Monthly Archives: July 2021

News: Daily Crunch: In all-stock transaction, Zoom to purchase Five9 for $14.7 billion

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 19, 2021. In the old days, venture capital had seasons. VCs didn’t work in December, and the July-August period could be a bit hazy. Such variations have declined. Deal-making, it turns out, is now pretty much the theme for all seasons. Evidence? Just read what’s below! — Alex

The TechCrunch Top 3

  • Rappi raises $500M: The on-demand economy is still hot around the world, something we can know for sure thanks to Rappi’s latest half-billion-dollar raise. The Colombian delivery company is now worth $5.25 billion. That’s a lot of money. Per Crunchbase data, the unicorn has now raised more than $2 billion since inception. Rappi operates in nine countries and 250 cities across Latin America.
  • Zoom buys Five9: Well, the deal got announced at least. It won’t close until next year. But the $14.7 billion transaction has folks talking. It’s a large amount of money, and it’s the combination of two public companies. Both companies, of course, are formerly venture-backed companies, and the deal could help set some pricing notes for other software M&A. TechCrunch has a look at the price of the deal here.
  • Robinhood and Duolingo set prices for their IPOs: If you are into watching the biggest tech companies go public, you are in luck. We got fresh infusions of data from both Robinhood, the U.S. consumer fintech giant, and Duolingo, the U.S. edtech giant. Enjoy!

Startups/VC

  • Sweetch raises $20M to help you get off your backside: If you wear a smartwatch, you’ve gotten notifications from it at the wrong time. A nudge to get up and move, say, when you are seated at a restaurant. Sweetch wants to provide smarter inducements for folks to take better care of themselves, framing it as a way to “outsmart chronic conditions.” Given how much we could all do better at health, I am curious about how this startup performs.
  • Dover raises $20M to make recruiting more organized: Recruiting is not a great process. Mostly it’s done by hand, and managed in spreadsheets, or perhaps a system like Lever. But startups think that there is more room for improvement. Dover is one such company, hoping that its software that helps recruiters “juggle and aggregate multiple candidate pools to source suitable job candidates automatically, and then manage the process of outreach” is just the ticket. And now it has raised from Tiger.
  • Breakr wants to connect musicians and influencers: The days when radio play was the way to break into the mainstream are firmly behind us. Startups like Breakr want to help musical artists navigate the new world by connecting them to folks with their own audiences. Along the way, Breakr will take a 10% cut of fees generated from linking the two parties.
  • Recapped raises $6.3M for better sales software: Akin to how Dover wants to help make recruiting a smoother process, Recapped wants to improve the sales process, namely by building software that provides greater visibility into sales pipelines and by providing buyers with a similar digital interface that it provides to sales folks. Anything to make buying stuff less awful, please!
  • Jones wants to make hiring commercial real estate vendors simpler: If you own a building, hiring folks to do work in or on said building is fraught with liability. Jones just raised $12.5 million to help CME folks “find and hire the people they need in a compliant way.”
  • TechCrunch broke the news that private equity group Carlyle is looking to spend more than $400 million on LiveU, a livestreaming service.

Founders: How well do you really understand seed-stage financing?

A famous poem advises us not to compare ourselves with others, “for always there will be greater and lesser persons than yourself.”

The same holds true for startup fundraising; the size of your seed round will be determined solely by your company’s immediate needs and the investors you’re working with.

“Remember that fundraising is not the goal,” says three-time YC alum Yin Wu. “Building a successful business is.”

If you are an early-stage founder who’s seeking clarity about apportioning equity — or if you’re biting your nails over how much to raise — read this primer. It’s also a useful overview for early employees and co-founders who may be new to startup financing.

  • How financing works: SAFEs versus equity rounds.
  • How much to raise.
  • How to arrive at your valuation.

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

Big Tech Inc.

  • Chaos in lidar-world: The CEO is out at Velodyne, a lidar company that went public via a SPAC. The news follows much other post-SPAC drama, our own Kirsten Korosec reports. In short, going public does not ensure that a company’s ducks will remain in a row after its shares start to trade. Velodyne is now worth just $8.69 per share, down from a high of $32.50.
  • CNN is going +: Yep, another streaming service with a “+” in its name is coming out. This time from cable news pioneer and hoster-of-many-useless-panels CNN. The company is apparently hiring heavily for the effort. CNN, I hereby offer to host a regular TechCrunch show on CNN+. Call me.
  • Uber wants to deliver more carrots: That’s our takeaway from news that the ride-hailing giant is expanding its grocery-delivery service to some 400 new cities. Uber also has earnings coming up, so the timing of this news item isn’t an accident; the company will have something positive to chat about in case its earnings do not delight investors’ expectations regarding its trailing performance.
  • Today in cybersecurity, the United States is pointing a finger at China for “the mass-hacking of Microsoft Exchange servers earlier this year, which prompted the FBI to intervene as concerns rose that the hacks could lead to widespread destruction,” TechCrunch reports. The climate regarding cyber fuckery is changing, with nation-states increasingly content to point a finger at China and Russia for bad behavior.

TechCrunch Experts: Growth Marketing

Illustration montage based on education and knowledge in blue

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

Join us tomorrow, July 20, at 5 p.m. ET on Twitter Spaces to hear Danny Crichton and MKT1, who we’ve previously interviewed for TechCrunch Experts, talk about the trends they’re seeing in growth marketing.

Announcing the agenda for the Disrupt Stage in September

We’re excited to give you a closer look at the Disrupt Stage, where the biggest names in tech talk about their companies, their plans and what’s next for the greater tech ecosystem.

News: GM confirms a third electric pickup truck is in development

GM will add a full-size electric pickup truck to its GMC lineup, the latest in a string of EV product announcements by the automaker in the past year as it pushes to deliver more than 1 million electric vehicles globally by 2025. The EV pickup was shared in a slide deck during the media presentation

GM will add a full-size electric pickup truck to its GMC lineup, the latest in a string of EV product announcements by the automaker in the past year as it pushes to deliver more than 1 million electric vehicles globally by 2025.

The EV pickup was shared in a slide deck during the media presentation and later confirmed to TechCrunch. Duncan Aldred, vice president of global Buick and GMC, didn’t provide further details about the vehicle or when it might go into production.

The GM brand is already aiming to begin production of its GMC Hummer EV in the fourth quarter of this year. The GMC Hummer EV, which will be produced at the company’s Factory ZERO assembly plant in Detroit and Hamtramck, a 350-mile range, 1,000 HP and up to 11,500 pound feet of torque with a starting price of $80,000.

The announcement comes three months after GM announced it would produce an electric Chevrolet Silverado pickup truck, which will also be assembled at the Factory ZERO plant. The Chevrolet Silverado EV pickup will be based on the automaker’s Ultium battery platform and will have an estimated range of more than 400 miles on a full charge.

GM President Mark Reuss said at the time that company is positioning the Chevrolet full-sized pickup for both consumer and commercial markets. The automaker plans to offer retail and fleet versions of the Silverado electric pickup with a variety of options and configurations.

News: This tool tells you if NSO’s Pegasus spyware targeted your phone

Over the weekend, an international consortium of news outlets reported that several authoritarian governments — including Mexico, Morocco and the United Arab Emirates — used spyware developed by NSO Group to hack into the phones of thousands of their most vocal critics, including journalists, activists, politicians and business executives. A leaked list of 50,000 phone

Over the weekend, an international consortium of news outlets reported that several authoritarian governments — including Mexico, Morocco and the United Arab Emirates — used spyware developed by NSO Group to hack into the phones of thousands of their most vocal critics, including journalists, activists, politicians and business executives.

A leaked list of 50,000 phone numbers of potential surveillance targets was obtained by Paris-based journalism nonprofit Forbidden Stories and Amnesty International and shared with the reporting consortium, including The Washington Post and The Guardian. Researchers analyzed the phones of dozens of victims to confirm they were targeted by the NSO’s Pegasus spyware, which can access all of the data on a person’s phone. The reports also confirm new details of the government customers themselves, which NSO Group closely guards. Hungary, a member of the European Union where privacy from surveillance is supposed to be a fundamental right for its 500 million residents, is named as an NSO customer.

The reporting shows for the first time how many individuals are likely targets of NSO’s intrusive device-level surveillance. Previous reporting had put the number of known victims in the hundreds or more than a thousand.

NSO Group sharply rejected the claims. NSO has long said that it doesn’t know who its customers target, which it reiterated in a statement to TechCrunch on Monday.

Researchers at Amnesty, whose work was reviewed by the Citizen Lab at the University of Toronto, found that NSO can deliver Pegasus by sending a victim a link which when opened infects the phone, or silently and without any interaction at all through a “zero-click” exploit, which takes advantage of vulnerabilities in the iPhone’s software. Citizen Lab researcher Bill Marczak said in a tweet that NSO’s zero-clicks worked on iOS 14.6, which until today was the most up-to-date version.

Amnesty’s researchers showed their work by publishing meticulously detailed technical notes and a toolkit that they said may help others identify if their phones have been targeted by Pegasus.

The Mobile Verification Toolkit, or MVT, works on both iPhones and Android devices, but slightly differently. Amnesty said that more forensic traces were found on iPhones than Android devices, which makes it easier to detect on iPhones. MVT will let you take an entire iPhone backup (or a full system dump if you jailbreak your phone) and feed in for any indicators of compromise (IOCs) known to be used by NSO to deliver Pegasus, such as domain names used in NSO’s infrastructure that might be sent by text message or email. If you have an encrypted iPhone backup, you can also use MVT to decrypt your backup without having to make a whole new copy.

The Terminal output from the MVT toolkit, which scans iPhone and Android backup files for indicators of compromise. (Image: TechCrunch)

The toolkit works on the command line, so it’s not a refined and polished user experience and requires some basic knowledge of how to navigate the terminal. We got it working in about 10 minutes, plus the time to create a fresh backup of an iPhone, which you will want to do if you want to check up to the hour. To get the toolkit ready to scan your phone for signs of Pegasus, you’ll need to feed in Amnesty’s IOCs, which it has on its GitHub page. Any time the indicators of compromise file updates, download and use an up-to-date copy.

Once you set off the process, the toolkit scans your iPhone backup file for any evidence of compromise. The process took about a minute or two to run and spit out several files in a folder with the results of the scan. If the toolkit finds a possible compromise, it will say so in the outputted files. In our case, we got one “detection,” which turned out to be a false positive and has been removed from the IOCs after we checked with the Amnesty researchers. A new scan using the updated IOCs returned no signs of compromise.

Given it’s more difficult to detect an Android infection, MVT takes a similar but simpler approach by scanning your Android device backup for text messages with links to domains known to be used by NSO. The toolkit also lets you scan for potentially malicious applications installed on your device.

The toolkit is — as command line tools go — relatively simple to use, though the project is open source so not before long surely someone will build a user interface for it. The project’s detailed documentation will help you — as it did us.

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News: What we learned from selling a blockchain service to African governments

Africa is a smaller addressable market. If you’re looking to pitch a product or service to governments, it’s helpful to keep in mind that your first customer might be from a smaller country.

Mohammed Ibrahim Jega
Contributor

Mohammed Ibrahim Jega is the co-founder of Domineum Blockchain Solutions, a serial tech entrepreneur, startup adviser, fintech expert and blockchain advocate.

A major attraction of Africa is its large population of 1.2 billion, which hints at a sizable addressable market. But what happens when your target audience is the governments of 54 countries?

In our situation, that was the case. We started Domineum Blockchain Solutions with the intention to help African governments solve problems with shipping and keeping records.

We knew it’d be hard work, but didn’t anticipate that getting our first customer would be the most difficult part.

It’s typical when entering Africa to want to focus on the big and popular markets like Nigeria, South Africa and Kenya. But what we’ve learned so far is that there’s a high probability that these countries might not be your first entry point.

Our first product was a cargo service that tracks shipment origin and movement and determines the contents of goods being imported or exported in any country. We built this to solve the problem of lost revenue due to shipments being passed through informal backdoor channels.

With our focus on sub-Saharan Africa, we approached four countries in 2019: our home country of Nigeria, plus Kenya, Gambia and Guinea-Conakry.

We started this conversation and didn’t get a substantial response from the four countries’ governments. They weren’t open to trying out our solution — it was new and they weren’t familiar with blockchain technology. Distraught, we decided to add a smaller country to our list: Sierra Leone.

The Freetown seaport, located in the country’s capital, is the main gateway for trade in and out of Sierra Leone, with 80% of trade passing through this port. The port has a long history as a trading hub and benefits from the country’s strategically important location midway between Europe and the Americas.

But Freetown isn’t one of the top ports in Africa or even sub-Saharan Africa; a fraction of a percentage point of the world’s trade shipment flows through its ports. The small African country, with about 0.1% of the world’s population, exports diamonds, cocoa and coffee and imports food, machinery and chemicals.

Notably, it faced big challenges in shipping these products in and out of the country. A Sierra Leonean supply chain manager described this situation, “We used to face big challenges during the export process. There would be long delays at the port. Our trucks would arrive before midnight and could be stuck in queue for hours, even days. The documentation process was so complicated.”

According to the World Bank, Sierra Leone’s “trade challenges can be attributed to several factors: lack of access to trade information; high levels of physical inspections; multiple fees, licenses, permits and certificates; manual processes; and the lack of coordination among agencies.” Domineum set out to solve this.

Our initial conversations with the Sierra Leone government went well. Fortunately, Sierra had developed a five-year plan (2018-2023), supported by the World Bank Group, to reduce the time and costs needed to move goods across its borders. The goal is to reduce trade costs by 10%. After three months of discussion, our cargo tracking system was implemented.

In late 2019, we started this partnership, and so far we’ve been able to capture $2 million in revenue that would have been lost. The business model is simple: We get a 40% commission out of extra revenue we’re able to capture for the Sierra Leone government via our cargo tracking system.

It’s typical when entering Africa to want to focus on the big and popular markets like Nigeria, South Africa and Kenya. But what we’ve learned so far is that there’s a high probability that these countries might not be your first entry point. A business-to-government model is a difficult one. There’s a lot of politicking that goes into working with the government.

What we’ve seen work is to approach other countries and gain a foothold, then use that as validation that the concept works. With the success of Sierra Leone, we’re hoping to return to other countries and get a better reception.

The success of Sierra Leone got us rethinking the services we were offering. The initial conversation started with a cargo tracking service, but then we wondered if we should offer a different service to countries that said no at first.

We identified that land registration was a common problem in Africa. More than 90% of rural land in Africa is undocumented and therefore vulnerable to land-grabbing. This hampers the growth of agriculture and other sectors because land is lost to other parties or taken forcefully by the government during times of conflict.

We returned to these countries, offering other services like land ownership registration via blockchain. We got a positive response from a state government in Nigeria to carry out a pilot program. We’re optimistic that once this pilot phase is over, we’ll be able to seal the next business deal.

What’s it like working with African governments? It’s a smaller addressable market. If you’re looking to pitch a product or service to governments in Africa, it’d be helpful to keep in mind that your first customer might be from a smaller country.

To seize other opportunities, we’ll keep looking to expand to other African countries with this mindset.

News: Duolingo’s IPO could cast golden halo on edtech startups

We are now seeing what growth will look like at Duolingo after its COVID-bump was digested.

Edtech giant Duolingo set an initial price range for its impending IPO today. The unicorn expects to price in its public debut at $85 to $95 per share, selling 3,700,000 in the deal.

Another 1,406,113 shares are being sold by existing shareholders, and 765,916 shares are being offered to underwriting banks as part of the transaction. All told, the company may see 5,872,029 shares trade hands in its IPO, worth some $557,842,755. Duolingo itself can raise as much as $424,262,020 in gross proceeds at its current range, provided that its underwriting banks exercise their option.

The IPO is a material fundraising event for the company. Before its public offering, the largest single hit of capital that Duolingo raised was a $45 million Series D from 2015.

Let’s dig into what Duolingo, which we profiled in much more detail here, is worth at its IPO price and peek at its preliminary second-quarter results. Our goal will be to understand its valuation in the context of its growth. From there, we’ll be able to draw some general conclusions about the larger edtech startup market.

What’s it worth?

After its IPO, Duolingo will have 35,892,152 shares outstanding, sans its underwriter’s option. At the lower and upper bounds of its simple IPO valuation, Duolingo is worth $3.1 billion to $3.4 billion.

As with every company going public, Duolingo’s IPO valuation rises if we include shares that have vested in RSU or options form, but have yet to be exercised. In the case of Duolingo, its share count rises to 43,776,271, per an initial TechCrunch analysis of the company’s RSU and options details provided in its S-1 filing. At that share count, Duolingo is worth $3.7 billion to $4.2 billion.

For every number provided, the company’s underwriter’s option adds modestly.

All valuations listed above are a premium over the company’s final private price set during its November 2020 Series H round of funding. That $35 million round valued the company at around $2.4 billion.

At first blush, then, the company’s IPO price range feels strong, regardless of whether we lean on simple or fully diluted share counts to come to a new price for the firm. But how do its new valuations stack against its recent revenue? Let’s find out.

News: Founders: How well do you really understand seed-stage financing?

Tactically, fundraising is a skill like any other. You get better the more you do it. But practicing gets you nowhere if you don’t have a strong foundation in understanding fundraising components.

Yin Wu
Contributor

Yin Wu, a three-time YC alum, is founder of Pulley, which offers cap table management tools that help companies better understand and optimize their equity.
More posts by this contributor

I’ve fundraised a lot. Tactically, fundraising is a skill like any other. You get better the more you do it. But practicing gets you nowhere if you don’t have a strong foundation in understanding a fundraising round’s core components.

As a founder, you will understand less than investors when it comes to fundraising. For investors, negotiating with founders is their full-time job. For founders, fundraising is just a small part of building a business. Understanding the basics of venture financing can help founders raise on better terms.

We’ll cover:

  • How financing works: SAFEs versus equity rounds.
  • How much to raise.
  • How to arrive at your valuation.

How financing works: SAFEs versus equity rounds

As a founder, you will understand less than investors when it comes to fundraising.

Venture financing takes place in rounds. The first stage is the pre-seed or seed round, then a Series A, then a Series B, then a Series C and so on. You can continue to raise funding until the company is profitable, gets acquired or goes public.

We will focus here on seed-stage funding — your very first funding round.

SAFEs

Post-money SAFEs are the most common way to raise funding. These documents are used by Y Combinator, angel investors and most early-stage funds. You should raise on post-money SAFEs using standard documents created by YC. Standard documents have consistent terms that have been drafted to be fair to both investors and founders.

By using the standard post-money SAFE, your negotiation can focus on the two terms that matter:

  1. Principal: The amount you want to raise per investor.
  2. Valuation cap: The value of your business.

News: Watch Blue Origin launch Jeff Bezos to space live, along with the youngest and oldest astronauts ever

Blue Origin is set to launch its fully reusable New Shepard spacecraft with humans on board for the first time on Tuesday, and it’s sending Amazon founder and billionaire Jeff Bezos up along with his brother and two record-setting astronauts. The launch live stream above is scheduled for 6:30 AM CDT (7:30 AM EDT/4:30 AM

Blue Origin is set to launch its fully reusable New Shepard spacecraft with humans on board for the first time on Tuesday, and it’s sending Amazon founder and billionaire Jeff Bezos up along with his brother and two record-setting astronauts. The launch live stream above is scheduled for 6:30 AM CDT (7:30 AM EDT/4:30 AM PDT), with the actual liftoff targeted for 8 AM CDT (9 AM EDT/6 AM PDT).

The full flight profile includes a takeoff from Blue Origin’s remote West Texas facility, followed by an ascent to a height of roughly 62 miles above the Earth’s surface. Those on board, including Bezos, his brother Mark, 82-year old Wally Funk and 18-year old Oliver Daemen will then experience between 3 and 4 minutes of weightlessness inside the New Shepard capsule, before it returns to Earth slowed by parachutes for a touchdown in the West Texas desert and then a recovery by Blue Origin staff.

This is not significantly different in terms of timing or sequence from the 15 prior New Shepard flights that Blue Origin has flown, but this is the first one with humans on board (including the world’s richest), so it’s obviously the one to watch.

News: CNN+ streaming service will offer live and on-demand content in early 2022

The rumors of a CNN streaming service were true. The network has unveiled a CNN+ service that will offer a blend of live and on-demand shows that are “separate and distinct” from existing TV coverage.

Jon Fingas
Contributor

Jon Fingas is a contributing writer at Engadget.

The rumors of a CNN streaming service were true. The network has unveiled a CNN+ service that will offer a blend of live and on-demand shows that are “separate and distinct” from existing TV coverage. It will debut sometime in the first quarter of 2022. CNN hasn’t narrowed down the price, but lead executive Andrew Morse told Variety in an interview that there wouldn’t be an ad-supported tier at launch.

The centerpiece, as you’d expect, will be the live material. CNN+ plans to offer eight to 12 hours of in-depth topical coverage and “lifestyle” material every day, with both veterans and newcomers at the helm. You’ll also have chances to interact with anchors and experts in real-time discussions. This won’t be a digital replica of CNN’s usual news, then, but you may have reasons to tune in every day.

The on-demand catalog unsurprisingly taps into CNN’s existing collection, including shows like Anthony Bourdain: Parts Unknown and United Shades of America. There will be original shows and movies for the internet service, although CNN+ won’t reveal those until later in 2021.

Officially, Morse said CNN+ wouldn’t be bundled or otherwise tie into HBO Max despite the WarnerMedia connection. Variety sources, however, claimed there was a “strong probability” the service would be bundled with HBO Max and Discovery+ after WarnerMedia and Discovery finalize their merger.

Morse considered the CNN+ launch the largest the network has had since it started TV service in June 1980. It was also a chance to experiment with formats that blur distinctions between entertainment and news, the executive added.

The question, of course, is whether or not viewers will bite. CNN has had success with long-form content like the late Anthony Bourdain’s shows, but it’s not clear if people are ready to pay a monthly fee to see them. There’s also the matter of streaming service overload — you might not be thrilled to subscribe to yet another offering just to be sure you catch everything CNN has to offer.

Editor’s note: This post originally appeared on Engadget.

News: Uber expands its grocery delivery service to more than 400 US cities and towns

The service now covers major markets like San Francisco, New York City and Washington DC

Uber has announced the first major expansion of its grocery delivery service in the US. The company is more than doubling the number of service areas this week to north of 400 cities and towns. It now serves several major markets through the Uber and Uber Eats apps, including San Francisco, New York City and Washington DC.

The rapid expansion was partly fueled by a partnership with Albertsons Companies and its 1,200 grocery stores across the country. Albertsons owns brands including Safeway, Jewel-Osco, Acme, Tom Thumb and Randalls. Uber also offers delivery from regional chains such as Southeastern Grocers and New York’s Red Apple Group. Uber Pass and Eats Pass subscribers don’t need to pay delivery fees on grocery orders over $30.

Grocery delivery became an important component of Uber’s business during the toughest parts of the COVID-19 pandemic, because the number of rides people were taking dropped significantly. The company is also dealing with a driver shortage that led to higher prices for rides. Uber bought several delivery startups over the last couple of years to fuel its growth in that sector, such as Cornershop, Postmates and Drizly.

Editor’s note: This post originally appeared on Engadget.

News: Velodyne Lidar CEO resigns in latest internal drama

Velodyne Lidar CEO Anand Gopalan is leaving the lidar company at the end of July as the sensor supplier continues to struggle with internal drama. Gopalan, who was previously CTO, is leaving the top leadership position after about a year and a half on the job. Velodyne said Monday in a statement that a team

Velodyne Lidar CEO Anand Gopalan is leaving the lidar company at the end of July as the sensor supplier continues to struggle with internal drama.

Gopalan, who was previously CTO, is leaving the top leadership position after about a year and a half on the job.

Velodyne said Monday in a statement that a team of top executives that includes COO Jim Barnhart, CFO Drew Hamer, Chief People Officer Kathy McBeath and Chief Commercial Officer Sinclair Vass will run the company as a search for a new chief executive is conducted. The company didn’t disclose why Gopalan was leaving.

Gopalan’s resignation comes after months of internal drama and business setbacks for a company that has been considered the leading supplier of lidar, the light detection and ranging radar sensor that is considered a critical component to commercially deploy autonomous vehicles.

The resignation is the latest in a series of issues that have cropped up since Velodyne Lidar struck a deal to merge with special purpose acquisition company Graf Industrial Corp. At the time, it was reported that Velodyne’s founder David Hall, along with backers Ford, Chinese search engine Baidu, Hyundai Mobis and Nikon Corp. would keep an 80% stake in the combined company. Hall became executive chairman and Gopalan remained CEO position.

Hall and his wife Marta Thoma Hall clashed with the SPAC that acquired Velodyne. In February, David Hall was removed as chairman of the board and Marta Thoma Hall lost her chief marketing officer position following an investigation by the board of “inappropriate behavior.”

Meanwhile, Ford, which had held almost 13.1 million shares — a value of about $244 million — in Velodyne at the close of the third quarter of 2020, sold off its stake by the end of the year.

Velodyne sensors had been used by Ford in its autonomous vehicle testing. The intention was that those would be the go-to sensor for its autonomous vehicles once they were deployed commercially.

Veoneer had even announced in 2019 that it was leveraging Velodyne’s technology for a contract to supply the sensor to Ford (and by extension its autonomous vehicle technology supplier Argo AI). But Veoneer reported in February that it had lost its contract.

Argo, which had acquired lidar company Princeton Lightwave, unveiled in May details on a long-range lidar sensor that it claims has the ability to see 400 meters away with high-resolution photorealistic quality and the ability to detect dark and distant objects with low reflectivity. With so much progress internally, Argo and Ford staked their future plans on its own lidar.

In a May letter, David Hall blamed the SPAC, specifically the SPAC-appointed members of the combined company’s board, for its poor financial performance and called for the resignation of Gopalan and two board members.

As part of Velodyne’s announcement on Gopalan’s resignation, the company restated its business outlook for 2021 revenue, noting that its guidance of between $77 million and $94 million remains unchanged. Velodyne will report second quarter financial results August 5.

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