Business News

Berlin’s Taxfix, a mobile assistant for filing your taxes, picks up $13M led by Valar Ventures

Startup News - 2018, August 9 - 5:00pm

Taxfix, the Berlin-based startup that has developed a mobile assistant to help you file your tax return, has closed $13 million in Series A funding. The round is led by Peter Thiel’s Valar Ventures, with participation from existing investors Creandum and Redalpine.

Launched in 2017, Taxfix is built on the premise that filing taxes remains a daunting task in most countries, involving a lot of archaic form filling, often carried out incorrectly and without the proper advice, and rarely optimised for tax refunds. As a result, the company says that in Germany alone, over 10 million employees decide not to file a tax return, and therefore forgo an average tax rebate of 935 Euros.

“The problem is that most people don’t have a personal tax accountant, nor the sufficient knowledge on how to file their taxes,” explains Taxfix co-founder and CEO Mathis Büchi. “Taxpayers are required to invest a substantial amount of time to become an expert themselves to receive their maximum tax refund. That’s why the rich can optimise their taxes with their own accountants and the regular citizens are overpaying billions of Euros in taxes every year in almost every country in the world”.

To help combat this, the Taxfix app works similar to a chatbot, and — coupled with the startup’s “tax-engine technology” — aims to make filing your taxes as easy as it would be if you hired your own tax accountant. You simply photograph your annual payslip and work through a questionnaire personally tailored to optimise your refund. The Taxfix app then automatically calculates the predicted tax rebate and submits your filing for you.

“[Taxflix creates] a digital tax accountant on the mobile phone, which asks the users simple questions and makes sure they optimise their refund and file their tax return correctly,” says Büchi.

To date, Taxfix’s typical customers are young people between 20-35 years old, who are not tax experts and often have never filed a tax return before. For every tax return that generates a refund of over 50 Euros, the startup charges 35 Euros for submission to the relevant financial authorities.

Of course, there are already a large number of startups and software companies that can help you file a tax return. These include legacy players such as WISO in Germany and Intuit’s TurboTax in the U.S., or upstarts such as the U.K.’s TaxScouts. A government’s own online tax filing gateway could also be considered a direct competitor.

“Taxfix differentiates itself from all other solutions by its mobile-first approach and by not using forms fields as the user interface,” adds Büchi. “Taxfix creates a completely new user experience with the conversational interface that asks simple questions and translates the information into tax language automatically. It takes on average 20 minutes to file your taxes with Taxfix, compared to 3 to 6 hours with traditional software”.

Meanwhile, Büchi says the new funding will be used for international expansion, bringing the app’s tax declaration capabilities to other jurisdictions. The German company also plans to invest heavily in machine learning to bring its tax engine technology “to the next level”.

Categories: Business News

WeWork’s HQ product aims to better accommodate mid-sized companies

Startup News - 2018, August 9 - 9:22am

WeWork recently announced a new office space solution called “HQ by WeWork” to provide mid-sized companies the privacy, flexibility, customization and cost-efficiency they need without making a long-term brick-and-mortar commitment.

According to U.S. Census data, the number of mid-sized companies with 11 to 250 employees account for 1.1 million companies in the country and employ approximately 30 million people. In many cases, these companies have begun seeing growth but are not ready (or financially capable enough) to settle into a long-term office space that they may soon outgrow.

“Be it those lifestyle businesses that are going to be 30 people forever, a small law firm, or a tech firm, we believe very strongly in companies of that size and how important they are to their local economies,” WeWork Chief Growth Officer Dave Fano told TechCrunch. “Often times space is still very much a challenge for companies of that size and the way they have to make these [office space] commitments ends up probably being an inhibitor to their growth.”

To better meet the needs of these companies, HQ by WeWork offers private office floors (leased and managed by WeWork) that companies can move into for flexible leasing periods — typically for a minimum of 12-24 months. But, should a company outgrow its space in six months, Fano said WeWork will work to accommodate a move to support its growth.

Unlike WeWork’s Powered by We model, which allows companies to bring the management of WeWork to spaces they rent themselves, companies using HQ by WeWork can leave the ins-and-outs of office real estate to the office-sharing company.

HQ by WeWork offers spaces with customizable color schemes and branding incorporation, private entrances and a service-lite model of WeWork management that includes essentials (IT, AV, etc.) but without all the bells and whistles (e.g. full conference rooms, events) that come with a typical WeWork office space. This paring down of amenities allows it to offer these spaces at a lower price per person than a typical WeWork accommodation, Fano told me. That said, HQ tenants can still drop-by any WeWork facility to utilize the features their spaces lack.

So far, WeWork has leased six HQ spaces in New York City and is actively working to expand HQ by WeWork into all the company’s flagship cities, such as Los Angles and Toronto.

Categories: Business News

Spark Neuro raises $13.5M to measure your emotional response to ads and movies

Startup News - 2018, August 9 - 3:17am

I’m not immune to compliments, and Spencer Gerrol, founder and CEO of Spark Neuro, offered a real winner as he demonstrated his technology.

“I love your brain,” he told me. This was after the startup’s vice president of research Ryan McGarry had strapped sensors to my fingers and head, then showed me an intense movie clip, with my attention level and emotional response displayed on a screen for all to see.

That, in miniature, is what Spark Neuro does: It helps companies study the audience response to things like ads, movies and trailers.

The goal is to replace things like focus groups and surveys, which Gerrol said are subject to a variety of biases, including group pressure and the desire to give the answer that you think the researcher wants to hear.

For example, he showed me a Mr. Clean ad that had performed poorly among men in focus groups. Spark Neuro, in contrast, found that it actually had “beautiful performance” among both men and women, and it ended up being one of the best-received ads at last year’s Super Bowl. (Apparently the guys just didn’t want to admit that they enjoyed watching a seductive cartoon man.)

We’ve also written about startups that try to measure ad effectiveness using technology like eye tracking and studying facial expressions. Gerrol said those are valuable data points, and indeed, they’re part of Spark Neuro’s research. But they have their limitations, which is why the company also looks at brain and electrodermal activity.

Gerrol highlighted the EEG data (i.e. data about the electrical activity in your brain) as offering “such richness and such depth.” The challenge is that “the data is incredibly noisy.” So Spark Neuro has developed tools to automatically remove the noise and make the data easy to understand.

At the same time, it’s not just relying on technology — Gerrol said his researchers also do one-on-one interviews with participants afterwards to get a better understanding of their responses.

“The most important thing, by 100 fold, is the intellectual property around the algorithms,” he added. “The algorithms take a mess of data that’s meaningless to the human eye and turn it into something you can just understand as a marketing executive.”

My own readings looked daunting at first, but they quickly became comprehensible as Gerrol walked me through them, showing me where my attention and emotions spiked.

Spark Neuro is already working with a long list of clients that includes Anheuser-Busch, General Motors, Hulu, JetBlue, Paramount and Walmart. It’s also announcing that it’s raised a $13.5 million Series A led by Thiel Capital, with participation from Will Smith (yes, that Will Smith) and former Disney CEO Michael Eisner.

Eventually, Gerrol suggested the technology could be applied in other ways, like measuring student attention in the classroom.

“There’s a million applications,” he said. “We’re very focused on being a dominating force in a discrete industry, but it’s also important to our future to set ourselves up for further applications.”

Categories: Business News

SoundCloud on the blockchain? Audius raises $5.5M to decentralize music

Startup News - 2018, August 9 - 1:29am

Audius wants to cut the middlemen out of music streaming so artists get paid their fair share. Coming out of stealth today led by serial entrepreneur and DJ Ranidu Lankage, Audius is building a blockchain-based alternative to Spotify or SoundCloud.

Users will pay for Audius tokens or earn them by listening to ads. Their wallet will then pay out a fraction of a cent per song to stream from decentralized storage across the network, with artists receiving roughly 85 percent — compared to roughly 70 percent on the leading streaming apps. The rest goes to compensating whomever is hosting that song, as well as developers of listening software clients, one of which will be built by Audius.

Audius plans to launch its open-sourced product in beta later this year. But it’s already found some powerful investors that see SoundCloud as vulnerable to the cryptocurrency revolution. Audius has raised a $5.5 million Series A led by General Catalyst and Lightspeed, with participation from Kleiner Perkins, Pantera Capital, 122West and Ascolta Ventures. They’re betting that Audius’ token will grow in value, making the stockpile it keeps worth a fortune. It could then sell chunks of its tokens to earn revenue instead of charging artists directly.

Audius co-founders (from left): head of product Forrest Browning, CEO Ranidu Lankage, CTO Roneil Rumburg

“The biggest problem in the music industry is that streaming is taking off and artists aren’t necessarily earning a lot of money. And it can take three months, or up to 18 months for unsigned artists, to get paid for streams,” says Lankage. “That’s what crypto really solves. You can pay artists in near real-time and make it fully transparent.”

The big question will be whether Audius can use the token economy to crack the chicken-and-egg problem of getting its first creators and listeners on a platform that might be less functionally robust than its traditional competitors. There are a lot of moving parts to decentralize, but there are also plenty of disgruntled musicians out there waiting for something better.

From Sri Lankan hip-hop star to serial entrepreneur

Most startup guys don’t have Billboard charting singles on their bio, but Lankage does. Born in Sri Lanka, his hip-hop songs in his native tongue of Sinhalese were the first of the language to be played on the BBC and MTV. He got signed to Sony and even went platinum, but left the label seeking greater control over his work. After going to Yale, he applied his music business knowledge to build a Reddit for dance music called The Drop with Twitch’s Justin Kan back in 2015.

The two teamed up again on a video version of Q&A app Quora called Whale, but that fizzled out too. Lankage’s next venture Polly, a polling tool built as a complement to Snapchat, inspired the now super-popular Instagram Stories polls and questions stickers. But after an acqui-hire by Reddit fell through, he returned to his first love: music.

“I’ve always been passionate about building tools for creators,” says Lankage. But this time, he wanted to focus on helping them turn their art into a profession. He teamed up with CTO Roneil Rumburg, an engineering partner at Kleiner Perkins who’d build a crypto wallet called Backslash, and head of product Forrest Browning, who’d sold his software metering startup StacksWare to Avi Networks.

Their goal is to build a blockchain streaming music service where listeners don’t have to understand blockchains. “A user wouldn’t even know that they have a wallet,” says Rumburg. They’ll just hear an ad every once in a while, get a subscription, or pay per stream. Since Audius is open sourced, developers will be able to build their own listening clients on top, which could specialize in discovery of certain types of music or offer their own payment schemes.

“I have known Ranidu, Forrest and Roneil for a long time, and have always been impressed with their ability to blend art, technology and business together,” says investor Niko Bonatsos of General Catalyst. “In Audius, they bring together all three skills, with a deep technical heart and a compelling solution for a very big marketplace.”

Tokens, not record labels

For starters, Audius is focusing on signing up independent electronic musicians. These are the types that might be popular on SoundCloud but actually have to pay for hosting there while not getting much back due to the platform’s weak monetization options. Don’t expect U2 and Ariana Grande on Audius, at least not yet. But the startup could differentiate by offering access to content you can’t find elsewhere.

To get artists on board, Lankage tells me Audius plans “to use token incentives.” Those willing to jump on first before there are many listeners could get a bonus allotment of tokens that might be worth more if they help popularize the service. And where artists go, their fans will follow. Audius is hoping artists will share its links first because that’s where they’ll earn the most money.

Audius has also lined up a legion of big-name advisors to help it develop its blockchain product and artist relationships. Those include Augur co-founder Jeremy Gardner, EDM artist 3LAU, EA co-founder Bing Gordon and more it can’t announce just yet.

The linchpin of Audius will be the user experience. If the system feels too complicated, listeners and artists will stay elsewhere. A DJ might earn more per stream from Audius, but if Spotify or SoundCloud offer better ways for fans to subscribe to them and generate more plays long-term, they’ll still direct supporters there. But if Audius can hide the nerdy bits while solving the music industry’s problems, it has the potential to be one of the first mainstream consumer blockchain projects that treats the tech as a utility, not just a new stock market to bet on.

Categories: Business News

Patreon buys Memberful but keeps it indie as patronage consolidates

Startup News - 2018, August 9 - 1:00am

Patreon is forming a patronage empire. Today it acquired white-labeled subscription membership platform Memberful, which lets creators sell exclusive access to content through their own site instead of a centralized platform like Patreon. Rather than being folded into a Patreon feature, Memberful will run as an independent brand, maintaining its tiered pricing structure, though new sign-ups will get a rate closer to Patreon’s low 5 percent rake.

Terms weren’t disclosed for the deal that brings Memberful’s whole seven-person team and 500 paying clients aboard. But Patreon clearly sees rolling up competitors and complements in the patronage space as a worthy use of its $60 million raise at a $450 million valuation late last year that brought it to $105 million in funding. In June, Patreon bought Kit to let creators bundle in merchandise with their perks for paying monthly subscribers. It also bought out competitor Subbable back in 2015.

By teaming up, Patreon and Memberful will be able to provide subscription patronage services for creators, whether they want their fan community to live on Patreon, or through Memberful on their own WordPress or website with integrations of Stripe and MailChimp. Patreon already has 2 million patrons paying an average of $12 each to a total of 100,000 creators, and it expects to pay out $300 million in 2018 alone. The acquisition could let Patreon move up market, recruiting comedians, illustrators, game developers and vloggers that already have an established audience elsewhere.

“I think membership is on the up and is going to grow for the next decade,” says Patreon VP of Product Wyatt Jenkins. “Our strategy is to be an open, neutral platform,” as opposed to focusing on one type of content like YouTube with videos or Twitch with streaming where you’re locked into that platform’s tools. Memberful, launched in 2013, has bootstrapped the creation of its white-labeled tools without the need for venture funding.

Memberful gives creators like Stratechery’s Ben Thompson (who has an interview with Patreon CEO Jack Conte about the acquisition) and podcast producer Gimlet Media full control over branding, with no Patreon chrome. But it’s more expensive and also requires more work as creators have to manage their own site, customer service and payment processing. Memberful takes a 10 percent cut with no monthly fee for its limited basic tier, or $25 per month plus 4.9 percent for the full-featured pro version, though it also offers enterprise pricing. That pricing will remain for existing users, but “new customers will see a transaction fee closer to Patreon’s,” which is a flat 5 percent, a Patreon spokesperson tells me. Patreon does basically everything for a creator, but it also ropes them into the Patreon-branded ecosystem that also promotes other content makers.

Sometimes Patreon handling everything can be a problem, though. Last week it experienced a higher-than-normal volume of declines from banks of charges to patrons. That left some creators without their expected income, and required patrons to deal with the chore of calling their bank to tell them paying $1, $5 or $20 per month to their favorite creator wasn’t fraud. Patreon now tells me that “as of Friday, we let everyone know that we were back to normal decline rates, and were going to continue retrying the rest of the cards like we normally do.”

It makes sense for Patreon to race to consolidate the patronage industry as it’s being invaded by giant incumbents. Twitch, YouTube and Facebook all offer their own versions of paid subscriptions to creators that get patrons extra perks like exclusive content or badges so they stick out in chat rooms full of fans. While those platforms are all focused on video streamers, they still pose a threat to Patreon, which needs to maximize the number of successful creators it hosts in order to earn enough from its tiny cut of payments. Facebook especially could muscle in, as many creators already run their own Facebook Pages.

Asked about competition from those platforms, Jenkins said, “I think there’s a strong chance it’s a tailwind. The concept of membership is pretty new. If those big companies are going to drop millions of dollars into marketing the concept of membership I think that’s great.” He stressed the question of “Do you want to own your fan base? On YouTube, those aren’t your fans, they’re YouTube users. YouTube is incentivized to keep them watching videos so it can show ads.”

That might lead fans to unsubscribe from a creator as YouTube promotes other similar ones they could watch instead. “You don’t own the relationship.” Facebook Page admins have found that out the hard way as algorithm changes prioritize friends over public figures, making it tough to reach the followers they spent years begging to like them. If Patreon can offer creators audience growth through discovery on its interconnected network without cannibalizing anyone’s member counts, its neutrality and focus could make it a leader in this new wing of the digital economy.

Categories: Business News

H1Z1 officially comes to the PS4

Startup News - 2018, August 9 - 12:20am

H1Z1 has spent a couple months on PS4 in an open beta. But today, the Battle Royale game is officially making its debut on the PlayStation platform.

Much like Fortnite Battle Royale, which has swept the gaming world unlike almost any title before it, H1Z1 drops 100 players into a map where they must loot up and survive. Unlike Battle Royale, H1Z1 is relatively more realistic, with a much larger map, more drab colors, and a handful of drivable vehicles.

Interestingly, H1Z1 was one of the earlier Battle Royale games during the game type’s wave of popularity, catching the attention of pro gamers back in 2015. Back then, the game was only available via Steam.

Since, games like PUBG and Fortnite have grown wildly, forcing H1Z1 makers Daybreak to play a bit of catch up.

But today, H1Z1 goes officially live on the PS4, giving gamers who are sick of Fortnite’s bubbly world a chance to get into the Battle Royale world in a different way.

Plus, Daybreak has added in a Fortnite-style Battle Pass for the season, letting PS4 players unlock reward levels for $5.49. H1Z1 is also getting a couple new weapons, including a Sniper Rifle and an RPG, as well as an ARV that can fit a full team of five.

You can check out the launch trailer below:

Categories: Business News

MessageBird offers single API for customer comms across WhatsApp, WeChat, Messenger and more

Startup News - 2018, August 8 - 10:00pm

MessageBird, the Amsterdam-based cloud communications platform backed by Accel in the U.S. and Europe’s Atomico, is unveiling a new product today that aims to make it easier for enterprises to communicate with customers across various channels of their choosing.

Dubbed “Programmable Conversations” (yes, really!), the product takes the form of a single API that unifies customer interactions across multiple channels into a single conversation thread. Out of the box these include WhatsApp, WeChat, Facebook Messenger, Line, Telegram, SMS and voice interactions. The idea is that by providing a consolidated view of a customer’s entire communication history with an enterprise, customer support agents and other customer-facing staff will have the firepower to stay on top of their game in terms of the customer service they provide.

Or, put another way, more communication channels inevitably lead to fragmented conversations, which, especially when multiple support staff are involved, can lead to a degradation of service. Programmable Conversations is an attempt to help solve this problem.

In a call with MessageBird founder and CEO Robert Vis, he told me that more broadly enterprises — and fast-growing startups — no longer have the luxury of dictating how and through what channels customers converse with them. Traditionally, customer service would be delivered via a dedicated phone number, but the plethora of established and emerging online messaging and communications channels has radically increased the number of options customers have and expect.

However, this creates a headache for businesses as each channel needs developer time to be integrated into an existing CRM or business process and additional staffing to service conversations across multiple channels.

It is this heavy lifting that MessageBird’s Programmable Conversations takes care of — keeping conversations in sync across multiple channels, for example, isn’t technically simple — thus cutting down on not just initial implementation time and cost, but also continued maintenance and upkeep.

Vis also explained that Programmable Conversations is designed to enable comms for enterprises that are global — including scale-ups with global ambitions from the get-go — in terms of the territories, carrier integrations and messaging platforms the company supports.

“Delivering communications experiences that improve customer satisfaction and loyalty has to be a focus of businesses today,” adds the MessageBird CEO in a statement. “Consumers today want to connect with businesses in the same way they do with their friends and family – on their own time, via their preferred channel with all the context of previous conversations. With Programmable Conversations enterprises can now easily build a modern communications experience while reducing the burden of their often over-tasked developers”.

Categories: Business News

Handiscover, the startup that helps you find accessible travel accommodation, raises $700K

Startup News - 2018, August 8 - 5:18pm

Handiscover, a startup that lets you find and book accessible travel accommodation, has raised $700,000 in new funding. The round is backed by Howzat Partners, which has previously invested in a number of successful travel companies, such as publicly-listed Trivago and more recently Lodgify. Tranquility Capital, a Swedish family fund with a background in accessibility, also participated.

Originally launched in June 2015 to enable hosts to list accommodation and have Handiscover’s algorithm classify the accessibility of their properties or rooms, the startup has since evolved into a fully fledged two-sided marketplace, enabling consumers to search for and book travel accommodation based on various accessibility needs. The idea, founder Sebastien Archambeaud tells me, was born from his own experience as the father of 13-year-old Teo (pictured) who has a muscle condition and uses a wheelchair to get around.

“When travelling as the family we got so frustrated about the lack of purposeful information about accessibility of both vacation rentals and/or rooms for hotels,” he says. “That was what planted the first seed in my mind. Having a long background in international management and some previous tech experience and knowledge about building marketplaces, I thought I was well equipped to build a project like that. But as usual it never is as easy at it first sounds”.

Easy it might not be, but Handiscover seems to be making a decent dent so far, and appears more than capable of picking up any slack left by Airbnb’s recent acquisition of lesser-sized Accomable, which it has since shuttered. Handiscover currently lists 28,000 properties and rooms, and covers 83 countries, with more to come.

“Our mission is to enable people with disabilities and special needs (15-20 percent of the population) to travel the world, by being able to find a great choice of accommodations at different price levels, adapted to our users specific needs,” explains Archambeaud. “As there is no international standard for accessibility we created our own, using an algorithm to classify accommodations according to their level of accessibility, in a consumer friendly way”.

Archambeaud says direct competitors are mostly traditional travel agencies that specialise in disability, meaning they might have a website but are mainly focused on selling full holiday packages by phone. “We are more into helping our community travel the ‘modern’ way by bringing the freedom of booking online, when you want and with a large international choice,” he says, revealing that Handiscover will soon be working with travel tech company Amadeus to scale supply in terms of the number of hotels listed.

Meanwhile, asked what he thinks of Airbnb’s acquisition of Accomable, Archambeaud had this to say: “[It] was a great signal that our community is relevant from a business point of view and that Airbnb takes an interest in it. For us it has just been positive so far, both business-wise when talking to investors, but also from a community point of view”.

Categories: Business News

Don’t fear the big company ‘kill zones’

Startup News - 2018, August 8 - 6:00am
Ed Byrne Contributor Share on Twitter Ed Byrne is an entrepreneur, investor and co-founder of Scaleworks.

Do you worry about the so-called “kill zones” of big tech companies? The Economist thinks you should. The theory basically suggests that if your product or service is anyway threatening or accretive to one of these incumbents,  they will either force-buy your company or clone it and destroy your market.

Any entrepreneur that believes this should probably pack up now before it’s too late —  if it’s not a “kill-shot,” it will be some other perceived death-knell that ruins your company.

Starting a company has never been easier. But growing a sustainable business is still difficult  —  as it should be. If you build something customers will pay for ,  you’re going to attract competition from copycats and incumbents. Consider it another type of validation, like product-market fit: competitors think we’re right.

Welcome to being an entrepreneur  —  you are going to be constantly battling  –  lack of cash, lack of customers, aggressive competition, better-funded competitors, underperforming staff, slow-moving sales cycle, or some other as-yet-unknown. The list of pitfalls is long. But enough willpower and perseverance — “blood, sweat and tears” —  will get you to the other side. Eventually. Remember  –  the product of an overnight success is years of hard work.

If this is sounds too daunting  –  don’t do it!

If you enter a market large enough, with deep pocketed and dominant incumbents, you have your work cut out for you. Maybe a nice UI and faster workflow attracted customers and some early adopters  – but guess what  – they are copyable features. Features alone are rarely enough to win a defensible market position.

Try to ignore advice that says you should focus on building the best product as your differentiator — this does not set you up with the highest chance of success. Instead, focus on finding and serving a targeted segment of customers, with a unique set of needs, and tailor your product and service experience specifically for them.

It’s easy for features to be copied  –  but you can’t be both custom and generic at the same time. Custom is a great approach that new entrants can take to get a toehold in a larger market with larger players that must be generic (i.e. Salesforce is a generic CRM, but there are lots of vertical CRMs that successfully compete  — Wise Agent for realtors, Lead Heroes for health insurance).

Presenting a Total Addressable Market (TAM) is the bane of potentially good startups that have been schooled in “anything less than a billion-dollar opportunity isn’t interesting.” Maybe we should reframe it as Potentially Ownable Market (POM). What are the details you can build in the beginning — where your tailored approach gives you instant leadership?

Project management for chefs

Let’s use project management as an example. Maybe a new entrant starts as an app for restaurants, which helps chefs build new menus. Each task list is a “recipe,” each recipe has “ingredients,” with amounts and timing, kitchen location, suppliers, alternatives and “garnishes and sauces.” The app integrates with the stock system and POS, and helps chefs predict inventory needs and staffing based on recipe times/complexity.

The founder has looked around and this is the only project management app that focuses on chefs, giving him an instant potentially ownable market. The business might be able to thrive in this segment alone and become the dominant player with its own kill zone.

Maybe this is the first step; the company gets profitable early growth and becomes sustainable, which funds development to grow the business into other vertical and complementary areas. Over time the business will grow into a large TAM  —  a far better approach than starting off in a large market with clear winners already.

Avoid the battle entirely by creating your own category.

Categories: Business News

Scale, whose army of humans annotate raw data to train self-driving and other AI systems, nabs $18M

Startup News - 2018, August 8 - 2:08am

The artificial intelligence revolution is underway in the world of technology, but as it turns out, some of the most faithful foot soldiers are still humans. A startup called Scale, which works with a team of contractors who examine and categorise visual data to train AI systems in a two-sided marketplace model, announced that it has raised an additional $18 million in a Series B round. The aim will be to expand Scale’s business to become — in the words of CEO Alexandr Wang, the 21-year-old MIT grad who co-founded Scale with Lucy Guo — “the AWS of AI, with multiple services that help companies build AI algorithms.”

“Our mission is to accelerate the development of AI apps,” Wang said. “The first product is visual data labelling, but in the future we have a broad vision of what we hope to provide.”

Wang declined to comment on the startup’s valuation in an interview. But according to Pitchbook, which notes that this round actually closed in May of this year, the post-money valuation of Scale is now $93.50 million ($75 million pre-money).

The money comes on the back of an eventful two years since the company first launched, with revenues growing 15-fold in the last year, and “multiple millions of dollars in revenue” from individual customers. (It doesn’t disclose specific numbers, however.)

Today, Scale’s base of contractors numbers around 10,000, and it works with a plethora of businesses that are developing autonomous vehicle systems such as General Motors’ Cruise, Lyft Zoox, Nuro, Voyage, nuTonomy and Embark. These companies send Scale’s contractors raw, unlabelled data sets by way of Scale’s API, which provides services like Semantic Segmentation, Image Annotation, and Sensor Fusion, in conjunction with its clients LIDAR and RADAR data sets. In total, it says it’s annotated 200,000 “miles of data” collected by self-driving cars.

AV companies are not its only customers, though. Scale also works with several non-automotive companies like Airbnb and Pinterest, to help build their AI-based visual search and recommendation systems. Airbnb, for example, is looking for more ways of being able to ascertain what kinds of homes repeat customers like and don’t like, and also to start to provide other ways of discovering places to stay that are based not just on location and number of bedrooms (which becomes more important especially in cities where you may have too many choices and want a selection more focused on what you are more likely to rent).

This latest funding round was led by Index, with existing investors Accel and Y Combinator (where Scale was incubated), also participated in this Series B, along with some notable, new individual investors such as Dropbox CEO Drew Houston and Justin Kan (two YC alums themselves who have been regular investors in other YC companies). This latest round brings the total raised by Scale to $22.7 million.

When Scale first made its debut in July 2016 as part of YC’s summer cohort, the company presented itself as a more intelligent alternative to Mechanical Turk, specifically to address the demands of artificial intelligence systems that needed more interaction and nuanced responses than the typical microtask asked of a Turker.

“We’re honing in on AI broadly,” Wang said. “Our goal is to be a pick axe in the AI goldrush.”

Early efforts covered a wide spread of applications — categorization/content moderation, comparison, transcription, and phone calling as some examples. But more recently the company has seen a particular interest from self-driving car companies, and specifically the ability to look at, understand and categorise images of what might appear on a road with the kind of recognition that only a human can provide for training purposes. For example, to be able to identify a scooter versus a wagon, a piece of asphalt or an article of granite-colored clothing on a person that could potentially look like asphalt to an unsuspecting camera, or whatever.

“This sub-segment of AI, autonomous vehicles, really took off after we launched, and that segment has been the killer use case for us,” Wang said.

My experience in talking with autonomous car companies and those who work with them has been that many of them are extremely guarded about their data, so much so that there are entire companies being built to help manage this IP standoff so that no one has to share what they know, but they can still benefit from each other.

Wang says that the same holds for Scale’s clients, and part of its unique selling point is that it not only provides data identification services but does so with the assurance that its systems retain none of that data for its own or other companies’ purposes.

“We don’t share across different silos and are very clear about that,” Wang said. “These companies are very sensitive, as are all AI companies about their data and where it goes, and we’ve been able to gain trust as a partner because will not share or sell data to any other parties.”

Scale uses AI itself to help select contractors. “We have built a bunch of algorithms and AI to vet and train contractors,” Wang said. In the training, “we provide feedback and determine if they are getting good enough to do the work, and in terms of ensuring the quality of their work, our algorithms go through what they are doing and verify the work against our models, too. There are a lot of algorithms.”

For clients who are calling in data from the public web — for example Pinterest or Airbnb — Scale uses a broader contractor pool that could include stay-at-home moms, students or others looking for extra money.

For clients who are sensitive about the data that’s being analysed — such as the car companies — the conditions are more restricted, and sometimes include centres where Scale controls the machines that are being used as well as how the data sets can be viewed.

This is one reason why Scale isn’t simply focused on growing the numbers of contractors as its only route for growing business. “We’ve noticed that when you have people who spend more time on this they do better work,” Wang said.

Wang said the Series B funding will be used to expand the kind of work Scale does for existing customers in the area of visual data analysis, as well as to gradually add in other categories of data, such as text.

“Our first goal is to improve algorithms for customers today,” he said. “There is no limit to how accurate they want to make their systems, and they need to be constantly feeding their AI with more data. All of our customers have this, and it’s an evergreen problem.”

The second is to diversify more outside driving and the visual data set, he said. “Right now, so much of the success has been in processing imagery and robotics or other perception challenges, but we really want to be the fabric of the AI world for new applications, including text or audio. That is another use of funds to expand to those areas.”

“Fabric” is the operative word, it seems: “Scale has the potential to become the fabric that connects and powers the Artificial Intelligence world,” said Mike Volpi, General Partner, Index Ventures, in a statement. “For autonomous vehicles in particular, Scale is well-positioned to take over an emerging field of data annotation regardless of which players ultimately come out on top. Alex…has recruited a highly talented and technical team to tackle this challenge and their progress is evident in the marquee list of customers they’ve won in such a short amount of time.”

Categories: Business News

Chinese AI startup Tianrang raises a $26M funding round, launches new project to apply ML to cities

Startup News - 2018, August 8 - 2:07am

Chinese AI startup Tianrang has raised a $26 million (RMB180 million) funding round from China’s Gaorong Capital and co-lead CMB International Capital. Other investors included Ziniu Fund and Chinese fintech company Wacai. In 2016, the company raised an angel round led by Gaorong Capital and participated in by Shanghai Jindi Investment Management Ltd.

Based on deep learning and other AI technology, Tianrang provides data analysis and smart solutions for enterprises. It was founded by in 2016 by Xu Guirong, former director of Alibaba’s Ali Cloud and chief scientist at Alibaba’s cloud platform Alimama. So no slouch on the AI front.

Tianrang claims to be able to automatically collect and analyze marketing trends and purchase-related information on Alibaba’s e-commerce platform, allowing vendors to make better marketing decisions.

Wang Hongbo, chief investment officer at CMB International Capital says: “With algorithm and AI, Tianrang lowers the requirement of complex machine decision-making and makes it accessible and scalable for commercial use.”

Tianrang also plans to set up a project to apply machine learning to the urban development of cities, led by Jessie Li, a professor at the College of Information Sciences and Technology of Pennsylvania State University.

Categories: Business News

Lumen raises $7M and passes $1M on Indiegogo for its breath-measuring device for weight loss

Startup News - 2018, August 8 - 1:36am

Our body is continuously storing and consuming energy to keep us alive — but understanding which fuels are being used and why is the Holy Grail of things like weight loss and body hacking. Today’s weight-loss market is saturated with generic products because — guess what — trying to tailor-make a solution for an individual is usually hard and expensive.

For a while now there’s been a technology around which can measure the metabolic gases found in your breath. The theory goes that if you can do that, everyone can work out what they should be eating and when. A few startups have tried, but nothing really took off. Now a new startup is having a crack and has secured significant funding to go for it.

Lumen is a pocket-sized device that measures the gases in your breath and translates that reading via an app into advice that gives you daily personalized meal plans.

As I said, this technology was tried by a startup called PATH Breath+Band, which had a similar device in 2016, but which didn’t take off.

The difference with Lumen is that it’s raised a decent war chest, as well as blowing up on Indiegogo.

It’s now raised a total of $7 million over the past four and a half years, from a host of investors. These include Disruptive VC, Oren Zeev, Red Swan Ventures, Resolute Ventures, Gigi Levy, Sir Ronald Cohen, Avishai Abrahami (Wix Founder) and RiverPark Funds. As part of that funding it’s also – in the last few days – raised more than $1 million on Indiegogo.

The founders are Merav Mor, a doctor of physiology (PhD) and cell biology and her twin sister, Michal Mor, also a doctor of physiology (PhD) and cell biology. CEO Daniel Tal is also a co-founder and also founded Wibiya, which was acquired by Conduit. It probably doesn’t hurt that the renowned Frog design helped in the, well, design.

As endurance athletes, the Mors began researching if there was a way for them to understand the impact of their nutrition and workouts on their bodies to improve their athletic performance. They came across a metabolic measurement called RQ (Respiratory Quotient), which is the gold standard for measuring the metabolic fuel usage of an individual. Top-performing athletes have been using this measurement for years, but the methods for measuring it are invasive (blood test), lengthy (1+ hour in metabolic chambers) and expensive (upwards of a few hundred dollars).

After four years of research and development they developed Lumen, with the ability to measure an individual’s RQ in one breath. What once took over an hour to measure, and a team of nutritionists and scientists to analyze, can now be done in less than three minutes. Michal and Merav’s technology is patent-pending.

So far Lumen says more than 300 beta users have lost an average of 6.8 lbs within the first 30 days of using the device.

Now, they do have competitors. These include Habit, which does pre-packaged personalized meals; Breezing, a technology that requires three minutes of continual breathing and the purchase of new cartridges with every measurement ($5); and Levl, which is a small home-lab setup that measures metabolism and ketosis and costs between $100-150/month. Then there is Ketonix, a computer-connected device that will only provide data on fat burn for users on a strict ketogenic diet.

But with Lumen you just buy the device and the app is free. No cartridges, filters or replacements.

All in all it’s quite a compelling proposition, so it will be interesting to see if Lumen can succeed where others have failed.

Categories: Business News

InVision hires former Twitter VP of Design Mike Davidson

Startup News - 2018, August 8 - 1:02am

InVision continues its slow march toward design world domination, today announcing the hire of Mike Davidson who will take over as Head of Partnerships and Community.

Davidson was previously the VP of Design at Twitter, where he built a 100-person team that was responsible for every aspect of Twitter’s user experience and branding, including web, mobile web, native apps and business tools.

Before Twitter, Davidson worked at ESPN/Disney until 2005, when he founded NewsVine, which was purchased by NBCNews in 2007. Davidson then took on a vice president roll for five years before starting at Twitter.

At InVision, Davidson will oversee partnerships, product integrations, strategic acquisitions and community building. This includes leading InVision’s Design Leadership Forum, which hosts private events for design leaders from big companies like Facebook, Google, Lyft, Disney, etc. Davidson will also work with the new Design Transformation team at InVision to help create educational experiences for InVision’s customers.

Davidson says he plans to spend the next 30 to 60 days talking as little as possible, and listening to the feedback he hears from his team around what can be improved.

“InVision has a seamless workflow that includes everyone in the company in the design process,” said Davidson. “If there’s one goal I’d like to realize, it’s that. Design is a team sport these days, which wasn’t the case 10 or 20 years ago.”

In Davidson’s own words, the position at InVision is “less about business to business and more about designer to designer.” Davidson will be meeting predominantly with the design teams from various companies to discuss not only how InVision can help them build better experiences, but how InVision can incorporate those design teams’ personalities into the product.

InVision was built on the premise that the screen is the most important place in the world, considering that every brand and company is now building digital experiences across the web and through mobile applications. CEO Clark Valberg hopes to turn InVision into the Salesforce of design, and partnerships, acquisitions and product integrations are absolutely vital to that.

“We couldn’t be more excited to have an authentic leader like Mike step into this role to help us further build out our design community — which is as important to us as our product — and to help drive design maturity inside of every organization,” said Valberg. “Digital product design is shaping every industry in the world, and as the leader in the space, we see it as our responsibility to support and foster community and advanced education.”

Categories: Business News

Self-driving truck startup Kodiak Robotics raises $40 million

Startup News - 2018, August 8 - 12:12am

In Don Burnette and Paz Eshel’s view, trucking is the killer app for self-driving technology.

It’s what led Burnette to leave the Google self-driving project and co-found Otto in early 2016, along with Anthony Levandowski, Lior Ron and Claire Delaunay.

And it’s what would eventually prompt Burnette to leave Uber the company that acquired Otto — and co-found with former venture capitalist Eshel a new driverless-trucks startup called Kodiak Robotics.

“It was no secret that Uber was primarily focused on the car project and 80 to 90 percent of my time was focused on the car project,” Burnette told TechCrunch. “But I still felt that trucking was the killer app for self-driving. I still believe that. I wanted to focus 100 percent of my time on trucking.”

Now he and Eshel can. Kodiak Robotics, which was founded in April, is coming out of stealth loaded up with venture capital.

Kodiak Robotics announced Tuesday it has raised $40 million in Series A financing led by Battery Ventures. CRV, Lightspeed Venture Partners and Tusk Ventures also participated in the round. Itzik Parnafes, a general partner at Battery Ventures, will join Kodiak’s board.

Kodiak Robotics will use the funds to expand its team and for product development. The company has about 10 employees, according to Eshel, who was a vice president at Battery Ventures, where he led the firm’s autonomous-vehicle investment project.

Burnette noted the core engineering team — many of whom have experience in shipping self-driving vehicles on public roads — has been assembled.

The pair weren’t ready to discuss the company’s go-to-market strategy. They did share the basic vision though: use self-driving technology to ease the current strain on the freight market.

The trucking industry is a primary driver of the U.S. economy. Trucks moved more than 70 percent of all U.S. freight and generated $719 billion in revenue in 2017, according to the American Trucking Association. Meanwhile, “full-truckload, over-the-road nonlocal drivers,” a term used to describe drivers who haul goods over long distances, are in short supply. This long-haul sector, which employs about 500,000, was short 51,000 truck drivers last year — up from a shortage of 36,000 in 2016.

Burnette and Eshel see an opportunity for driverless trucks to help close that gap.

“We believe self-driving trucks will likely be the first autonomous vehicles to support a viable business model, and we are proud to have the support of such high-profile investors to help us execute on our plan,” Burnette said.

They also revealed the company’s technical approach.

Kodiak Robotics plans to use light detection and ranging radar known as LiDAR as well as camera, radar and sonar technologies. “Pretty much everything you can imagine self-driving cars using in a comprehensive sensor fusion type system,” Burnette said.

Engineers will focus on developing the full self-driving system stack from the company’s own hardware and software architectures. However, Kodiak Robotics is not going to build any sensors. Instead it will use sensors from third-party suppliers.

Categories: Business News

Klara picks up $11.5 million to improve communication in healthcare

Startup News - 2018, August 7 - 11:46pm

Healthtech continues to make impressive strides forward, but some pieces of the healthcare puzzle are still lagging way behind.

Communication is one of those pieces. But a startup called Klara, which just received $11.5 million in Series A, is looking to change that.

FirstMark Capital led the round, with participation from existing investors Lerer Hippeau, Project A Ventures and Atlantic Labs, alongside a few angels, including Zac Weinberg and Nat Turner (Flatiron Health founders), Vivek Garipalli (Clover Health founder and CEO) and Clark Valberg (InVision founder and CEO).

Led by founders and co-CEOs Simon Bolz and Simon Lorenz, Klara looks to rethink the way communication is handled across the healthcare industry.

As it stands now, the vast majority of communication across a practice, both internally and with patients, happens either in-person or on the phone. A good deal of this communication is either diagnostic, or part of the treatment, and yet phone calls and one-on-one convos don’t offer a record of the conversation. They also take time.

According to Klara, the average practice misses around 34 percent of calls. Missed calls turn into calls back, which often turns into an endless game of phone tag. These back-and-forth calls take up a good chunk of a practice staff’s time.

But Klara, a HIPAA-compliant messaging service, saves up to two hours of time for a medical practice’s staff each day. The service lets all departments of a practice, from doctors to physician’s assistants to nurses to the payments department and the scheduling department, communicate via text around a patients diagnosis and treatment. The platform also allows medical staff to communicate directly with a patient regarding scheduling and treatment.

Not only does this save time for the staff, and reach patients where they want to be reached, but it also saves money. According to Klara, doctors estimate that phone calls alone cost between $15 and $20 each, and that prescription renewal calls alone cost around $10,000/year.

Klara hasn’t finalized its pricing, but charges on a per-month basis based on the size of the practice.

The long-term vision for Klara is to incorporate complementary services, like payments and scheduling services, as well as insurance carriers and pharmacies. The idea is to turn Klara into the fabric of the healthcare system.

Klara says it currently has thousands of practices on the platform, with hundreds of thousands of patients. As part of the funding deal, FirstMark’s Amish Jani will join the board.

Categories: Business News

Researchers teach an AI how to dribble

Startup News - 2018, August 7 - 11:34pm

While this animated fellow looks like something out of NBA 2K18, it’s really an AI that’s learning how to dribble in real time. The AI starts out fumbling the ball a bit and by cycle 95 it is able to do some real Harlem Globetrotters stuff. In short, what you’re watching is a human-like avatar learning a very specialized human movement.

To do this researchers at Carnegie Mellon and DeepMotion, Inc. created a “physics-based, real-time method for controlling animated characters that can learn dribbling skills from experience.” The system, which uses “deep reinforcement learning,” can use motion capture date to learn basic movements.

“Once the skills are learned, new motions can be simulated much faster than real-time,” said CMU professor Jessica Hodgins.

Once the avatar learns a basic movement, advanced movements come more easily including dribbling between the legs and crossovers.

From the release:

A physics-based method has the potential to create more realistic games, but getting the subtle details right is difficult. That’s especially so for dribbling a basketball because player contact with the ball is brief and finger position is critical. Some details, such as the way a ball may continue spinning briefly when it makes light contact with the player’s hands, are tough to reproduce. And once the ball is released, the player has to anticipate when and where the ball will return.

The program learned the skills in two stages — first it mastered locomotion and then learned how to control the arms and hands and, through them, the motion of the ball. This decoupled approach is sufficient for actions such as dribbling or perhaps juggling, where the interaction between the character and the object doesn’t have an effect on the character’s balance. Further work is required to address sports, such as soccer, where balance is tightly coupled with game maneuvers, Liu said.

The system could pave the way for smarter online avatars and even translate into physical interactions with the real world.

Categories: Business News

Shell Ventures backs UK car repair marketplace WhoCanFixMyCar

Startup News - 2018, August 7 - 11:11pm

WhoCanFixMyCar, the U.K. online car repair marketplace, has secured £4 million in new funding. Backing the startup is Shell Ventures — the corporate venture arm of Shell — in addition to chairman Sir Trevor Chinn (who previously chaired the boards ofAA, Kwik Fit and RAC), Active Partners, and Venrex Investment Management.

Launched in 2011 by former investment bankers Al Preston and Ian Griffiths, WhoCanFixMyCar.com claims to be the biggest online marketplace in the U.K. for matching car owners with repair garages. Specifically, the company, which has offices in Newcastle upon Tyne, London and Kiev, operates a local garage and mechanic online comparison service, allowing drivers to post jobs and receive quotes from local garages and mechanics.

The platform currently has 11,500 garages registered to the site, and says it has processed 1 million repair requests from U.K. drivers and receives circa 60,000 new job requests from drivers every month.

This, I’m told, has seen single site garages obtaining around 600 new customers per year on average through WhoCanFixMyCar, with top regional garage groups securing 3,000-4,000 bookings per year.

Furthermore, Shell’s investment via Shell Ventures follows the development of the Shell Helix Service Specialist Network, a recently launched scheme which allows independent workshops on the WhoCanFixMyCar.com site to be officially associated with Shell. In other words, strike this up as potentially quite a strategic investment for Shell.

Armed with a cash injection, Al Preston, co-founder of WhoCanFixMyCar.com, says that the plan it to keep scaling the startup’s activities and consolidate its position in the UK.” We are also focusing on new products and solutions that will further benefit our garage network and provide car owners with a better, richer experience when it comes to car maintenance and repairs,” he says.

On the surface, ClickMechanic can be considered a similar-sized competitor, although it operates a different model, more akin to ‘Uber for car mechanics,’ by offering instant quotes and then putting the job out to a curated network of garages and mechanics who can choose to accept or reject. In contrast, WhoCanFixMyCar is a two sided marketplace in the truest sense, letting you request quotes and compare reviews, with much more emphasis on lead generation from the garage’s point of view.

Article updated to clarify how WhoCanFixMyCar and ClickMechanic operated very different models, despite being competitors on the consumer-facing side.

Categories: Business News

Evolute debuts enterprise container migration and management platform

Startup News - 2018, August 7 - 9:19pm

Evolute, a 3-year old startup out of Mountain View, officially launched the Evolute platform today with the goal of helping large organizations migrate applications to containers and manage those containers at scale.

Evolute founder and CEO Kristopher Francisco says he wants to give all Fortune 500 companies access to the same technology that big companies like Apple and Google enjoy because of their size and scale.

“We’re really focused on enabling enterprise companies to do two things really well. The first thing is to be able to systematically move into the container technology. And the second thing is to be able to run operationally at scale with existing and new applications that they’re creating in their enterprise environment,” Francisco explained.

While there are a number of sophisticated competing technologies out there, he says that his company has come up with some serious differentiators. For starters, getting legacy tech into containers has proven a time-consuming and challenging process. In fact, he says manually moving a legacy app and all its dependencies to a container has typically taken 3-6 months per application.

He claims his company has reduced that process to minutes, putting containerization within reach of just about any large organization that wants to move their existing applications to container technology, while reducing the total ramp-up time to convert a portfolio of existing applications from years to a couple of weeks.

Evolute management console. Screenshot: Evolute

The second part of the equation is managing the containers, and Francisco acknowledges that there are other platforms out there for running containers in production including Kubernetes, the open source container orchestration tool, but he says his company’s ability to manage containers at scale separates him from the pack.

“In the enterprise, the reason that you see the [containerization] adoption numbers being so low is partially because of the scale challenge they face. In the Evolute platform, we actually provide them the native networking, security and management capabilities to be able to run at scale,” he said.

The company also announced that it been invited to join the Chevron Technology Ventures’ Catalyst Program, which provides support for early stage companies like Evolute. This could help push Evolute to business units inside Chevron looking to move into containerization technology and be big boost for the startup.

The company has been around in since 2015 and boasts several other Fortune 500 companies beyond Chevron as customers, although it is not in a position to name them publicly just yet. The company has 5 full time employees and has raised $500,000 in seed money across two rounds, according to data on Crunchbase.

Categories: Business News

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