Monthly Archives: December 2020

News: How DoorDash and C3.ai can defend their red-hot IPO valuations

• December 9, 2020
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Last night both DoorDash and C3.ai priced their IPOs above their raised ranges. In simpler terms, both companies provided the market with a target price interval. Then they both raised it and each priced higher than that raised target. The IPO market, even as December races along and winter begins to bite, is red-hot. The

Last night both DoorDash and C3.ai priced their IPOs above their raised ranges. In simpler terms, both companies provided the market with a target price interval. Then they both raised it and each priced higher than that raised target.

The IPO market, even as December races along and winter begins to bite, is red-hot.

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But while the new, higher valuations and strong cash hauls from their respective IPOs are great news, they each have a higher bar to cross when they begin to trade later today and over the next few weeks as the market settles on their real value.

This morning, ahead of Airbnb’s pricing later this afternoon — the home-sharing unicorn will begin trading tomorrow morning, provided all goes according to plan — let’s chat about what the markets are implying about both DoorDash and C3.ai, and what means that each must accomplish in the coming few quarters if they want to not only defend their newly-won valuations, but take them higher.

Let’s start by calculating new valuations and revenue multiples. This will be fun!

How to keep winning

Let’s kick off with DoorDash, the larger of the two IPOs.

After raising its IPO range from $75 to $85 per share, a price point that already appraised the company far above its final private valuation, DoorDash raised its range to $90 to $95 per share. Then it priced at $102.

The company has a non-diluted valuation of $32.4 billion at that price, a figure that rises as high as $38.4 billion if you include shares that currently exist as unexercised options and the like. For a company worth just $16 billion earlier this summer, its IPO price is a coup.

And given DoorDash’s huge consumer brand, the recent IPO climate, a possibly limited first-day float and the impact of a retail-investing boom, its shares may soar today.

But to defend its new valuation, pop or not, DoorDash has a steep road ahead of it. Investors have valued the firm as if it will not only defend its 2020 growth, but that it will continue to accrete new revenues even as the pandemic subsides as vaccines roll out in 2021.

Recall that COVID-19 took an already-growing DoorDash, accelerated its revenue growth and helping it drive operating leverage against its new scale; the company’s economics seem to improve with scale, a good thing, but one that might worry the more ursine amongst us if one expects consumers to order less food when it’s safer to go outside.

DoorDash is not the only COVID-accelerated company to receive a shiny, new, larger valuation during the pandemic. Robinhood and Instacart are further examples of the trend.

News: Arthur.ai snags $15M Series A to grow machine learning monitoring tool

• December 9, 2020
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At a time when more companies are building machine learning models, Arthur.ai wants to help by ensuring the model accuracy doesn’t begin slipping over time, thereby losing its ability to precisely measure what it was supposed to. As demand for this type of tool has increased this year, in spite of the pandemic, the startup

At a time when more companies are building machine learning models, Arthur.ai wants to help by ensuring the model accuracy doesn’t begin slipping over time, thereby losing its ability to precisely measure what it was supposed to. As demand for this type of tool has increased this year, in spite of the pandemic, the startup announced a $15 million Series A today.

The investment was led by Index Ventures with help from new comers Acrew and Plexo Capital along with previous investors Homebrew, AME Ventures and Work-Bench.The round comes almost exactly a year after its $3.3 million seed round.

As CEO and co-founder Adam Wenchel explains, data scientists build and test machine learning models in the lab under ideal conditions, but as these models are put into production, the performance can begin to deteriorate under real world scrutiny. Arthur.AI is designed to root out when that happens.

Even as COVID has wreaked havoc throughout much of this year, the company has grown revenue 300% in the last six months smack dab in the middle of all that. “Over the course of 2020, we have begun to open up more and talk to [more] customers. And so we are starting to get some really nice initial customer traction, both in traditional enterprises as well as digital tech companies,” Wenchel told me. With 15 customers, the company is finding that the solution is resonating with companies.

It’s interesting to note that AWS announced a similar tool yesterday at re:Invent called SageMaker Clarify, but Wenchel sees this as more of a validation of what his startup has been trying to do, rather than an existential threat. “I think it helps create awareness, and because this is our 100% focus, our tools go well beyond what the major cloud providers provide,” he said.

Investor Mike Volpi from Index certainly sees the value proposition of this company. “One of the most critical aspects of the AI stack is in the area of performance monitoring and risk mitigation. Simply put, is the AI system behaving like it’s supposed to?,” he wrote in a blog post announcing the funding.

When we spoke a year ago, the company had 8 employees. Today it has 17 and it expects to double again by the end of next year. Wenchel says that as a company whose products looks for different types of bias, it’s especially important to have a diverse workforce. He says that starts with having a diverse investment team and board makeup, which he has been able to achieve, and goes from there.

“We’ve sponsored and work with groups that focus on both general sort of coding for different underrepresented groups as well as specifically AI, and that’s something that we’ll continue to do. And actually I think when we can get together for in person events again, we will really go out there and support great organizations like AI for All and Black Girls Code,” he said. He believes that by working with these groups, it will give the startup a pipeline to underrepresented groups, which they can draw upon for hiring as the needs arise.

Wenchel says that when he can go back to the office, he wants to bring employees back, at least for part of the week for certain kinds of work that will benefit from being in the same space.

News: Stuf raises $1.8M to rethink self-storage

• December 9, 2020
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Stuf, a new startup transforming basements and other unused spaces into self-storage locations, is announcing that it has raised $1.8 million in seed funding. Co-founder and CEO Katharine Lau previously led the real estate team at co-working company Industrious. She told me that she became interested in the self-storage industry during the early months of

Stuf, a new startup transforming basements and other unused spaces into self-storage locations, is announcing that it has raised $1.8 million in seed funding.

Co-founder and CEO Katharine Lau previously led the real estate team at co-working company Industrious. She told me that she became interested in the self-storage industry during the early months of the pandemic, after a period of spring cleaning prompted her to put some of her belongings into storage.

Lau lives in New York city, where she said most self-storage locations are “way out in the West Side Highway or the East River, pretty far from where most people live.” She added that “at some of these traditional operations, it felt really sterile, with these fluorescent lights.”

“They were designed like morgues,” she said. “You really don’t know what’s behind these doors.”

These may not be big issues for people who put their things in storage and then forget about them for months or years, but Lau said that it’s a bad fit for the modern customer, particularly millennial women living in cities.

“Millennials tend to live more transient lifestyles and visit on a more frequent basis,” she said. “The storage facility becomes an extension of their home. It’s about much more than having place to leave your stuff. It becomes a useful extension of your life.”

So Stuf looks for what Lau described as “the forgotten spaces that weren’t generating cashflow,” signing revenue-sharing deals with landlords and then converting the space. The startup can go from touring a site to opening up for storage in four to six weeks, she said.

The result is a self-storage location closer to where customers actually live. And Lao said the company pays close  attention to interior design, aiming to create a “warm and inviting” environment that people enjoy visiting.

Other startups are trying to reinvent self-storage with a more on-demand approach, where the company picks up your belongings for you. Lau said that’s a nice consumer experience, but it creates unit economics that are “quite challenging.”

Stuf CEO Katharine Lau

Stuf’s pricing is currently “on par” with traditional self-storage, she said, and because “we don’t buy the buildings or sign [a traditional lease], there are some savings we plan to pass on to customers as we grow.” (When I looked at listings for Stuf’s Brooklyn location this morning, pricing ranged from $172.51 per month for a 10×6 foot space to $43 for a 5×3 space.)

The startup already has three locations in San Francisco and New York. And it’s seeing real consumer demand, with its initial spaces filled to 90% capacity within three months.

The seed funding was led by Wilshire Lane Partners and Harlem Capital, allowing Stuf to continue opening new locations nationwide. Lau’s goal is to launch more than 100,000 square feet of storage space in 2021.

“Stuf is truly special because, business opportunity aside, two Black-led VC funds came together to invest in a business founded and run by a woman,“ said Harlem Capital Managing Partner Henri Pierre-Jacques in a statement. “Katharine stood out given her industry expertise, leadership and vision. We couldn’t be more excited to be on the journey with her as she looks to alter the storage industry.”

News: Xbox cloud gaming coming to iOS and PC in Spring 2021

• December 9, 2020
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Microsoft has shared some details about the roadmap for its cloud gaming service. In addition to Android devices, the company confirms that it plans to add support for more platforms. In Spring 2021, Microsoft will launch its cloud gaming service on iOS and on computers. Originally called Project xCloud, Microsoft’s cloud gaming service lets you

Microsoft has shared some details about the roadmap for its cloud gaming service. In addition to Android devices, the company confirms that it plans to add support for more platforms. In Spring 2021, Microsoft will launch its cloud gaming service on iOS and on computers.

Originally called Project xCloud, Microsoft’s cloud gaming service lets you play Xbox games on non-Xbox devices. The games run on a server in a data center near you. The video is streamed to your device, and your interactions are relayed to the server in real time.

Xbox cloud gaming isn’t a separate subscription. People who subscribe to the Xbox Game Pass Ultimate for $14.99 per month can access cloud gaming as part of their subscription. The plan also includes access to a library of games, EA Play and Xbox Live Gold.

When it comes to new devices, you’ll soon be able to launch a game on Xbox cloud gaming from a PC. The service will be available in the Xbox app and using a web browser.

While you can download games to your PC if you’re an Xbox Game Pass Ultimate subscriber, cloud gaming is going to be particularly useful for people who don’t have a powerful GPU in their computer. It’s going to be interesting to see whether Microsoft limits its service to web browsers running on Windows computers. I’m sure many people would like to access the service from a Mac as well.

As for iOS, Microsoft will launch cloud gaming through web browsers exclusively due to restrictive App Store rules. Nvidia already launched a beta version GeForce Now for iOS web browsers. I tried Nvidia’s service from an iPhone and an iPad, and the web browser workaround works really well.

If you have an Android phone or tablet, Xbox cloud gaming is already accessible from the Xbox Game Pass app. Your experience will greatly vary depending on your internet connection and the quality of your Wi-Fi network.

You also need to be located near a data center to minimize latency. That’s why Xbox cloud gaming is only accessible in a handful of countries — mostly the U.S., Canada, South Korea and part of Europe.

In its blog post, Microsoft says that the company is opening more data centers and expanding to new markets. You can expect Xbox cloud gaming in Australia, Brazil, Japan and Mexico soon.

News: Coinbase’s backstory and future with ‘Kings of Crypto’ author Jeff John Roberts

• December 9, 2020
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“I used Coinbase as a vehicle because a lot of the early stuff in crypto is hard to understand.”

No industry better epitomizes elite tech opinion as blockchain. Ignored for years in its infancy, the industry received intense interest from investors, engineers and the public five years ago, generating some of the most deeply devout evangelists that have emanated from startups since the advent of the World Wide Web and the dot-com boom. Then, it all burned down, but a few companies made it through the flames, among them Coinbase .

Coinbase today is still valued at a 2018 price of $8 billion, and is expected to go public in the coming months. Despite major controversies around its mission-focused policy and diversity, the company continues to lead the pack of consumer-oriented blockchain and crypto companies.

That makes its origin story and rise all the more enticing. Jeff John Roberts, a staff writer at Fortune, has put together precisely that narrative in his new book “Kings of Crypto”, published by Harvard Business School Press. It’s the story of Coinbase, Brian Armstrong and the dream of a crypto economy. Given all the recent discussions and controversies swirling the company and Bitcoin’s recent record-beating price increase, provides a deeper, more analytical perspective on a complicated subject.

I sat down with Roberts last month to talk more about the company, the crypto industry at large and what’s next as we head into 2021.

This interview has been edited and condensed for clarity.

TechCrunch: How did you get into this project and decide to write the book?

Jeff John Roberts: There’s a lot of crypto books out there, some of them not very good, but I think there’s kind of a first-generation series of books on the subject. Nate Popper’s “Digital Gold” is very good, and then the Wall Street Journal guys with “Age of Cryptocurrency“ is a really good explainer, so I was looking for a new way to tell the story. Focusing on a company is just sort of a narrative mechanism, since companies can be a good way to tell the story of a broader industry.

I used Coinbase as a vehicle because a lot of the early stuff in crypto is hard to understand. I think it’s still true, but crypto can’t decide if it wants to be a subculture or sort of a mainstream technology and a lot of the early writings on it celebrated the quirky angles. So I tried to tell it as more of a general interest, “Hatching Twitter”-style business story and fortunately there’s a lot of gossip and things in there to recount.

How did you get interested in crypto originally?

My own interest came about when I was at GigaOm. Back in 2013, there was a meeting in New York City in Union Square, an event called Satoshi Square every Monday at the little corner of the park. I went down to check it out, and what it emerged to be was a bunch of crypto anarchists selling bitcoin. Some of the other people there though were Wall Street traders in $5,000 suits, which left an indelible image for me. It was really funny watching that collision of cultures, with the mix of greed and counterculture.

So it was during Bitcoin’s first splash into something close to the mainstream that I covered, and then that kind of dried up and went away, as it does, and then it came roaring back in 2015, 2016 and I covered the bubble. And now there’s again been an uptick in interest. So my timing for the book wasn’t good in the sense of the pandemic (I got cheated out of my canapé launch parties) but my timing was good in that a lot of the prices are soaring today.

You’ve seen a lot in the crypto industry over the years, what’s the most interesting storyline today?

I think the most interesting story right now is that there is this tension because Wall Street and Silicon Valley don’t like each other, but for crypto, they need each other, and it’s been interesting watching them kind of dance and find a way to kind of bridge the two worlds.

Bitcoin is forever promising it’s going to change our financial world, but realistically it hasn’t, but I think in the coming decade, blockchain really is going to start doing some needed stuff and so that kind of convergence of Wall Street and the Valley [is inevitable].

Then there are also the big corporates coming in. Obviously Facebook with Libra, but Square and PayPal and I’m sure that Apple’s going to get in this game soon because they’re good at privacy, they’ve got all the wallets and they presumably pay a shit ton in transaction fees, so I think that’s the coming story and what’s interesting to me. And then Coinbase sort of sits right kind of at the center of all that, so they’re a good vehicle to tell that story.

You chose Coinbase as one of the focus companies for the book. Why them?

I mean, there’s a lot of recent cultural stuff we can talk about, but it was interesting to me because going back to what we talked about earlier: Do you want to be a rebel in a subculture or do you want to actually make a difference?

I think Coinbase was the first and the best at the latter, and Brian Armstrong, who even among many Valley CEOs is a weird dude, he saw early the need to make this mainstream. That tension goes on to this day in the crypto world — and also within Coinbase — between the purest sort of libertarian vision of holding your own wallet versus the practicality. I think Coinbase is very astute in seeing that’s where things are going and building it out that way, building sort of the crypto version of online banking.

So I think that they’re always telling you, “We’re the white knight of crypto” and so on, and then of course Andreessen Horowitz and Fred Wilson had a big role in shepherding it that way, but it was the right call and they’ve largely executed, which I think is really interesting.

What was it like building Coinbase early on? Were there some fun stories from that time?

News: With investors expecting a Latin American cryptocurrency boom, Mexico’s Bitso raises $62 million

• December 9, 2020
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Six years after the launch of the Mexico-based crypotcurrency exchange and financial services platform Bitso the company revealed it has closed on $62 million in financing to capitalize on the cryptocurrency boom investors expect to hit Latin America.  The three major cryptocurrencies are all trading up in the waning months of 2020, with Bitcoin prices

Six years after the launch of the Mexico-based crypotcurrency exchange and financial services platform Bitso the company revealed it has closed on $62 million in financing to capitalize on the cryptocurrency boom investors expect to hit Latin America. 

The three major cryptocurrencies are all trading up in the waning months of 2020, with Bitcoin prices nearing (or exceeding) record highs. The global growth of these digital currencies and their applications in emerging markets have savvy financial services investors like the firm QED Investors (founded by the masterminds behind Capital One) intrigued. Which is why the firm joined the Latin American heavyweight investor Kaszek Ventures in financing Bitso’s $62 million round.

Bitso may already be the dominant cryptocurrency platform in Latin America boasting 1 million users (primarily in Mexico and Argentina) and is one of the only platforms to be licensed under the Distributed Ledger Technology (DLT) license from the Gibraltar Financial Services Commission (GFSC). 

 A visual representation of digital cryptocurrencies, Bitcoin, Ripple, Ethernum, Dash, Monero and Litecoin. (Photo Illustration by Chesnot/Getty Images)

Founded by Ben Peters, Daniel Vogel and Pablo Gonzalez, the company has been dominant in the Latin America crypto market, but it has also not been able to avoid some of the controversies that surround the crypto industry.

A report from Reuters flagged Bitso as one of the platforms that criminals like the human trafficker Ignacio Santoyo were using to launder money.

The founders of Bitso and their investors focus on the ability for cryptocurrencies to reduce friction and cost in markets where financial services often ignore the middle class and low income consumers that often need them the most.

“Crypto as an asset class was not going away and was clearly coming of age,” said Nigel Morris, the QED co-founder who previously led Capital One. “It’s not going away. And with that there are various financial services that are enabled by this asset class. You can lend against it. You can use it to move money cross-border. This thing is now palpable and real and has come of age.”

For all of those reasons, Latin America represented a big opportunity for QED Investors to make its first bet in the cryptocurrency space, and for Bitso to be that initial investment.

“This is a terrific business model and a great team and a geography that we know,” said Morris. The firm has invested in startups like Coru and Confio already and is a big believer in the opportunity for financial services startups in Mexico broadly. 

For Bitso, the big opportunities are presenting Latin American investors with an opportunity to invest in foreign currencies like the US dollar through stablecoin offerings alongside a slew of lending and cross-border remittance services — in addition to the peer to peer transaction services the company already offers.

Bitso already employs 200 people and intends to use the capital to expand aggressively across Latin America. The company’s first port of call will be Brazil. The largest market in the region, Brazil represents a huge untapped opportunity for Bitso’s growth, according to co-founder Daniel Vogel.

“We have really good traction building products where the central product is not exposure to bitcoin or crypto but fulfilling this vision of making crypto useful,” Vogel said. “These two investors have a lot fo knowledge in the fintech space int he traditional financial services space and we’re excited to continue developing projects. We have been building some of these things out … utilizing technology for things that are useful to the end customer and developing products along those lines.”

For instance, Bitso is already processing $1 billion in remittances for customers, enabling transactions for financial services partners like crypto-currency enabled money transmitters.

Vogel first met QED and Kaszek when he was just getting Bitso off the ground, living and working in a hacker house that was shared with five other companies. “I had to kick my team out of the meeting from my only room,” Vogel recalled.

Now the company boasts a customer base of 1 million and with the new cash, hopes to add another 1 million Brazilian customers to the platform.

He thinks that access to stablecoins will lead the way. “There was so much uncertainty that people flocked to the dollar as a store of value,” Vogel said. “Access to dollars is something that has grown quite a bit in the last year.”

News: HealNow raises $1.3 million to bring online payments to pharmacies

• December 9, 2020
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As the healthtech landscape rapidly evolves another startup is making its presence known. HealNow has closed a $1.3 million round of funding from SoftBank Opportunity Fund and Redhawk VC. The company was founded by Halston Prox and Joshua Smith. Prox has worked in healthcare for more than a decade with major organizations such as Providence

As the healthtech landscape rapidly evolves another startup is making its presence known. HealNow has closed a $1.3 million round of funding from SoftBank Opportunity Fund and Redhawk VC.

The company was founded by Halston Prox and Joshua Smith. Prox has worked in healthcare for more than a decade with major organizations such as Providence Health, Mount Sinai and Baylor Scott & White, mostly focused on digitizing health records and designing and implementing software for doctors, nurses, etc. Smith, CTO at the company, has been a developer since 2012.

The duo founded HealNow to become the central nervous system for order and delivery of prescriptions, according to Prox. Your average payments processing system isn’t necessarily applicable to pharmacies large and small because of the complexities of health insurance and the regulatory landscape.

Not only is it costly to facilitate online payments for pharmacies, but they also have their own pharmacy management systems and workflows that can be easily disrupted by moving to a new payments system.

HealNow has built a system that’s specifically tailored to pharmacies of any shape or size, from grocery stores to mom and pop pharmacies and everything in between. It’s a white label solution, meaning that any pharmacy can put their brand language on the product.

“We’re embedded in their current workflows and pharmacies don’t have to do anything manual, even if they’re using a pharmacy management system,” said Prox.

When a user looks to get a prescription from their pharmacy, they are sent a link that allows them to securely answer any questions that may be necessary for the pick-up, enter insurance info, make a payment, and schedule a curbside pick-up or a delivery. The tech also integrates with third-party delivery services for pharmacies that offer deliveries.

This technology has been particularly important during the COVID-19 pandemic, giving smaller pharmacies the chance to compete with bigger chains who have digital solutions already set up that allow for curbside pick up. This is especially true now that Amazon has gotten into the space with the launch of Amazon Pharmacy.

HealNow is a SaaS company, charging a monthly subscription fee for use of the platform as well as a service fee for prescriptions purchased on the platform. However, that service fee is a flat rate that never changes based on the cost of the prescription.

The space is crowded and growing more crowded, with competitors like NimbleRX and Capsule offering their own spin on simplifying and digitizing the pharmacy. One big difference for HealNow, says Prox, is that the startup has no intention of ever being a pharmacy, but rather serving pharmacies in a way that doesn’t disrupt their current workflow or system.

“We’re not a pharmacy, and we want to enable all these pharmacies to be online,” said Prox. “To do that we have to do that in an unbiased way by focusing on being a complete tech company.”

The funding is going primarily toward building out the sales and marketing arms of the company to continue fueling growth. HealNow has a foothold in the West, Southwest and Middle America, and is opening an office in Birmingham to sprint across the East Coast. Prox says the company is processing thousands of orders a day and tens of thousands of orders each month.

HealNow launched in 2018 after graduating from the Entrepreneurs Roundtable Accelerator .

News: Blue Origin’s space industry all-star team submits proposal for landing system to carry humans back to the Moon

• December 9, 2020
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The Blue Origin -led “National Team” has submitted a proposal to NASA for its Human Landing System (HLS), which would be used to transport the next lunar astronauts to the surface of the Moon during NASA’s forthcoming Artermis mission series. Blue Origin is one of three companies selected by NASA to bid on contracts for

The Blue Origin -led “National Team” has submitted a proposal to NASA for its Human Landing System (HLS), which would be used to transport the next lunar astronauts to the surface of the Moon during NASA’s forthcoming Artermis mission series. Blue Origin is one of three companies selected by NASA to bid on contracts for its human Moon landing missions, leading its team comprised of itself, Lockheed Martin, Northrop Grumman and Draper. Blue Origin and Dynetics were the other companies with proposals strong enough to impress the U.S. space agency.

Blue Origin’s submitted proposal is for the so-called Option A portion of the NASA HLS proposal ask, which is set intentionally to provide the right timing for the current 2024 target for the first human landing to take place during the Artemis series. There’s also an Option B ask, which would be for later stage missions including a 2026 flight demonstration. NASA is seeking to find a private partner to build the human landing system, which will be wholly owned by the commercial entity that ends up producing the vehicle, with NASA acting as a customer – similar to what the agency did with its Commercial Crew program for transportation from Earth to the International Space Station.

The HLS is designed to dock with NASA’s lunar Gateway space station, which will orbit the Moon and provide a staging base for reaching the lunar surface. NASA astronauts will make the trip to the Moon using the in-development Orion spacecraft, which will launch atop the Space Launch System rocket, both of which are NASA-owned, and built by contractors (Lockheed Martin/Airbus and Boeing respectively).

NASA envisions a future in which the Gateway and Moon act as hubs for commercial activity as well as science and research, and so the HLS was designed to foster the creation of landing systems that can also serve private company customers in addition to the agency.

News: App stores to see 130 billion downloads in 2020 and record consumer spend of $112 billion

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Consumers will have downloaded 130 billion apps in 2020 across iOS and Google Play, up 10% year-over-year, according to mobile data and analytics firm App Annie’s year-end forecast. Consumer spending across the two app stores will also grow by 25% year-over-year to reach $112 billion by year end, the firm also predicts. Typically, much of

Consumers will have downloaded 130 billion apps in 2020 across iOS and Google Play, up 10% year-over-year, according to mobile data and analytics firm App Annie’s year-end forecast. Consumer spending across the two app stores will also grow by 25% year-over-year to reach $112 billion by year end, the firm also predicts.

Typically, much of the download growth is led by emerging markets, but this year things were different.

Due the COVID-19 pandemic, mobile adoption accelerated by 2 to 3 years. As a result, consumers increasingly turned to apps as digital solutions for work, education, entertainment, shopping, and more. This resulted in the rise in downloads, time spent on mobile, and consumer spending — despite there being more maturity in the mobile market.

Image Credits: App Annie

Google Play downloads in 2020 outnumbered iOS downloads by 160%, but both stores saw 10% growth. Games, meanwhile, increased their share of the downloads to 40%. On Google Play, they accounted for 45% of all downloads, up 5% year-over-year, but they maintained a 30% share on iOS. Games additionally accounted for $0.71 of every dollar spent across both app stores.

Also due to COVID-19, consumers spent more time on devices — a metric that saw a significant 25% jump from 2019 to top 3.3 trillion hours on Android. (App Annie cannot measure the figure on iOS).

Image Credits: App Annie

This increased time spent helped contribute to the growth in consumer spending, which hit a new annual record ($112B) in 2020. In 2020, 65 cents of every dollar of that spend went to iOS but spend on Google Play continues to grow. This year, it will reach close to 30%, the firm predicts.

Top markets for consumer spend on iOS included the U.S., Japan, and the U.K., which is a different list than in 2018 and 2019, when the list included U.S., China, and Japan. Top markets for Google Play were the U.S., South Korea and Germany — with South Korea and Germany bumping out Japan and the U.K.’s place in terms of growth, compared with the past 2 years.

The report also looked at the top apps of the year, which saw TikTok No.1 by downloads and No. 2 by consumer spend, but still beat out by Facebook on monthly active users. Despite a lockdown, dating app Tinder made it to No. 2 in terms of consumer spend.

Other Facebook apps, including Instagram, Messenger, and WhatsApp maintained top positions across download and active users charts. Thanks to COVID, Zoom made it on 2020’s list of top downloads, in the No. 4 position. On iOS, it had been No. 1 by downloads, Apple recently reported, followed by TikTok. Google Meet made a showing as well, at No. 7.

Image Credits: App Annie

We should note today’s numbers don’t paint a full picture of the mobile market, as they exclude third-party app stores in China. Those figures are wrapped into App Annie’s more extensive “State of Mobile” report that tends to arrive early in the year for the year prior.

News: China court blacklists cash-strapped apartment rental startup Danke

• December 9, 2020
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As financial troubles escalate at Danke, China’s authorities are stepping in to hold the once-promising apartment rental and sharing company accountable. In recent weeks, landlords who did not receive payments from Danke, which functions as a sublessor, began to evict tenants. After a flurry of local reports exposing the firm’s massive debt, which is reported

As financial troubles escalate at Danke, China’s authorities are stepping in to hold the once-promising apartment rental and sharing company accountable.

In recent weeks, landlords who did not receive payments from Danke, which functions as a sublessor, began to evict tenants. After a flurry of local reports exposing the firm’s massive debt, which is reported to be as high as $520 million, a district court in Shanghai placed Ziwutong Beijing Asset Management, the parent organization behind Danke, on the country’s “social credit” blacklist.

The Chinese government’s social credit system is a set of mechanisms aimed at improving the enforcement of existing laws and offenders can face restrictions in their daily activity. In Danke’s case, founder and chief executive officer Gao Jing has been barred from “heavy spending,” which includes everything from flying first-class, taking a high-speed train, buying property, going on vacation, to enrolling children in “expensive” private schools, according to a court notice.

The move came after a senior judge from China’s Supreme People’s Court told the press that Danke was under investigation by relevant authorities over its cash-flow problems.

Danke, founded in 2015 and backed by high-profile investors like Ant Financial, Tiger Global, and LinkedIn’s former China head Derek Shen, pledged to make urban housing affordable and pleasant for China’s white-collar workers. The catch is it’s advancing through aggressive debt-fueled expansion.

Instead of the traditional rental model, Danke relies on an elaborate financing scheme to maintain cash flows. Tenants are offered price incentives to pay upfront for a year and induced to cover the sums by taking out loans, which are provided by Danke’s partner banks. Renters who refuse to sign up for the loans are asked to pay more.

With capital funded by the loans, Danke then pays the homeowners — but only on a monthly or quarterly basis. This gives the startup much financial flexibility to rent from landlords and spend on renovating apartments, which are then sublet to tenants at a markup.

Danke’s model epitomizes the promises of internet platforms or so-called sharing economy — light asset, rapid scaling, but it also creates enormous risks for the suppliers and consumers it vows to serve. When the COVID-19 pandemic hit, China’s rental market cooled, putting stress on Danke’s funding vehicle.

When TechCrunch spoke to Danke’s angel investor and chairman Derek Shen last year about the firm’s financial risks, he had this to say: “There’s nothing wrong with the financial instrument itself. The real issue is when the housing operator struggles to repay, so the key is to make sure the business is well-functioning.”

“What is needed is stricter market supervision to prevent such cases from recurring,” said an opinion piece published in state-backed paper China Daily. “The involvement of banks and loans have made the risks even higher. Given how unsustainable Danke’s business model is, it is time financial supervision departments consider making stricter financial rules forbidding such risky practices.”

Listed in New York, Danke saw its shares plunge to $2 last month from a high of $13.5 when it went public in January. Year to date the company has only released its Q1 earnings report, which recorded a net loss of $174.3 million.

The financial turmoil also puts WeBank, Danke’s major partner bank, under the spotlight for its participation in a highly leveraged rental business in return for handsome interests. The Tencent-backed internet bank announced on social media that it would transfer loan obligations from tenants to Danke, which has been subsidizing renters’ loan interests to WeBank already. In the three months ended March, Danke paid a total of $7.9 million in interests related to “rent financing.”

Danke cannot be immediately reached for comment on the story.