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Blossom Capital’s ‘Cultivate’ is an angel program seeking to back European unicorn alumnus

2020, April 7 - 4:00pm

Just a few months after closing a new $185 million fund to continue backing early-stage European startups, Blossom Capital, the VC firm founded by Ophelia Brown, is announcing a new angel investment program seeking to back European unicorn alumnus.

Dubbed “Cultivate,” the new program looks to create a 30-strong angel network made up of founders or operators from European unicorns or those with a European HQ, who will be tasked with backing alumni starting up.

This idea is to act as a catalyst for a more robust angel ecosystem in Europe, and in turn, trigger a virtuous cycle as employees inevitably leave successful companies to hopefully build the next generation of European unicorns, backed by experienced operators.

At launch, the Cultivate angel network includes Des Traynor, co-founder and Chief Strategy Officer at Intercom, Guillaume Pousaz, CEO and founder of Checkout.com, Nilan Peiris, VP Growth at Transferwise, and Shakil Khan, an early investor in Spotify. Additional angels are expected to join in the coming months.

“In the first year of the program, we’ve just made it available to people spinning out of unicorns,” Ophelia Brown tells me. “And so if you know you’re the CEO of Intercom or the CEO of Checkout, you’re going to have people leave your company, that’s just a fact, and you hope that they’re gonna go off and start something great. So they’re sourcing, in that they can refer either their former employees or anyone else that they meet building a startup, but they’re not going to be spending their day to day sourcing. Blossom is helping with the sourcing as well.”

Over the next 12 months, Blossom says it aims to invest a total of $5 million via the Cultivate program into 20 startups in Europe, with a focus on seed and pre-seed (as apposed to Blossom’s Series A sweet spot). Each startup will get an equal investment of $250,000, although individual angels are invited to make additional co-investments, too. Beyond capital, Cultivate-backed founders will be given access to the angel network throughout the year for insights, advice and learnings.

“This is different [from an angel scout program] in that the angels are all acting in concert together,” explains Brown. “They will review the applications as a group and make a decision based on that. I think it’s [the] first of its kind in that it sits somewhere between a scout program and something like Y Combinator, because with YC, the power’s in the network. And we’ve kind of taken the best of both and made it fit for Europe.”

Asked why founders might choose Cultivate over applying to YC, Brown is quick to heap praise on the renowned Silicon Valley accelerator program, but says it doesn’t necessarily make sense for startups in Europe.

“For lots of European businesses that are building their core in Europe, why would you want to move to the valley for that period to come back to build in Europe? It’s disruptive,” she says. “And also I think people are beginning to realize that the 7% tax that YC takes is actually significant when you’re doing future rounds in terms of how diluted it could be. So I think YC is no doubt a great program. Like, it’s absolutely amazing, but it’s not one size fits all. And certainly, for European founders, we wanted them to get access to founders who have experience of scaling businesses in Europe. It’s a different ecosystem.”

On that note, Brown says she hopes to grow the Cultivate angel program over time. This may well include opening it up beyond unicorn alumni, once the concept it proven, and hopefully inspiring the angel network to take on a life of its own.

“Europe really lacks an angel ecosystem in the way that we need it to exist,” adds the Blossom founder. “And so we hope that we spawn the first group and then as they feel comfortable, they’ll go and do it independently of Blossom.”

A conversation with ‘the most ambitious female VC in Europe’

Atomico unveils Angel Programme to ‘activate’ the next generation of European investors

Categories: Business News

Agritech startup DeHaat raises $12M to reach more farmers in India

2020, April 7 - 9:19am

DeHaat, an online platform that offers full-stack agricultural services to farmers, has raised $12 million as it looks to scale its network across India.

The Series A financial round for the eight-year-old Patna and Gurgaon-based startup was led by Sequoia Capital India. Dutch entrepreneurial development bank FMO, and existing investors Omnivore and AgFunder, also participated in the round. The startup, which began to seek funding from external investors last year, has raised $16 million to date and $3 million in venture debt.

DeHaat (which means village in Hindi) eases the burden on farmers by bringing together brands, institutional financers and buyers on one platform, explained Shashank Kumar, co-founder and chief executive of the startup, in an interview with TechCrunch.

The platform helps farmers secure thousands of agri-input products, including seeds and fertilizers, and receive tailored advisory on the crop they should sow in a season. “We have built a comprehensive database of crop tests to offer advice to farmers,” he said.

DeHaat, which employs 242 people, also helps them connect with 200 institutional partners to provide farmers with working capital, and when the season is over, helps them sell their yields to bulk buyers such as Reliance Fresh, food delivery startup Zomato and business-to-business e-commerce giant Udaan.

DeHaat today operates in 20 regional hubs in the eastern part of India — states such as Bihar, Uttar Pradesh, and Jharkhand — and serves more than 210,000 farmers, said Kumar.

Shashank Kumar, Amrendra Singh, Adarsh Srivastav and Shyam Sundar Singh co-founded DeHaat in 2012

The startup has developed a network of hundreds of micro-entrepreneurs in rural areas that distribute agri-input goods to farmers from their regional hubs and then bring back the output to the same hub.

“We have an app in local languages and a helpline desk that farmers, many of whom don’t own a smartphone, use to reach out to us and explain their pain points and needs,” he said.

DeHaat does not charge any fee for its advisory, but takes a cut whenever farmers use its platform to buy agri-inputs or sell their crop yields.

The startup will use the fresh capital to extend its network to 2,000 rural retail centres, on-board more micro-entrepreneurs for last-mile delivery and reach 1 million farmers by June of next year, said Kumar. DeHaat is also working on automating its supply chain and developing more sophisticated data analytics, he said.

At stake is India’s agriculture market that is worth $350 billion and serves nearly 100 million small and independent farmers, said Abhishek Mohan, VP at Sequoia Capital India, the VC fund that writes more checks than anyone else in the country.

“This industry is on the brink of a massive transformation thanks to ease of regulation, farmers getting organized and increasing penetration of smartphones. DeHaat is leveraging these trends to build the next-gen product in agricultural supply chain,” said Mohan in a statement.

“The tipping point that led to Sequoia India’s decision to partner with them was the field visit, where the farmers expressed how proud they were to be associated with a platform they felt truly worked in their favour. This impact and deep brand loyalty stems from the leadership team’s razor-sharp focus, deep empathy and fine execution,” he added.

Categories: Business News

Bidet startup Tushy scales up to meet demand amid toilet paper shortage

2020, April 7 - 7:53am

Business at Tushy is booming.

While the circumstances that led to the boom are sobering, the bidet company needed to adapt its strategy after seeing an uptick in business amid the COVID-19 pandemic. Other companies in this cohort include video conferencing service Zoom, meal kit service Blue Apron and Facebook, thanks to its social network, video hardware Portal and Oculus Quest VR headset. These companies all have something in common — they offer solutions to problems that, until recently, were not all that urgent.

Founded in 2015 by Thinx founder Miki Agrawal, Tushy aims to replace toilet paper, CEO Jason Ojalvo tells TechCrunch. Ojalvo, who joined the company as CEO in 2018, says North America has been a holdout when it comes to bidets. As a result, the nation flushes about 15 million trees down the toilet every year.

Tushy, which has raised $2.9 million since its founding, has been profitable for the last two years. That’s in part thanks to the company’s focus on sustainability — not just from an environmental standpoint, but from a business one, Ojalvo says. That means not over-hiring or spending too much on marketing.

“We’re really careful about doing it in a way so we won’t explode like some other direct-to-consumer companies can do when they raise too much money and they over-hire and then they have to let people go,” Ojalvo says. “That’s just a debacle that I’ve seen first hand and I don’t want to be part of it. Not only do I not want to be part of it but I don’t want to be the leader of the company that does that.”

Prior to the coronavirus pandemic, Tushy saw its growth double year-over-year. Ojalvo says that’s partly been a result of having customers who evangelize on their behalf. Fast-forward to around March 9, when sales really started to double beyond the norm; a few days later, Tushy was having days where it brought in $500,000 in sales.

Categories: Business News

As demand for mental health services soars, SonderMind raises $27 million to expand its services

2020, April 7 - 5:36am

“Our real focus is on democratizing mental healthcare,” says SonderMind co-founder chief executive, Mark Frank.

His company, founded back in 2017, is having a moment. With the restrictions and economic stresses caused by the government’s efforts to mitigate the spread of the COVID-19 epidemic in the U.S., demand for mental health services is soaring. And it’s compounding what was already a mental health crisis in the U.S. 

A 2019 article from Bloomberg Businessweek laid out the scope of the problem in stark terms. In 2017, 47,000 people died by suicide in the U.S. and there were 1.4 million suicide attempts — a suicide rate that’s the country’s highest since World War II, according to the Centers for Disease Control and Prevention. Drug overdoses, another measure of the nation’s anguish, killed 70,000 people in 2017. Another 7% of U.S. adults reported suffering at least one major depressive episode in 2018.

Taken together, the data points to a tremendous health problem. One that the current healthcare system is only now grappling with.

SonderMind’s chief executive sees his company as part of the solution.

Most mental health practitioners don’t operate within a healthcare network or take insurance, which means that the only folks with access to care are the ones that can afford the high price of therapy. SonderMind changes that equation by offering practitioners a toolkit and back office services so they can bill insurance providers and take care of the operational side of running a healthcare practice. It also acts as a funnel, gauging the needs of potential patients and connecting them to the therapists that are best suited to provide them the care they need. That lets practitioners focus on seeing patients, the company said.

The company currently counts 500 providers on its marketplace, which operates in Colorado, Arizona and Texas, and has raised $27 million in its latest round of financing to extend its services to other parts of the U.S.

The San Francisco-based investment firm General Catalyst led the financing, which also included additional new investors F-Prime Capital and participation from previous investors like the Kickstart Seed Fund, Diōko Ventures (managed by FCA Venture Partners) and Jonathan Bush. 

“This financing provides the fuel to support our growth objectives and advance our mission to make behavioral health more accessible, approachable and utilized by building a modern marketplace that holds great appeal to both clinician and patient,” said Frank in a statement.

The investment extends General Catalyst’s funding into healthcare services in recent years and represents a continued emphasis on healthcare services for the firm. “Healthcare is obviously a really important thesis for GC as a whole,” says Holly Maloney, a managing director at General Catalyst. “This is going to be one of the largest value drivers for VC this decade.”

General Catalyst already had a robust portfolio of healthcare-focused companies — including Livongo, OM1 and Oscar Health.

For Maloney, the investment in SonderMind grew out of the firm’s exposure to mental health investment through another portfolio company, Mindstrong Health. “Mindstrong forced us to explore… access to care and finding care,” says Maloney. 

The General Catalyst investor sees the investment in SonderMind as also helping to open doors for more people to join the profession.

“It helps people to start their business for sure. It helps more people pursue it as a career path,” she said. And that’s good for a country where more mental health professionals and better access to care are desperately needed. 

Categories: Business News

Airbnb turns to private equity to raise $1 billion

2020, April 7 - 5:35am

Airbnb said Monday that it has raised $1 billion in debt and equity from private equity firms Silver Lake and Sixth Street Partners, even as the online rental marketplace has seen its business plummet due to the COVID-19 pandemic.

Terms of the deal were not disclosed. It’s unclear how this funding might alter Airbnb’s previously shared plans to go public.

COVID-19, the disease caused by coronavirus, prompted governments throughout the world to issue stay-at-home orders, triggering a wave of cancellations in the travel and hospitality industries. Airbnb emphasized that the funds would support its ongoing work to invest over the long term, a statement aimed at couching this raise as strategic and not a bailout in troubled times. 

“While the current environment is clearly a difficult one for the hospitality industry, the desire to travel and have authentic experiences is fundamental and enduring,” Silver Lake co-CEO and managing partner Egon Durban said in a statement. “Airbnb’s diverse, global, and resilient business model is particularly well suited to prosper as the world inevitably recovers and we all get back out to experience it.”

Airbnb CEO Brian Chesky acknowledged Monday that while the desire to connect and travel has been reinforced during this time, the “way it manifests will evolve as the world changes.”

Airbnb is betting how and where people work will evolve. As a result, the company said it will direct its attention and new funds toward three core products: hosts, long-term stays and Airbnb experiences.

Last month, Airbnb said it would direct $250 million to help hosts who have been impacted by COVID-19. The funds will be used to pay a host 25% of what they would normally receive through their cancellation policy if a guest cancels a reservation due to COVID-19 between March 14 and May 31. Airbnb said this policy applies retroactively to all cancellations during that period.

The move was an attempt by Airbnb to make amends to its hosts who complained that the company’s policy would allow guests to cancel reservations and receive a full refund. That policy, which is still active, lets guests who booked reservations on or before March 14 that begin anytime on or before May 31 to cancel and receive a standard refund or travel credit.

Categories: Business News

Quibi had a launch day outage

2020, April 7 - 5:18am

Looks like things haven’t gone completely smoothly with Quibi‘s launch.

The issue appears to have been resolved, but the Quibi customer support account tweeted this afternoon that “some users may be experiencing problems with the Quibi app,” only to add an hour later that “Users should once again be able to use the Quibi app normally. Thank you for your patience.”

It’s not clear how widespread the outage was, but according to The Verge, one staffer saw an error screen and was unable to browse the app, while another was unable to create an account. The app seems to be working normally as I write this shortly after 4pm Eastern.

If nothing else, it’s a reminder that reliably delivering streaming video is hard, even for a startup that’s raised $1.75 billion. Heck, even Disney experienced widespread streaming issues when it launched Disney+ in November. (It all worked out fine.)

Users should once again be able to use the @Quibi app normally. Thank you for your patience.

— Quibi Cares (@quibicares) April 6, 2020

A quick catch-up for those of you still wondering what Quibi even is: It’s a short-form video service founded by Hollywood executive Jeffrey Katzenberg and led by CEO Meg Whitman (previously CEO of Hewlett Packard Enterprise and eBay).

The app is launching with nearly 50 shows today, all of them created specifically for mobile, with episodes that are less than 10 minutes long. After a 90-day free trial, it’ll cost you $4.99 with ads or $7.99 per month without ads.

Quibi launches its mobile streaming service in the middle of the quarantine era

Categories: Business News

COVID-19 crisis spurs triple-digit growth for refurbishing startup Back Market

2020, April 7 - 5:14am
Eva Yoo Contributor Eva Yoo is founder of Seek Road, the project wherein she cycles from Seoul to London while interviewing startups on the Silk Road. More posts by this contributor

While a number of startups have been hard hit by efforts to curb the spread of the COVID-19 virus, refurbishing firm Back Market is showing increased growth globally.

The Paris -based startup encourages customers to send in their old devices so they can be refurbished and resold into the e-commerce secondhand market. The growth achieved in the midst of the COVID-19 crisis is partly due to increased laptop sales as people seek better devices to work remotely.

For people who are unsure whether refurbished products are reliable, Back Market permits customers to send in old devices, exchange them for newer versions and pay the difference. CEO Thibaud Hug de Larauze said this payback service is currently possible only in France, but starting in Q2, it will be available in other markets.

Founded in 2014, Back Market has raised a total of €48 million in funding over two rounds, most recently a Series B in June 2018. The company is profitable and reportedly still has money to spend from its last funding round.

“We don’t release the gross merchandise volume, but it’s a three-digit growth rate,” Hug de Larauze told TechCrunch. “We saw an increase in demand for laptops, printers and other devices needed for working at home. Demand for refurbished phones is going down as people seek to get the first necessity items, like food for their situation.”

Over the past two weeks, Back Market saw skyrocketing demand from Italy, a nation with a high coronavirus death toll where citizens were warned they would be confined to their homes for four weeks.

Another factor that helped the platform’s growth: Smartphone brands like Apple and Samsung closed their retail stores, a move that turned Back Market into a major supply channel. While offline retailers and carriers are shut down in Europe, Hug de Larauze says Chinese offline retailers and refurbishing factories are starting to get back to work.

Categories: Business News

BounceX cuts staff, reduces salaries in wake of COVID-19 economic disruptions

2020, April 7 - 4:48am

TechCrunch confirmed today that BounceX (the firm is rebranding this year) has executed layoffs and salary cuts in the wake of recent COVID-19-led economic disruptions.

Many startups are undergoing staff cuts as the domestic and global economies slow, making individual reductions less newsworthy as the layoff tally rises. However, as BounceX is a company we’ve recently highlighted for its growth and capital efficiency, its own cuts are worth noting.

Reductions

TechCrunch was tipped concerning the BounceX staff cuts and salary reductions earlier today, events that the company confirmed this afternoon. Our original tipster pegged the cuts at around 20% of staff, with pay cuts for the rest of its denizens.

The company confirmed the existence of salary cuts and layoffs, but did not affirm our figures. Here’s BounceX on its hard day; the firm confirmed pay cuts via a spokesperson separately from this comment:

COVID-19 has hit our client base really hard, especially if they had significant retail presence. In order to accommodate clients and help stabilize our business & their businesses, we made the immensely difficult decision to move forward with a reduction in force. While we expected over 30% growth this year and adding 150 new roles by year end, we were forced to consolidate roles in order to do everything we could to take care of as many of our people as possible and continue to help our clients get through this.

It is not a surprise that BounceX was planning revenue growth and 150 new roles; the company recently crossed the $100 million ARR threshold, an event that TechCrunch covered as part of our long-running series focused on companies that reach the revenue threshold.

Indeed, in February, when BounceX shared the milestone, the firm also announced a rebrand, stating that it would change its name to Wunderkind. As you can read from the name, BounceX was feeling good at the time, looking to the future, proud of its growth and track record of efficient capital use.

As TechCrunch wrote at the time:

Wunderkind has been super efficient to date, with [CEO Ryan] Urban telling TechCrunch that “the amount of equity [his company has] actually put to work is probably sub-$35 million,” with less than $50 million in equity capital raised. The company also has debt lines that it can use, the CEO noted.

Given its history of conservative capital management, it doesn’t seem likely that BounceX is in existential danger after its layoffs. The company’s debt line — though we don’t know anything about its covenants — could provide more cushion. But its quick turnaround in fortunes shows how fast things can change.

The impact of COVID-19 on BounceX shows that no company, no matter how successful they were in February, is safe in April. Heck, TripActions was crowing about a huge new debt facility it secured right before COVID-19; the firm has since pared staff as well.

Categories: Business News

Twilio CEO Jeff Lawson on shifting a 3,000-person company to fully remote

2020, April 7 - 4:05am

What’s it like to take a company with 3,000 employees distributed across 25 offices and make it fully remote with just a few weeks’ notice?

I hopped on a call with Twilio CEO Jeff Lawson to hear about how their transition has gone so far, and what he’s learned from the process.

Twilio CEO Jeff Lawson

Remote work isn’t brand-new for Twilio; as with a lot of software companies, many employees have worked remotely. But it’s still a massive shift: Prior to the coronavirus outbreak, Lawson says around 10% of the company worked remotely. Today, it’s everyone.

“For a company like us to go from partially virtual to fully virtual in a short period of time,” he says, “it’s not without its hiccups, but it has worked pretty well.”

Things are weird for everyone right now, so compassion is key

Shifting to remote work might make things feel different for a while — but those differences pale in comparison to the other changes people are coping with in the shadow of the COVID-19 pandemic.

“I think the fact that you are distributed is lesser than the fact that you’re like, not allowed to go outside,” says Lawson. “You’re worried about friends and family and you’re reading the news… those things are more impactful.”

Categories: Business News

Swarm gets all the approvals it needs to begin operating its satellite connectivity service in the US

2020, April 7 - 3:15am

Space startup Swarm emerged from stealth mode in an unusual way two years ago when it turned out that it had launched some of its satellites in contravention of an FCC order not to do so. The regulator had argued that their satellites, which are tiny spacecraft smaller even than most CubeSats, were in fact too small and couldn’t be reliably tracked using existing technology. Now, two years later, Swarm has announced that it has cleared all the requisite regulatory hurdles in order to begin operating commercially in the U.S.

Already last year, Swarm got approval from the FCC to send up the 150 satellites it planned for its initial constellation, as well as up to a total of 600, and it gained approval to use the wireless spectrum that it requires to transmit from its satellites to Earth. On top of that, the company has now added regulatory approval to operate in the U.K., New Zealand, Germany, Sweden, Antarctica and in international waters, and it gained approval for ground stations in the U.S., the U.K., Antarctica, New Zealand and the Azores, with plans for more to come online through the remainder of this year, bringing its total ground station network to 30 by the end of summer, if all goes to plan.

Swarm’s ultimate goal is to provide a worldwide, affordable satellite data network that will be suitable for use in IoT applications, including maritime and ground logistics tracking, and agriculture, as well as for basic communication services for areas that have inadequate ground infrastructure. It’s now at the point where it can begin turning on services using the nine satellites it already has on orbit, as it continues to work toward launching more and expanding its regulatory approvals to cover active operations across more countries.

Categories: Business News

Foursquare merges with Factual

2020, April 7 - 2:36am

Foursquare, the 10-year-old location platform based in New York City, has today announced its plan to merge with Factual.

The terms of the deal were not disclosed. The merged company will keep the Foursquare moniker, and Foursquare CEO David Shim will remain at the helm, with Factual’s founder and now-former CEO Gil Elbaz joining Foursquare co-founder Dennis Crowley as a member of the board and executive team.

Shim confirmed to TechCrunch that this merger was in the works before the coronavirus turned the world upside down.

A company spokesperson acknowledged that there are redundancies in the two teams — so there will be layoffs, although they declined to get specific about how many employees or which teams will be affected.

Foursquare is not the same company it was when it launched at SXSW in 2009. The location-based social network, which let people check in to locations to share with their friends and earn badges, has evolved over time into an advertising and marketing platform focused on location as a differentiator.

In 2014, Foursquare split its main app into two separate apps, the Foursquare City Guide and Swarm. Swarm let users check in to locations and earn mayorships and other stickers, with a focus on social utility that was eventually de-emphasized in favor of life logging. Foursquare City Guide, on the other hand, used past check-in data and data from Swarm to power a Yelp competitor, giving users a way to find great restaurants and experiences in their area.

Since that split, Foursquare has built out a back-end platform for brands and publishers to leverage its data, including an API and SDK for developers to offer location-contextual experiences to their end users. For example, Uber started using Foursquare’s tools to allow users to type in the name of the restaurant or store where they wanted to be picked up, rather than having to hunt down the physical address.

The Pilgrim technology, according to Foursquare, is more accurate than your average location tech because of its 10 years of check-in data. The tech understands the difference between a fifth-story location and a ground-floor location. It knows the difference between the coffee shop and the bar next door in a densely packed city like New York.

Because of this, Foursquare is able to give brands the ability to serve these hyper-contextual experiences in the right place at the right time. And it’s been relatively successful doing so.

Foursquare reported more than $100 million in revenue last year.

Factual, for its part, also launched in 2009 as a repository for open data, but over time it has become increasingly focused on using its location data to improve advertising. The company offered brands the ability to track the success of their marketing campaigns, measuring whether a campaign actually got people to visit stores physically — so you can see why it might be a good fit with Foursquare.

Factual’s Elbaz argued that there’s not only a huge opportunity in the location data space, but also a need to combat the threat posed by the digital ad “duopoly” of Google and Facebook. This is a sentiment that has been echoed by Foursquare, which says that a vertically integrated, solely location-focused company is better for data privacy than ad-first companies like Facebook and Google.

“Both companies have long maintained that there is a need for independent, neutral location data, available outside of the walled gardens, and we expect near-term that the walled gardens will relent and seek out an independent partner,” said David Shim. “Foursquare is primed to be that provider.”

Collectively, our biggest strength lies in trust,” added Gil Elbaz. “Marketers need an independent and neutral party they can trust, for measurement, for continuity, and for true innovation. This deal represents 30+ years of combined experience where we have been sought out as the independent, leading source for location.”

Prior to the merger, Factual raised a total of $104 million, most recently in a $42 million round with participation from Upfront Ventures and Felicis Ventures.

The combined entity will represent some of the largest location data sets in the world, spanning more than 500 million devices, a panel of 25 million opted-in, always-on users and more than 14 billion user-confirmed check-ins. The company will also have data on more than 105 million points of interest across 190 countries and 50 territories.

That said, combining forces might be more than just a good idea — it might be a necessity. A recent IAB survey found that 74% of media planners and brands are expecting the COVID-19 pandemic and resulting economic downturn will have an even bigger impact on ad spend than the 2008 recession. Add to that the fact that most people are (or should be) staying home and it’s looking like a challenging year for any location-based ad company.

“Generally speaking, there’s no denying that the entire advertising/marketing industry at large has taken a hit from COVID-19,” said David Shim. “We started seeing some impact in late-March. At the same time, it’s opened up new conversations from those who are looking to us to help them understand the impact COVID on their business, and brands are already working with us to prepare for the ‘Great Reset’ in offline consumer behavior.”

He added that there will be pent-up consumerism, making this “a historic opportunity to grab and defend market share.”

Categories: Business News

Creative Destruction Lab launches a new startup program dedicated to COVID-19 response

2020, April 7 - 2:01am

Global academic science and tech startup accelerator program Creative Destruction Lab (CDL) is adding a dedicated stream to its existing areas of focus, which include AI, health sciences, space, quantum computing, blockchain, energy and oceans. The new addition is a timely one: CDL Recovery, which is designed to help turn science and research work into scalable products and services to address the consequences of the COVID-19 pandemic, in terms of both its effects on public health and the economy.

CDL’s model for helping startups move from concept to product is fairly unique, and potentially uniquely well-suited to addressing new needs that emerge as a result of how the world is changing in response to the novel coronavirus. Many of the efforts to address needs both in terms of therapeutics and in medical hardware to help shore up shortages are originating at schools and universities around the world, and CDL’s expertise heavily favors moving deep tech and hard science from inside the research lab to the market.

The program will be aimed at helping usher innovations from innovation to product in key areas, including around diagnostic testing, vaccine development, remote care and telemedicine, as well as in areas of economic support like virtual work, talent re-training, remote equipment operation, automation and food production and supply. CDL founder and University of Toronto professor Ajay Agrawal said in a blog post about the new program that many have suggested there’s a need “to assume a wartime footing in response to COVID-19,” and that’s one of the aims of the program.

It’s definitely true that crises like the one we face currently have a way of decreasing the turnaround time from research to development and deployment. And already, CDL’s program is designed from the ground-up to try to accelerate the pace at which that happens, working with academic institutions around the world, including the University of Oxford, HEC Paris, the Georgia Institute of Technology, the University of British Columbia, HEC Montreal, the University of Calgary and Dalhousie University, as well as the University of Toronto. Teams that are approved to join take part in a series of sessions that set objectives, and then measure their progress, guided by mentors, including the founders and executives of world-leading companies and institutions.

The CDL Recovery program will follow the same structure as its standard streams, but will be done at twice the pace in order to expedite the results. Applications are open now, and the program is available at no cost, and without any equity taken by any of the program operators.

Categories: Business News

Daily Crunch: Quibi finally launches its mobile streaming app

2020, April 7 - 1:18am

Quibi launches its mobile streaming service, Apple sources 20 million protective masks and Red Hat announces a new CEO. Here’s your Daily Crunch for April 6, 2020.

1. Quibi launches its mobile streaming service in the middle of the quarantine era

The much-hyped mobile app promising to deliver “quick bites” of video entertainment is finally here. The company has been in the headlines for more than two years, thanks to the involvement of founder Jeffrey Katzenberg (who previously co-founded DreamWorks Animation) and CEO Meg Whitman (previously the CEO of eBay and Hewlett Packard Enterprise), not to mention $1.75 billion in funding.

Judging from a few hours of exploration, the app is as slick as promised, with impressive Turnstyle technology for switching between portrait and landscape viewing. What’s missing so far, however, is any real sense of creative breakthrough.

2. Apple has sourced over 20 million protective masks, now building and shipping face shields

The company is working with governments around the world to distribute its supply of face masks to where it’s needed most. Meanwhile, the first delivery of Apple face shields went out to Kaiser hospital facilities in the Santa Clara valley earlier this week, according to CEO Tim Cook.

3. Paul Cormier takes over as Red Hat CEO, as Jim Whitehurst moves to IBM

Cormier would seem to be a logical choice to run Red Hat, having been with the company since 2001. He joined as its VP of engineering and has seen the company grow from a small startup to a multi-billion dollar company.

4. GrubHub, Seamless’s pandemic initiatives are predatory and exploitative, and it’s time to stop using them

Jon Evans argues that GrubHub (which also owns Seamless) is hurting, not helping, the restaurants that it pretends it’s trying to support.

5. Pandemic puts the brakes on micromobility

Ride Report creates software that enables cities to better work with micro-mobility operators and has a bird’s-eye view on the industry. In a conversation with TechCrunch, CEO William Henderson outlined what we can expect for micro-mobility operators during the pandemic and once it’s over. (Extra Crunch membership required.)

6. Open banking fintech Yapily raises $13M Series A

Founded in mid-2017 by ex-Goldman Sachs employee Stefano Vaccino, Yapily’s open banking platform makes it easier for various service providers to connect to banks. Specifically, it provides a way to retrieve financial data and initiate payments via a “single secure API” that in turn connects to each supported bank’s open API.

7. This week’s TechCrunch podcasts

The latest full-length episode of Equity discusses the tremendous growth of Zoom and how that’s cast a spotlight on the videoconferencing app’s security flaws, while the Monday news roundup looks for positive signs in startup funding. And on Original Content, we review the first season of “Star Trek: Picard” and the extremely unsettling Netflix film “The Platform.”

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 9am Pacific, you can subscribe here.

Categories: Business News

Why AI startups’ economics will likely improve over time

2020, April 6 - 11:56pm

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

If you can recall February, we dug into the question of AI startup gross margins. Venture shop a16z had published an interesting blog on the subject, arguing that it may be the case that AI-focused startups will enjoy strong gross margins, but perhaps not as strong as those posted by SaaS companies.

Modern software startups (SaaS companies) have some of the highest gross margins in business, delivering their digital services over the Internet at little cost. Their high-margin revenue has made them incredibly valuable to private and public investors alike. To see a16z draw a line for AI gross margins a little under SaaS, then, was notable. AI startups might earn long-term lower revenue multiples than SaaS firms, and, if so, they might need to adjust their valuation expectations.

Since that nerdy interlude, the world has fallen apart. The United States has accreted over 337,000 COVID-19 cases, the stock markets have fallen sharply and we’re somewhere between a bear market and a recession. Shit, as they say, has changed.

But after our first look at the world of AI margins, asking a number of VCs to weigh in on the matter, we wound up talking to one more VC, David Blumberg of Blumberg Capital, who had some interesting notes on the AI margin matter to share from his portfolio.

Since that conversation, TechCrunch covered Deepgram’s Series A, which brought the subject of AI startups and their margins back into our heads. So, before Q2 really gets under way, a little more on AI and COGS.

AI margins and the future
Categories: Business News

Equity Monday: Hunting for green shoots amid the startup data

2020, April 6 - 10:50pm

Good morning friends, and welcome back to TechCrunch’s Equity Monday, a short-form audio hit to kickstart your week.

Before we jump into today’s show, don’t forget that the long-form Equity that we’ve done for more than three years still drops on Friday. Last week’s was a particular delight, so make sure you’re caught up. Ready? Let’s go.

This weekend was busy, with Quibi launching, folks in the UK attacking 5G towers and Skype trying to steal some of Zoom’s thunder. News was dominated, as always, by COVID-19, this time leading to a stock market bump as some data from the disease appeared to take a short breather with — depending on which tracker you favor — fewer folks contracting the infection in the last 24 hours than the day prior; investors are hunting for any positive signal to trade on, and that appears to have been enough.

What’s coming up this week? Not earnings, or at least not the sort of earnings reports that we care about. Instead, we’re keeping eyes peeled for Q1 VC data and economic information from the United States. Here in the States Friday is off, remember, so this is a short week.

Next, two venture rounds:

  • Valispace, a Germany-based startup that also has folks in Portugal, raised €2.2M recently led by JOIN Capital. The startup calls itself “Github for hardware,” which TechCrunch summarized as a “collaboration platform for engineers, allowing them to develop better satellites, planes, rockets, nuclear fusion reactors, cars and medical devices” with a browser-based app.
  • And Vertical Future just raised £1.1M. It’s doing vertical farming, a topic that I’ve read about every few years but now appears to really be a thing! That’s exciting. Vertical Future raised a bigger round last year, and is generating food today in production sites.

Finally, we close with a question: How many more startups are going to die this year, compared to 2019, and what do their deaths mean for staff and investors alike? Will the end of so-called “tourist” money harm young companies or will it merely cull the silly?

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.

Categories: Business News

Myriota raises $19.3 million to expand its IoT satellite constellation

2020, April 6 - 10:00pm

Internet of things satellite connectivity startup Myriota has raises a $19.3 million Series B funding round, led by Hostplus and Main Sequence Ventures, with additional funding from Boeing, former Australian PM Malcolm Turnbull, Singtel Innov8 and others. The company has now raised $37 million in Funding, and has four satellites on orbit already, with a plan to expand that to 25 by 2022 with the help of this new funding.

Myriota provides low-cost, power efficient direct satellite connectivity for IoT uses, including industrial applications like equipment monitoring and measurement of environmental measures like groundwater levels. The Adelaide-based company has developed its own proprietary low-over iOT communications technology, that claims big advantages over existing solutions in terms of battery life, security, scalability and cost.

With this new funding, it also hopes to expand headcount, adding 50 percent more employees over the course of the next two years, with a focus on expanding globally to provider service to more international markets. It’s also going to concentrate on building out product to enable real-time reporting across all its offerings.

Already, Myriota has begun its expansion plans with a new acquisition of assets from another space tech company, Canada’s exactEarth. The company has purchased four satellites on orbit from the company and brought on new employees as well as six ground stations located in new international locations, including in Canada, the U.S., Norway, Singapore, Panama and Antarctica.

In total, Myriota has a goal of building out a constellation of 50 IoT satellites to provide global scale and service.

Categories: Business News

Lydia lets you donate to hospitals and charities

2020, April 6 - 9:22pm

Fintech startup Lydia is the dominating mobile payment app in France with most of its 3.3 million users in its home country. That’s why the startup has been working hard over the past ten days to ship a feature that was originally planned for this summer — donations to charities and hospitals.

Starting today, Lydia users can choose between 17 charities and send money to those charities using the familiar Lydia payment flow. It works like sending money to your friends and family.

Donations start at €0.50 and those are one-off payments — you can’t set up recurring payments or round up transactions for instance.

Lydia recently introduced “the market”, a marketplace of financial products, such as small credit lines, phone insurance and free credit on home insurance and utility bills. The market menu was buried under the profile tab. The company is now surfacing that screen in its own tab right next to your accounts and transaction history. You can find donations as a new button in the market.

There’s another way to donate. On the payment screen, when you tap a sum and hit next, in addition to the usual list of recipients, you can choose to send money to a charity from there as well. This feature is live on Android and will be available soon on iOS — iOS users have to go through the market for now.

The startup has selected 17 charities for now, but that list could grow over time. You’ll find public hospitals (Paris, Nantes, Strasbourg, Grenoble, Lille and Nice), charities focused on health as well as general public interest charities (Fondation de France, Fondation 101, Médecins du Monde, Epic, Action contre la Faim, La Croix Rouge française, La Fondation Abbé Pierre, La Ligue Nationale contre le Cancer, Réseau Entourage and La Maison des Femmes de Saint-Denis).

If you’re not a Lydia user, you can still use Lydia’s payment flow in your web browser with a credit or debit card. (But nothing is stopping you from donating directly on the charity websites of course.)

If you want to give a large sum of money and deduct part of your donation from your income taxes, you’ll have to ask charities directly. Lydia can’t give you a tax form directly as it only acts as an intermediary.

Eventually, Lydia will deduct processing fees from your donations before handing them over to charities. But the company is waving fees until June 30 due to the coronavirus crisis.

Categories: Business News

Open banking fintech Yapily raises $13M Series A

2020, April 6 - 2:00pm

Yapily, one of a number of fintech startups that offer an opening banking API to let enterprises, such as financial service providers and merchants, connect to banks, has raised $13 million in Series A funding. Leading the round is Lakestar, which is also a backer of fintech unicorn Revolut.

Existing investors HV Holtzbrinck Ventures, and LocalGlobe also participated. Yapily last disclosed $5.4 million in seed funding in May 2019, and counts the likes of Taavet Hinrikus (TransferWise chairman and co-founder), Ott Kaukver (Twilio’s CTO), Roberto Nicastro (UniCredit’s former deputy CEO) and Frank Strauss (Former CEO of Deutsche Postbank) as angel backers.

Founded in mid 2017 by ex-Goldman Sachs employee Stefano Vaccino, Yapily’s open banking platform makes it easier for various service providers to connect to banks. Specifically, it provides a way to retrieve financial data and initiate payments via a “single secure API” that in turn connects to each supported bank’s open API.

Customers are said to include Fortune 500 companies and fast growth fintechs, including Intuit QuickBooks, where Yapily’s API is used by the accounting software provider to help SMEs access insights and financial information from bank accounts in the U.K., France, and Ireland. Another customer of Yapily is GoCardless, the London fintech that makes it easy to offer customers the option to pay by direct debit.

More broadly, Yapily’s platform can be used by anything from accountancy firms, companies in the payment space, to crypto currency providers, digital wealth applications and e-commerce companies.

To that end, the open banking fintech says it will use the investment to “drive open banking adoption by organisations across Europe,” noting that more than 6,000 banks will be affected by the PSD2 (European open banking) deadline. This means that most European countries are set to release open banking-style APIs publicly in 2020, which Yapily hopes to benefit from.

Open banking platform Tink raises €90M at a post-money valuation of €415M

Categories: Business News

Quibi launches its mobile streaming service in the middle of the quarantine era

2020, April 6 - 1:00pm

Quibi, the much-hyped mobile app promising to deliver “quick bites” of video entertainment, is finally here.

The company has been in the headlines for more than two years, thanks to the involvement of founder Jeffrey Katzenberg (who previously co-founded DreamWorks Animation) and CEO Meg Whitman (previously the CEO of eBay and Hewlett Packard Enterprise).

Plus, it’s raised a whopping $1.75 billion to fund a star-studded content slate from filmmakers like Steven Spielberg, Guillermo del Toro, Lena Waithe and Catherine Hardwick.

Quibi is launching with nearly 50 shows today. The initial lineup includes “Chrissy’s Court” (in which Chrissy Teigen presides over small claims court), “Shape of Pasta” (a food and travel show starring chef Evan Funke), “Most Dangerous Game” (a dystopian thriller starring Liam Hemsworth) and “Survive” (a scripted plane crash drama starring Sophie Turner). All the episodes are less than 10 minutes in length, and can be viewed in either portrait or landscape mode.

Quibi says it will be delivering more than 25 new episodes every day, including segments of what the company is calling Daily Essentials — news and entertainment shows like “Last Night’s Late Night” from Entertainment Weekly and “The Replay” from ESPN.

The service will cost $4.99 with ads or $7.99 per month without ads. Quibi is also offering a 90-day free trial if you sign up before the end of April.

Image Credits: Quibi

In a briefing with reporters last week, CTO Rob Post acknowledged that it’s been a long, expensive road to launch. But he said that given the heavy investment in content, “There was no room for [Chief Product Officer Tom Conrad] and I to deliver a minimum viable product.” Instead, they had to build something that was fully polished.

While Quibi has been building up to this for months, with a big presentation at the Consumer Electronics Show, Super Bowl ads and more, the world has changed, with a global pandemic making this a strange time to launch any product.

People are certainly looking for distraction and escape right now. But the app is designed for viewing while you’re on-the-go, whether that’s walking around, waiting in line or sitting in the backseat of a car — all moments that are happening considerably less often as huge swaths of the population are advised to shelter in place and maintain social distance.

Still, Post argued that there’s a need for the kind of entertainment that Quibi is offering.

“I’m looking to take small breaks more than ever before to stand up, walk around, go outside,” he said. “Our use cases are these in-between moments. Now more than ever, that use case is still present.”

And of course, these restrictions have also created challenges for Quibi’s launch and content production.

“That’s meant all kinds of things,” Conrad said. “Our Daily Essentials, which were all set to be produced in studios in New York and L.A. each day, in most instances are being shot in people’s homes … Everybody from the production team to postproduction houses to the engineering and marketing organizations are trying to adapt to this moment.”

Quibi has already been showing off is Turnstyle technology, which allows for a seamless transition back-and-forth between portrait and landscape modes. (Apparently Quibi’s filmmakers have to deliver two edits of each episode, one optimized for each orientation.) Last week, the company gave reporters access to the full app.

Judging from a few hours of exploration, Quibi is indeed as polished as Post and Conrad promised, making it easy to swipe through and browse the day’s offerings. Turnstyle also works smoothly, with a blink-and-you’ll-miss-it transition every time I rotate my phone.

I quickly noticed, however, that I was torn between the two viewing modes. Portrait mode was more comfortable, particularly when I was watching a full seven- or eight-minute episode, but landscape mode looked much more cinematic, and often included imagery that had been cropped out of the more narrow, vertical footage.

Image Credits: Quibi

In addition, the focus on a smartphone app — rather than an experience for the browser, tablet or connected-TV — made for a clumsy experience anytime I tried to watch with someone else. (The whole point is to focus on the mobile viewing experience, but Conrad said, “If there’s appetite for Quibi in the living room or on tablets, we certainly will follow that interest as the data reveals.”)

As for the content itself, my favorite show was probably “Most Dangerous Game,” which kicks off with a tantalizingly bleak introduction (the premise will be familiar to viewers of the classic film of the same name). I also enjoyed “Shape of Pasta,” which includes plenty of mouth-watering pasta footage, and”Chrissy’s Court” — Teigen is always delightful, and I liked seeing a courtroom reality show that leans more into humor than drama.

At CES, Whitman positioned Quibi as the first platform to truly take advantage of the new creative opportunities that mobile phones offer to filmmakers. She also emphasized that in contrast to free video platforms like YouTube, Quibi will offer “Hollywood-quality content.”

“[YouTube] is the most ubiquitous, democratized, incredibly creative platform,” Whitman told us. “But they make content for hundreds of dollars a minute. We make it for $100,000 a minute.”

The production value is certainly evident — most of the shows I watched look significantly more expensive that what you’ll find on YouTube. What’s missing so far, however, is any real sense of the creative breakthrough that Whitman was hinting at. Instead, Quibi delivers well-produced, moderately entertaining shows that can be watched when you’ve got a few minutes to spare. They’re fine, but rarely more than that.

Maybe that will be enough for most viewers, particularly during the trial period. The challenge will be convincing those viewers to stick around and pay a subscription fee. To do that, I suspect Quibi will need a breakout show, or something that really takes advantage of the phone in a new way. We’ll see if that arrives in the months to come.

Quibi execs Jeffrey Katzenberg and Meg Whitman explain their big vision

 

Categories: Business News

R&D Roundup: Ultrasound/AI medical imaging, assistive exoskeletons and neural weather modeling

2020, April 5 - 11:49pm

In the time of COVID-19, much of what transpires from the science world to the general public relates to the virus, and understandably so. But other domains, even within medical research, are still active — and as usual, there are tons of interesting (and heartening) stories out there that shouldn’t be lost in the furious activity of coronavirus coverage. This last week brought good news for several medical conditions as well as some innovations that could improve weather reporting and maybe save a few lives in Cambodia.

Ultrasound and AI promise better diagnosis of arrhythmia

Arrhythmia is a relatively common condition in which the heart beats at an abnormal rate, causing a variety of effects, including, potentially, death. Detecting it is done using an electrocardiogram, and while the technique is sound and widely used, it has its limitations: first, it relies heavily on an expert interpreting the signal, and second, even an expert’s diagnosis doesn’t give a good idea of what the issue looks like in that particular heart. Knowing exactly where the flaw is makes treatment much easier.

Ultrasound is used for internal imaging in lots of ways, but two recent studies establish it as perhaps the next major step in arrhythmia treatment. Researchers at Columbia University used a form of ultrasound monitoring called Electromechanical Wave Imaging to create 3D animations of the patient’s heart as it beat, which helped specialists predict 96% of arrhythmia locations compared with 71% when using the ECG. The two could be used together to provide a more accurate picture of the heart’s condition before undergoing treatment.

Another approach from Stanford applies deep learning techniques to ultrasound imagery and shows that an AI agent can recognize the parts of the heart and record the efficiency with which it is moving blood with accuracy comparable to experts. As with other medical imagery AIs, this isn’t about replacing a doctor but augmenting them; an automated system can help triage and prioritize effectively, suggest things the doctor might have missed or provide an impartial concurrence with their opinion. The code and data set of EchoNet are available for download and inspection.

Categories: Business News

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