Yearly Archives: 2021

News: The DL on CockroachDB

As college students at Berkeley, Spencer Kimball and Peter Mattis created a successful open-source graphics program, GIMP, which got the attention of Google. The duo ultimately joined Google, and even personally got kudos from Sergey Brin and Larry Page. Kimball and Mattis quickly rose to prominence within the company, and then chose to leave it

As college students at Berkeley, Spencer Kimball and Peter Mattis created a successful open-source graphics program, GIMP, which got the attention of Google. The duo ultimately joined Google, and even personally got kudos from Sergey Brin and Larry Page. Kimball and Mattis quickly rose to prominence within the company, and then chose to leave it all behind to start what would eventually become CockroachDB. Years later, Cockroach Labs has over 250 employees and has received investments from the likes of Benchmark, GV, Index Ventures and Redpoint totaling more than $350 million, according to Crunchbase. The company is now on route to what some think is an “inevitable IPO.”

The story of CockroachDB, from its origin to its future, was told in a four-part series in our latest EC-1: 

I’m biased, but it’s a must-read that gets into tensions that any startup founder can relate to: from navigating heavyweight competitors, to growing past free tiers, to maintaining your users’ attention. It’s the eighth EC-1 we’ve published to date, which my colleague and TC Managing Editor Danny Crichton estimates puts us at 90,000 words all about startup beginnings, product development, marketing and more.

In the rest of this newsletter, we’ll get into that WeWork book, bite-sized entrepreneurship and some SPACs. Follow me on Twitter @nmasc_. Or don’t, it’s your choice!

The Cult of We

Adam Neumann (WeWork) at TechCrunch Disrupt NY 2017. Image Credits: TechCrunch

This week on Equity, Alex and I interviewed Eliot Brown, who wrote “The Cult of We” along with Maureen Farrell. Our conversation riffed on some of the book’s eyebrow-raising details and anecdotes, but mainly focused on what WeWork’s rise and fall did to the state of startups and tech journalism more broadly.

Here’s what to know: Not much has changed. Jokes aside, Brown shared his notes on how the current boom in startup financings has a worrisome air of frenzy and fluff. He also chatted about how sometimes the most illuminating question can be a simple one: What makes you a tech company?

More money, more problems?

TikTok what again?

tiktok glitch

Image Credits: TechCrunch

TikTok kept popping up throughout the week. Index Ventures, for example, noted how the firm’s TikTok account has amassed an impressive following and is a channel to talk to the younger generations. Nothing like some short-form videos to stay hip and relatable while raising $3 billion in one go. 

Here’s what to know: While TikTok has certainly changed the world, I worry when I see the allure of bite-sized content get edtech’d. Bite-sized content can be a nifty way to spread content, but it isn’t one-size-fits-all. Duolingo, which priced its IPO this week, still struggles to show meaningful learning outcomes and optimizes more for motivation than comprehension. This tension is a key note for companies like Numerade and Sololearn, which both raised this week, to not overly TikTok learning materials.

Other edtech content for your eyes:

So, SPACs

hands signing check 1

Image Credits: Bryce Durbin / TechCrunch

It’s been awhile since I’ve used that acronym in Startups Weekly. That said, special purpose acquisition vehicles are still very much a thing and are still very much worth paying attention to.

Here’s what to know: Lucid Motors’ SPAC merger was just approved. Reporter Aria Alamalhodaei  writes that the move came after executives extended the deadline to vote to merge by one day after not enough investors showed up. “The issue is unusual but could become more common as more companies eschew the traditional IPO path to public markets and instead merge with SPACs,” she writes.

Also special:

Around TC

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Across the week

Seen on TechCrunch

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Same time, same place next week? Bring a friend!

N

News: Should we be worried about insurtech valuations?

Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter for your weekend enjoyment.

Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s inspired by what the weekday Exchange column digs into, but free, and made for your weekend reading. Want it in your inbox every Saturday? Sign up here.

Hello everyone, I hope you had a lovely week. I turned 32 after experiencing sleep-destroying heartburn. So, a little good and a little bad. But that didn’t stop the markets. Nope. Not a bit. Which means we have a lot to talk about, including falling insurtech stocks and what the situation might mean for startups, and a raft of IPOs. This will be fun!

Before we get into the nitty-gritty of our chats with newly public companies Kaltura, Couchbase and Enovix, let’s talk insurtech.

In the last year or so we’ve seen a number of insurtech startups go public, including Root (auto insurance), Metromile (car insurance), and Lemonade (rental insurance). Here’s a quick digest of how their performance looks today:

  • Root: $7.72 per share, 71.4% down from its $27 per share IPO price.
  • Metromile: $7.26 per share, down 64.4% from its post-combination highs.
  • Lemonade: $86.97 per share, up 199.9% from its IPO price of $29 per share.

Recall that Root and Metromile began to trade after Lemonade, so their declines are not over a longer time horizon, but a shorter interval. Which makes the situation all the more interesting.

What’s going on? Well, two of the three insurtech public offerings (SPACs, IPOs, etc.) are sharply underwater. That doesn’t bode incredibly well for Hippo, which is pursuing its own SPAC-led combination that should be wrapping up in short order. The huge declines don’t seem bullish for insurtech startups, who will have to answer private-market investor doubts concerning their value.

Does Lemonade’s strong post-IPO performance allay concerns? It’s tricky. The company has been busy expanding into new markets, including auto insurance. The company did take a somewhat material hit from the Texas freeze earlier this year — per its most recent earnings report — but past those two data points it’s not entirely clear what the company is doing that the other two are not. But investors are stoked about Lemonade, and not Root and Metromile. Figuring out why that’s the case, and why their startup is more Lemonade than the other two, is going to be key for the many insurtech startups still scaling toward their own IPOs.

It’s IPO season

The Exchange has been busy on the phones these last two weeks, talking to CEOs of companies going public to try and learn from their recent experiences. So, what follows are notes from calls with folks at Kaltura, Couchbase and Enovix. Enjoy!

Kaltura

  • Reminder: Online-video-focused Kaltura filed to go public earlier this year before delaying its IPO and taking another run at the funding event.
  • The Exchange spoke with Kaltura CEO Ron Yekutiel, who said that the company’s IPO’s timing was impacted by the early-2021 public market turmoil. That was not a surprise, but it was good to get confirmation regardless.
  • That freeze was partially caused by the Archegos implosion, per Yekutiel. That makes sense, but was news to us.
  • Yekutiel said that his company wasn’t thrilled about the delay — going public is the only fundraise that you pre-announce, he noted — but added that investors his company had already spoken to the first-time around were still enthused about Kaltura on its second run at an IPO.
  • Per the CEO, Kaltura’s preliminary Q2 results showed investors that what it was talking about earlier in the year was coming true. He also stressed uptake in new products as key to the company’s continued growth.
  • The CEO was happy with how his company priced and traded during its first day, snagging a flat 20% uptick in value upon trading. He noted that more would have been excessive, and less would have been un-good.
  • Regarding the lower valuation that Kaltura priced at compared to its March-era IPO price range, Yekutiel said that you don’t get a third chance to make a first impression and that his company wanted to get the offering done. So they did. Points for not getting lost in their own head.
  • Kaltura is up 17.5% from its $10 per-share IPO price as of the time of writing.

One anecdote, if I may. Kaltura won an early TechCrunch40 — the precursor to the TechCrunch50 event, itself a predecessor to today’s TechCrunch Disrupt conference series — thanks to a single vote cast via physical token. Yekutiel still has that token, and showed it to us during our chat. Neat!

Couchbase

  • The Exchange spoke with noSQL database company Couchbase’s CEO Matt Cain. Couchbase priced at $24 per share, above its $20 to $23 per-share IPO price range.
  • Today it’s worth $33.20, rising 9.2% in today’s trading as of the time of writing.
  • Cain was talking from a pretty strict script — a pretty standard situation amongst newly public CEOs worried about fucking up and going to jail — so we didn’t get the precise answers we were looking for. But we still managed to learn a few things, including that Couchbase was yet another company that found the meeting density made possible by remote roadshows to be accretive.
  • The CEO was focused on discussing the scale of the opportunity ahead of Couchbase, namely the world of operational databases. It’s hard to find a bigger market, he argued, which made investors excited about what his company might be able to accomplish. Our read here is that there’s probably plenty of surface area for startups in the database world, if the market is as big as Cain reckons it is.
  • We wanted to learn a bit more about how public-market investors view open-source powered companies, but didn’t get too much from him on the matter. Still, the company’s IPO is a pretty damn strong one, implying that being OSS-built isn’t exactly a detriment to a company hoping to exit.

Enovix

  • The Exchange wanted to chat with newly public company Enovix because it debuted via a SPAC. Why does that matter? Because there are other battery-focused companies looking to go public via SPACs. So, the chat was good background for later work.
  • And we love talking to public companies. Who doesn’t?
  • Asked if combination-and-trade-under-new-ticker-symbol day was like an IPO to his firm, Rust said that it was. Fair enough.
  • The company’s combination date for its SPAC slipped from Q2 to Q3, we noticed. Why was that? Some SEC changes regarding accounting, in short. Not a big deal was our impression from the chat, but one that did cause a slight delay to Enovix’s trading date.
  • Why go public via a SPAC? Cash, but also the particular sponsor of their combination, which Rust said was a key resource in terms of operational knowledge. The company has also hired from its SPAC sponsor’s network, which felt notable. (Hey look, actual investor value-add!)
  • Asked why his company is worth less than the impending SES SPAC, another battery company that has yet to generate revenue, Rust said that the value of his company in its SPAC deal was a negotiation, and that if the company is successful, whether it was valued at $1.1 billion or $1.4 billion wouldn’t really matter.
  • What’s fun about Enovix is that it is not starting with its impending battery tech aimed at EVs. Instead, it’s targeting high-end electronics. Why? Quick cycles to get batteries into hardware and possible pricing power. It does intend to get into EVs in time, however.
  • The company is worth $17.33 per share, giving it what Yahoo Finance describes as a $2.5 billion valuation. That’s a good markup from what it expected and could bode well for SES’s own, future debut.

Yo, that was a lot. Thanks for sticking with me. And thanks for reading The Exchange’s little newsletter. You can catch up on all our work here if you want some long-form reads on the global venture capital market, edtech and other topics. Stay cool!

Your friend,

Alex

News: China Roundup: Kai-Fu Lee’s first Europe bet, WeRide buys a truck startup

Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world. Despite the geopolitical headwinds for foreign tech firms to enter China, many companies, especially those that find a dependable partner, are still forging ahead. For this

Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

Despite the geopolitical headwinds for foreign tech firms to enter China, many companies, especially those that find a dependable partner, are still forging ahead. For this week’s roundup, I’m including a conversation I had with Prophesee, a French vision technology startup, which recently got funding from Kai-Fu Lee and Xiaomi, along with the usual news digest.

Spotting opportunities in China

Like many companies working on futuristic, cutting-edge tech in Europe, Prophesee was a spinout from university research labs. Previously, I covered two such companies from Sweden: Imint, which improves smartphone video production through deep learning, and Dirac, an expert in sound optimization.

The three companies have two things in common: They are all in niche fields, and they have all found eager customers in China.

For Prophesee, they are production lines, automakers and smartphone companies in China looking for breakthroughs in perception technology, which will in turn improve how their robots respond to the environment. So it’s unsurprising that Xiaomi and Chinese chip-focused investment firm Inno-Chip backed Prophesee in its latest funding round, which was led by Sinovation Venture.

The funding size was undisclosed but TechCrunch learned it was in the range of “tens of million USD.” It was also the first investment that Kai-Fu Lee has made through Sinovation in Europe. As Prophesee CEO Luca Verre recalled:

I met Dr. Kai-Fu Lee three years ago during the World Economic Forum … and when I pitched to him about Prophesee, he got very intrigued. And then over the past three years, actually, we kept in touch and last year, given the growing traction we were having in China, particularly in the mobile and IoT industry, he decided to jump in. He said okay, it is now the right timing Prophesee becomes big.

The Paris-based company wasn’t actively seeking funding, but it believed having Chinese strategic investors could help it gain greater access to the complex market.

Rather than sending information collected by sensors and cameras to computing platforms, Prophesee fits that process inside a chip (fabricated by Sony) that mimics the human eyes, a technology that is built upon neuromorphic engineering.

The old method snaps a collection of fixed images so when information grows in volume, a tremendous amount of computing power is needed. In contrast, Prophesee’s sensors, which it describes as “event-based,” only pick up changes in the environment just as the photoreceptors in our eyes and can process information continuously and quickly.

Europe has been pioneering neuromorphic computing, but in recent years, Verre saw a surge in research coming from Chinese universities and tech firms, which reaffirmed his confidence in the market’s appetite.

We see Chinese OEMs (original equipment manufacturers), particularly Xiaomi, Oppo and Vivo pushing the standard of quality of image quality to very, very high … They are very eager to adopt new technology to further differentiate in a way which is faster and more aggressive than Apple. Apple is a company with an attitude which to me looks more similar to Huawei. So maybe for some technology, it takes more time to see the technology mature and adopt, which is right very often but later. So I’m sure that Apple will come at certain point with some products integrating event-based technology. In fact, we see them moving. We see them filing patents in the space. I’m sure that will come, but maybe not the first.

Though China is striving for technological independence, Verre believed Prophesee’s addressable market is large enough — $20 billion by his estimate. Nonetheless, he admitted he’d be “naive to believe Prophesee will be the only one to capture” this opportunity.

WeRide bought a truck company

One of China’s most valuable robotaxi startups has just acquired an autonomous trucking company called MoonX. The size of the deal is undisclosed, but we know that MoonX raised “tens of millions RMB” 15 months ago in a Series A round.

While WeRide is focused on Level 4 self-driving technology, it is also finding new monetization avenues before its robotaxis can chauffeur people at scale. It’s done so by developing minibusses, and the MoonX acqui-hire, which brings the company’s founder and over 50 engineers to WeRide, will likely help diversify its revenue pool.

WeRide and MoonX have deep-rooted relationships. Their respective founders, Tony Han and Yang Qingxiong, worked side by side at Jingchi, which was later rebranded to WeRide. Han co-founded Jingchi and took the helm as CEO in March 2018 while Yang was assigned vice president of engineering. But Yang soon quit and started MoonX.

Han, a Baidu veteran, gave Yang a warm homecoming and put him in charge of the firm’s research institute and its new office in Shenzhen, home to MoonX. WeRide’s sprawling headquarters is just about an hour’s drive away in the adjacent city of Guangzhou.

AI surveillance giant Cloudwalk nears IPO

Cloudwalk belongs to a cohort of Chinese unicorns that flourished through the second half of the 2010s by selling computer vision technology to government agencies across China. Together, Cloudwalk and its rivals SenseTime, Megvii and Yitu were dubbed the “four AI dragons” for their fast ascending valuations and handsome funding rounds.

Of course, the term “AI dragon” is now a misnomer as AI application becomes so pervasive across industries. Investors soon realized these upstarts need to diversify revenue streams beyond smart city contracts, and they’ve been waiting anxiously for exits. Finally, here comes Cloudwalk, which will likely be the first in its cohort to go public.

Cloudwalk’s application to raise 3.75 billion yuan ($580 million) from an IPO on the Shanghai STAR board was approved this week, though it can still be months before it starts trading. The firm’s financials don’t look particularly rosy for investors, with net loss amounting to 720 million yuan in 2020.

Also in the news

  • Speaking of the torrent of news in autonomous driving, vehicle vision provider CalmCar said this week that it has raised $150 million in a Series C round. Founded by several overseas Chinese returnees in 2016, CalmCar uses deep learning to develop ADAS (Advanced Driver Assistance System) used in automotive, industrial and surveillance scenarios. German auto parts maker ZF led the round.
  • Baby clothes direct-to-consumer brand PatPat said it has raised $510 million from Series C and D rounds. The D2C ecosystem leveraging China’s robust supply chains is increasingly gaining interest from venture capitalists. Brands like Shein, PatPat, Cider and Outer have all secured fundings from established VCs. Founded by three Carnegie Mellon grads, PatPat counts IDG Capital, General Atlantic, DST Global, GGV Capital, SIG China and Sequoia China among its investors.

News: This Week in Apps: Clubhouse opens up, Twitter talks bitcoin, Snap sees record quarter

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy. The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

This Week in Apps will finally be a newsletter! It will launch on August 7. Sign up here: techcrunch.com/newsletters

This Week in Apps took a little vacation this month, so we’re back this week with a big round-up of all the news we missed — and then some. And a super-sized section of apps getting funded, too! Let’s play some catch-up…

Weekly News

Platforms: Apple

ATT isn’t killing mobile game performance. An Apptopia report found that Apple’s launch of App Tracking Transparency has so far had no clear impact on mobile game download performance or monetization performance. The firm says this could be the result of any number of factors, including publishers using fingerprinting techniques (despite not being permitted), increased ad budgets on large networks like Facebook, increased spend on user acquisition, use of IDFV (vendor identifier) by larger publishers or higher than expected opt-in rates than was predicted.

Image Credits: Apptopia

Image Credits: Apptopia

iOS 14.7 launched, adding support for Apple Card Family with combined credit limits, a Home app with support for multiple timers on HomePod, support for the MagSafe Battery Pack, Podcast app enhancements and more. iPadOS 14.7 also became available, offering bug fixes, security updates, as well as the same Apple Card Family and HomePod support.

Meanwhile, the iOS 15 beta 3 added the ability to update your device using Software Update even if less than 500 MB of storage is available. This could be a big deal for getting users onto the most recent version of iOS, which has in the past been more difficult when users’ phone storage is nearly full.

Apple added the ability to assign tax categories to apps and in-app purchases on App Store Connect. The categories are based on the app’s content — like videos, books, news, etc. — and allow Apple to administer taxes at the specific rates that apply to that type of application or purchase.

Apple expanded Ultra Wideband functionality in the Apple Watch Series 6, iPhone 11 and 12 to more countries, including Argentina, Pakistan, Paraguay and the Solomon Islands. Some countries don’t allow the technology still, and it must be disabled, including Armenia, Azerbaijan, Belarus, Indonesia, Kazakhstan, Kyrgyzstan, Nepal, Russia, Tajikistan, Turkmenistan, Ukraine and Uzbekistan.

Apple asked Judge Gonzalez Rogers to consider three other antitrust cases that have since been decided since the start of Epic Games’ antitrust lawsuit, which is now being deliberated. The cases include a recent decision by the courts to throw out the FTC lawsuit against Facebook.

Platforms: Google

Android beta 3 came out. The new release dropped a month after beta 2, and includes features like scrolling screenshots, face detect auto-rotate, more Material You theme options and new icons, the ability to disable Assistant corner swipe activation, tweaks to features like one-handed mode and internet toggles and changes to the camera, Chrome, toggles, launcher and more.

Android phones’ backup system was upgraded to “Backup by Google One,” an improvement that now backs up photos, videos and MMS messages with more granular control, in addition to the app data, SMS messages, call logs and device preferences the old system covered.

Google won’t enforce the original September 30, 2021 deadline that would have required all Play Store apps to switch over to the Play Billing IAP system. The company will now allow developers to request an extension for adopting the new policy, in the wake of the big antitrust lawsuit filed by AGs across 36 U.S. states and D.C.

Epic Games filed an update in its antitrust lawsuit against Google over its Play Store policies, but most of the information it contains has been redacted. From the visible tidbits, Epic discusses Google’s relationship with Apple and its agreement to pay between $8 and $12 billion to be the default search provider; as well as Epic’s plans to launch Fortnite on the Samsung Galaxy Store.

Verizon joined AT&T and T-Mobile in preloading the Android Message app as the default texting app on all Android phones it sells, meaning that now all three major U.S. carriers support RCS — the next-gen standard to replace SMS — as the default Android experience.

E-commerce

Amazon got the recently launched app Fakespot pulled from the App Store. An extension of the fake review-spotting website, Fakespot app was taken down because it was wrapping the Amazon website without permission, which Amazon successfully argued could be exploited to steal customer data. Amazon also said Fakespot injected code into its website, which opened up an attack vector. Apple said it gave Fakespot time to correct its issues before the takedown.

Augmented Reality

✨ Snap called out its AR advances during its Q2 earnings where the company posted record revenue and the largest user growth in four years. The company’s Cartoon 3D Style Lens went viral in the quarter on other social networks, including TikTok, generating 2.8 billion impressions on Snapchat alone. Snap also partnered with Disney on location-based Lenses for Walt Disney World’s 50th anniversary. The company is now working on shopping features that could potentially allow users to try on clothes using AR.

Fintech

Popular investment app Robinhood is targeting its IPO valuation up to $35 billion in a filing released on the 19th. The company first filed to go public in early July after raising billions earlier in the year. The fintech giant expects to debut between $38 and $42 per share.

Fintech giant Revolut launched a travel booking feature called Stays, which allows users to book hotels and other accommodations in its app, in a move to become more of a “super app” that offers multiple services through one interface.

Venmo removed the app’s global, public feed as part of its major redesign. The public feed put user privacy at risk, and follows a number of complaints about Venmo’s oversharing throughout the years. Recently, Venmo’s privacy leaks led BuzzFeed News to uncover President Biden’s Venmo account.

✨ Twitter CEO Jack Dorsey said bitcoin will be a “big part” of Twitter’s future. On the company’s earnings call, the exec spoke for the first time about how he envisions bitcoin can integrate with Twitter’s products, including commerce, subscriptions and other new additions like the Twitter Tip Jar and Super Follows. The company posted the fastest revenue growth since 2014 in a pandemic rebound, but user growth slightly declined.

Social

Instagram confirmed it’s testing a new feature called Limits that would allow users to lock down their accounts in a moment of crisis. Found in privacy settings, users could quickly toggle on options to limit the ability for new followers or accounts who don’t follow you to comment or message you. The Limits could be applied for a set period of time you specify, in terms of days or even weeks.

Facebook launched a new tool available to U.S. Facebook Groups that allows users to ask for prayers. The prayer request tool could help drive engagement on the platform by turning into a product something users were already doing. Facebook’s head of faith partnerships told Reuters COVID gave new urgency to the building of the feature.

TikTok ads get more tools and upgrades. TikTok partnered with Vimeo to integrate the latter’s video tools with the TikTok platform. The deal gives SMBs the tools they need to create effective video ads via Vimeo’s AI-driven production tool, Vimeo Create, and the ability to publish ads directly into TikTok’s Ad Manager. The companies also collaborated on custom video templates optimized for TikTok. The video app also launched Spark Ads, which allow brands to use existing posts from influencers in their ad campaigns.

Instagram added new controls that allow users to limit “sensitive” content in the app’s Explore tab. The feature appears in the settings menu and lets users choose to allow or limit content that could be “upsetting or offensive,” or “limit even more.”

Instagram also began testing a new “collab” feature in India and the U.K. that lets users invite another account as a collaborator on posts or Reels. If the other person accepts, both accounts will appear in the header of the post or Reel.

Twitter is killing Fleets, its misguided effort to offer its own version of “Stories” in an app where content flows so quickly it effectively already feels “ephemeral,” even if the posts don’t auto-delete. Twitter hoped Stories would give hesitant users a place they felt comfortable posting, but that didn’t happen. The feature will be removed on August 3.

Tumblr’s community lashed out at the company’s new subscription feature, now in beta, that would allow bloggers to get paid for their content. The system, called Post+, offers the ability to paywall content, which subscribers can pay for at price points of $3.99, $5.99 or $9.99 per month. But some angry Tumblr users didn’t like the idea of paying, or at least, not being able to pay the blogger directly without the company taking a cut. They harassed and even sent death threats to one early tester. (Perhaps it’s time to move to Substack?)

Messaging

WhatsApp is testing multi device support that works without the phone. The company recently rolled out a limited public beta that will allow users to use the service on up to four non-phone devices without having the registered phone switched on or otherwise connected to the internet.

Facebook Messenger introduced “soundmojis,” which are, as you’d expect, emojis that include sound. The sounds include laughter and applause as well as those sourced from pop culture — like snippets from Netflix’s “Bridgerton,” movies like “F9,” and various musicians. It also later added a search bar for emoji reactions, and a recently used emojis section.

Streaming & Entertainment

✨ Clubhouse opens to all. The pandemic’s favorite audio chat app Clubhouse this week exited beta and become publicly available to everyone. That means users no longer need to know someone with an invite in order to sign up. The app continues to grow thanks to its Android release. In June, the app was installed 7.7 million times across iOS and Android. It also just launched an in-app messaging feature called Backchannel to allow users to chat both one-on-one and in groups as they host or listen.

Apple Music updated its Android app to add support for Spatial Audio and Lossless Audio. The Dolby Atmos-powered Spatial Audio feature requires a compatible phone, however, and even some Pixel devices don’t qualify.

TikTok found to drive music discovery. A recent study of around 1,500 TikTok users found that 75% discovered artists on the video app, and 63% said TikTok was a source for music they hadn’t heard before.

Spotify partnered with Facebook-owned Giphy to connect users to artists’ music through GIFs. The new GIFs will allow users to click a button to hear the artist’s songs on Spotify directly. The GIFs can be found in the Giphy mobile app or on the web.

Triller, the one-time TikTok rival that has since expanded into PPV events, has now moved into long-form video, including both prerecorded and live shows. As part of this effort, Triller livestreamed the Essence Festival of Culture on its app.

YouTube added the ability for users to directly pay creators for their videos through a new feature called Super Thanks. This is YouTube’s fourth Paid Digital Good alongside Super Chat, Super Stickers and channel subscriptions, and is the first that lets fans tip creators for uploads instead of just livestreams.

HBO Max partnered with Snap to allow Snapchat users to stream a selection of free episodes inside the Snapchat app with their friends. That means users can both stream and chat with others as they watch, and even react with Bitmoji.

Gaming

Top gaming title and award winner Genshin Impact released its 2.0 update on Android devices. This update brings cross-save functionality for all platforms, a brand-new region called Inazuma and the new Thunder Sojourn event, as well as new characters, stories and weapons.

Facebook bypassed building a native iOS app for its cloud gaming service and instead launched to the web at fb.gg. The company did not want to go the App Store route due to Apple’s restrictions on apps that offer app stores of sorts and its commissions on in-app purchases.

Health & Fitness

A poll suggests around 20% of U.K. adults have now deleted the NHS COVID app, most because they want to avoid orders that would have them self-isolate. Among younger users ages 18 to 34, more than one-third had removed the app.

Edtech

Duolingo said it aims to be valued as much as $3.41 billion in its U.S. IPO, with 5.1 million shares that will be offered between $85 and $95 each, raising more than $485 million at the top end of the range.

Reading

Amazon’s Kindle app launched a serialized fiction store called Kindle Vella, which will allow readers to unlock episodic, self-published stories via in-app purchases that range from $2 for 200 tokens to up to $15 for 1,700 tokens. The Wattpad-like feature is only available on the Kindle iOS app for the time being.

Utilities

Chrome for iOS lets you lock your private tabs. The new version rolled out support for using either Face ID or Touch ID to lock incognito tabs, along with other features, like full-page screenshots, and more.

Google’s iOS search app now lets you choose an option to delete your last 15 minutes of search history — perfect for those times when you forgot to launch an incognito tab.

Government & Policy

China has given 145 apps until July 26 to take corrective measures over what authorities said was their illegal collection of user information by misleading customers or by requesting excessive permissions. Apps from Amazon, ByteDance, NetEase, Tencent and others are among those being called out by Beijing in the crackdown.

China’s most popular fitness app, Keep, backed by SoftBank and Tencent, pulled its U.S. IPO after Chinese regulators announced an investigation into data security concerns at ride-hailing app Didi. The move indicates that China’s probe is having larger impact on the stock market, as China’s biggest podcasting platform, Ximalaya, also recently canceled its U.S. IPO.

Facebook escaped an EU ban on its use of WhatsApp customer data but will face an investigation of its new terms of service that sparked customer outrage. The European Data Protection Board said the new practices must be examined in a “swift” fashion by the EU privacy watchdog.

Security & Privacy

A Catholic priest was outed by way of his phone’s location data found in a data set from a data vendor. This data is commonly aggregated and sold by data vendors, and can then be analyzed for timestamped location data. The signals collected on the priest’s phone were gathered from Grindr, and tracked to his home and other bars and clubs.

Reports found that military-grade spyware developed by Israeli firm NSO Group and licensed to governments for tracking terrorists and criminals was used to hack the phones of journalists, activists, politicians and other business executives, whose phones appeared on a list of 50,000 numbers. Amnesty International has now provided a toolkit that can help people identify if their phones had been among those targeted.

Funding and M&A

💰 Voice-based social app Zebra raised $1.1 million in a pre-seed round for its messaging app that pairs photos with voice chat. Reddit co-founder Alexis Ohanian’s early-stage venture firm Seven Seven Six led the round.

💰 Sololearn raised $24 million led by Drive Capital for its Duolingo-like coding education app. The app delivers short bursts of bite-sized content and offers a community of helpers and influencers, not formal teachers.

💰 Belarus-based video editing app VOCHI raised $2.4 million in a late-seed round after growing its app to over 500,000 MAUs and achieving a $4 million+ annual run rate in a year’s time. The company now has 20,000 paid subscribers for its advanced filters and video effects, but makes 60% of its effects catalog available for free.

💰 Instant grocery delivery app Gopuff is raising $750 million at a $13.5 billion valuation, according to an SEC filing, but sources say the fundraise is higher — $1 billion at a $15 billion valuation.

💰 Investment app Titan raised $58 million in Series B funding led by Andreessen Horowitz (a16z), valuing the business at $50 million. The Robinhood rival has 30,000 users and is also backed by General Catalyst, BoxGroup, Ashton Kutcher’s Sound Ventures and a group of professional athletes and celebrities including Odell Beckham Jr., Kevin Durant, Jared Leto and Will Smith.

💰 Fitness app HealthifyMe raised $75 million in Series C funding from LeapFrog and Khosla Ventures to grow its user base in India, Southeast Asia and North America. The app has around 1,500 trainers and coaches on the platform, with plans to add 1,000 more to support its expansion.

💰 Free-to-play games publisher Tilting Point raised $235 million to fund its business of acquiring users for partnered games, or what the company refers to as its “progressive publishing model.” The company borrows from its line of credit to fuel advertising for games that show promise, allowing them to grow users and revenues, and then shares in the growth that it achieves.

💰 Virtual and in-person care app Carbon Health raised $350 million at a valuation of $3.3 billion in a round led by Blackstone’s Horizon platform. The company has 80 clinics across the U.S.

💰 Yoobic raised $50 million in Series C funding for its chat and communications app aimed at frontline service workers. Highland Europe led the round. The startup works with 300 brands across 80 countries.

💰 Travel rewards app Miles raised $12.5 million in Series A funding in a round led by Scrum Ventures that included Japan Airlines, Translink Capital and others. The app aims to offer travel rewards, with a focus on clean transportation.

🤝  Salesforce’s deal to acquire workplace communication app Slack officially closed. The $27.7 billion deal was first announced in December 2020.

🤝  Fortnite and Unreal Engine maker Epic Games bought New York-based Sketchfab, a 3D model sharing platform.

💰 Fintech app M1 Finance raised $150 million in a SoftBank-led Series E, valuing the business at $1.45 billion. The app offers automated investing, borrowing and banking/spending accounts, and has grown to $4.5 million assets under management.

💰 Mobile.dev raised $3 million in seed funding from Cowboy Ventures and others for its service that aims to catch bugs and errors in apps before they launch. The two-person team includes a former Uber engineer and has already bagged Reddit as a client.

💰 On-demand coworking space app Deskimo gets Y Combinator backing for its app currently available in Singapore and Hong Kong that helps remote workers find alternative spaces to work at times, like the occasional meeting.

💰 London-based financial “super app” Revolut raised $800 million in Series E funding co-led by Softbank Vision Fund 2 and Tiger Global, valuing the business at $33 billion. This makes Revolut the most valuable fintech in the U.K.

💰 Indian startup Inshorts, maker of a news aggregator app and a social media app called Public, raised $60 million in a new round led by Vy Capital, valuing the business at $550 million.

💰 Miami’s Play2Pay raised $13 million in Series A funding led by Telesoft Partners to convert mobile user engagement into bill payments. The company offers a way for consumers to lower their bills by playing mobile games, watching videos and competing in challenges and surveys.

💰 South Korea’s largest travel app Yanolja Co. raised $1.7 billion in funding from SoftBank. The app began as a hotel booking service and has since expanded to include transportation and leisure activities.

💰 Venezuela-based delivery app Yummy raised $4 million to expand its delivery operations across Latin America. Backers included Y Combinator, Tinder co-founder Justin Mateen, Canary, Hustle Fund, Necessary Ventures and the co-founders of TaskUs. The company has connected with over 1,200 merchants and completed over 600,000 deliveries. It now plans to move into ridesharing.

🤝Tumblr and WordPress.com owner Automattic acquired the popular podcast app Pocket Casts, which had sold to a combined group comprised of WNYC, NPR, WBEZ and This American Life back in 2018. The app went up for sale in January, after NPR reportedly lost $800,000 on it the year prior.

💰Israeli AI-driven health app Sweetch raised $20 million in Series A round led by Entreé Capital. The app encourages users to change their behaviors using AI smarts, after learning about your lifestyle through mobile sensors. The app is distributed through health organization partners, not the App Store.

Downloads

Skate City: Tokyo

Apple Arcade has added a handful of reimagined classic games in recent days, including an updated version of Alto’s Odyssey, called Alto’s Odyssey: The Lost City, which adds a new locale and other features. This week, Apple Arcade added a new version of Snowman’s popular game, Skate City. The expansion coincides with the start of the Olympic Games in Tokyo, and includes 21 new challenges, 30 new goals, new soundtracks and more. Another classic, Tetris Beat, is on the way soon.

HalloApp

Image Credits: HalloApp

 

Two early WhatsApp employees have launched a private social networking app called HalloApp on both iOS and Android. The ad-free app is somewhat similar to WhatsApp as it also allows for encrypted, private chats with friends and family, including group chats. The app also features a Home feed with posts from friends. The company plans to eventually monetize via subscriptions if it gains traction.

Anyone

Image Credits: Anyone

Audio app Anyone launched its “marketplace for advice” app on iOS and Android after previously operating in a closed beta. The app allows users to pay for access to busy people whose advice they’d like to seek out, but limits calls to just five minutes. (Advice givers can opt to donate the money to charity, if they don’t want to profit from the help they’re giving.) The company claims to vet advisors before they’re allowed to offer calls, in order to keep the advice on the platform high-quality.

Streamlabs’ Crossclip

Image Credits: Streamlabs

Streamlabs, a maker of livestreaming software, launched a new iOS app that allows creators to easily turn their Twitch clips into a format that works on TikTok, Instagram Reels, YouTube Shorts and Facebook. The app works by allowing streamers to enter the URL of a clip, selecting the output format (landscape, vertical or square) and choosing a pre-loaded layout. You can also crop the clip, blur the background and select from different layouts depending on which frames you want to feature. The app is free with a subscription of $4.99/mo or $49.99/yr to remove the watermark and add more features, including higher-quality exports.

Tweets

This remains one of the most annoying app store rules and it should go away. https://t.co/i5oQ27uTaU

— Sean Heber (@BigZaphod) July 22, 2021

The thrill of a new app idea… pic.twitter.com/hLzcYeUheY

— Heidi Helen Pilypas (@heidi_helen) July 22, 2021

Cannot wait to see how the App Store submission will go with Apple.

Digital services (to date) cannot be paid in anyway with anything else but in app purchases. https://t.co/y32N3hPc7X

— Ouriel Ohayon (@OurielOhayon) July 23, 2021

There are scam apps… Then there’s The League dating app which charges a mind-boggling $999.99/week for a VIP subscription! Literally had to double check to make sure it wasn’t a typo. pic.twitter.com/pPzKXtsQe3

— Zach (@zachshakked) July 23, 2021

TL;DR — Glass is launching next month.https://t.co/BekJ8u7DbS

— Glass (@tryglass) July 23, 2021


News: Sequoia’s Mike Vernal outlines how to design feedback loops in the search for product-market fit

“Finding product-market fit is not a deterministic process. Most of the time, it requires iteration. It requires constant adaptation.”

Sequoia’s Mike Vernal has worn many hats. He was VP of product and engineering at Facebook for eight years before getting into investment. His portfolio includes Houseparty, Threads, Canvas, Citizen, PicsArt and more, and he continues to invest in companies across a broad spectrum of stages and verticals, including consumer, enterprise, marketplaces, fintech and more.

Vernal joined us at TechCrunch Early Stage: Marketing and Fundraising earlier this month to discuss how founders should think about product-market fit, with a specific focus on tempo. He covered how to organize around the pace of iteration, how to design with customer feedback loops in mind and how Sequoia evaluates companies with regard to tempo.

Be explicit and be greedy at every single step along the way about getting feedback.

What is tempo?

Vernal breaks down tempo into two separate ingredients: speed and consistency.

It’s not just about going fast (which can often lead to some recklessness). It’s about setting a pace and staying consistent with that pace.

One of the very best compliments an angel can bestow on a founding team and include in an introduction to us is, “They’re just really fast,” or “She’s a machine.” What does that mean? It doesn’t mean fast in the kind of uncontrolled, reckless, crashing sense. It means fast in a sort of consistent, maniacal, get-a-little-bit-better-each-day kind of way. And it’s actually one of the top things that we look for, at least when evaluating a team: how consistently fast they move. (Timestamp: 2:26)

Vernal went on to say that tempo is directly correlated to goals and objectives and key results (OKRs). Building a feedback loop into those OKRs and determining the tempo with which to attack them is critical, especially during the process of finding product-market fit.

Finding product-market fit is not a deterministic process. Most of the time, it requires iteration. It requires constant adaptation. My mental model is that it’s actually just a turn-based game with an unknown number of steps, and sometimes either the clock or the money or both run out before you get to finish the game. It’s kind of like a game of chess. So what is your optimal strategy? (Timestamp: 4:25)

Feedback is your friend

As Vernal explained, finding product-market fit is all about feedback, and that must be an ongoing, built-in part of the process. He outlined how founders can go about designing with that in mind.

News: Hear Startup Alley companies pitch expert VC judges on the next episode of Extra Crunch Live

We know how much you love a good startup pitch-off. Who doesn’t? It combines the thrill of live, high-stakes entertainment with learning about the hottest new thing. Plus, you get to hear feedback from some of the smartest folks in the industry, thus learning how to absolutely crush it at your next pitch meeting with

We know how much you love a good startup pitch-off. Who doesn’t? It combines the thrill of live, high-stakes entertainment with learning about the hottest new thing. Plus, you get to hear feedback from some of the smartest folks in the industry, thus learning how to absolutely crush it at your next pitch meeting with a VC.

With all that in mind, we’re introducing a special summer edition of Extra Crunch Live that’s all pitch-off, all the time.

On August 4, Extra Crunch Live will feature startups exhibiting in the Startup Alley at TechCrunch Disrupt 2021 in September. Those startups will pitch their products/businesses to a pair of expert VC judges, who will then give their live feedback.

Extra Crunch Live is usually a combination of an interview with a founder/investor duo and an audience pitch-off. But as it’s summer, and Disrupt is right around the corner, we thought it would be fun to bring you even more pitches and even more feedback.

On August 4, our expert VC judges will be Edith Yeung from Race Capital and Laela Sturdy of CapitalG. Register here for free!

Edith Yeung started out as an investor at 500 Startups and is now a general partner at Race Capital. She’s an expert on both the China and Silicon Valley investment landscape and has made more than 50 investments, with a portfolio that includes 50 startups, including Lightyear/Stellar (valued $1.2 billion), Silk Labs (acquired by Apple), Chirp (acquired by Apple), Fleksy (acquired by Pinterest), Human (acquired by Mapbox), Solana, Oasis Labs, Nebulas, Hooked, DayDayCook, AISense and many more.

Laela Sturdy is a 10x unicorn operator-turned-investor whose investments are worth nearly $200 billion. She joined CapitalG, the investment arm of Alphabet, in 2013, and her portfolio includes Stripe, UiPath, Duolingo, Gusto, Webflow and Unqork, among many others.

As a special thank you, all attendees of this episode of Extra Crunch Live will be entered into a random drawing for a chance to win one of three free tickets to TechCrunch Disrupt 2021. Following the event, we’ll randomly select three winners and send details on how to redeem their passes. Do you need to submit any additional information to enter the drawing? Nope. All you need to do is register for Extra Crunch Live by clicking here and attend the event on August 4.

News: Daily Crunch: Bitcoin ‘is a big part of our future,’ says Twitter CEO Jack Dorsey

Hello friends and welcome to Daily Crunch, bringing you the most important startup, tech and venture capital news in a single package.

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Hello and welcome to Daily Crunch for July 23, 2021. It’s been an interesting week for the crypto faithful. One eye-catching piece of news came from Twitter and Square CEO Jack Dorsey, who said that bitcoin will be a “big part” of the company’s future. In his view it’s the internet’s “native currency.” Kinda? I would have picked a more modern chain, but that’s just me. — Alex

The TechCrunch Top 3

  • Indian IPOs are a go: After much selling and waiting, the Zomato IPO took flight in India to great effect. Shares of the food delivery unicorn went up sharply, marking a successful flotation for the growth-oriented unicorn. For other richly valued Indian unicorns, it’s just about the best news that you could imagine. More, please.
  • Snap is very much not dead: Lost amidst all the Facebook and TikTok brouhaha is the fact that Snap is still growing its user base (some) and revenue scale (more). The company still consumes cash and has huge share-based compensation costs, but it reported the sort of growth that delights investors. So, up went its shares.
  • China cracks down on edtech: The changing climate for startups and tech giants in China took a new twist this week when news broke that the Chinese Communist Party may force tutoring companies in the country to go nonprofit. That hit a number of stocks, and, we presume, was a pretty bad day for the country’s larger edtech venture and startup ecosystem.

Startups/VC

  • Paystand is building Venmo for businesses: Want to send a bloc of cash as a company? The process can suck. Happily Paystand just raised $50 million for its work on the matter. TechCrunch’s Christine Hall told Daily Crunch that she picked up the round because the company is “not only taking on the business-to-business payment space, but is also utilizing blockchain technology as its engine.”
  • Former Minter wants to be king: That’s our first read of the startup Monarch, founded by Val Agostino, who was the first PM at Mint.com. What does Monarch do? Helps folks manage their financial futures. Sure, other companies do that, but most of them are garbage. Have you used the Fidelity website lately?
  • Lucid Motors discovers the weaknesses of democracy: The EV company had to extend its voting deadline to approve its SPAC deal after not enough folks voted. Per TechCrunch, the “hiccup occurred on Thursday, when shareholders voted to approve all but one of the proposals as part of the merger.” That particular item required more votes. Regardless, it now has the votes and will go public.
  • And if you wanted to know what’s up with the Duolingo IPO, the Equity team has you covered.

Susan Su on how to approach growth as your startup raises each round

If you are methodical in your approach to building a larger customer base, it is not difficult to foster steady growth.

Marketers who shift with whichever way the wind is blowing — or blindly follow someone else’s idea of best practices — are less likely to be successful.

“The not-so-secret secret here is that the key to great retention is really simple,” said growth expert Susan Su recently at TechCrunch Early Stage: Marketing and Fundraising.

“It is building a product that solves a real and especially persistent problem for people.”

In a conversation with Managing Editor Eric Eldon, Su delved into several issues, including tips for how founders should discuss growth with their investors and her methods for developing a sample qualitative growth model.

“I firmly believe that every founder should try their hand at growth,” said Su.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

  • GM recalls the Bolt. Again: If you own a 2017-to-2019-era Bolt, it may catch fire. So you’ll want to take part in the current recall. The first to happen since November of 2020 we hasten to add. Still the news underscores that EV tech is coming to maturity, even if some earlier attempts at such vehicles are riding the struggle bus.
  • Taboola goes shopping: Fresh off its SPAC combination, Taboola announced that it is buying “Connexity, a marketing technology company that operates a retail- and e-commerce-focused advertising network” for $800 million. You can do this more easily if you are public. Buy things, that is. Shares in the online effluent provider were up sharply in today’s trading.
  • Folks still using Tumblr not stoked that Tumblr wants a future: A few days back Daily Crunch was generally positive about Tumblr’s move to introduce paywalls for creators who wanted them. Why not position the venerable company toward the burgeoning creator economy and help folks make a few bucks? Well, users are pissed. It’s a somewhat standard internet mess, but that doesn’t make it any less befuddling.

TechCrunch Experts: Growth Marketing

Illustration montage based on education and knowledge in blue

Image Credits: SEAN GLADWELL (opens in a new window) / Getty Images

We’re reaching out to startup founders to tell us who they turn to when they want the most up-to-date growth marketing practices. Fill out the survey here.

Read one of the testimonials we’ve received below!

Marketer: Jonathan Metrick, Portage Ventures

Recommended by: Matt Byrd

Testimonial: “Jonathan was truly transformative at Policygenius. Prior to his arrival, we were running a smart but disjointed marketing effort. Our messaging was inconsistent, and our approach to understanding channel efficacy was weaker than it could have been. Jonathan brought a growth mindset to the team, and built a hypereffective org in a short amount of time.”

News: Automakers have battery anxiety, so they’re taking control of the supply

Battery joint ventures have become the hot must-have deal for automakers that have set ambitious targets to deliver millions of electric vehicles in the next few years.

Battery joint ventures have become the hot must-have deal for automakers that have set ambitious targets to deliver millions of electric vehicles in the next few years.

It’s no longer just about securing a supply of cells. The string of partnerships and joint ventures show that automakers are taking a more active role in the development and even production of battery cells, .

Automakers are taking a more active role in the development and even production of battery cells.

And the deals don’t appear to be slowing down. Just this week, Mercedes-Benz announced its $47 billion plan to become an electric-only automaker by 2030. Securing its battery supply chain by expanding existing partnerships or locking in new ones to jointly develop and produce battery cells and modules is a critical piece of its plan.

Mercedes, like other automakers, is also focused on developing and deploying advanced battery technology. In addition to setting up eight new battery plants to supply its future EVs, the German automaker said it was partnering with Sila Nano, the Silicon Valley battery chemistry startup that it has previously invested in, to increase energy density, which should in turn improve range and allow for shorter charging times.

“This follows a trend that we’ve seen of automakers realizing how critical the battery is and taking more control of the production of the cells in order to ensure their own supply,” Sila Nano CEO Gene Berdichevsky said in a recent interview. “Like if you’re VW, and you say, ‘We’re going to go 50% electric by whatever year,’ but then the batteries don’t show up, you’re bankrupt, you’re dead. Their scale is so big that even if their cell partners have promised them to deliver, automakers are scared that they won’t.”

Tesla, BMW and Volkswagen were early adopters of the battery joint-venture strategy. In 2014,Tesla and Panasonic signed an agreement to build a large battery manufacturing plant, or a gigafactory as everyone is now calling it, in the U.S. and have worked together since. BMW began working with Solid Power in 2017 to create solid-state batteries for high-performance EVs that could potentially lower costs by requiring less safety features than lithium-ion batteries.

In addition to its partnership with Northvolt, VW is also in talks with suppliers to secure more direct access to supplies like semiconductors and lithium so it can keep its existing plants running at full speed.

Now the rest of the industry is moving to work with battery companies, to share knowledge and resources and essentially become the manufacturer.

News: Peer-to-peer car rental startup Getaround fined nearly $1M by DC’s Attorney General

Getaround was fined nearly $1 million by the Washington D.C. Office of the Attorney General for operating without a license and other violations, part of a settlement of what the peer-to-peer car rental startup calls “politically motivated allegations.” The AG’s office started investigating the company early last year, after it received reports of vehicle thefts

Getaround was fined nearly $1 million by the Washington D.C. Office of the Attorney General for operating without a license and other violations, part of a settlement of what the peer-to-peer car rental startup calls “politically motivated allegations.”

The AG’s office started investigating the company early last year, after it received reports of vehicle thefts of cars listed on the Getaround platform. The settlement, released Friday, requires the company to pay the city $950,000, in addition to implementing other changes, including paying restitution to customers whose vehicles were stolen or damaged while it was listed for rent on Getaround’s platform.

Getaround, the winner of TechCrunch’s Startup Battlefield at Disrupt NYC in 2011, lets individual car owners rent their vehicles by the hour or day via its website and app. The site, much like competitor Turo or home rental analog Airbnb, mediates this exchange (and takes a cut off the top). The company’s attracted a lot of interest from investors, most recently raising a $140 million Series E that brought its total venture funding to $600 million.

The settlement is what’s known as an “assurance of voluntary compliance,” and it’s not an admission of guilt. The settlement document makes clear that Getaround denies it violated any consumer protection or tax laws.

“Gig economy companies must abide by the same rules as their brick-and-mortar counterparts,” Attorney General Karl Racine said in a statement. “They must provide clear and accurate information to consumers, especially about the safety of their services, and they must pay their fair share of taxes like everyone else does.”

The AG’s office claims that Getaround operated without a license in the district, misrepresented its service, and made “untrue or misleading representations” about the safety of its car rental services. As part of the settlement, the company must create a written policy for user complaints regarding vehicle damage or theft, including a way for users to report any issues. It also must clearly disclose limitations of its safety features, such as its “Enhanced Security” software feature, which Getaround says on its website can immobilize your car when it’s not being used. Getaround must also more clearly state the terms and conditions for insurance coverage.

The AG’s office also claimed that Getaround misled consumers by creating fake owner profiles for vehicles that it owned and operated. The company must now disclose its fleet cars clearly in listings.

A Getaround spokesperson told TechCrunch that the company “categorically disagrees” with the AG’s allegations.

“With regard to safety and security, as the Attorney General acknowledges, as soon as Getaround was notified of security issues affecting certain cars in the District, the company took immediate corrective action,” the spokesperson said. “As is its practice, Getaround will continue to compensate car owners who have filed valid claims for loss or damage. Finally, Getaround never disputed liability for the taxes it is paying pursuant to this settlement.  Getaround will continue to pay applicable taxes to the District and in every jurisdiction in which it operates.”

The company spokesperson went on to say that “while the Attorney General is focused on scoring political points, Getaround remains focused on connecting safe, convenient, and affordable cars with District residents who need them to live and work.”

News: Extra Crunch roundup: finding GTM, China’s edtech clampdown and how to define growth

“The not-so-secret secret here is that the key to great retention is really simple,” says growth expert Susan Su.

Early-stage startups tend to claim that their go-to-market strategy is fully operational. In reality, GTM is a stark numbers game, and even with a solid plan in place, it can be easily foiled by common problems like turf battles and poor communication.

Finding GTM fit is a milestone for any startup that includes everything from expanding the engineering team to launching your first media buy. But how do you know when you’ve reached that magic moment?

“You have to consider three metrics: gross churn rate, the magic number and gross margin,” says Tae Hea Nahm, co-founder and managing director of Storm Ventures.

High churn means customers aren’t delighted, low gross margins mean poor unit economics, and that so-called magic number?

“You can calculate it by taking new ARR divided by your marketing and sales spending,” Nahm writes. “But keep in mind that the magic number is a lagging indicator, and it may take you a few quarters to see a positive result.”


Full Extra Crunch articles are only available to members
Use discount code ECFriday to save 20% off a one- or two-year subscription


If you are methodical in your approach to building a larger customer base, it is not difficult to foster steady growth.

Marketers who shift with whichever way the wind is blowing — or blindly follow someone else’s idea of best practices — are less likely to be successful.

“The not-so-secret secret here is that the key to great retention is really simple,” said growth expert Susan Su recently at TechCrunch Early Stage: Marketing and Fundraising. “It is building a product that solves a real and especially persistent problem for people.”

In conversation with Managing Editor Eric Eldon, Su delved into several issues, including tips on how founders should discuss growth with investors, and her methods for developing a sample qualitative growth model.

“I firmly believe that every founder should try their hand at growth,” said Su.

Thanks very much for reading Extra Crunch this week!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

How we built an AI unicorn in 6 years

An adult wearing a unicorn mask leaps over a chain-link fence

Image Credits: Lucas Knappe/EyeEm (opens in a new window)/ Getty Images

Few startups go to market with the exact product their founders first envisioned.

Today, Tractable is known for developing tech that allows drivers to upload photos of their vehicles after a collision so its AI can assess the damage. Its first paying customer, however, used Tractable to inspect plastic pipe welds.

And as fate would have it, that customer also fired them just as the founders were raising their first round.

“We struck gold with car insurance,” says co-founder Alex Dalyac, as it was “a huge and inefficient market in desperate need of modernization.”

In an Extra Crunch guest post, he shares several takeaways from the last six years spent scaling a unicorn that have value for founders of all stripes. Step one?

“Search for complementary co-founders who will become your best friends,” advises Dalyac.

 

The European VC market is so hot it may skip its summer holiday

Alex Wilhelm and Anna Heim continued their exploration of the scorching global VC market, this time taking a look at Europe.

For perspective, they analyzed data from Dealroom and spoke to four VCs about the continent’s investment climate:

  • Diana Koziarska, SMOK Ventures
  • Vinoth Jayakumar, Draper Esprit
  • Simon Schmincke, Creandum
  • Javier Santiso, Mundi Ventures

“There’s little indication that what we’ve seen thus far from Europe in 2021 will slow in Q3 or Q4,” Alex and Anna write.

“Even though Europe has a reputation for lengthy summer vacations, investors don’t expect much — if any — slowdown to come in Europe during this sun-drenched quarter.”

Startups and investors are turning to micromobility subscriptions

Image Credits: Bryce Durbin

“Amid the chaos of the COVID-19 pandemic and the murky path to profitability for shared electric micromobility, an increasing number of companies have turned to subscriptions,” Rebecca Bellan writes in a roundup about the future of micromobility.

“It’s a business model that some founders and investors argue hits the profit center sweet spot — an approach that appeals to customers who are wary of sharing as well as paying upfront to own a scooter or e-bike, all while minimizing overhead costs and depreciation of assets.”

What Robinhood’s warnings about crypto trading say about Coinbase’s near-term future

After noting that Robinhood anticipates a decline in revenue in the third quarter as a result of slowing crypto trading, Alex Wilhelm got to thinking about what that forecast means for Coinbase.

“The now-public unicorn has lived through crypto ups and crypto downs,” he writes. “A decline in consumer interest in the next few months or quarters is not a huge deal, assuming one keeps a long enough perspective and the crypto-infused future that its fans expect comes to pass.”

But will it?

Dear Sophie: Should we look to Canada to retain international talent?

lone figure at entrance to maze hedge that has an American flag at the center

Image Credits: Bryce Durbin/TechCrunch

Dear Sophie,

I handle people ops as a consultant at several different tech startups. Many have employees on OPT or STEM OPT who didn’t get selected in this year’s H-1B lottery.

The companies want to retain these individuals, but they’re running out of options. Some companies will try again in next year’s H-1B lottery, even though they face long odds, particularly if the H-1B lottery becomes a wage-based selection process next year.

Others are looking into O-1A visas, but find that many employees don’t yet have the experience to meet the qualifications. Should we look at Canada?

— Specialist in Silicon Valley

Silicon Valley comms expert Caryn Marooney shares how to nail the narrative

Caryn Marooney, right, vice president of technology communications at Facebook, poses for a picture on the red carpet for the 6th annual 2018 Breakthrough Prizes at Moffett Federal Airfield, Hangar One in Mountain View, Calif., on Sunday, Dec. 3, 2017. (N

Image Credits: MediaNews Group/Bay Area News via Getty Images (opens in a new window)/ Getty Images(Image has been modified)

Caryn Marooney, a Silicon Valley communications professional turned venture capitalist, spoke extensively on storytelling at TechCrunch Early Stage: Marketing and Fundraising.

Throughout her time in Silicon Valley, she helped companies like Salesforce, Amazon, Facebook and more launch products and sharpen their messaging. In 2019, she left Facebook, where she was VP of technology communication, and joined Coatue Management as a general partner.

Marooney uses the acronym RIBS to describe her basic strategy for startup messaging: Relevance, Inevitability, Believability and keeping it Simple.

Canada’s startup market booms alongside hot global VC investment

For The Exchange, Alex Wilhelm and Anna Heim looked at Canada’s VC market in the first half of 2021, and if you’ve been reading their work, you know what’s coming.

Canada, like the rest of the globe, was absolutely scorching in the first half.

“Canada’s venture capital results now rival those of the entire Latin American region, with exits and mega-deals coming in roughly on par in the second quarter, and a similar number of total venture capital rounds in the period,” they write.

“That caught our attention.”

Greylock’s Mike Duboe explains how to define growth and build your team

With more venture funding flowing into the startup ecosystem than ever before, there’s never been a better time to be a growth expert.

At TechCrunch Early Stage: Marketing and Fundraising earlier this month, Greylock Partners’ Mike Duboe dug into a number of lessons and pieces of wisdom he’s picked up leading growth at a number of high-growth startups, including StitchFix. His advice spanned hiring, structure and analysis, with plenty of recommendations for where growth teams should be focusing their attention and resources.

Last-mile delivery in Latin America is ready to take off

a cardboard box flies through outer space propelled by two thruster rockets

Image Credits: Erlon Silva/TRI Digital (opens in a new window) / Getty Images

Thanks to sprawling fulfillment centers, seamless logistics networks and ubiquitous internet access, consumers in many regions can now order groceries and a new set of cookware during breakfast and reasonably expect everything to arrive in time for dinner.

In Latin America, a lack of technology infrastructure makes delivery operations complex, and these supply chains are often managed with spreadsheets, paper and pen.

Algorithms that manage delivery routes or automatically dispatch drivers “are almost unheard of in the Latin America retail logistics sector,” says Bob Ma, an investor at WIND Ventures.

But thanks to growing consumer demand and expanding investment in last-mile delivery startups, Ma says the region is at a turning point.

Since Latin America’s middle class has grown 50% in the last decade and e-commerce constitutes just 6% of all retail, several unicorns have emerged in recent years, with more waiting in the wings.

China’s expected edtech clampdown may chill a key startup sector

China’s edtech industry is estimated to be worth $100 billion, but its leaders are reportedly considering a plan that would require these firms to operate as non-profits.

“When it comes to control, the Chinese government doesn’t mind wiping out a few dozen billion dollars in market cap here and there,” writes Alex Wilhelm in this morning’s edition of The Exchange.

“That’s not a great system.”

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