Monthly Archives: February 2021

News: Aurora acquires a second lidar company in push to bring self-driving trucks to the road

• February 26, 2021
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Aurora, the autonomous vehicle company that recently closed its acquisition of Uber’s self-driving subsidiary, has snapped up another startup.  This time, Aurora is buying OURS Technology, the second lidar startup it has acquired in less than two years. Aurora acquired Blackmore, a Montana-based lidar startup in May 2019.  Aurora declined to disclose the acquisition price

Aurora, the autonomous vehicle company that recently closed its acquisition of Uber’s self-driving subsidiary, has snapped up another startup. 

This time, Aurora is buying OURS Technology, the second lidar startup it has acquired in less than two years. Aurora acquired Blackmore, a Montana-based lidar startup in May 2019.  Aurora declined to disclose the acquisition price or other financial terms of the deal. OURS Technology, which was founded in 2017 by a team of University of California-Berkeley researchers and Phds, employs 12 people. The entire team is heading to Aurora, according to the company.

“We are always on the lookout for how we can make progress as quickly as possible and OURS’s expertise in developing lidar chips adds to the expertise we already have and accelerates our work,” an Aurora spokesperson said.

Lidar, or light detection and ranging radar, is considered by most companies developing autonomous driving systems a critical and necessary sensor to safely deploy self-driving vehicles at scale. A future where millions of self-driving vehicles coursing through cities is still years — even decades some argue — away. But that hasn’t prevented dozens of lidar companies from launching, each one aiming to cash in on that eventual demand. 

The vast majority of the 70-odd companies that exist in the industry today are developing and trying to sell time-of-flight lidar sensors, which send out pulses of light outside the visible spectrum and then measures how long it takes for each of those pulses to return. As they come back, the direction of, and distance to, whatever those pulses hit are recorded as a point and eventually forms a 3D map.

Some lidar companies, including Blackmore and OURS Technology, are pursuing Frequency Modulated Continuous Wave (FMCW) lidar, which emits a low-power and continuous wave, or stream, of light. FMCW lidar developers tout two primary benefits of this technology. It can measure distance with a higher dynamic range and instant velocity, meaning it can gauge the speed of the objects coming to or moving away from them. It also doesn’t struggle with interference from sun or other other sensors.

But FMCW is also complex. FMCW starts as a range finder on a chip. To make it a 3D lidar, many FMCW developers use big mirrors and other components to provide the field of view, which pushes up the size of the sensors. OURS Technology claims to be a lidar-on-a-chip company, which suggests that this four-year-old company has developed a way to combine everything into a solid-state scanning mechanism. This would allow the sensor to shrink in size, solving one of FMCW’s primary issues.

Aurora unveiled last summer its so-called FirstLight Lidar, a sensor based on Blackmore’s technology that was developed for its fleet of self-driving vehicles, namely long-haul trucks. Aurora is clearly interested in OURS’ speed of development, noting in its announcement that the startup been able to produce four generations of lidar in just three years and developed a solid-state scanning mechanism compatible with its technology.

The company plans to use the startup’s expertise and development know-how to make its sensor scaleable. In short: Aurora hopes to use OURS’ team and their blueprint for key elements such as the solid-state scanning mechanism and development process to accelerate development.

“Now, as we look to expand our fleet and commercialize our driverless trucks, FirstLight lidar must be increasingly scalable — it needs to be smaller and less expensive, but just as powerful,” the company said.

News: Only a few hours left to buy early-bird passes to TC Early Stage 2021

• February 26, 2021
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By now you probably know that we’re hosting two TC Early Stage events this year — one on April 1-2 and another on July 8-9 — each with its own set of topics, speakers and content — both designed to help nascent startup founders build a better, more successful business. What you may not know

By now you probably know that we’re hosting two TC Early Stage events this year — one on April 1-2 and another on July 8-9 — each with its own set of topics, speakers and content — both designed to help nascent startup founders build a better, more successful business.

What you may not know is that you have only a few hours left to take advantage of early-bird pricing on a single event or dual-event pass. Beat the deadline — 11:59 p.m. (PST) tonight — score the lowest possible price and save $100.

TC Early Stage functions like a minibootcamp for entrepreneurs. You’ll hear from top experts, founders and investors from across the startup ecosystem. They’ll share valuable tips, advice and hard-won lessons they learned in the trenches. We’re talking issues that every startup founder needs to master or understand well enough to delegate wisely.

Our slate of experts will present workshops on subjects like operations, fundraising, pitch deck pointers, term sheet tips, product-market fit, brand building, growth marketing, recruiting, taming your tech stack and a lot more.

Here are just two examples to whet your entrepreneurial appetite. Marlon Nichols, founding managing partner of MaC Venture Capital, will discuss how to get noticed by investors, how to grow your business and how to survive in the crowded, competitive space of tech startups. He’ll offer insights on how to network, craft a great pitch and target the best investors for your success.

You’re just beginning to build your startup — what could go wrong? Plenty according to Fuel Capital’s Leah Solivan. Currently an early-stage investor, Solivan founded TaskRabbit, a startup she led to a successful exit in 2017 (acquired by IKEA). She’ll share ways to avoid making big mistakes early in your founding journey.

We reserved day two of TC Early Stage for something truly exciting — the TC Early Stage Pitch Off. We sent out a call for competitors and the response was overwhelming. Narrowing the field wasn’t easy, but we chose 10 early-stage startup founders. They’ll each get five minutes to deliver their best pitch to a panel of prominent VC judges — followed by a five-minute Q&A. Those judges will pick three founders to move to the finals for a second pitch-and-Q&A to a new set of judges. The winner receives a feature article on TechCrunch.com, a free, one-year subscription to ExtraCrunch and a free Founder Pass to TechCrunch Disrupt 2021.

TC Early Stage 2021 takes place on April 1-2. Learn the best ways to build a better, more successful business from the folks who paved the way. Buy your pass before the deadline hits tonight at 11:59 p.m. (PST) and save up to $100.

News: Jumia co-CEO Jeremy Hodara talks African e-commerce, and his company’s path to profitability

• February 26, 2021
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This month, African e-commerce giant Jumia released its second full-year financials for Q4 and its fiscal year 2020. The results were mixed — active customers and gross profit increased, while orders and gross merchandise volume (GMV) fell. A particular feature that has troubled the company since its inception in 2012 was also present, namely persistent

This month, African e-commerce giant Jumia released its second full-year financials for Q4 and its fiscal year 2020. The results were mixed — active customers and gross profit increased, while orders and gross merchandise volume (GMV) fell.

A particular feature that has troubled the company since its inception in 2012 was also present, namely persistent adjusted EBITDA and operating losses. However, those metrics fell year over year, and the company, in a statement, said that it had demonstrated “meaningful progress on our path to profitability.”

The unevenness of Jumia’s business is also reflected in how its share price performed in the past year. In March 2020, the company hit rock bottom and traded at an all-time low of $2.15 after facing fraud allegations. But it hit an all-time high of $69.89 almost a year later this February. 

With the release of its financials, two things were top of TechCrunch’s mind: What made Jumia’s value swell by more than 3,000 percent in the last year, and will the e-commerce player’s unending losses end anytime soon?

I spoke with Jumia co-CEO Jeremy Hodara to get his insights on these two questions and on issues that have faced the company in the past.

Talking profitability with Jumia

This interview has edited for length and clarity.

TechCrunch: This time last year, Jumia was trading between $2 and $4. Now it’s within $40 to $50. What do you think has been the driving factor behind this?

Jeremy Hodara: What I think is really important about the stock rise is two things. First, in general, the world realized that there was a big paradigm shift in e-commerce and that e-commerce was the way to go for the future. This is something you can look at for every e-commerce company in the past 12 to 18 months. The second thing that happened is that we at Jumia have been very clear about the opportunities e-commerce represents in Africa. E-commerce is a real problem of access to consumption and has a strong value proposition to those who necessarily don’t fancy brick-and-mortar stores in Africa.

What we never really have proven is that you can build a profitable e-commerce business. However, I think that will change soon because what we’ve done quarter after quarter is to be disciplined to bring clarity that we’re going after a profitable business model and profitable growth. And as people understood and saw what we were doing, it also gave them more confidence about how exciting this opportunity is. In my opinion, what happened in the last 12 months was the combination of people understanding how important e-commerce is worldwide. Secondly, Jumia brought proof points that it was building a sustainable and profitable business model.

Would you say Andrew Left’s reversal in October and his decision to take long positions at Jumia also affected the share price?

Not really. Like I said earlier, I think it had to do with the story of e-commerce change for the future. That didn’t start in October; it started months before. Also, we being disciplined quarter after quarter to build what’s right started months before, so I can’t really comment if his decision affected our share price or if an investor’s negative or positive comments would change market sentiment towards our stock.

You’ve talked about how Jumia is trying to build a profitable business. But how’s it going to do that if the company reports losses quarter after quarter and year after year?

I think we’re on the right path, considering that our EBITDA losses reduced by 47 percent last quarter, and we’ll be trying to do so every quarter. We want to go about it by improving the efficiency of the business and opening new avenues for growth.

The most exciting thing about e-commerce is that first, you build large assets for your own use, but it becomes relevant for other stakeholders over time. For us, we have an application and website with very engaged visitors, and we’re exploring having third-party advertisers who place ads on the platform.

Our logistics service is also another way. We’re building tools and technology to equip our logistics partners and help them become more productive. This drives our costs per delivery down and is the type of benefit that comes with scaling. So I think there’s a path to profitability by opening the assets we’ve built for ourselves to benefit our ecosystem.

Jumia’s expenses dropped last year, but revenue also dropped despite a little increase in customer base. Aren’t those worrying signs?

On the revenue side, here’s how we should look at it. When you’re a marketplace, your revenue is the commission that you make from a transaction. So if you’re a seller on Jumia and sell something that costs $100 and your commission is 10 percent, your revenue inside the P&L of Jumia will be $10. If I buy a product from you at $90 and sell it to my consumer for $100, I’ll record $100 as the revenue.

That’s the insurance from the financial pinpoint between what you call the third-party and the first-party model. At the first-party model, you record as the revenue the value of the product. At the marketplace, you only record the commission. Jumia has, give or take, 10 percent of its business as the first-party model and 90 percent as the marketplace model. But that percentage changed over time, and when it did, you can see how the revenue went down.

So we don’t base our profitability on revenue. What is the right KPI for us is the gross profit as it shows the monetization of Jumia. It has been growing quarter after quarter, this time by 12% percent. Our active consumers growing 12 percent from 6.1 million in Q4 2019 to 6.8 million in Q4 2020 shows a disciplined growth towards profitability.

If there’s indeed a path to profitability, why did Jumia investors — Rocket Internet and MTN — exit the company? And does that put pressure on the company?

Oh, not at all. The fact that Jumia was able to gain support from the companies was a blessing, and they’ve come a long way with us. But like any investor after six to nine years, I think it was time for them to decide to leave the company, and I’ll say the company was lucky to have had them along our side from the beginning. Well, I can’t say for them, but for myself, I don’t think one can say that their leaving after so many years is a sign of distrust in our ability to become profitable.

One of the positives of your financials was JumiaPay. Does it tie into Jumia’s journey to being profitable?

JumiaPay is an amazing opportunity for us. Once you have a great commerce platform, you have a fantastic opportunity to build a great payments solution for your consumers. We can see that consumers are adopting it very fast, and I think this is because the platform also gives them access to other digital services where they top up their phone, pay bills and get loans. Also, it is a great payment method for consumers who want to prepay for services. And when you prepay for products, you make logistics more efficient and have more sales.

Sales remind me of the fraud issues in 2019 when some J-Force team members engaged in improper sales practices. What is Jumia doing to avoid situations like that?

It’s a lesson we’ve learnt, and we have put in the right compliance, the right internal control team to resolve such situations. I’ll say one of the reasons why we’re becoming one of the most professional organizations in Africa is because we now have these systems in place.

As an African company, how is Jumia addressing concerns around diversity, especially at top positions?

I think what’s really African with Jumia is who we are serving, our African sellers, our African consumers and our African team. In Nigeria, Juliet Anammah, who was the CEO of Jumia Nigeria, is now the chairperson of Jumia Group. I don’t know what constitutes an African or a non-African company, but what I can tell you is that our team is African, our consumers are African, and we’re selling on the continent every day. I think that’s what should make sense to our ecosystem.

News: Jamaica’s JamCOVID pulled offline after third security lapse exposed travelers’ data

• February 26, 2021
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Jamaica’s JamCOVID app and website were taken offline late on Thursday following a third security lapse, which exposed quarantine orders on more than half a million travelers to the island. JamCOVID was set up last year to help the government process travelers arriving on the island. Quarantine orders are issued by the Jamaican Ministry of

Jamaica’s JamCOVID app and website were taken offline late on Thursday following a third security lapse, which exposed quarantine orders on more than half a million travelers to the island.

JamCOVID was set up last year to help the government process travelers arriving on the island. Quarantine orders are issued by the Jamaican Ministry of Health and instruct travelers to stay in their accommodation for two weeks to prevent the spread of COVID-19.

These orders contain the traveler’s name and the address of where they are ordered to stay.

But a security researcher told TechCrunch that the quarantine orders were publicly accessible from the JamCOVID website but were not protected with a password. Although the files were accessible from anyone’s web browser, the researcher asked not to be named for fear of legal repercussions from the Jamaican government.

More than 500,000 quarantine orders were exposed, some dating back to March 2020.

TechCrunch shared these details with the Jamaica Gleaner, which was first to report on the security lapse after the news outlet verified the data spillage with local cybersecurity experts.

Amber Group, which was contracted to build and maintain the JamCOVID coronavirus dashboard and immigration service, pulled the service offline a short time after TechCrunch and the Jamaica Gleaner contacted the company on Thursday evening. JamCOVID’s website was replaced with a holding page that said the site was “under maintenance.” At the time of publication, the site had returned.

Amber Group’s chief executive Dushyant Savadia did not return a request for comment.

Matthew Samuda, a minister in Jamaica’s Ministry of National Security, also did not respond to a request for comment or our questions — including if the Jamaican government plans to continue its contract or relationship with Amber Group.

This is the third security lapse involving JamCOVID in the past two weeks.

Last week, Amber Group secured an exposed cloud storage server hosted on Amazon Web Services that was left open and public, despite containing more than 70,000 negative COVID-19 lab results and over 425,000 immigration documents authorizing travel to the island. Savadia said in response that there were “no further vulnerabilities” with the app. Days later, the company fixed a second security lapse after leaving a file containing private keys and passwords for the service on the JamCOVID server.

The Jamaican government has repeatedly defended Amber Group, which says it provided the JamCOVID technology to the government “for free.” Amber Group’s Savadia has previously been quoted as saying that the company built the service in “three days.”

In a statement on Thursday, Jamaica’s prime minister Andrew Holness said JamCOVID “continues to be a critical element” of the country’s immigration process and that the government was “accelerating” to migrate the JamCOVID database — though specifics were not given.

An earlier version of this report misspelled the Jamaican Gleaner newspaper. We regret the error.

News: Atlassian is acquiring Chartio to bring data visualization to the platform

• February 26, 2021
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The Atlassian platform is chock full of data about how a company operates and communicates. Atlassian launched a machine learning layer, which relies on data on the platform with the addition of Atlassian Smarts last fall. Today the company announced it was acquiring Chartio to add a new data analysis and visualization component to the

The Atlassian platform is chock full of data about how a company operates and communicates. Atlassian launched a machine learning layer, which relies on data on the platform with the addition of Atlassian Smarts last fall. Today the company announced it was acquiring Chartio to add a new data analysis and visualization component to the Atlassian family of products. The companies did not share a purchase price.

The company plans to incorporate Chartio technology across the platform, starting with Jira. Before being acquired, Chartio has generated its share of data, reporting that 280,000 users have created 10.5 million charts for 540,000 dashboards pulled from over 100,000 data sources.

Atlassian sees Chartio as way to bring that data visualization component to the platform and really take advantage of the data locked inside its products. “Atlassian products are home to a treasure trove of data, and our goal is to unleash the power of this data so our customers can go beyond out-of-the-box reports and truly customize analytics to meet the needs of their organization,” Zoe Ghani, head of product experience at platform at Atlassian wrote in a blog post announcing the deal.

Chartio co-founder and CEO Dave Fowler wrote in a blog post on his company website that the two companies started discussing a deal late last year, which culminated in today’s announcement. As is often the case in these deals, he is arguing that his company will be better off as part of large organization like Atlassian with its vast resources than it would have been by remaining stand-alone.

“While we’ve been proudly independent for years, the opportunity to team up our technology with Atlassian’s platform and massive reach was incredibly compelling. Their product-led go to market, customer focus and educational marketing have always been aspirational for us,” Fowler wrote.

As for Chartio customers unfortunately, according to a notice on the company website, the product is going to be going away next year, but customers will have plenty of time to export the data to another tool. The notice includes a link to instructions on how to do this.

Chartio was founded in 2010, and participated in the Y Combinator Summer 2010 cohort. It raised a modest $8.03 million along the way, according to Pitchbook data.

News: As BNPL startups raise, a look at Klarna, Affirm and Afterpay earnings

• February 26, 2021
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To better understand what’s going on with the companies hoping to help you finance your next mistaken purchase, let’s check out earnings results from Klarna, Afterpay and Affirm.

As the e-commerce market grows, startups are racing to help online retailers sell larger items to consumers with so-called “buy-now-pay-later” options. Via BNPL, consumers turn a one-time purchase into a limited string of regular payments.

Terms vary, but the space is very active. TechCrunch covered Scalapay’s January $48 million round, what the Italian BNPL described as a seed round. Also this year, we’ve seen France’s Alma raise a $59.4 million Series B for its BNPL efforts. And I recently covered Wisetack’s aggregate $19 million fundraise as it looks to make more noise about its service that focuses on real-world transactions like home improvement.

But unlike some burgeoning startup niches where we lack visible results from leading players to use as a lens for vetting the market, we do have a number for the BNPL space. This morning, to better understand what’s going on with the younger companies hoping to help you finance your next mistaken purchase, let’s check out earnings results from Klarna, Afterpay and Affirm.

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Klarna, based in Sweden, is said to be considering a direct listing. Its 2020 results are here. Afterpay, based in Australia, went public a few years ago. Its H1 fiscal 2021 results are here. And then there’s Affirm, the recently public U.S.-based BNPL company that had a recent direct listing. Its fiscal Q2 2021 (calendar Q4) results are here.

Let’s see how the three are doing, yank learnings for the mix and then check our gut about what their results might mean for BNPL startups the world ’round.

BNPL results

The BNPL cohort of startups is showing signs of pursuing verticalization to find veins of market demand that remain untapped by the largest players in their market. So, while Affirm wants to check you out everywhere online, providing you with repayment options wherever you travel digitally, Wisetack wants to integrate with a particular set of merchants. The latter model could provide startups pursuing similar, narrower market targets the ability to better understand their economics and perhaps generate more total margin on their loans.

That’s a long way to say that even with the information at our disposal, we’re thinking directionally. But doing so is both good fun and illustrative, so let’s get into it. First, Klarna.

Klarna

This morning we’ll look at Klarna’s Q3 2020 report and its Q4 report from the same year.

The gist is that Klarna had a super-solid 2020. In its Q3 update, Klarna wrote that it saw 43 percent growth in gross merchandise volume during the first nine months of the year. In its Q4 report, it noted a full-year number of 46 percent GMV growth. From that, we can intuit that Klarna had a great fourth quarter.

Turning to the U.S. market, Klarna first reported “10 million total consumers by [the Q3] period end, and 11 million by the end of October.” And for the full year, it wrote that it had seen “15 million consumers choosing to shop with Klarna by January 2021” in the United States. Again, those look pretty great.

News: Relativity Space unveils plans for a new, much larger and fully reusable rocket

• February 26, 2021
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3D-printed rocket company Relativity Space has just revealed what comes after Terran 1, the small launch vehicle it hopes to begin flying later this year. It’s next rocket will be Terran R, a much larger orbital rocket with around 20x the cargo capacity of Terran 1, that will also be distinguished from its smaller, disposable

3D-printed rocket company Relativity Space has just revealed what comes after Terran 1, the small launch vehicle it hopes to begin flying later this year. It’s next rocket will be Terran R, a much larger orbital rocket with around 20x the cargo capacity of Terran 1, that will also be distinguished from its smaller, disposable sibling by being fully reusable – across both first and second-stages, unlike SpaceX’s Falcon 9.

I spoke to Relativity Space CEO and founder Tim Ellis about Terran R, and how long it’s been in the works for the space startup. Ellis said that in fact, the vision every since Relativity’s time at Y Combinator has included larger lift rockets – and much more.

“When I founded Relativity five years ago, it always was inspired by seeing SpaceX launching and landing rockets, docking with the International Space Station, and this idea that going to Mars was critically important for humanity’s future, and really expanding the possibilities for human experience, on Earth and beyond,” Ellis told me. “But that all of the animations faded to black right when people walked out [of spaceship landing on Mars], and I believed that 3D printing had to be this inevitable technology that was going to build humanity’s industrial base on Mars, and that we needed to really inspire dozens, or even hundreds of companies to work on making this future happen.”

The long-term goal for Relativity Space, Ellis said, has always been to become an “end-product 3D printing company,” with its original Terran 1 light payload rocket simply representing the first of those products it’s bringing to market.

“3D printing is our new tech stack for aerospace, and really is rewriting something that we don’t feel has fundamentally changed over the last 60 years,” he said. “It’s really bringing automation that replaces the factory fixed tooling, supply chains, hundreds of thousands of parts, manual labor and slow iteration speed, with something that I believe is needed for the future on Earth, too.”

Terran R, which will have a payload capacity of over 20,000 kg (more than 44,000 lbs) to low-Earth orbit, is simply “the next logical step” for Relativity in that long-term vision of producing a wide range of products, including aerospace equipment for use right here on Earth. Ellis says that a larger launch vehicle makes sense given current strong customer demand for Terran 1, which has a max payload capacity of 1,250 kg (around 2,755 lbs) to low-Earth orbit, combined with the average size of satellites being launched today. Despite the boon in so-called ‘small’ satellites, many of the constellations being build today have individual satellites that weigh in excess of 500 kilograms (1,100 lbs), Ellis points out, which means that Terran R will be able to delivery many more at once for these growing on-orbit spacecraft networks.

A test fire of the new engine that Terran R will use for higher thrust capabilities.

“It’s really the same rocket architecture, it’s the same propellant, same factory, it’s the same printers, the same avionics and the same team that developed Terran 1,” Ellis said about the forthcoming rocket. That means that it’s actually relatively easy for the company to spin up its new production line, despite Terran R actually being quite functionally different than the current, smaller rocket – particularly when it comes to its full reusability.

As mentioned, Terran R will have both a reusable first and second stage. SpaceX’s Falcon 9’s first stage (a liquid fuel rocket booster) is reusable, and detaches from the second stage before quickly re-orienting itself and re-entering Earth’s atmosphere for a propulsive landing just after entering space. The Falcon 9 second stage is expendable, which is the space term for essentially just junk that’s discarded and eventually de-orbits and burns up on re-entry.

SpaceX had planned to try to make the Falcon 9 second stage reusable, but it would’ve required too much additional mass via heat shielding for it to make sense with the economics it was targeting. Ellis was light on details about Terran R’s specifics, but he did hint that some unique use of fairly unusual materials made possible though 3D printing, along with some sparing use of generative design, will be at work in helping the Relativity rocket’s second stage reusable in a sustainable way.

“Because it’s still entirely 3D-printed, we’re actually going to use more exotic materials, and design geometries that wouldn’t be possible at all, traditionally, to manufacture,” Ellis said. “It’s just too complicated looking; it would be way too difficult to manufacture traditionally in the ways that that Terran R is designed. And that will actually make it a much more reusable rocket, and really helped build the best reusable rocket possible.”

Terran R will also use a new upper stage engine that Relativity Space is designing, which is also unique compared to the existing engines used on Terran 1. It’s 3D printed as well, but uses a copper thrust chamber that will allow it to have higher overall power and thrust capabilities, according to Ellis. When I spoke to Ellis on Thursday evening, Relativity had just completed its first full success duration test of the new engine, a key step towards full production.

Ellis said that the company will share more about Terran R over the course of this year, but did note that the existing large 3D printers in its production facilities are already sized correctly to start building the new rocket – “the only change is software,” he said. He also added that some of the test sites Relativity has contracted to use at NASA’s Stennis Space Center are able to support testing of a rocket at Terran R’s scale, too, so it sounds like he’s planning for rapid progress on this new launch vehicle.

News: Newness raises $3.5 million for its ‘Twitch for beauty streamers’

• February 26, 2021
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Newness, a startup co-founded by former Twitch employees, has raised $3.5 million in a Sequoia-led seed round for its live-streaming platform aimed at beauty creators and their fan communities. Though today’s creators are not without options when it comes to livestreaming — Twitch, YouTube, TikTok, Instagram and Facebook are all popular choices — Newness is

Newness, a startup co-founded by former Twitch employees, has raised $3.5 million in a Sequoia-led seed round for its live-streaming platform aimed at beauty creators and their fan communities. Though today’s creators are not without options when it comes to livestreaming — Twitch, YouTube, TikTok, Instagram and Facebook are all popular choices — Newness is focused on building differentiated tools and features that work well for the beauty streamer market in particular. This includes offering options for both public and private streams, engagement mechanisms that reward positive contributions, moderation features, and the ability for fans to earn access to free beauty products by community participation.

In the new round, Jess Lee invested on behalf of Sequoia Capital. Other investors in Newness include Cowboy Ventures (Aileen Lee), Upside Partnership (Kent Goldman), Dream Machine (former TechCrunch editor Alexia Bonatsos), Index Ventures (Nina Achadjian), Twitch co-founder Kevin Lin, former Twitch execs Jonathan Shipman and John Sutton, Eventbrite founders Kevin and Julia Hartz, Incredible Health co-founder and CEO Iman Abuzeid, and other angel investors from Twitch.

The idea for Newness comes from CEO Jenny Qian, an early Twitch employee who held a number of roles at the game-streaming site over the years, most recently as the Senior Director of Business Strategy for Twitch’s video platform. She’s joined by CTO Youri Park, who also previously worked at Twitch, as well as Blizzard and Facebook Gaming.

Though always an avid gamer herself, Qian says she began getting into skincare after she turned 30. She then soon realized the potential in the live-streaming beauty space.

“I was so used to the format from Twitch. And, in some ways, I feel like I was spoiled with live-streaming,” she explains. Being able to hang out with streamers, ask questions, and learn from them was something that made the live format so compelling, she believes.

Image Credits: Newness

“It made me scratch my head and think: why didn’t something like this exist for the beauty community? It’s a community that is just as passionate, if not more so…and it’s a content category that is so incredibly popular. How come there isn’t a live medium available?,” she wondered.

But at the same time, Qian admits she didn’t feel comfortable going live on Twitch.

“It’s one thing to be made fun of for my gameplay. But I think it’s another if I take my makeup off, and people are making fun of me for how I look. It just cuts to a whole new level,” she says.

With Newness, the goal is to create a sort of anti-Twitch, in a way. It aspires to be a wholesome, positive community for beauty creators and fans, where moderation is a key focus and fans get rewarded for quality participation, not trolling.

When creators go live, Newness will pair them with an in-house moderator to help them feel more comfortable and to keep the content flowing. Once they’re a more established streamer, Newness will work with the creator to locate and elevate a moderator from their own fan community to help out with future streams.

Meanwhile, fans are awarded virtual items called crystals for positive participation and good behavior — for example, for watching your favorite stream and engaging in chat. In Newness, every chat message also has a little heart next to it. And the more hearts you earn over time for higher-quality comments, the more crystals you also earn.

Image Credits: Newness

These crystals can be redeemed for full-size beauty products, which Newness will source through brand deals. Because moderators spend more time on the platform, they’ll also earn more crystals — and that means more opportunities for products.

The positive reward system has so far proven successful during beta tests, as around 66% of Newness viewers, on average, end up chatting during live streams, Qian says.

Another differentiating feature for Newness is the ability for creators to host both public and private streams. The latter is not meant to be some sort of OnlyFans equivalent, but is instead focused on allowing creators to host more professional and exclusive live events. With private streams, creators can sell both general admission and even pricier VIP tickets that could come with some sort of reward — like a goodie bag of beauty supplies.

In addition to events, Newness supports an in-app tipping mechanism called “gifting” on everyday streams.

Eventually, the startup plans to take a share of the revenue these transactions generate, but it hasn’t yet rolled that out as it’s still beta testing.

At present, the Newness community its small. And it still chooses which creators are allowed to live stream.

“We handpick the creators that we let on to our platform and keep it invite-only because we want to make sure that our earliest creators are helping to set the tone and building the culture of the community,” she says. The startup wants to ensure there are enough community members to sustain itself, while also not allowing the community to become toxic as it scales.

“We really care about cultivating an incredibly wholesome community. So for us, safety, moderation — all that is really important to us,” Qian notes.

The creators produce a range of content, including more expert advice and product reviews to more casual “get ready with me” videos and vlogs.

Newness, of course, will face steep competition from larger, existing platforms for streamers, like YouTube and Instagram, as well as from newcomers more focused on beauty videos, like Supergreat.

The startup has been in beta testing since last year, and is only available on the web for the time being. With the seed funding, Newness expects to build out its iOS consumer app in 2021, to complement its dedicated streaming app for creators. (Creators can also opt to stream from their DSLRs, if they prefer.)

It also aims to hire engineering talent and build out its 14-person team that’s now spread out across San Francisco, New York (thanks to some ex-Glossier hires), and L.A.

News: First Boulevard raises $5M for its digital bank aimed at Black America

• February 26, 2021
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The murder of George Floyd last May ignited many things in the United States last year — one of which that was perhaps unexpected: a rise in the number of digital banks targeting the Black community. Some members of the Black community took their belief that big banks are not meeting their needs and turned

The murder of George Floyd last May ignited many things in the United States last year — one of which that was perhaps unexpected: a rise in the number of digital banks targeting the Black community.

Some members of the Black community took their belief that big banks are not meeting their needs and turned them into startup concepts.

One of those startups, First Boulevard (formerly called Tenth), has just raised $5 million in seed funding from Barclays, Anthemis and a group of angel investors such as actress Gabrielle Union, Union Square Ventures John Buttrick and AutoZone CFO Jamere Jackson.

For co-founder and CEO Donald Hawkins, the genesis for the Overland, Kansas-bank came after Floyd’s murder, when he and friend Asya Bradley were talking about what they felt Black America “really needed to get out of a vicious cycle” of dealing with the same issues with no real solutions in sight.

CEO Donald Hawkins

COO Asya Bradley

“After viewing yet another tragedy engulf the Black community, and the all-too-familiar protests against persisting issues,” Hawkins said. “it was beyond clear to me that the solutions Black America needs must be financially-focused and developed within our community.”

The pair both had fintech experience. Hawkins had founded Griffin Technologies, a company focused on providing real-time, contextual intelligence to community banks and credit unions. And Bradley most recently was a founding team member and head of revenue at Synapse, a platform that built banking-as-a-service APIs to help bank the unbanked of America by connecting fintech platforms to banking institutions.

They discovered that there were only about 19 Black banks in the U.S., collectively holding about $5 billion in assets.

“And their technology was really behind the times,” Hawkins said. “We also took a hard look at some of the existing digital banks to really see who was really going about it  in the same way that we felt like America needed, and it was pretty clear at that point, that no one was really attacking the issue of helping Black America build some level of financial stability through the form of wealth-building play.”

The pair formed First Boulevard last August under the premise that Black Americans are “massively underserved consumers” of financial products and services despite having a collective spending power of $1.4 trillion annually. The startup’s mission is to empower Black Americans “ to take control of their finances, build wealth and reinvest in the Black economy” via a digitally-native platform. First Boulevard has 100,000 people on its waitlist currently.

Part of its goal with the new capital involves building out a Black business marketplace, which will give its members Cash Back for Buying Black. It also plans to use the money to expand its team, increase its customer base and grow its platform to offer fee-free debit cards, financial education and on developing technology to help members automate their saving and wealth building goals.

“History has proven that oppressed communities can succeed when their finances are centralized, and when it comes to financial services for the Black community, a centralizing force is long overdue,” Hawkins said.

The bank’s Cash Back for Buying Black program helps members earn up to 15% cashback when they spend money at black-owned businesses. 

“I believe the most recent stat but that also was that 41% of black owned businesses have closed since COVID-19 started,” Hawkins said. “We want to support them as much as we can.”

First Boulevard also is focused on passively building wealth for its communities.

“Black America as a whole has been blocked from learning how money works. We want to connect our members to wealth-building assets such as micro investments like money market accounts, high yield savings and cryptocurrency — things that Black America has largely been blocked from,” Hawkins said.

Bradley, who serves as First Boulevard’s COO, believes the current financial industry was not built to serve the needs of melanated people. Its goal is to take their understanding of the unique needs of the Black community to provide things such as early access to wages, round up savings features, targeted financial education and budgeting tools.

The pair aims to have a “fully inclusive” team that represents the community it’s trying to serve. Currently, its 20-person staff is 60% black, and 85% BIPOC. Two-thirds of its leadership team are women and 100% is BIPOC. The company plans to boost its headcount to 50 by year’s end.

“We are very proud of that considering that in the fintech space, those are not normal numbers from a leadership perspective,” Bradley said.

For Katie Palencsar, an investor at the Female Innovators Lab by Barclays and Anthemis, said that her firm has always recognized “that access to financial services has long remained a challenge despite the digital evolution.”

“This is especially true for Black Americans who often reside in financial deserts and struggle to find platforms that truly look to serve them,” she said. “First Boulevard deeply understands the challenge.”

Palencsar believes that First Boulevard’s mission of helping Black Americans not just bank, but actually build wealth, is unique in the market.

“First Boulevard sees the wealth gap that continues to grow within the U.S. and wants to build a digital banking platform that addresses the systemic and structural challenges that face this population while enabling Black Americans and allies to invest in the community,” she said.

The company also recently announced a partnership with Visa, under which First Boulevard will be first to pilot Visa’s new suite of crypto APIs. First Boulevard will also launch a First Boulevard Visa Debit card.

First Boulevard is one of several digital banks geared toward Black Americans that have emerged in recent months. Paybby, a digital bank for the black and brown communities, recently acquired Wicket, a neobank that uses AI and biometric technology to create a personalized experience for users. Hassan Miah, the CEO and founder of Paybby, said the bank’s goal is to be “the leading smart, digital bank for the Black and Brown communities.”

Paybby, which started by offering a bank account and a way to expedite PPP loans, will soon be adding a cryptocurrency savings account for the Black and Brown communities.   

“Black buying power is projected to grow to $1.8 trillion by 2024,” Miah said. “Brown buying power is over $2 trillion. Paybby wants to take a good portion of this multi-trillion dollar market and give it back to these communities.”

Last October, Greenwood raised $3 million in seed funding from private investors to build what it describes as “the first digital banking platform for Black and Latinx people and business owners.”

At the time, co-founder Ryan Glover, founder of Bounce TV network, said it was “no secret that traditional banks have failed the Black and Latinx community.”

News: Why are we still dating LinkedIn in 2021?

• February 26, 2021
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• in:  Blog 
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Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines. Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. Before we get into this week’s show, make sure to check out all the news here about how Equity is expanding, and becoming even more of

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. Before we get into this week’s show, make sure to check out all the news here about how Equity is expanding, and becoming even more of a thing in 2021! We are beyond hyped about it.

Coming on the back of such a wild news week, we had to cut and cut from the notes doc to get the show to size. So, here’s what made the cut:

• Coinbase filed to go public. Alex wrote about its S-1 filing here, and Danny riffed on a fascinating nuance regarding its cap table here.
• Hopin is raising more money, at an even larger valuation. Every time we cover the latest version of this story, we think it must be the last time. And then it happens again. So, check back here in October for when Hopin raises again.
• Reddit also picked up more money. Again. Our take is that the capital must mean that Reddit is a better business than we anticipated.
• Reddit co-founder Alexis Ohanian backed a new community tool proving the monetary value of the community. That led us into a conversation about a professional network for independent workers that is competing with LinkedIn, and a collaborative workspace for interior design fans. 
• Toast is said to be on the road to an IPO, and so we riffed on what Olo’s IPO can tell us about the Boston-based unicorn.
• Shippo raised more money after a big 2020; can the company double again in 2021?
• Finix raised $3 million through an SPV filled with over 80 Black and LatinX investors. 

Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday at 6:00 AM PST, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts!