — a consideration that TechCrunch had earlier suggested should have been Apple’s course of action in the first place. Under increased regulatory scrutiny, Apple eventually relented and allowed the apps back on the App Store last year. Not all partners are some little guy getting crushed by App Store rules. Some may have run afoul of rules designed to protect consumers, like Apple’s crackdown on offerwalls. Gift Card Offerwall’s SDK, for example, was used to incentivize app monetization and in-app purchases, which isn’t something consumers tend to welcome. Apple revises App Store rules to permit game streaming apps, clarify in-app purchases and more Despite increased regulatory pressure and antitrust investigations in their business practices, both Apple and Google have modified their app store rules in recent weeks to ensure they’re clear about their right to collect in-app purchases from developers. Meanwhile, Apple and CAF member Epic Games are engaged in a lawsuit over the Fortnite ban, as Epic chose to challenge the legality of the app store business model in the court system. Other CAF members, including Spotify and Tile, have testified in antitrust investigations against Apple’s business practices, as well. “Apple must be held accountable for its anticompetitive behavior. We’re committed to creating a level playing field and fair future, and we’re just getting started,” CAF said in an announcement about the new partners. It says it’s still open to new members.

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posted 8 days ago on techcrunch
After pricing at $27 per share, Datto’s stock rose during regular trading. By mid-afternoon the data and security software company was worth $28.10, up a hair over 4%. The company’s IPO comes on the back of a rapid-fire Q3 in which a host of technology companies, particularly software, made it to the public markets. While the number of un-exited unicorns in the United States still rose in the quarter, Q3 brought with it a wave of liquidity that felt long coming. Datto’s IPO is one among what appears set to be a smaller Q4 class, though offerings like Airbnb and Affirm are still tipped to be coming in short order. Airbnb and Affirm each announced that they have filed privately to float, though have yet to publicly drop their S-1 filings. The Datto IPO was interesting for a few reasons, including its mix of slower growth and rising profitability, its place in the midst of the current Vista drama, and how well it was priced. While 2020 has brought with it many venture-backed IPOs, the year has also brought a nearly commensurate number of complaints about the IPO process itself. After many tech, and tech-ish, companies saw their values skyrocket after pricing and listing, vocal tech and venture figures argued that IPOs were effectively handing upside from companies to underwriting banks, and their customers. Lessons from Datto’s IPO pricing and revenue multiple There was some merit to the arguments. Datto, however, will not stoke similar fires. Up a mere few points from its IPO price, it was priced pretty much perfectly from the perspective of raising as much money as it could for itself in its debut. Datto will use its IPO proceeds to pay down debts that it accrued during its takeover from Vista (private equity: a good deal for private equity). However, Datto’s CEO Tim Weller told TechCrunch in a call that the company will still be well-capitalized after the public offering, saying that it will have a very strong cash position. The company should have places to deploy its remaining cash. In its S-1 filings, Datto highlighted a COVID-19 tailwind stemming from companies accelerating their digital transformation efforts. TechCrunch asked the company’s CEO whether there was an international component to that story, and whether digital transformation efforts are accelerating globally and not merely domestically. In a good omen for startups not based in the United States, the executive said that they were. The company did not entertain a SPAC-led public debut, with Datto’s founder, Austin McChord, saying that his company had long planned a traditional public offering. Closing on the Vista front, McChord said that the removal of Vista’s Brian Sheth was immaterial to Datto’s IPO process. Late-stage deals made Q3 2020 a standout VC quarter for US-based startups

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posted 8 days ago on techcrunch
Sophie Alcorn Contributor Share on Twitter Sophie Alcorn is the founder of Alcorn Immigration Law in Silicon Valley and 2019 Global Law Experts Awards’ “Law Firm of the Year in California for Entrepreneur Immigration Services.” She connects people with the businesses and opportunities that expand their lives. More posts by this contributor Dear Sophie: I came on a B-1 visa, then COVID-19 happened. How can I stay? Dear Sophie: How can employers hire & comply with all this new H-1B craziness? Here’s another edition of “Dear Sophie,” the advice column that answers immigration-related questions about working at technology companies. “Your questions are vital to the spread of knowledge that allows people all over the world to rise above borders and pursue their dreams,” says Sophie Alcorn, a Silicon Valley immigration attorney. “Whether you’re in people ops, a founder or seeking a job in Silicon Valley, I would love to answer your questions in my next column.” Extra Crunch members receive access to weekly “Dear Sophie” columns; use promo code ALCORN to purchase a one- or two-year subscription for 50% off. Dear Sophie: What are the visa prospects for a graduate completing an advanced degree at a university in the United States who wants to co-found a startup after graduation? Can the new startup or my co-founders sponsor me for a visa? —Brilliant in Berkeley Dear Brilliant, Thank you for your questions and for your contributions. The U.S. economy greatly benefits from entrepreneurial individuals like you who create companies — and jobs — in the U.S. Let me take your second question first: Yes, it is theoretically possible for your startup to sponsor you for a visa, and for one of your co-founders to be your supervisor. Many visas and employment green cards require a company to sponsor you and for you to demonstrate that a valid employer-employee relationship exists. Given your situation, timing will be key, particularly since one of your best visa options is the H-1B Visa for Specialty Occupations. The number of H-1B visas issued each year is typically capped at 85,000-60,000 for individuals with a bachelor’s degree and 25,000 for individuals with a master’s or higher degree. Because of the cap on H-1B visas and because the demand for them far outstrips the supply, U.S. Citizenship and Immigration Services (USCIS) holds a lottery once a year in the spring to determine who can apply for this visa.

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posted 8 days ago on techcrunch
Yin Wu has cofounded several companies since graduating from Stanford in 2011, including a computer vision company called Double Labs that sold to Microsoft, where she stayed on for a couple of years as a software engineer. In fact, it was only after that sale she she says she “actually understood all of the nuances with a company’s cap table.” Her newest company, Pulley, a 14-month-old, Mountain View, Ca.-based maker of cap table management software aims to solve that same problem and has so far raised $10 million toward that end led by the payments company Stripe, with participation from Caffeinated Capital, General Catalyst, 8VC, and numerous angel investors. Wu is going up against some pretty powerful competition. Carta was reportedly raising $200 million in fresh funding at a $3 billion valuation as of the spring (a round the company never official confirmed or announced). Last year, it raised $300 million. Morgan Stanley has meanwhile been beefing up its stock plan administration business, acquiring Solium Capital early last year and more newly purchasing Barclay’s stock plan business. Of course, startups often manage to find a way to take down incumbents and a distraction for Carta, at least, in the form of a very public gender discrimination lawsuit by a former VP of marketing, could be the kind of opening that Pulley needs. We emailed with Yu yesterday to ask if that might be the case. She didn’t answer directly, but she did mention “values,” as long as shared some more details about what she sees as different about the two products. TC: Why start this company? Has Carta’s press of late created an opening for a new upstart in the space? YW: I left Microsoft in 2018 and started Pulley a year later. We skipped the seed and raised the A because of overwhelming demand from investors. Many wanted a better product for their portfolio companies. Many founders are increasingly thinking about choosing with companies, like Pulley, that better align with their values. TC: How many people are working for Pulley and are any folks you pulled out of Carta? YW: We’re a team of seven and have four people on the team who are former Y Combinator founders. We attract founders to the team because they’ve experienced firsthand the difficulties of managing a cap table and want to build a better tool for other founders. We have not pulled anyone out of Carta yet. TC: Carta has raised a lot of funding and it has long tentacles. What can Pulley offer startups that Carta cannot? YW: We offer startups a better product compared to our competitors. We make every interaction on Pulley easier and faster. 409A valuations take five days instead of weeks, and onboarding is the same day rather than months. By analogy, this is similar to the difference between Stripe and Braintree when Stripe initially launched. There were many different payment processes when Stripe launched. They were able to capture a large portion of the market by building a better product that resonated with developers. One of the features that stands out on Pulley is our modeling feature [which helps founders model dilution in future rounds and helps employees understand the value of their equity as the company grows]. Founders switch from our competitors to Pulley to use our modeling tool [and it works] with pre-money SAFEs, post-money SAFEs, and factors in pro-ratas and discounts. To my knowledge, Pulley’s modeling tool is the most comprehensive product on the market. TC: How does your pricing compare with Carta’s? YW:  Pulley is free for early-stage companies regardless of how much they raise. We’re price competitive with Carta on our paid plans. Part of the reason we started Pulley is because we had frustrations with other cap table management tools. When using other services, we had to regularly ping our accountants or lawyers to make edits, run reports, or get data. Each time we involved the lawyers, it was an expensive legal fee. So there is easily a $2,000 hidden fee when using tools that aren’t self-serve for setting up and updating your cap table. TC: Is there a business-to-business opportunity here, where maybe attorneys or accountants or wealth managers private label this service? Or are these industry professionals viewed as competitors? YW: We think there are opportunities to white label the service for accountants and law firms. However, this is currently not our focus. TC: How adaptable is the software? Can it deal with a complicated scenario, a corner case? YW: We started Pulley one year ago and we’re launching today because we have invested in building an architecture that can support complex cap table scenarios as companies scale. There are two things that you have to get right with cap table systems, First, never lose the data and second, always make sure the numbers are correct. We haven’t lost data for any customer and we have a comprehensive system of tests that verifies the cap table numbers on Pulley remain accurate. TC: At what stage does it make sense for a startup to work with Pulley, and do you have the tools to hang onto them and keep them from switching over to a competitor later? YW: We work with companies past the Series A, like Fast and Clubhouse. Companies are not looking to change their cap table provider if Pulley has the tool to grow with them. We already have the features of our competitors, including electronic share issuance, ACH transfers for options, modeling tools for multiple rounds, and more. We think we can win more startups because Pulley is also easier to use and faster to onboard. TC: Regarding your paid plans, how much is Pulley charging and for what? How many tiers of service are there? YW; Pulley is free for early-stage startups with less than 25 stakeholders. We charge $10 per stakeholder per month when companies scale beyond that. A stakeholder is any employee or investor on the cap table. Most companies upgrade to our premium plan after a seed round when they need a 409A valuation. Cap table management is an area where companies don’t want a free product. Pulley takes our customers data privacy and security very seriously. We charge a flat fee for companies so they rest assured that their data will never be sold or used without their permission. TC: What’s Pulley’s relationship to venture firms? YW: We’re currently focused on founders rather than investors. We work with accelerators like Y Combinator to help their portfolio companies manage their cap table, but don’t have a formal relationship with any VC firms.

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posted 8 days ago on techcrunch
“More than 50% of our founders still are in their current jobs,” said John Vrionis, co-founder of seed-stage fund Unusual Ventures. The fund, which closed a $400 million investment vehicle in November 2019, has noticed that more and more startup employees are thinking about entrepreneurship as the pandemic has shown how much room there is for new innovation. To gain a competitive advantage, Unusual is investing small checks into founders before they’re full-time. Unusual, which cuts an average of eight checks per year into seed-stage companies, isn’t doling out millions to every employee who decides to leave Stripe. The firm is conservative with its spending and takes a more focused approach, often embedding a member from the firm into a portfolio company. It’s not meant to scale to dozens of portfolio companies a year, but instead requires a methodical approach. One with a healthy pipeline of companies to choose from. In an Extra Crunch Live chat, Vrionis and Sarah Leary, co-founder of Nextdoor and the firm’s newest partner, said lightweight investing matters in the early days of a company. “There were a lot of teams that needed capital to start the journey, but frankly, it would have been over burdensome if they took on $2 or $3 million,” Leary said. “[New founders] want to be in a place where they have enough money to get going but not too much money that they get locked into a ladder in terms of expectations that they’re not ready to take advantage of.” The checks that Unusual cuts in pre-seed often range between $100,000 to half a million dollars. Leary chalks up the boom to the disruption in consumer behavior, which opens up the opportunity for new companies to win.

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