Category: TECHNOLOGY
Freemium or free trials: Why not both?
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The recent OpenView-Chargebee 2022 report had SaaS benchmarks as its focus, but also touched in passing on a topic I’ve been curious about: reverse trials, a pricing model that offers SaaS companies a middle ground between freemium and free trials. Let’s explore. — Anna
A binary choice?
As more SaaS companies adopt product-led growth (PLG), a sales method in which user conversions are driven by the product itself rather than a sales team, founders are often faced with a pricing model dilemma. If their startup opts for a freemium model, most users will never get a taste of the premium features reserved for paying users. But if the company offers a time-limited free trial, users who don’t become customers at the end of that period might be gone forever.
There are many other pros and cons to freemium and free trials.
As OpenView partner Kyle Poyar told me, “freemium models tend to drive more acquisition and more signups to your product, for example, while free trials have fewer signups but have a higher conversion rate from free to paid.”
As a result, founders often think they are facing a binary choice, Poyar said. In an interview, Airtable head of growth Lauryn Isford told him that these two choices are often thought of as prioritizing user growth (with freemium) or revenue growth (with free trials.)
Poyar, however, doesn’t think freemium versus free trials is the only alternative. For companies to “get the best of both worlds,” he and OpenView advocate for the reverse trial model, exemplified by Airtable. But what are reverse trials all about, and are they for everyone?
Psychology 101
Freemium or free trials: Why not both? by Anna Heim originally published on TechCrunch
https://techcrunch.com/2022/11/12/freemium-or-free-trials-why-not-both/
How Rad Power Bikes stacks up for a Boomer and a Millennial
Rad Power Bikes, the U.S.-based e-bike manufacturer, has made its mark as a direct-to-consumer business selling fat tire bikes that helped shape the COVID e-bike boom. In 2021, the company raised two massive rounds – $150 million in February 2021 and another $154 million just eight months later – that brought its total funding above and beyond what Europe’s e-bike darling VanMoof secured.
I wanted to see why investors seemed so keen on the company and why these bikes were gaining in popularity.
The company recently sent me two e-bikes to test out: the RadRunner 2 and the RadExpand 5. They both appealed to me as affordable and stable bikes that could be delivered to your door, but I also wanted to give them a go based on a comment that Rad chief product officer Redwood Stephens made in a recent interview with TechCrunch.
Stephens told me that Rad’s main target customers aren’t urban commuters. Rather, Rad’s sturdy frames, fat tires and easy-to-read digital displays are aimed at people over 50 years old who live in suburban or rural areas and want a greener mode of transport that still feels safe. I decided to test that by putting my mom on one of them, and you’ll hear her thoughts on that later (Spoiler: She wants to buy one.)
The RadRunner 2, an update on Rad’s very successful RadRunner utility bike with a step-through frame, came out in December 2021 at $1,499 and comes in black or forest green. The RadExpand 5 launched in April as a foldable e-bike at $1,599. It comes in black or white.
Rad Power bike specs
Both the RadRunner 2 and RadExpand 5 have a simple display to turn the bike on and off, choose a pedal assist level and turn the lights on.
The two bikes have very similar looks, feels and specs. Here’s what they have in common:
- Motor: 750W brushless geared hub motor
- Top speed: 20 miles per hour (unless you’re flying downhill, then it definitely can go faster)
- Battery: 672 Wh; can be charged on the bike or can be removed to charge inside
- Range: 25 to 45 miles
- Brakes: Mechanical disc brakes
- Other stuff: Simple LED display, bell, 4 pedal assist settings, half-twist throttle
Here’s what’s the same, but different:
Both bikes come with an optional front rack and an integrated rear rack, but their payload capacities differ. For example, the RadExpand’s rear rack max load is 59 pounds, but the RadRunner can handle 120 pounds (and then some, as my partner and I proved.)
The kickstands are different, too. RadExpand’s is a regular style kickstand, but RadRunner’s is a dual leg, spring loaded kickstand, which is much harder to push over. Additionally, while both bikes have LED head/tail/brake lights, RadRunner 2’s rear lights not only indicate when braking but also have a flash mode.
They both are very easy to turn on by holding down the ON button, but I found that maybe made them easy to steal. Many suburbanites don’t actually lock their bikes up, but rather leave them in the shed. For a smart bike, it would be cool to see an anti-theft locking system.
Finally, the RadRunner and the RadExpand both have fat, puncture-resistant tires, but just how fat differs with each bike. The RadRunner has 20 inch by 2.2 inch tires, and the RadExpand’s tires are 20 inch by 4 inch. I found that on both bikes, the fat tires made for a bouncy, rather than bumpy, ride over potholes and other cracks in the road.
What my 61-year-old mom thought of the RadRunner 2
The RadRunner2 is great for both on-roading and off-roading. Image Credit: Rebecca Bellan
“The throttle makes it a game changer. I like how when it accelerates it doesn’t accelerate where you feel like you’re being thrown back. It’s a gentle acceleration, which is especially good for us older folk,” Bellan the senior told me after an hour-long cycle around a suburban neighborhood in Long Island.
She noted that despite its 65 pounds of weight, the RadRunner 2 isn’t so heavy as compared to her current e-bike, the Aventon Pace. The Pace, by the way, does indeed feel like you’re about to be thrown off the saddle when you accelerate using the pedal assist.
Bellan said the high handlebars kept her from feeling like she was leaning over too much, which helped with the general feelings of stability and avoiding back pain.
The model we tried out had a seat for an additional rider on the back. It’s probably meant for a child, but my partner and I defied the advertised 300-pound weight limit on a previous jaunt around the neighborhood. My mother said she’d choose to have a storage rack instead, which is one of the options available to RadRunner 2 purchasers.
“I would go shopping in it. Totally, without a doubt,” she said. “With all the months I didn’t have to worry about the weather, this is the way I would travel through town.”
An avid suburban biker, Bellan even said she’d be willing to take it offroad.
“It would make me feel more confident going on a mountain biking trail knowing that I had the opportunity to use these extra tidbits and develop my legs,” said Bellan; the extra tidbits being the different levels of pedal assist and the throttle. “I like that I can still get a workout but be able to traverse all the hills without killing myself.”
The screen, which simply displays battery capacity, pedal assist power mode and head/tail light status, was also mother-approved.
Off-roading with the RadExpand 5
The RadExpand 5 is also great for on-roading and off-roading. Image Credit: Rebecca Bellan
When Rad Power dropped off the bikes to me, they told me the RadExpand is geared towards suburbanites who would leave the bike in the trunk of their car and take it on camping and other off-roading adventures. So naturally, I decided to find the nearest mountain biking trail and give the whole thing a go.
I’ll first note what the experience of folding and unfolding the bike was like. In a word: Clumsy. But it got easier with time. Folding up the bike is a two-step process. First you drop the handlebars lower and then sort of close the bike like a book as it balances on one tire. No tools required, which is excellent for saving time and sanity.
The bike weighs 62.5 pounds, which somehow feels heavier when it’s condensed in a smaller package. I had to give it a good heave to get it into the trunk of my crossover – I also had to put the backseat down to fit it properly, so ample storage space is of the essence.
 
 
I drove the bike over to a nearby trail and decided to choose the “more difficult” track as opposed to the “easy” or “difficult” tracks, just to see how the RadExpand would perform. I forgot to consider how I might perform.
I’m a very confident city biker. I can weave in and out of rush hour Second Avenue traffic, throwing up a middle finger to the car that’s double parked in the bike lane without losing momentum. But mountain biking is an entirely different beast, and there were some moments I was truly scared for my life. That might be because Rad doesn’t actually advertise this as a mountain bike, but I’m also confident that someone with more experience off-roading would have found the RadExpand to be a dream on that trail.
That said, I generally felt safer on the RadExpand in that rough terrain than I ever have on a normal mountain bike.
The fat tires simply make you feel more stable, and the fact that you can rely on the throttle to speed up when needed was vital when braving the gravel, sand, gigantic tree roots and big inclines in the trail. I suppose I’d say the suspension was good, because I never once felt that jolting pain that goes from your tailbone up your spine that I get riding over bumps in my push bike. But that might have been attributable to the bouncy tires, rather than Rad’s suspension system.
Unrelated to my mountain biking foray, the ability to switch between low levels of pedal assist and the throttle was something I also appreciated driving in dense urban areas. When you’re at a traffic light, for example, you want to be able to creep past other pedestrians without accidentally lurching into them as you push down on the pedal. But when you’re then trying to cross a busy street and make it around a double parked car, that throttle really comes in handy for speed.
Conclusion
Overall, both bikes were pretty dreamy to ride, and for the price point and convenience of delivery to your door and Rad’s mobile service network to test, buy and service bikes, I’m not left with many bad things to say about the bikes.
How Rad Power Bikes stacks up for a Boomer and a Millennial by Rebecca Bellan originally published on TechCrunch
https://techcrunch.com/2022/11/12/how-rad-power-bikes-stacks-up-for-a-boomer-and-a-millennial/
Nearly 80% of venture funds raised in just two states as US LPs retreat to the coasts
Venture capital funds in the United States raised more dry powder in the first three quarters of this year than they did in all of 2021, but it’s not equally distributed: The big funds keep getting bigger while fundraising has gotten harder for the majority of other players. And Q3 data shows that where a firm is based appears to be playing an increasing role.
Through the third quarter of 2022, U.S. venture firms raised $150.9 billion across 593 funds, according to data compiled by PitchBook. While this represents a boost from the $147.2 billion raised in 2021, it marks a staggering drop from the 1,139 funds closed last year.
A lot of these dollars went into legacy or well-established firms, which have the clout to raise mega-funds, though some firms drew in dollars by garnering hype. Consequently, LPs are not as interested in backing firms outside of the established venture hubs this year, marking an unfortunate reversal to the COVID-induced trend of more venture money making its way to emerging ecosystems.
Nearly 80% of venture funds raised in just two states as US LPs retreat to the coasts by Rebecca Szkutak originally published on TechCrunch
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Crypto VC David Pakman on FTX: an “entirely avoidable tragedy”
If you want to better understand exactly how big a deal it is that the cryptocurrency exchange FTX just imploded, you could do worse than talk with David Pakman, an entrepreneur turned venture capitalist. After logging 14 years with the investment firm Venrock, Pakman — who led Venrock’s investment in the digital collectibles company Dapper Labs and even mined bitcoin at his own home years back — leaned into his passion for digital assets and last year joined the now seven-year-old crypto venture firm CoinFund.
His timing was either very good or very bad, depending on your view of the market. Indeed, in part because CoinFund was an early investor in the collapsing cryptocurrency exchange FTX, we asked Pakman to jump on the phone with us today to talk about this very wild week, one that began with high-flying FTX on the ropes, and which ended with bankruptcy filings and the resignation of FTX founder, Sam Bankman-Fried, as CEO. Excerpts of that conversation follow, edited lightly for length.
TC: The last time we talked, almost two years ago, the NFT wave was just getting underway. Now, we’re talking on a day where one of the biggest cryptocurrency exchanges in the world just declared bankruptcy. Actually, it’s declaring bankruptcy for 130 additional affiliated companies. What do you make of this development?
DP: I think it’s absolutely terrible on a bunch of levels. First, it was an entirely avoidable tragedy. This failure of the company was brought on by a bunch of flawed human decision-making, not by a failing business. The core business is doing great. In fact, it’s highly profitable and growing, even in a bear market. It’s not like it was running out of capital or a victim of the macro environment. But its leadership, with almost no oversight apparently, made a bunch of terrible decisions and did things really wrong. So the tragedy is how avoidable it was, and how many victims there are, including employees and shareholders and the hundreds or even thousands of customers who will be affected [by this bankruptcy].
There’s also the reputational harm to the entire crypto industry, which already suffers from questions like, ‘Isn’t this a scammy place with scammy people?’ This sort of Enron-esque meltdown of one of the most highly valued and arguably most successful companies in the space is just really bad, and it will take a long time to dig out of it. But there are also positives.
Positives?
Well, what’s positive is the technology did not fail; the blockchains did not fail. The smart contracts were not hacked. Everything we know about the tech behind crypto continues to work brilliantly. So it would be different if this was a meltdown because of flawed software design, or the blockchains aren’t scaling, or big hacks that injured people. The long-term promise of the software and the technology architecture about crypto is intact. It’s the people who keep making mistakes. We’ve had two or three pretty big human-generated mistakes this year.
There are plenty of news stories out there outlining what happened in broad strokes. How do you explain it?
I don’t have firsthand knowledge about what they really did or didn’t do. But apparently FTX and [the trading desk also owned and run by Sam Bankman-Fried] Alameda Research had a relationship that maybe was not known to all shareholders, employees, or customers. And it sounds like FTX took FTT, which is their token that was held in great amounts by Alameda, and they pledged it as collateral and took big loans in fiat against that. So they took a highly volatile asset, and they pledged as collateral.
One could imagine if a board of corporate executives or investors knew about that, someone would say, ‘Hang on. What happens if FTT goes down by 50%? It happens in crypto with high frequency, right? So, like, why are we pledging this super highly volatile asset? And by the way, half a billion dollars’ worth of the asset is held by our biggest rival [Binance]. What happens if they dump it in the market?’
So just the act of borrowing against it was ill-advised. And then it sounds like they also took the proceeds of that borrowing, and they invested that in highly illiquid assets, like maybe to rescue BlockFi or all these other private companies that FTX recently bought. But it’s not like they could quickly sell out of those if they needed to return the proceeds of their borrowing. They were also apparently using customer funds and loaning that out or maybe even loaning it to their trading arm. So all this stuff is just stuff that I think a board, if they knew about it, would be like, no, no.
But there was no board, which is mind blowing, considering that VCs poured $2 billion into this company. Your firm is among those firms.
I joined CoinFund a little bit more than a year ago, so the investment that the firm made in FTX was a long time ago, before my time, and it’s a tiny, tiny amount. We’re barely on the cap table. We didn’t hold any FTT tokens.
But I will address your big question, which I think is about the governance of this company. I come from a traditional tech investing background, where maybe 99% of the time, there’s just a standard set of governance that every entrepreneur agrees to when they take venture capital, which is: there’s going to be a board; the board is going to be made up of investors and employees and maybe outside experts; there’s going to be a set of controls; the controls usually say things like, ‘You have to disclose any related party transactions’ so you don’t shuffle coconuts between one company and something else that we don’t know about. The board also has to approve things, so that whenever you’re going to pledge assets as collateral for borrowing, you can’t issue new shares without [the board] knowing about it.
The fact that none of that was present here is mind-boggling. And I hope what comes of this Enron-like moment in crypto is that whatever loose norms there were about not giving that level of oversight and governance as part of investing goes away immediately.
Everything is so highly correlated. Crypto investor Digital Currency Group is reportedly giving a $140 million equity infusion to a derivatives business in its portfolio called Genesis Global Trading because Genesis has about $175 million dollars locked in its FTX account. How bad is this going to become? What percentage of your own investment portfolio is being impacted here because of FTX’s failure?
How much are we at CoinFund impacted? It’s negligible because we had such a tiny investment in this company from one of our funds and we held none of our assets at FTX, either its U.S. or international business. [As for broader implications], I don’t think any of us knows the full, long-term impact of what’s happening here because there’s like some contagion, right? Like, how many other funds when companies and investors have assets at FTX and how long will it take to get those funds back? One must assume that the entire thing goes into a massive bankruptcy proceeding that takes many months or years to unwind. And so there’ll be this uncertainty, not just about when you’re getting money back but how much you’re getting.
The overwhelming majority of the startups that we invest in aren’t trading on FTX and so they weren’t customers. But FTX was very useful for providing a launching pad for tokens to become liquid, and then either making a market for those tokens or at least providing a place for them to trade and providing liquidity. A big part of crypto today is not just raising equity capital but creating tokens and using tokens as an incentive mechanism, and that requires at some point for these tokens to become liquid and trade on exchanges, and FTX was one of the largest places where those tokens traded. And now you lose that.
How does that affect your day-to-day business of making investments? I did see the news that CoinFund is looking to raise a new $250 million fund, that it filed SEC paperwork on November 1 after closing a $300 million fund three months ago. Will you have to put a pin in that now? I’m sure this debacle has LPs feeling nervous.
We’ve talked to a lot of our LPS in the last 48 hours. I think most people are processing. They’re asking, like you’re asking, ‘What happened here?’
I think late-stage capital will freeze up for a little bit here. The dust really needs to clear. And it’s unlikely that capital is attracted to a tragedy like this.
A more immediate impact is on startup valuations. Valuing startups is an imperfect process done by investors in non-liquid markets, and one way it’s done is to look at comparables. And one of the brightest star comps that just about everyone in crypto pointed to was FTX. If FTX is worth $40 billion, we’re worth X. So you take the most highly valued venture-backed crypto company, and it goes from $40 billion to zero, then who is the new ceiling of crypto value? It immediately impacts late-stage valuations.
Crypto VC David Pakman on FTX: an “entirely avoidable tragedy” by Connie Loizos originally published on TechCrunch
https://techcrunch.com/2022/11/11/crypto-vc-david-pakman-on-ftx-an-entirely-avoidable-tragedy/
Engage with Aerospace Corp, Mynaric and Otter at TC Sessions: Space
We’re getting ready to launch our third TC Sessions: Space conference on December 6 in Los Angeles, and we still feel the thrill associated with space technology and the intrepid early-stage startup founders and researchers who dare to explore the possibilities beyond the boundaries of our home planet — and beyond what we thought possible.
If you’ve got rocket fuel running in your veins, don’t miss the chance to learn the latest developments within the space economy — from manned space travel, colonization and communications to earth observation data, manufacturing, and even war, in space.
Countdown to launch: Buy a pass now for just $199 — full price is $495 — and get ready to join the spacefaring ecosystem on December 6.
We’re not quite ready to reveal the full agenda, but we’re thrilled to share that you’ll hear from distinguished experts like Dr. Carolyn Mercer, chief technologist for NASA’s Science Mission Directorate; Peter Beck, the CEO and founder of Rocket Lab; Frank Calvelli, assistant secretary of the Air Force for Space Acquisitions; and Amela Wilson, the CEO of Nanoracks, to name but a few.
Like all TechCrunch events, TC Sessions: Space is designed to help founders and early-stage startups build stronger businesses. But it’s not just us — our event partners are equally committed to your success.
TechCrunch partners don’t just cut a check and hand over a logo. They show up, and they deliver a high level of relevant content, educational expertise, resources and connection at the event. Their participation elevates, engages and supports early-stage founders.
We’d like to take a moment to highlight just three of our incredible partners, an, while we don’t have clearance to post their presentation topics just yet, we’ll share more info in the coming weeks.
The Aerospace Corporation is a nonprofit and the only federally funded research and development center for the space enterprise. They will host both a partner session and a smaller roundtable session that allows time for Q&A. You’ll also find them exhibiting on the show floor — the perfect opportunity to connect, network and explore opportunities.
Mynaric develops and builds wireless laser communication systems for air, space and mobile applications. The company, which says its mission is to eliminate global connectivity barriers, will host a partner session. We’ll have more specific info soon.
Otter.ai’s productivity tool records meetings and provides real-time note-taking, transcripts and captioning.
We’ll have more speakers, sessions and partners to announce in the coming weeks, so watch this non-galactic space!
TC Sessions: Space takes place on December 6 in Los Angeles. Buy a pass for $199, and then join us — and our partners — to learn about the latest space tech, network for opportunities and build a stronger startup to the stars.
Is your company interested in sponsoring or exhibiting at TC Sessions: Space? Contact our sponsorship sales team by filling out this form.
Engage with Aerospace Corp, Mynaric and Otter at TC Sessions: Space by Lauren Simonds originally published on TechCrunch
https://techcrunch.com/2022/11/11/engage-with-aerospace-corp-mynaric-and-otter-at-tc-sessions-space/
Amazon eyes devices group as it undertakes broad cost cutting
The Echo business has always looked like Amazon playing the long game from the outside. Above all, the company’s home consumer hardware is a convenient vessel for getting Alexa into millions of homes. But when a corporation is doing some serious belt tightening amid broader economic headwinds, no divisions are safe from cost cutting — certainly not one that is reportedly operating at a $5 billion a year revenue loss.
The Wall Street Journal this week noted that Amazon’s devices group could be the latest to get hit with cuts as the company braces for further macroeconomic disruption. The paper notes that “Amazon’s leadership is closely evaluating its Alexa business, according to some of the people,” citing internal documents.
Many of the cutbacks thus far have been focused on longer-tail products. Devices is a mature division for the company, however, encompassing a wide range of Echo home devices, Fire tablets and Kindles, among others.
Amazon offered TechCrunch a fairly boilerplate response to the report, while noting that the normal performance review is certainly being impacted by the overall financial climate.
“We remain excited about the future of our larger businesses, as well as newer initiatives like Prime Video, Alexa, Grocery, Kuiper, Zoox, and Healthcare,” the company writes. “Our senior leadership team regularly reviews our investment outlook and financial performance, including as part of our annual operating plan review, which occurs in the fall each year. As part of this year’s review, we’re of course taking into account the current macro-environment and considering opportunities to optimize costs.”
A second comment, meanwhile, highlights Alexa’s overall successes:
Alexa started as an idea on a whiteboard. In less than a decade, it’s turned into an AI service that millions of customers interact with billions of times each week in different languages and cultures around the world. Even in the last year, Alexa interactions have increased by more than 30%. We’re as optimistic about Alexa’s future today as we’ve ever been, and it remains an important business and area of investment for Amazon.
Andy Jassy has been tasked with cutting costs across the firm — not an enviable task in any economy. In his 2021 shareholder letter, the CEO took a trip down memory lane, beginning with the first Kindle in 2007, while highlighting the ups and down of the category, including a little insight into the life (and death) of Fire phone, noting, “The phone was unsuccessful, and though we determined we were probably too late to this party and directed these resources elsewhere, we hired some fantastic long-term builders and learned valuable lessons from this failure that have served us well in devices like Echo and FireTV.”
Jassy also highlighted the division’s evolving future, writing:
Our goal is for Alexa to be the world’s most helpful and resourceful personal assistant, who makes people’s lives meaningfully easier and better. We have a lot more inventing and iterating to go, but customers continue to indicate that we’re on the right path. We have several other devices at varying stages of evolution (e.g. Ring and Blink provide the leading digital home security solutions, Astro is a brand new home robot that we just launched in late 2021), but it’s safe to say that every one of our devices, whether you’re talking about Kindle, FireTV, Alexa/Echo, Ring, Blink, or Astro is an invention-in-process with a lot more coming that will keep improving customers’ lives.
Amazon eyes devices group as it undertakes broad cost cutting by Brian Heater originally published on TechCrunch
https://techcrunch.com/2022/11/11/amazon-eyes-devices-group-as-it-undertakes-broad-cost-cutting/
Amid record dry powder, VCs are determined to fund anything but you
If you had to sum up the 2022 venture capital market in one word, that word could be contradictions.
Venture funds have record dry powder — deployable capital on hand — and yet funding continues to steadily decline. There is seemingly more talk of backing women and people of color in the industry than ever, and yet the numbers are headed in the opposite direction. VCs said publicly that they were focusing on companies on the path to profitability, but that wasn’t true for even a minute.
So while many venture firms said they are largely sitting out investing this year as they wait for valuations to fall, it is, again, largely untrue.
What does seem to be true, though, is that some VCs are using this year’s uncertainty as an excuse to avoid doing the work it takes to discuss valuations and assess TAM on potential investments into companies with real customer bases. Because they aren’t backing no one — they’re just backing everyone but you.
Amid record dry powder, VCs are determined to fund anything but you by Rebecca Szkutak originally published on TechCrunch
TechCrunch+ roundup: H-1B worker advice, managing remote teams, pitch deck teardown
I once managed an office where the CEO and I were the only two people who weren’t on the engineering team. We occupied a pod in a co-working space, so we all sat around one large table.
Outside of our group lunches, the developers rarely spoke to each other, as most communication took place via Slack, Jira and GitHub. Today, that team works remotely.
In a post for TC+, entrepreneur and angel investor Kuan Wei (Greg) Soh shared his top suggestions for managing distributed engineering teams, which includes mandatory standups and at least three hours each day when everyone is available to chat.
“We expect Slack messages to be replied to within an hour, that everyone be reachable if we call them, and that we would work responsibly with our assigned partners,” he says.
According to layoffs.fyi, more than 23,000 tech workers have been laid off so far this month. For comparison, the site tracked 12,463 layoffs in October.
Facebook’s parent company Meta announced the first major job cuts in its history this week, eliminating 11,000 jobs. Like Twitter, Stripe, Brex, Lyft, Netflix and other tech firms based in the Bay Area, many of the employees impacted are immigrants here on worker visas.
An unexpected layoff introduces an element of chaos into anyone’s life, but when an H-1B worker loses their job, a very loud clock starts clicking: unless they can land a new position or change their immigration status within 60 days, they’ll need to leave the country. And because tech companies at every size are enacting hiring freezes and planning more cuts, their ability to live and work in the U.S. is suddenly in question.
Earlier today, I hosted a Q&A with immigration lawyer Sophie Alcorn for H-1B workers who have been laid off (or think they might be).
“You either get a new job, you leave, or you figure out some other way to legally stay in the United States, but you have to take some action within those 60 days.” Start looking now for new opportunities, she advised, as it will take new employers time to submit paperwork to U.S. Citizenship and Immigration Services.
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“The best-case scenario would be that this new company files your new change of employer petition and USCIS receives the paperwork on or before the 59th day since your last day of employment,” said Alcorn.
“It takes at least three weeks to prepare everything,” which means candidates and employers must move quickly as the days count down. “You probably need a signed offer around day 33,” she said.
A lot of the information Alcorn provided was just as relevant for hiring managers as it was for workers who’ve been laid off: any number of factors can combine to further complicate a process that’s already hard to puzzle out. For example, what happens to H-1B workers who get laid off while they’re out of the country? Can getting married actually solve an immigration problem? (Definitely not!)
Because so many people have been laid off during a season when it’s traditionally hard to land a new position, I asked Alcorn whether she thought the layoffs would cause an exodus of tech talent from Silicon Valley.
“The American Dream is still really important to immigrants,” she said. “A lot of people are going to fight to find a way to stay here, even if it’s not necessarily in the in the Bay Area with the high cost of living. They still want what America represents and they’re going to reevaluate their relationship with Big Tech and the nature of work.”
3 tips for managing a remote engineering team
Image Credits: Inok (opens in a new window) / Getty Images
I once managed an office where the CEO and I were the only two people who weren’t on the engineering team. We occupied a pod in a co-working space, so we all sat around one large table.
Outside of our group lunches, the developers rarely spoke to each other, as most communication took place via Slack, Jira and GitHub. Today, that team works remotely.
In a post for TC+, entrepreneur and angel investor Kuan Wei (Greg) Soh shared his top suggestions for managing distributed engineering teams, which includes mandatory standups and at least three hours each day when everyone is available to chat.
“We expect Slack messages to be replied to within an hour, that everyone be reachable if we call them, and that we would work responsibly with our assigned partners,” he says.
Use IRS Code Section 1202 to sell your multimillion-dollar startup tax-free
Image Credits: BrianAJackson (opens in a new window) / Getty Images
Founding teams usually select a corporate structure like an LLC or S-Corp, but those who hope to exit for $10 million for more should consider starting up as a Qualified Small Business (QSB) C-Corporation, advises tax attorney Vincent Aiello.
Under IRS Code Section 1202, founders who hold QSB stock for five years or longer will be exempt from paying capital gains tax after a sale.
“It constitutes a significant tax savings benefit for entrepreneurs and small business investors,” Aiello says.
“However, the effect of the exclusion ultimately depends on when the stock was acquired, the trade or business being operated, and various other factors.”
Revenue-based financing: A new playbook for startup fundraising
Image Credits: Cocoon / Getty Images (Image has been modified)
Revenue-based financing can make early-stage startups less dependent on investors so they can hold onto more equity.
With terms that usually range from 12-24 months, many teams use these funds for short-term projects, like sales and marketing campaigns.
“Because the return on these activities may be higher than the cost of revenue-based financing, startups should use revenue-based financing to fund initiatives that will bear fruit soon,” advises Miguel Fernandez, CEO and co-founder of Capchase.
Pitch Deck Teardown: Syneroid’s $500K seed deck
Image Credits: GPC Smart Tags (opens in a new window)
Stolen-vehicle recovery systems have been available for decades, but a lost pet has higher emotional stakes.
According to Syneroid, a startup that makes smart tags, 10 million pets are lost each year in the United States, but “less than 30% are returned home.”
After raising a $500,000 seed round at a a $3.9 million valuation, the company’s founders shared their 12-slide pitch deck with TechCrunch for a review. “No information has been redacted or omitted,” writes Haje Jan Kamps.
TechCrunch+ roundup: H-1B worker advice, managing remote teams, pitch deck teardown by Walter Thompson originally published on TechCrunch