News: Supersonic jet company Aerion partners with NASA on high-speed point-to-point travel

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Aerion has been working on ushering in a new era of commercial supersonic flight for nearly a decade now, and the company just revealed that it has signed a new partnership with NASA to put that experience to use in the pursuit of supersonic point-to-point travel – the technical name for putting the kind of

Aerion has been working on ushering in a new era of commercial supersonic flight for nearly a decade now, and the company just revealed that it has signed a new partnership with NASA to put that experience to use in the pursuit of supersonic point-to-point travel – the technical name for putting the kind of high-speed flight typically associated with space launches to use in helping people move very quickly from one place on Earth to another.

The new collaboration comes via the Space Act Agreement, which basically allows NASA to enlist the aid of private companies to help it achieve its various goals. NASA has been developing high-Mach, supersonic aircraft technologies for some time now, in particular though its arrangement with Lockheed Martin to build and fly the X-59 QueSST, a demonstrator aircraft that will show how supersonic craft can also operate relatively quietly, with so-called ‘low-boom’ capabilities that avoid the loud sonic booms produced by most supersonic vehicles when they break the sound barrier.

NASA announced a similar partnership under the Space Act Agreement with Virgin Galactic last year, with the goal of helping the agency develop technologies that will assist in the eventual deployment of sustainable supersonic commercial flight. Aerion’s team-up with the agency will focus specifically on studying commercial flight capabilities in speeds ranging between Mach 3 and Mach 5, with a focus on propulsion and thermal management systems, power generation and technologies for use in the passenger and crew cabins.

Aerion’s own high-speed commercial aviation efforts are currently on track to see its AS2 private jet for business customers enter production in 2023, which will set the stage for its AS3 commercial supersonic passenger aircraft to follow after that.

This isn’t Aerion’s first team-up with NASA: The two have collaborated twice previously on similar projects, with the first collaboration begun way back in 2012. Now that Aerion’s closer to actual production, it’s likely that both partners will gain a lot towards their mutual goals of helping the U.S. develop commercially viable and sustainable supersonic passenger flight technologies.

News: Meet the entrepreneurs bringing bitcoin to institutions

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There’s a popular misconception that the cryptocurrency industry is a realm of rogue tech-bro cowboys. But the reality is many of the most ambitious entrepreneurs in fintech are betting big on institutional bitcoin adoption.  Such is the case with Lebanese-American venture capitalist Soona Amhaz of Volt Capital, whom Forbes recently listed as one of the

There’s a popular misconception that the cryptocurrency industry is a realm of rogue tech-bro cowboys. But the reality is many of the most ambitious entrepreneurs in fintech are betting big on institutional bitcoin adoption. 

Such is the case with Lebanese-American venture capitalist Soona Amhaz of Volt Capital, whom Forbes recently listed as one of the most influential people in Silicon Valley. She discovered bitcoin through Reddit, back when she was an engineering student at the University of Michigan. Now her firm has invested in 11 crypto startups and is working alongside institutional players like TD Ameritrade, Cumberland and CMT Digital as part of the Chicago DeFi Alliance (CDA). 

“Where institutions are at now is they’re looking to back quality founders in the space early on. They’re looking to be market makers for a lot of these [crypto] projects, and they’re looking to help with integrations and partnerships between decentralized finance [DeFi] projects and more established financial firms,” Amhaz said. “They see where the puck is going and the smart ones are getting ahead of the curve.” 

When it comes to “DeFi,” Amhaz said the term includes bitcoin and the variety of blockchain-based systems gaining popularity among day traders during the pandemic.

“Specific DeFi projects that are gaining more traction now include automated market makers (AMMs), stablecoins and platforms for decentralized exchange (DEX) aggregation, lending and derivatives,” Amhaz said. “Recent DeFi projects simply offer more avenues to use bitcoin as a productive asset, not just a reserve asset.” 

Until now, most institutions have preferred indirect exposure to cryptocurrency. Goldman Sachs alum Juthica Chou, who co-founded the derivatives exchange LedgerX back in 2013, pioneered the physically settled bitcoin futures that are now mainstay offerings among firms like Bakkt and CME Group. Futures contracts and bitcoin options offer a way for institutions to bet on the price of bitcoin without actually owning bitcoin directly. A cash-settled product means the buyer is paid in dollars, such as getting $10,000 when the option to buy at $10,000 expires, instead of getting paid in bitcoin. Rumor has it the asset management giant BlackRock will soon become the next player offering bitcoin futures products. 

So far, many institutions are willing to forgo some profits in exchange for lower risk. One of the most popular institutional product providers, Grayscale’s Bitcoin Trust (GBTC), reportedly saw $1.2 billion in fresh investor funds in January 2021. 

“I’m still bullish on options and derivatives,” Chou said, adding there’s enough demand from institutions for trust shares like GBTC, bitcoin options and even prospective exchange-traded funds (ETFs) to all generate substantial wealth in 2021. 

“The environment has way more infrastructure than we had back in 2013,” Chou said. “There’s security infrastructure and best practices for custodians, auditing infrastructure … banking is another great example. Compared to 2013, the difference between where we were and where we are today is night and day.”

With regards to GBTC, in particular, insatiable demand for shares with lower risks than custodying bitcoin leads to sky-high premiums, sometimes up to 100% more expensive than buying cryptocurrency directly. That’s why Valkyrie CEO Leah Wald launched her own Texas-based asset management firm in 2020. According to Crunchbase, she was one of roughly 800 women founders who raised capital last year. 

“It was really difficult to raise during a pandemic… not being able to organically expand my network,” Wald said. “I couldn’t have a meeting with someone even if I wanted to. And so much of seed investing is trusting in the team; trust built through high-quality, in-person conversations.”

Yet by January 2021, her startup had raised an undisclosed seed round from angel investors like Coinbase alum Charlie Lee, then applied to the Securities and Exchange Commission for permission to launch a bitcoin ETF. Chou said such a bitcoin ETF would boost the whole ecosystem because it would “open access for people who are already users brokers or securities services.”

Several ETF proposals have been rejected over the years, starting with a proposal by Tyler and Cameron Winklevoss in 2013. However, Wald says now she believes there’s never been better timing for an ETF to get approved. Among futures and options, trust shares and ETFs, all these products have different regulatory shapes that allow them to be redeemed faster, or traded in different ways, than the underlying asset, bitcoin, could be at-scale. Generally speaking, institutions seek indirect ways to gain exposure to these nascent, and often lucrative, crypto markets. 

“Bitcoin’s market cap has grown large enough that it may have finally surpassed an important threshold in the minds of the regulators,” Wald said. “I believe the biggest reason the regulators were nervous about approving a bitcoin ETF in 2017 was concerns around custodial solutions and security. And I agree with that. We’re much closer to better security and custody now with institutional-grade options.” 

Wald added that both Valkyrie’s bitcoin trust shares and prospective ETF are structured to reduce volatility and premiums.  

“We wanted to create a more transparent product. I wanted our product to trade closer to the net asset value [NAV],” Wald said. “We’re the only bitcoin trust launching an ETF fund so everyday investors can buy exposure to bitcoin.”  

This propensity among women entrepreneurs using cryptocurrency isn’t restricted to American tech bubbles. According to Toya Zhang, head of marketing at the Hong Kong-based crypto and futures exchange AAX, women make up 25% of her platform’s users and a third of the top users. 

“Our biggest market is in Russia. Other than Russia, our biggest markets are Hong Kong, Korea, Indonesia and India,” Zhang said. “Asian women are more often the one to take care of finances. If you look at stock investment user groups in China and Hong Kong, women are more than half of them.”

The highly specialized crypto landscape is quickly gaining diversity, compared to other financial sectors. At India’s Coinswitch.co exchange, women reportedly make up 50% of around 25,000 users, depending on the specific region. Women also make up at least 40% of British cryptocurrency users, according to a survey by the crypto exchange Gemini. 

Across borders, the clear gender disparity may be associated with net worth rather than any lack of interest. In 2018, the World Bank estimated women only held 38% of capital wealth. Plus, Crunchbase tallied just 15,379 companies, less than 20% of startups that raised capital, that had women founders from 2009-2019. 

Beyond startups, there are also several companies like the New York Digital Investments Group (NYDIG), where women executives took the helm in order to innovate on established brokerage models. 

In December 2020, the insurance company Massachusetts Mutual Life Insurance Co. purchased $100 million in bitcoin and acquired NYDIG equity, a move that signaled a bullish outlook on institutional demand for bitcoin exposure in 2021. Then, on February 8, 2021, Elon Musk’s publicly traded car company Tesla validated the institutional thesis by buying $1.5 billion worth of bitcoin. 

“In 2021, the greater acceptance of bitcoin by traditional investors and allocators is really exciting,” said NYDIG president Yan Zhao. “We’ll give banks and wealth managers the ability to offer bitcoin products and exposure. We’ll handle the back end.”

Zhao said her bitcoin-focused firm has roughly $4 billion under management, including derivatives, and is currently courting prospective clients like private banks and various asset managers. Her firm is open to exploring ideas like a bitcoin ETF or trust shares, she said, but isn’t interested in Ethereum-based DeFi products. 

“We’ve made a conscious decision to focus on bitcoin,” Zhao said.

Likewise, Chou was skeptical about many of the Ethereum-based DeFi options available today, while remaining cautiously optimistic about the future of DeFi derivative options.

“Crypto-native products are important because that’s how you can really harness the power of not having centralized authorities involved to facilitate the transaction,” Chou said.

In short, now traditional options offer indirect access to cryptocurrency gains. At the same time, cryptocurrency itself is experimentally being used to offer comparable, yet more accessible, financial products. These DeFi products are designed for new functionality, not just price exposure. 

Meanwhile in California, from network scaling crusader Elizabeth Stark, CEO of Lightning Labs, to Amhaz at Volt Capital, the next generation of bitcoin whales may look remarkably different from Silicon Valley’s past unicorn-building bros. 

“The face of our industry looks different than how the tech industry looked in the early 90s or how finance has looked since forever,” Amhaz said. “We’re starting at a higher, more informed baseline. So, although there’s still work to be done here, I’m optimistic.”

Disclosure: Together, Leah Wald and Leigh Cuen are volunteer co-founders of the Digital Salon Initiative.

 

News: Decrypted: A hacker attempted to poison Florida town’s water supply

• February 9, 2021
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Oldsmar is a small town in Florida that became the center of the cyber world this week when a hacker broke into its drinking water supply and tried to poison it. It’s the nightmare scenario that the security community has warned for years, one that could kill thousands by targeting the critical infrastructure that we

Oldsmar is a small town in Florida that became the center of the cyber world this week when a hacker broke into its drinking water supply and tried to poison it.

It’s the nightmare scenario that the security community has warned for years, one that could kill thousands by targeting the critical infrastructure that we all rely on. The hacker gained access to a computer at the water facility used for running remote control software TeamViewer, according to Reuters, and jacked up the levels of sodium hydroxide, aka lye, which would have made the water highly toxic to drink.

It’s not known what security was in place to prevent unauthorized users from gaining access to the critical system. Sheriff Bob Gualtieri said in a press conference that there were fail-safes and alarms in place to prevent tainted water from reaching residents, and as a result there was little risk to the population of some 15,000 residents.

But suffice to say, running remote control software in a facility that controls the local water supply is a disaster waiting to happen. These networks are supposed to be isolated from the internet to prevent this exact scenario. But you can look for clues in this Reuters report: The water facility is a public utility owned by the town and has its own internal IT staff.

Gualtieri, in his remarks, said: “The important thing is to put everyone on notice.” He’s not kidding; it’s a similar picture to a lot of small-town America, where much of these facilities are under-resourced and underfunded. Robert Lee, founder and chief executive at industrial security startup Dragos, set the context:

The FBI confirmed it has been called in to investigate. But what’s unlikely to change any time soon is that small towns are underfunded and don’t get the resources that other critical infrastructure gets. In the end, a TeamViewer subscription will be cheaper than a person’s salary, and there is no greater incentive to cut costs than during a pandemic.

On with the rest of Decrypted.

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THE BIG PICTURE

Hackers post stolen health data after hospital ransomware attacks

As COVID-19 vaccines begin to roll out, ransomware actors are hitting back. NBC News this week revealed two hospitals that were hit by data-stealing ransomware. After the hospitals refused to pay the ransom, the hackers started to publish highly sensitive health and medical data stolen from the hospital networks.

News: New York’s David Energy has raised $4.1 million to ‘build the Standard Oil of renewable energy’

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“We intend to build the Standard Oil of renewable energy,” said James McGinniss, the co-founder and chief executive of David Energy, in a statement announcing the company’s new $19 million seed round of debt and equity funding.  McGinniss’ company is aiming to boost renewable energy adoption and slash energy usage in the built environment by

“We intend to build the Standard Oil of renewable energy,” said James McGinniss, the co-founder and chief executive of David Energy, in a statement announcing the company’s new $19 million seed round of debt and equity funding. 

McGinniss’ company is aiming to boost renewable energy adoption and slash energy usage in the built environment by creating a service that operates on both sides of the energy marketplace.

The company combines energy management services for commercial buildings through the software it has developed with the ability to sell energy directly to customers in an effort to reduce the energy consumption and the attendant carbon footprint of the built environment.

The company’s software, Mycor, leverages building demand data and the assets that the building has at its disposal to shift user energy consumption to the times when renewable power is most available, and cheapest. 

It’s a novel approach to an old idea of creating environmental benefits by reducing energy consumption. Using its technology, David Energy tracks both the market price of energy and the energy usage by the buildings it manages. The company sells energy to customers at a fixed price and then uses its windows into energy markets and energy demand to make money off of the difference in power pricing.

That’s why the company needed to raise $15 million in a monthly revolving credit facility from Hartree Partners. So it could pay for the power its customers have bought upfront.

There are a number of tailwinds supporting the growth of a business like David Energy right now. Given the massive amounts of money that are being earmarked for energy conservation and energy efficiency upgrades, companies like David, which promise to manage energy consumption to reduce demand, are going to be huge beneficiaries.

“Looking at the macro shift and the attention being paid to things like battery storage and micro grids we do feel like we’re launching this at the perfect time,” said McGinniss. “We’re offering [customers] market rates and then rebating the savings back to them. They’re getting the software with a market energy supply contract and they are getting the savings back. It’s is bringing that whole bundled package together really brings it all together.”

In addition to the credit facility, the company also raised $4.1 million in venture financing from investors led by Equal Ventures and including Operator Partners, Box Group, Greycroft, Sandeep Jain and Xuan Yong of RigUp, returning angel investor Kiran Bhatraju of Arcadia, and Jason Jacobs’ recently launched My Climate Journey Collective, an early-stage climate tech fund. 

“Renewable energy generators are fundamentally different in their variable, distributed, and digitally-native nature compared to their fossil fuel predecessors while customer loads like heating and driving are shifting to electricity consumption from gas. The sands of market power are shifting and incumbents are poorly-positioned to adapt to evolving customer needs, so there’s a massive opportunity for us to capitalize.” 

Founded by McGinniss, Brian Maxwell and Ahmed Salman, David Energy raised $1.5 million in pre-seed financing back in March 2020.

As the company expands, its relationship with Hartree, an energy and commodities trading desk, will become even more important. As the startup noted, Hartree is the gateway that David needs to transact with energy markets. The trader provides a balance sheet for working capital to purchase energy on behalf of David’s customers.

 

“Renewables are causing fundamental shifts in energy markets, and new models and tools need to emerge,” said Dinkar Bhatia, Co-Head of North American Power at Hartree Partners. “James and the team have identified a significant opportunity in the market and have the right strategy to execute. Hartree is excited to be a commodity partner with David Energy on the launch of the new smart retail platform and is looking forward to helping make DE Supply the premier retailer in the market.”

David now has retail electricity licenses in New York, New Jersey, and Massachusetts and is looking to expand around the country.

“David energy stands to reinvent the way that hundreds of billions of dollars a year in energy are consumed,” said Equal Ventures investor Rick Zullo. “Business model creativity and finding ways to change user behavior with new models is just as important if not more important than the technology innovation itself.”

Zullo said his firm pitched David Energy on leading the round after years of looking for a commercial renewable energy startup. The core insight was finding a service that could appeal not to the new construction that already is working with top-of-the-line energy management systems, but with the millions of square feet that aren’t adopting the latest and greatest energy management systems.

“Finding something that will go and bring this to the mass market was something we had been on the hunt for really since the inception of Equal Ventures,” said Zullo.

The innovation that made David attractive was the business model. “There is a landscape of hundreds of dead companies,” Zullo said. “What they did was find a way to subsidize the service. They give away at low or no cost and move that in with line items. The partnership with Partree gives them the opportunity to be the cheapest and also the best for you and the highest margin regional energy provider in the market.”

News: Announcing the agenda for TechCrunch Sessions: Justice

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TC Sessions: Justice, our second-ever dedicated event to diversity, equity, inclusion and labor in tech, is coming up on March 3, 2021. This is a virtual one-day conference featuring the brightest innovators, leaders and worker-activists in the industry. We’re pumped to be able to host Backstage Capital founder and Managing Partner Arlan Hamilton, Gig Workers

TC Sessions: Justice, our second-ever dedicated event to diversity, equity, inclusion and labor in tech, is coming up on March 3, 2021. This is a virtual one-day conference featuring the brightest innovators, leaders and worker-activists in the industry.

We’re pumped to be able to host Backstage Capital founder and Managing Partner Arlan Hamilton, Gig Workers Collective’s Vanessa Bain, Alphabet Workers Union Executive Chair Parul Koul, Color of Change President Rashad Robinson, Anti-Defamation League CEO Jonathan Greenblatt and others.

In addition to the firesides and panel discussions of the virtual stage, the event will also include networking, startup presentations and the chance to connect with attendees from around the world.

Below, you’ll find the official agenda for TC Sessions: Justice. It’s a packed day already, but we’ve got some extra surprises in store, so keep an eye on the agenda over the coming weeks for more great speakers we’re adding.

If you want to be a part of this event, you can grab a ticket here for just $5.

If you’re interested in a sponsored speaking opportunity to join the stage with these fantastic speakers, contact us here to speak with someone from our sales team!

AGENDA

Wednesday, March 3

State of the Union with Parul Koul (Google), Grace Reckers (Office and Professional Employees International Union), and Clarissa Redwine (NYU)

Labor unions have been fairly uncommon in tech. That’s finally starting to change in recent years, as workers have pushed to organize at some the industry’s biggest companies, from Alphabet to Kickstarter. Parul Koul (Google), Grace Reckers (Office and Professional Employees International Union) and Clarissa Redwine (NYU) will join us to discuss the growing movement.

Finding the Next Unicorn with Arlan Hamilton (Backstage Capital)

Arlan Hamilton, the founder and managing partner of Backstage Capital, has raised more than $12 million to back 150 companies led by underrepresented founders. In this session, Hamilton will discuss how she vets the biggest opportunities in investment, and how to disrupt in a positive way.

The Path Forward For Essential Tech Workers with Vanessa Bain (Gig Workers’ Collective), Jessica E. Martinez (National Council for Occupational Safety and Health), and Christian Smalls (The Congress of Essential Workers)

Gig workers and warehouse workers have become essential in a pandemic-ravaged economy. In California, a law went into effect earlier this year that makes gig workers independent contractors. Meanwhile, Amazon warehouse workers in Alabama are actively seeking to form a union to ensure better protections at the workplace. You’ll hear from workers and organizers about what’s next for gig workers and tech’s contractor workforce, and what battles lie ahead for these essential workers.

Identifying and Dismantling Tech’s Deep Systems of Bias with Haben Girma (Disability Justice Lawyer), Mutale Nkonde (AI for the People), and Safiya Umoja Noble (UCLA)

Nearly every popular technology or service has within it systems of bias or exclusion, ignored by the privileged but obvious to the groups affected. How should these systems be exposed and documented, and how can we set about eliminating them and preventing more from appearing in the future? AI for the People’s Mutale Nkonde, disability rights lawyer Haben Girma, and author of Algorithms of Oppression Safiya Umoja Noble discuss a more inclusive future.

Founders in Focus with Tracy Chou (Block Party)

We sit down with the founders poised to be the next big disruptors in this industry. Here we chat with Tracy Chou of Block Party, which works to protect people from abuse and harassment online.

The Role of Online Hate and Where Social Media Goes From Here with Naj Austin (Somewhere Good and Ethel’s Club), Jesse Lehrich (Accountable Tech), and Rashad Robinson (Color of Change)

Toxic culture, deadly conspiracies and organized hate have exploded online in recent years. We’ll discuss how much responsibility social networks have in the rise of these phenomena and how to build healthy online communities that make society better, not worse.

Networking Break

With our virtual platform, attendees can network via video chat, giving folks the chance to make meaningful connections. CrunchMatch, our algorithmic matching product, will be available to ensure you’re meeting the right people at the show, as well as random matching for attendees who are feeling more adventurous.

Demystifying First-Check Fundraising with First-Check Investors with Brian Brackeen (Lightship Capital), Astrid Scholz (Zebras Unite), and Sydney Thomas (Precursor Ventures) 

There are so many ways to finance your startup that don’t include Y combinator or a traditional fund. In this stacked panel, founders will hear from a trio of decision-makers about how to leverage unconventional communities and resources to get the first dollars they need to execute.

Meeting of the Minds with Wade Davis (Netflix) and Bo Young Lee (Uber)

Diversity and inclusion as an idea has been on the agenda of tech companies for years now. But the industry still lacks true inclusion, despite best efforts put forth by heads of diversity, equity and inclusion at these companies. We’ll seek to better understand what’s standing in the way of progress and what it’s going to take to achieve real change.

Access All Areas: Designing Accessibility From Day One with Cynthia Bennett (Carnegie Mellon University), Srin Madipalli (former Accomable and Airbnb), and Mara Mills (NYU)

The session will examine the importance of ensuring accessible product design from the beginning. We’ll ask how the social and medical models of disability influence technological evolution. Integrating the expertise of disabled technologists, makers, investors, scientists, software engineers into the DNA of your company from the very beginning is vital to the pursuit of a functioning and equitable society. And could mean you don’t leave money on the table.

Creating New Opportunities For Formerly Incarcerated People with Jason Jones (The Last Mile), Deepti Rohatgi (Slack), and Aly Tamboura (Chan Zuckerberg Initiative)

Reentering society after having been incarcerated presents challenges few of us can understand. In this panel, we will examine the role tech can play in ensuring pathways to employment for returned citizens.

 

News: Encrypted data handling startup DataFleets acquired by LiveRamp for over $68M

• February 9, 2021
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LiveRamp has acquired DataFleets, a fresh young startup that made it possible to take advantage of large volumes of encrypted data without the risk or fuss of decrypting or transferring it. LiveRamp, an enterprise data connectivity platform itself, paid more than $68 million for the company, a huge multiple on DataFleet’s $4.5 million seed announced

LiveRamp has acquired DataFleets, a fresh young startup that made it possible to take advantage of large volumes of encrypted data without the risk or fuss of decrypting or transferring it. LiveRamp, an enterprise data connectivity platform itself, paid more than $68 million for the company, a huge multiple on DataFleet’s $4.5 million seed announced just last fall.

DataFleets saw the increasing need for sensitive data like medical or financial records to be analyzed or used to train machine learning models. Not only are such databases bulky and complex, making transfers difficult, but allowing them to be decrypted and used elsewhere opens the door to errors, abuse and hacks.

The company’s solution was essentially to have software on both sides of the equation, the data provider (perhaps a hospital or bank) and the client (an analyst or AI developer), and act as a secure go-between. Not for the sensitive data itself, but for the systems of analysis and machine learning models that the client wanted to set loose on the data. This allows the client to perform an automated task on the data, such as harvesting and comparing values or building an ML model, without ever having direct access to it.

Clearly this approach seemed valuable to LiveRamp, which provides a number of data connectivity services to major enterprise customers, household names in fact. They announced in their earnings statement last night that they paid $68 million up front for DataFleets, though that price does not reflect the various other incentives and deferred payments that many such deals involve, and in this case seem likely to remain private.

The deal will probably result in the retiring of the DataFleets brand (young as it was), but their various customers will probably make the trip to LiveRamp. The most recent of those is HCA Healthcare, a major national provider that just announced a COVID-19 data sharing consortium that would be using DataFleets’s services. That’s a pretty powerful validation for an approach just commercialized late last year, and a nice catch for LiveRamp to add to its healthcare client collection.

For its part LiveRamp plans to use its augmented services to expand its operations and offerings in Europe, Asia and Latin America over the coming year. The company has also called for a federal data privacy law, something that hopefully that will be achieved under the new administration.

News: OptioLend launches new marketplace to become ‘the LendingTree of commercial real estate’

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The commercial real estate industry is facing its share of challenges, considering the fact that so many people are working from home (and not in offices) and retail is riding a slippery slope as more people shop online. But from downturns, opportunity emerges. Enter OptioLend, a new startup that wants to help individual investors take

The commercial real estate industry is facing its share of challenges, considering the fact that so many people are working from home (and not in offices) and retail is riding a slippery slope as more people shop online.

But from downturns, opportunity emerges.

Enter OptioLend, a new startup that wants to help individual investors take advantage of opportunities in commercial real estate by connecting them with “the best possible” lenders. The Columbus, Ohio-based company launched its marketplace Tuesday after months of operating in private beta.

The new platform uses an AI-powered algorithm and a database of more than 9,500 capital sources to help prospective real estate borrowers in search of debt financing find lenders “with the best terms.” In other words, the company’s self-proclaimed mission is to become the “LendingTree for commercial real estate.” (For the unacquainted, Charlotte, North Carolina-based LendingTree is an online marketplace that provides consumers multiple offers from several lenders for things like mortgage, student and personal loans.)

In fact, Joel Lowery, a former LendingTree executive who built the back end of that company’s platform, helped build out the OptioLend portal serving in a technical advisor capacity along with former data scientists at IBM.

Once an investor applies for a loan, OptioLend identifies up to 20 lenders best suited for that application based on recent lending history and other criteria. Borrowers and brokers can negotiate and close deals from within the company’s platform via the mostly automated process, the company claims. But it’s also launching “with a concierge service of experienced capital advisors” to help guide users who need help during the loan procurement process.

To get off the ground, OptioLend last year raised about $1 million in seed funding led by the Schottenstein Family Office with participation from Loud Capital and MLG Ventures. For context, the Schottenstein family is one of the largest private real estate owners in the country.

CEO Richard Geisenfeld said there’s a plethora of lenders that can lend at that price point, whereas there is “a relatively small pool of capital sources” that focus on deals above $10 million.

“Capital markets are experiencing a 50% surge in refis and new loans as the markets start to rebound from COVID,” he said. “And as existing loans start coming due, we think we’re in a perfect timing to roll out. Properties are going to be repurposed, and are already starting to be.”

And while OptioLend can work with institutions and individual investors, it’s more focused on the latter.

“Institutions have a lot of choices,” Geisenfeld said. “Individual investors do not.

Geisenfeld said he comes from a family of developers and himself has closed about $1.7 billion worth of transactions in 44 states as founder of Capital Commercial Partners. He’d been representing the Schottenstein family for nearly 20 years before the concept behind OptioLend emerged.

As an experiment prior to the formation of OptioLend, the family office had reached out to more than 50 lenders in an effort to finance the purchase of a small single tenant, triple net portfolio. They were surprised to discover that the interest rates varied as much as a full percentage point.

“Every time we did a deal with them, we’d hear anecdotally there were better [loan] rates out there and they agreed that we needed to create some kind of efficiency and automation,” Geisenfeld told TechCrunch. “So I went to one of my colleagues and asked ‘how do we change the paradigm from the traditional methodology?’ And that’s the problem we’re out to solve — by increasing an investor’s access to capital by 10 times in 10 minutes.”

The startup says it not only helps investors with new loan applications, but it can also help them refinance existing assets. Its sweet spot is on transactions in the middle market — in the $1 million to $10 million range.

OptioLend will work with commercial real estate and mortgage brokers alike either by allowing them to use the platform directly or to refer property owners to it. Their incentive for referrals is earning up to 50% of the original fees.

David Schottenstein, principal of Schottenstein Family Office, noted in a written statement that in today’s market, borrowers with limited access to capital sources sometimes sign onto loan terms with interest rates “as much as 100 basis points higher than they have to.” 

“OptioLend’s ability to get deals in front of multiple lenders quickly helps ensure that borrowers are getting the best terms possible,” he added.

News: Aurora strikes deal with Toyota, Denso to develop, test self-driving Sienna minivans

• February 9, 2021
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Aurora has reached a deal with Toyota and auto-parts supplier Denso to develop and test vehicles equipped with the self-driving startup’s technology, beginning with a fleet of Toyota Sienna minivans. Engineering teams from Aurora and Toyota will work together to design and build the self-driving Sienna minivans with an aim to start testing a fleet

Aurora has reached a deal with Toyota and auto-parts supplier Denso to develop and test vehicles equipped with the self-driving startup’s technology, beginning with a fleet of Toyota Sienna minivans.

Engineering teams from Aurora and Toyota will work together to design and build the self-driving Sienna minivans with an aim to start testing a fleet by the end of 2021, the companies said Tuesday.

The announcement follows Aurora’s acquisition of Uber Advanced Technologies Group, which spun out from Uber in 2019 after the unit raised $1 billion in funding from Toyota, Denso and SoftBank’s Vision Fund. The acquisition, which closed January 20, was a complex deal in which Uber handed over its equity in ATG and invested $400 million into Aurora. Uber now holds a 26% stake in the combined company. Toyota also has a minority stake in Aurora as a result of the acquisition.

The partnership announced Tuesday is similar — at least in part — to an agreement reached in 2018 between Toyota and Uber to bring an on-demand autonomous ride-hailing service to market. Under that deal, which included a $500 million investment by Toyota, the companies agreed to integrate Uber ATG’s self-driving technology into the Sienna minivans for use in Uber’s ride-hailing network. The vehicles later could be owned and operated by third-party fleet managers, Toyota and Uber ATG said at the time.

Aurora co-founder and chief product officer Sterling Anderson emphasized that this is a new partnership and not just an extension of Toyota’s agreement with Uber ATG.

Toyota and Aurora declined to disclose details such as the size of the team or whether there were financial incentives tied to the deal, making it difficult to determine the scope of the collaboration.

However, Aurora describes this as a long-term strategic deal and laid out an ambitious vision for a partnership that extends far beyond testing. Aurora said that the joint development work in 2021 will lay the groundwork for the mass production and launch of these vehicles with Toyota on ride-hailing networks, including Uber’s. Aurora said it will also explore mass production of autonomous driving components with Denso and the creation of a services platform with Toyota that could manage financing, insurance and maintenance of the self-driving vehicles.

Anderson noted that the development of these commercial downstream services such as fleet management has become increasingly important for the company following its agreement with trucking firm PACCAR and now Toyota.

“We need a vehicle, we need a driver and we need support services,” Anderson said in a recent interview. “One of the areas that we’re exploring with Toyota as part of this, is the scaled deployment of Toyota-built vehicles, powered by the Aurora driver, supported by a combination of Aurora’s support services as well as Toyota’s network. This is one of the areas where Toyota’s scale becomes so significant to us.”

The path from testing to commercialization is a long one, riddled with potential speed bumps, including technical and regulatory challenges, competing with rivals over skilled workers and raising enough capital. Achieving these doesn’t always equate to success as operating an autonomous ride-hailing network has its own set of hurdles. The upshot: Aurora’s partnership with Toyota is no guarantee.

Still, locking in a partnership with a large automaker is still important for Aurora.

“Toyota has an unparalleled legacy, engineering expertise, leadership, and ability to deliver high-quality, affordable, and reliable vehicles,” Aurora co-founder and CEO Chris Urmson wrote in a blog post Tuesday. “They’re also the preferred vehicle brand for transporting riders on ride-hailing networks, so we’re excited and honored to work with them to unlock driverless mobility services with the Aurora Driver.”

Urmson added that Aurora’s development work on highway driving to support its first commercial product, a driverless truck, “will also be critical for safely moving people, as a significant fraction of ride-share bookings today require the ability to drive over 50 mph.”

News: Spotify confirms it’s (finally) testing a live lyrics feature in the U.S.

• February 9, 2021
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Spotify this morning confirmed it’s testing a new, synced lyrics feature in the U.S. market, following a report from Engadget. Though the streaming music service today offers live lyrics in a number of markets — 27, in fact, including its recent launch in South Korea — it has not offered lyrics in the U.S. for

Spotify this morning confirmed it’s testing a new, synced lyrics feature in the U.S. market, following a report from Engadget. Though the streaming music service today offers live lyrics in a number of markets — 27, in fact, including its recent launch in South Korea — it has not offered lyrics in the U.S. for many years. Instead, Spotify here runs the “Behind the Lyrics” feature provided in partnership with Genius, which offers a combination of lyrics and trivia about the song being played.

Reached for comment, Spotify said the new Lyrics feature rolled out as a test for some users in the U.S. starting today.

“We can confirm we’re currently testing our lyrics feature to a select number of users in the U.S.,” a spokesperson told TechCrunch. “At Spotify, we routinely conduct a number of tests in an effort to improve our user experience. Some of those tests end up paving the way for our broader user experience and others serve only as an important learning.”

The company declined to share additional details about its plans, but did note that its U.S. partner on the new Lyrics feature is Musixmatch — a service that already powers Spotify’s lyrics feature in various non-U.S. markets.

This is not the first time Spotify has run a lyrics feature in the U.S., to be clear. The streaming service had originally worked with Musixmatch from 2011 through 2016, before ending that relationship to instead partner with Genius. But despite ongoing user demand for lyrics’ return, Spotify never brought the feature back to the U.S.

In more recent years, however, Spotify rekindled its relationship with Musixmatch. Last year, it announced the launch of real-time lyrics in, then, 26 worldwide markets across Southeast Asia, India and Latin America. This had been the first time lyrics were offered in 22 of these 26 markets, as only Thailand, Vietnam, Indonesia and Mexico had some form of prior lyrics support via other providers.

Spotify’s ongoing lack of support for lyrics in the U.S. has given its streaming music competitors an advantage. Amazon Music, for example, allowed users to view lyrics as songs played and tied the feature to its Alexa voice platform, so consumers could ask Alexa to search for songs by lyrics. Meanwhile, the updated version of Apple Music that rolled out with iOS 12 in 2018 included a way to search by lyrics, instead of just artist, album or song title. It later added live, synced lyrics with the launch of iOS 13. Siri can also respond to commands that involve lyrics.

Musixmatch additionally confirmed it has partnered with Spotify on the new U.S. test.

“Musixmatch is keeping growing at a fast pace thanks to our continued investment we’ve made [over] a decade. We’re focused now on bringing more data to continue enriching the audio experience globally,” Musixmatch CEO and founder Max Ciocciola told TechCrunch.

Because the lyrics feature is only a test, you may not see it yourself in the Spotify app, due to its limited availability. Spotify has not said if or when the test may be expanded.

News: Mighty Buildings nabs $40M Series B to 3D print your next house

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Once upon a time, the idea of 3D-printed homes felt like a thing of the future. But as housing gets less and less affordable — especially in ultra-expensive markets such as the Bay Area — companies are getting creative in their quest to build more affordable homes using technology. One of those companies, Oakland-based Mighty

Once upon a time, the idea of 3D-printed homes felt like a thing of the future.

But as housing gets less and less affordable — especially in ultra-expensive markets such as the Bay Area — companies are getting creative in their quest to build more affordable homes using technology.

One of those companies, Oakland-based Mighty Buildings, just raised $40 million in Series B funding for its quest to create homes that it says are “beautiful, sustainable and affordable” using 3D printing, robotics and automation. It claims to be able to 3D print structures “two times as quickly with 95% less labor hours and 10-times less waste” than conventional construction. For example, it says it can 3D print a 350-square-foot studio apartment in just 24 hours.

The four-year-old startup’s efforts caught the eye of Khosla Ventures, which co-led the financing along with Zeno Ventures. 

Ryno Blignaut, an operating partner at Khosla, believes that Mighty Buildings — which launched out of stealth last August — has the potential to cut both the cost and carbon footprint of home construction “by 50% or more.”

The company takes a hybrid approach to home construction, combining 3D printing and prefab (meaning built offsite) building, according to co-founder and COO Alexey Dubov. It has invented a proprietary thermoset composite material called Light Stone Material (LSM) as part of its effort to reduce the home construction industry’s reliance on concrete and steel. 

The material can be 3D printed and hardens almost immediately, according to the company, while also maintaining cohesion between layers to create a monolithic structure. Mighty Buildings can then 3D print elements like overhangs or ceilings without the need for additional supporting formwork. That way, it’s able to fully print a structure and not just the walls. 

Robotic arms can post-process the composite, which combined with the company’s ability to automate the pouring of insulation and the 3D printing gives Mighty Buildings the ability to automate up to 80% of the construction process, the company claims.

Khosla was drawn to the Mighty Buildings’ innovative approach.

“We believe in dematerializing buildings and non-linearly reducing the amount of cement and steel used, thereby reducing the cost of construction in order to increase affordable access to housing together with improved sustainability,” Blignaut wrote via email.

Mighty Building’s use of 3D printing, advanced manufacturing techniques, modern robotics and “new lighter and stronger materials” gives it an edge, he added.

Since its launch, the company has produced and installed a number of accessory dwelling units (ADUs) and is now taking orders for Mighty Houses — its newest product line that will range from 864 to 1,440 square feet at an estimated cost of $304,000 to $420,500. (Similarly sized houses in some parts of the Bay Area can sell for upwards of $1 million).

The units are created with a 3D-printed exterior panelized shell while certain elements — such as bathrooms for example — are prefabricated in the company’s 79,000-square-foot production facility in Oakland. 

For now, the company is only building in California, but Dubov says it’s open to exploring other markets as its factory can be replicated.

Also, Mighty Buildings plans this year to market its Mighty Kit System and a new fiber-reinforced material for multi-story projects as part of a planned B2B platform for developers. In fact, the company already has secured contracts with developers for its single family housing product line. It also plans to use the new capital in part to scale its production capacity with increased automation.

Ultimately, Mighty Building’s vision is to provide production-as-a-service, with builders and architects designing their own structures and then developers using Mighty Factories to produce them at scale.

Mighty Buildings is not the only startup doing 3D-printed homes. Last August, Austin-based ICON raised $35 million in Series A funding. The company also aims to reinvent building affordable homes with the use of 3D printers, robotics and advanced materials. The biggest difference between the two companies, according to Dubov, is that ICON does primarily onsite construction while Mighty Buildings prefabricates in a factory.

More than a dozen other investors also participated in Mighty Building’s latest round, including returning backers Bold Capital Partners, Core Innovation Capital and Foundamental and new investors including ArcTern Ventures, Abies Ventures, Modern Venture Partners, MicroVentures, One Way Ventures, Polyvalent Capital and others. Mighty Buildings was also included in Y Combinator’s Top companies list, all of which have valuations over $150 million (although the company declined to reveal its current valuation). 

For its part, Khosla’s Blignaut believes that buildings are “a big part of our urban landscape and a large consumer of resources.”

“Construction and building account for more carbon emissions in the U.S. than transportation or industry,” he said. Other portfolio companies addressing such challenges include Ori Living, Vicarious, Katerra and Arevo.