Category: TECHNOLOGY
FTC warns ‘no CEO or company is above the law’ if Twitter shirks privacy order
The FTC has telegraphed what appears to be a now-inevitable investigation into Twitter’s internal data handling practices, as the company continues to shed important staff and improvise new features. “No CEO or company is above the law,” the agency said in a statement — and if Elon Musk’s Twitter continues its current spree, they may find themselves in violation of the FTC’s order and facing serious consequences.
To be clear at the outset, the FTC has not announced any investigation into Twitter or Elon Musk, or even that they are gathering information in service of such an investigation. Nor would it be able to confirm it was investigating if it was. But circumstantial evidence, common sense, and the ominous statement issued today leave little doubt that the company is in the agency’s crosshairs.
In the course of its ordinary oversight duties, the FTC looks into complaints by consumers, companies, and anyone with a bone to pick about things like misleading advertising, broken privacy promises, illicit business arrangements, and so on. But in 2011, Twitter agreed to a consent decree with the regulator after being found to have misused user data. It was also found to have done so again for many years in an investigation culminating in a $150 million settlement earlier this year, so this isn’t some bygone red tape.
This decree required Twitter to establish and maintain a program to ensure and regularly report that its new features do not further misrepresent “the extent to which it maintains and protects the security, privacy, confidentiality, or integrity of any nonpublic consumer information.” The revised order adds more oversight and gives the FTC more power, since evidently Twitter needed a stick as well as a carrot.
The gist of it is that Twitter is in the doghouse with the FTC already, and it has specific and legally binding requirements regarding what it can and can’t do with data, and how it verifies that it is in compliance.
Around the time of the settlement, Elon Musk entered the stage and now we have all…this. But the news that last night several data handling executives, no doubt important to walking the line with a watchful regulator, all reportedly left at once. Literally minutes after I wrote this paragraph, the company’s head of trust and safety, Yoel Roth, was reported to be leaving as well.
This would be troubling at any company, at any time, under any level of federal scrutiny. But for Twitter, the departing chiefs might as well have hired a skywriter to spell out “INVESTIGATE ME” in huge letters above Twitter HQ. (Of course, normally that might apply to any number of companies in downtown San Francisco, but right now there’s little question.)
The amount of changes, new products, eliminations of various departments and processes (many of which had to do with privacy, fairness, data handling and other crucial topics) don’t mean Twitter is necessarily in violation of the consent decree. But with things going the way they are, it’s quite hard to imagine that it is in compliance now, or if it is, will it remain so for long.
It’s important, though, to understand that the FTC isn’t like the FBI, kicking doors down and arranging evidence in damning dioramas. The FTC conducts its investigations privately and at great length — they can’t and don’t publicize the fact that they are looking into a company for some violation or another until there is a legally binding consequence like a signed consent decree, settlement, or a decision to go to trial via the Department of Justice.
Although many expected the FTC, under the leadership of tech skeptic and very smart person Lina Khan, to be more proactive, it is limited by law as to what it can do. It’s actually a bit surprising that the agency got as spicy as it did in the full statement:
We are tracking recent developments at Twitter with deep concern. No CEO or company is above the law, and companies must follow our consent decrees. Our revised consent order gives us new tools to ensure compliance, and we are prepared to use them.
Though it stops short of saying, “We are sharpening our knives,” this statement nevertheless is about as strong an implication that they will be giving Twitter a call as soon as they can justify it. (A juicy tidbit uncovered by CNN’s Brian Fung, while enticing, could relate to ongoing discussions regarding the $150 million settlement, so don’t get too excited.)
If they decide to pursue an investigation, which would probably happen if there are any red flags at all, let alone this many, it will be done confidentially — but importantly, it is not secret.
That means that although it is the FTC’s policy not to reveal or comment on an investigation, a company or person being investigated may do so at any time if they wish. So if the FTC makes a formal request for certain data from Twitter, or deposes its executives (present or former), they may decide to publicize that information.
In fact, Twitter did this in late 2020, long before the settlement with the FTC was finalized. After all, you don’t want your investors to be the last to hear about something like a $150 million charge, even though in telling them you risk discovery by hawk-eyed journalists.
So if the FTC investigates Twitter, it’s far more likely that we will hear about it from the company — in a filing with investors or, more likely, from its incautious and prolix CEO during one of his increasingly frequent emergency meetings.
The state of chaos at Twitter makes the commonplace observation that we don’t know what it will look like in six months into a gross understatement, however, meaning the entire company might have changed hands or business models before the FTC has finished its (hypothetical) work. Still, that won’t get the flailing company off the hook. Twitter’s leadership, or what’s left of it, may want to prioritize survival and compliance with federal regulators before returning to its now regularly scheduled mayhem.
FTC warns ‘no CEO or company is above the law’ if Twitter shirks privacy order by Devin Coldewey originally published on TechCrunch
Tumblr’s only viable business model is shitposting
As Elon Musk struggles to make people give Twitter $8 a month for a blue check, Tumblr had an idea: What if they offered users $8 for not one, but two blue checks?
Yes, you can legitimately buy two blue checks for your Tumblr blog. For the low, low price of $7.99. As Tumblr wrote in an official post, “That’s cheaper than some other places, when you consider that you get not one but TWO checkmarks for your blog.”
If you keep paying Tumblr, you can get even more blue checks. Want 10 blue checks? That’ll be about $40.
Tumblr has struggled to monetize for its entire existence. Tumblr was acquired by Yahoo (TechCrunch’s parent company) for $1 billion in 2013, but when it sold again to Verizon (TechCrunch’s former parent company) in 2019, it was worth just $3 million.
Tumblr’s success as a social media platform has been in even more jeopardy since it banned porn in 2018 to protect its presence on the App Store. In the last year alone, Automattic has tried to get Tumblr to make money through paid ad-free browsing, a subscription product and a tip jar, marking some of the first paid creator features on the longstanding blogging site. Yet despite growing nostalgia for Tumblr, the platform has failed to grow its user base significantly since the porn ban, when it lost 30% of web traffic.
Tumblr’s initial rollout of its Post+ subscription rollout was a mess, as users worried how the harsh reality of capitalism would change their fandom paradise. But Tumblr users have proven to be extremely willing to pay money for two things: ad-free browsing and shitposting.
According to data from SensorTower, Tumblr’s mobile app has seen approximately $507,000 in consumer spending since April. That was the month when Tumblr announced Blaze, a feature that lets users promote their own posts. Not coincidentally, Blaze debuted on 4/20 with price points ending in $4.20.
On a platform like Facebook, promoted posts are usually for businesses. On Tumblr, Blazed posts are commonly used to make other people bear witness to your cursed content.
Tumblr’s top in-app purchases (April to November 10, 2022). Image Credits: SensorTower
Since the launch of Blaze, Tumblr’s top five in-app purchases have been ad-free browsing (monthly and annual), two price points for Blaze and … crabs. Yes, crabs. In July, Tumblr added a feature that allows you to send someone crabs that dance around their dashboard for a day, and now, crabs have generated more in-app purchases than Post+.
Tumblr’s paid jab at Twitter verification has only just launched, so we can’t say yet how profitable it will be. But if Tumblr’s history is any indication, this should be a financial slam dunk, since Tumblr users seem to just really want to buy things that are useless.
According to analytics firm Similarweb, Tumblr did not experience a significant uptick in monthly visits worldwide on mobile and desktop after it launched creator monetization features in summer 2021. However, Tumblr is generating some more interest now that we live in a world in which Elon Musk owns Twitter. Other alternative social networks have seen an influx of new users too — Mastodon nearly doubled its user base so far this month.
Matt Mullenweg, CEO of Automattic (the company that owns Tumblr), tweeted that Tumblr app downloads are up about 58% in the last week. This could be because Twitter now seems like more of a hellsite than Tumblr under Musk’s ownership, or because Tumblr just changed its community guidelines. Now, Tumblr allows nudity, but not “visual depictions of sexually explicit acts.” Some internet denizens took this policy change to mean that porn is back, but the last time we checked, porn generally falls into the category of “visual depictions of sexually explicit acts.”
If you’re looking to jump ship from Twitter as Elon Musk gets settled in as its new owner, I hate to break it to you: Tumblr may not be your saving grace (unless if you’re a former “Superwholock” fan whose new favorite book is “Gideon the Ninth,” in which case, you’re probably still on Tumblr anyway). But to be fair, it’s likely that none of the Twitter alternatives that are floating around — no, not even Mastodon — will become the new Twitter.
Regardless, Tumblr now has something that Twitter doesn’t: two blue checkmarks.
Tumblr’s only viable business model is shitposting by Amanda Silberling originally published on TechCrunch
https://techcrunch.com/2022/11/10/tumblr-blue-check-shitposting-business-model/
Google says surveillance vendor targeted Samsung phones with zero-days
Google says it has evidence that a commercial surveillance vendor was exploiting three zero-day security vulnerabilities found in newer Samsung smartphones.
The vulnerabilities, discovered in Samsung’s custom-built software, were used together as part of an exploit chain to target Samsung phones running Android. The chained vulnerabilities allow an attacker to gain kernel read and write privileges as the root user, and ultimately expose a device’s data.
Google Project Zero security researcher Maddie Stone said in a blog post that the exploit chain targets Samsung phones with a Exynos chip running a specific kernel version. Samsung phones are sold with Exynos chips primarily across Europe, the Middle East, and Africa, which is likely where the targets of the surveillance are located.
Stone said Samsung phones running the affected kernel at the time include the S10, A50, and A51.
The flaws, since patched, were exploited by a malicious Android app, which the user may have been tricked into installing from outside of the app store. The malicious app allows the attacker to escape the app sandbox designed to contain its activity, and access the rest of the device’s operating system. Only a component of the exploit app was obtained, Stone said, so it isn’t known what the final payload was, even if the three vulnerabilities paved the way for its eventual delivery.
“The first vulnerability in this chain, the arbitrary file read and write, was the foundation of this chain, used four different times and used at least once in each step,” wrote Stone. “The Java components in Android devices don’t tend to be the most popular targets for security researchers despite it running at such a privileged level,” said Stone.
Google declined to name the commercial surveillance vendor, but said the exploitation follows a pattern similar to recent device infections where malicious Android apps were abused to deliver powerful nation-state spyware.
Earlier this year security researchers discovered Hermit, an Android and iOS spyware developed by RCS Lab and used in targeted attacks by governments, with known victims in Italy and Kazakhstan. Hermit relies on tricking a target into downloading and installing the malicious app, such as a disguised cell carrier assistance app, from outside of the app store, but then silently steals a victim’s contacts, audio recordings, photos, videos, and granular location data. Google began notifying Android users whose devices have been compromised by Hermit. Surveillance vendor Connexxa also used malicious sideloaded apps to target both Android and iPhone owners.
Google reported the three vulnerabilities to Samsung in late 2020, and Samsung rolled out patches to affected phones in March 2021, but did not disclose at the time that the vulnerabilities were being actively exploited. Stone said that Samsung has since committed to begin disclosing when vulnerabilities are actively exploited, following Apple and Google, which also disclose in their security updates when vulnerabilities are under attack.
“The analysis of this exploit chain has provided us with new and important insights into how attackers are targeting Android devices,” Stone added, intimating that further research could unearth new vulnerabilities in custom software built by Android device makers, like Samsung.
“It highlights a need for more research into manufacturer specific components. It shows where we ought to do further variant analysis,” said Stone.
Google says surveillance vendor targeted Samsung phones with zero-days by Zack Whittaker originally published on TechCrunch
https://techcrunch.com/2022/11/10/google-surveillance-samsung-spyware/
Daily Crunch: Sequoia Capital writes off its $210M investment in crypto exchange FTX
Founding teams usually select a corporate structure like an LLC or S-Corp, but those who hope to exit for $10 million or 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.”
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Tech reporting is a lot of things, but it sure ain’t boring, as the chaos around Twitter, crypto, and layoffs continues. We’re just trying to hang on for dear life to try to make some sense of it all. We think we did a pretty decent job, and here, we’ve got a selection of what’s been happening in the past 24 hours of tech. — Christine and Haje.
The TechCrunch Top 3
- Another domino falls: It was probably already a fiasco, but Binance deciding to not buy FTX led Sequoia Capital to claim its minority stake in FTX as nothing more than some unrealized gains, Connie reports. Investor letter and everything.
- Meanwhile, over at our other favorite hot mess: Elon Musk was right when he tweeted that the company would be doing “lots of dumb things.” Darrell reports on one of its latest take-backs (because they seem to accumulate before we even have time to take a breath), where all of these accounts were promised that little blue checkmark in exchange for $8, but as you all know, when you make fake accounts, that means we can’t have nice things.
- More Twitter changes: Another group of top dogs at Twitter decided to leave the nest. This time it is chief information security officer Lea Kissner, followed by chief compliance officer Marianne Fogarty and chief privacy officer Damien Kieran. The latter two have reportedly resigned today, according to Zack and Ingrid, who teamed up to chase down the details.
Startups and VC
Denver-based VC firm SpringTime Ventures is pivoting away from its original focus on its home state of Colorado, despite being the only local fund in two of the state’s 10 unicorn companies, Becca reports. It’s also now able to expand its team thanks to raising three times as much money for Fund II, giving SpringTime enough cash on hand to allow its partners to finally pay themselves “a real salary.”
New crypto startups forged ahead during Alliance DAO’s demo day on Wednesday amid the FTX implosion. The most recent cohort, known as All9, for Alliance DAO, a web3 accelerator and builder community, presented their ideas on Wednesday during a demo day, exclusively covered by Jacquelyn.
And here’s a smattering of other things that caught our beady little eyes today:
- If you’re only moderately broken, these startups can moderately fix youMike reports how “Self-therapy” startups are blooming in the “moderate mental health” space.
- We shall know you by your high five: With $7 million raised, Brian reports, Keyo launches a biometric palm verification network.
- Your Excel, up to the minuteCoefficient wants to bring live data into your existing spreadsheets, writes Kyle.
- Tracking pollution with sensorsAirly fights air pollution with a network of affordable sensors, Catherine reports.
- Subscriptions finding their grooveIngrid reports that Ordergroove picks up $100 million to grow e-commerce subscriptions as a service.
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 or 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.”
Three more from the TC+ team:
- Smart dog collars, smart pitch deck?Pitch Deck Teardown: Syneroid’s $500K seed deck, by Haje.
- Hitting rock bottom…maybe?Alex wonders, As inflation slows, did we just see the bottom for tech stocks?
- In a crisis, don’t hide — double down!: Guest author Vadym Synegin writes that in times of crisis, fintech startups should take the long view instead of hibernating.
TechCrunch+ is our membership program that helps founders and startup teams get ahead of the pack. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!
Big Tech Inc.
Elon Musk wants Twitter workers in the office and wants them battling spam. Those were some of the messages the new owner had for his social media staff, Ivan writes. Oh, he also told them to be ready for “difficult times ahead,” which is always something you want to hear from your leader with regard to the future of your job.
After the Binance deal fell through, FTX founder Sam Bankman-Fried has some new focuses: winding down trading at Alameda Research and winding up his fundraising prowess, Manish reports.
We promise, no more FTX or Twitter below:
- Want to see a bin-picking robot?: You’re in luck! Meet the Amazon Sparrow. Brian has more.
- Ole, Ole Ole Ole: Starting November 20, FIFA World Cup fans will have an easier time following their favorite teams thanks to Google’s new cross-platform features, Ivan writes.
- Californians want more electric cars but don’t want to pay for themOne of the losers this week was Prop 30, a Lyft-backed plan that would have taxed California residents so that the price of electric cars and public charging stations could be subsidized, Harri reports.
- Arrested development: Police arrest suspected LockBit operator just as the ransomware gang leaks more data, Carly writes.
- Mute fast, mute often: Reddit users who don’t want to see a certain community can now mute it. Aisha has more.
Daily Crunch: Sequoia Capital writes off its $210M investment in crypto exchange FTX by Christine Hall originally published on TechCrunch
Meet Pineapple, the platform aiming to reshape professional networking for Gen Z
Diamond says the main focus of Pineapple is user profiles, which are designed to help create deep and meaningful professional connections by allowing users to express themselves in a visual way. The app’s profiles are a cross between LinkedIn and Instagram, as they showcase a user’s introduction, experience, projects and more in a visual Story-like way.
Another big part of Pineapple is Communities, which aim to help users find other people who are passionate about the the same thing as them. From VCs to marketers to designers, there are specific communities for all sorts of topics. You can see the member directory for each community and connect with specific people. Within Communities, there are Jams, which are threaded conversations for discussions that last for 24 hours. Jams can be used to go in-depth about a specific topic. For instance, a founder can start a Jam to answer questions that people may have about their journey.
Pineapple also includes an Explore page where you can discover more Jams, people and communities. The app also has a TikTok-inspired For You page that is designed to help you keep up with your connections.
Some may see Pineapple as the “LinkedIn for Gen Z,” but Diamond says the platform still has a ways to go before looking to take on LinkedIn. Right now, Pineapple is focused on helping people network in different ways than LinkedIn is. For instance, Diamond says that some young users may use LinkedIn to find a mentor, but Pineapple is where they can come to network with their peers, learn new things and find people for their side projects. Pineapple also isn’t focused on status/job updates or the hustle culture that is often associated with LinkedIn, Diamond says.
Image Credits: Pineapple
For the time being, Pineapple is going to focus on growth before venturing into monetization. When Pineapple is ready to add monetization features to its platform, Diamond says the company will focus on helping creators earn money. One of the ways the company plans to due this is through creator subscriptions where popular creators will be able to offer educational content to users for a price. In addition, Pineapple hopes to partner with companies who will be able to recruit employees directly from the platform.
“We want to be the go-to professional network for Gen Z and folks who are early on in their career,” Diamond says. “From a roadmap standpoint, we want Pineapple to be the obvious solution for people who are starting their career. I think in order to do that, we need to up our game when it comes to profile-building. I think you should be able to build a mini-website within Pineapple, and I don’t think there should be a need to ever have a portfolio website if you have Pineapple.”
In terms of funding, Pineapple raised a $1.1 million pre-seed round in April that was co-led by F7 Ventures and 500 Global. The round included participation from angel investors Bradley Horowitz, the VP of product at Google, and Julie Zhou, the former VP of design at Facebook. Diamond says the funding mainly went toward research and development, along with making key early hires.
Pineapple is kicking off its seed round soon and plans to close it sometime next year.
Pineapple, an app that’s aiming to reshape professional networking for Gen Z, is officially launching to the public today. The idea behind Pineapple is to give young professionals a way to network with others through a visual story profile that’s kind of like a digital portfolio. For now, the platform is only available on iOS.
The professional network is the brainchild of Pineapple’s 22-year-old co-founder and CEO David Diamond, who got an early start in tech as a product design intern at Intercom at age 15. Diamond was initially rejected from Intercom after applying with a standard paper resume and was also told he was too young to work there. After strengthening his resume and building a portfolio, Diamond says he landed the role.
“I started to think about how I landed the job and how lucky I was,” Diamond told TechCrunch in an interview. “I wondered, if I had to put together a portfolio, what was the rest of my generation doing? From there, we had a clear vision of building a professional network for Gen Z. We saw that other networks weren’t accurately representing Gen Z. We wanted to make a network that helps Gen Z network with each other and gain opportunities, rather than focusing on creating another jobs board. The goal was to give users profiles that really represent them.”
In 2020, Diamond founded Pineapple alongside Oliver Cruise with the goal of changing professional networking for Gen Z. After beta testing the platform with 10,000 users, Pineapple is now ready to grow.
Image Credits: Pineapple
Diamond says the main focus of Pineapple is user profiles, which are designed to help create deep and meaningful professional connections by allowing users to express themselves in a visual way. The app’s profiles are a cross between LinkedIn and Instagram, as they showcase a user’s introduction, experience, projects and more in a visual Story-like way.
Another big part of Pineapple is Communities, which aim to help users find other people who are passionate about the the same thing as them. From VCs to marketers to designers, there are specific communities for all sorts of topics. You can see the member directory for each community and connect with specific people. Within Communities, there are Jams, which are threaded conversations for discussions that last for 24 hours. Jams can be used to go in-depth about a specific topic. For instance, a founder can start a Jam to answer questions that people may have about their journey.
Pineapple also includes an Explore page where you can discover more Jams, people and communities. The app also has a TikTok-inspired For You page that is designed to help you keep up with your connections.
Some may see Pineapple as the “LinkedIn for Gen Z,” but Diamond says the platform still has a ways to go before looking to take on LinkedIn. Right now, Pineapple is focused on helping people network in different ways than LinkedIn is. For instance, Diamond says that some young users may use LinkedIn to find a mentor, but Pineapple is where they can come to network with their peers, learn new things and find people for their side projects. Pineapple also isn’t focused on status/job updates or the hustle culture that is often associated with LinkedIn, Diamond says.
Image Credits: Pineapple
For the time being, Pineapple is going to focus on growth before venturing into monetization. When Pineapple is ready to add monetization features to its platform, Diamond says the company will focus on helping creators earn money. One of the ways the company plans to due this is through creator subscriptions where popular creators will be able to offer educational content to users for a price. In addition, Pineapple hopes to partner with companies who will be able to recruit employees directly from the platform.
“We want to be the go-to professional network for Gen Z and folks who are early on in their career,” Diamond says. “From a roadmap standpoint, we want Pineapple to be the obvious solution for people who are starting their career. I think in order to do that, we need to up our game when it comes to profile-building. I think you should be able to build a mini-website within Pineapple, and I don’t think there should be a need to ever have a portfolio website if you have Pineapple.”
In terms of funding, Pineapple raised a $1.1 million pre-seed round in April that was co-led by F7 Ventures and 500 Global. The round included participation from angel investors Bradley Horowitz, the VP of product at Google, and Julie Zhou, the former VP of design at Facebook. Diamond says the funding mainly went toward research and development, along with making key early hires.
Pineapple is kicking off its seed round soon and plans to close it sometime next year.
Meet Pineapple, the platform aiming to reshape professional networking for Gen Z by Aisha Malik originally published on TechCrunch
https://techcrunch.com/2022/11/10/pineapple-platform-reshape-professional-networking-gen-z/
Dispatches from the conference room
Greetings on a brisk New England morning. I’m finally here on my long threatened trip to Boston. I was planning to be here in early July ahead of our robotics event, but SARS-CoV-2 and its many variants had different ideas. I narrowly avoided another reschedule on my third time around with COVID, but now I’m in that brief (and ever narrowing) window of relative immunity. It’s like I’m Superman or something (probably shouldn’t have gone with one of the few DC superheroes without a mask).
Given the fact that I haven’t been out since 2019, I may well have overbooked. Met with four startups yesterday afternoon after arriving at Logan, spent this morning meeting with a couple of VCs/accelerators and startups, and am currently writing to you from a MassRobotics conference room (shoutout to Joyce, who kindly reserved me a conference room to chat with some founders ahead of a panel and more meetings tonight).
An aerial general view during a game between the Boston Red Sox and the New York Yankees on August 13, 2022 at Fenway Park in Boston, Massachusetts. Image Credits:Billie Weiss/Boston Red Sox/Getty Images
Call it a fact-finding mission. Or maybe a temperature check. We’ve entered an interesting moment, where superpowered robotic VC investments are finally having to contend with the realities of market forces. For a moment there, the industry appeared relatively immune to the slowdown, but in spite of continued bullish feelings about automation at large, nothing here can appropriately be labeled “recession proof.”
Anecdotally, we may have also entered the stage in which the key players in already well-represented categories such as logistics/fulfillment are already in place. That isn’t to say there isn’t room for key new players to enter the picture, but I suspect it’s a lot harder to get tens of millions in funding by telling investors that you’re an Amazon Robotics killer than it was at the beginning of the pandemic.
At the moment, I’ve got a keen eye out for two things:
First, the companies solving the extremely unsexy problems. There are still a lot of extremely bad — and impossible-to-staff — jobs out there that are ripe for automation. I spoke with a company that’s a great representation of that phenomenon, which I’ll dive into when I debrief my Boston trip in next week’s Actuator.
Second, the key components of the broader robotics experience. I know a lot of well-funded companies are looking to create their full-stack solutions, but as these technologies grow in application, a ton of smaller industries are going to sprout up around that. If you’ve got a sufficiently adaptable piece of that puzzle, you’ve got a great — and perhaps overlooked — business on your hands.
There’s value in well-placed myopia. Sometimes thinking small is the right business move. I realize and respect that a lot of folks enter the space with plans to change the world, but they think globally and act locally and all of that good stuff.
Roughly 24 hours into this trip, and I’m realizing how much I missed landing in a place and talking to as many startups as possible. Glad I’m able to do this in Boston again, and hoping to be in more cities soon to see what companies are cooking and, perhaps, check the temperature of the industry from a much closer vantage point. Again, lots more on all of the above next week.
Image Credits: Iron OX
For now, two things are top of mind on this newsletter. One is fun. The other less so. We’ll start with the bad news first. Layoffs. Almost overnight, half the staff at Iron Ox is out of work. Even forgetting the extremely real and immediate human impact of such a move, it’s very disheartening for the industry. There are a lot of questions here. Is this a broader indictment of fully automated greenhouses? Is it something specific to Iron Ox? Perhaps the company’s solution was more proprietary and less adaptable to existing systems than a startup needs to be in the space.
Either way, it’s hard not to walk away from this with the sense that such a well-funded firm is something of a bellwether for automation’s hard road ahead, as the space grapples with bigger macroeconomic issues.
Chief legal officer Myra Pasek confirmed the layoffs this week with TechCrunch. All told, they amount to just under half of Iron Ox’s staff, and appear to run across the organization. It’s a gutting of a company that is clearly doing some soul searching around which existing elements to capitalize on going forward. Says Pasek:
We’ve decided to hyperfocus on our core competence of engineering and technology; as a result, we eliminated many roles that are not core to our renewed focus. However, the layoff was comprehensive and included positions throughout the organization — i.e., not limited to only certain departments.
Reducing the Iron Ox team was a painful decision — one we did not take lightly. We are working with our board members and leaning into our extensive ecosystem throughout Silicon Valley to help employees find meaningful new work at mission-aligned companies. Iron Ox has always hired world-class talent, and I’m confident that the individuals we unfortunately had to cut this week will have many options open to them. As a matter of policy, we are not going to provide additional details or comment on specific personnel, and we ask that you respect their privacy at this sensitive time.
This was precisely the caveat I was alluding to in last week’s newsletter when talking about climate robotics firms. Not everything is a surefire bet, but that shouldn’t distract founders from the fact that there’s a lot of good to be done and money to be made in this space.
Image Credits: NimbRo
The more pleasant news this week is around teleoperation. Our TC Sessions: Robotics pitch-off winner Touchlab made it to the semifinals, but ultimately, the XPrize Avatar trophy went to NimbRo, which hails from the Autonomous Intelligent Systems group at the University of Bonn, Germany. The company won the $5 million prize at the finals competition in Long Beach, California.
“NimbRo’s work demonstrates the remarkable potential of avatar technology to transcend time and distance and help address urgent human challenges, from health care access to disaster relief,” Xprize CEO Anousheh Ansari said in a release. “The final testing event was an exciting opportunity to share the power of telepresence with thousands of people in-person and around the world. We are grateful to all the participating teams for their impressive work and their efforts to boldly push technological boundaries.”
NimbRo beat out 98 other teams, completing the 10 teleoperation tasks in five minutes, 50 seconds. The second-place team Pollen Robotics took ten minutes, 50 seconds, and the third-place team from Northeastern did so in 21 minutes, nine seconds. Here’s a breakdown of the event’s numerous stages, straight from NimbRo.
If I wasn’t on the road this like, I likely would have contributed a significant portion of this week’s newsletter to the topic of telepresence. Namely, it seems like the automotive market dominated the conversation and caused many folks in the space to skip directly to full automation. But there’s some important middle ground here to explore. Remote operation makes a lot of sense in a lot of contexts, especially as many are recognizing precisely how difficult a problem full automation truly is.
Ouster demo vehicle Image Credits: Ouster
Earlier this week, two major lidar companies agreed to become one. Both Ouster and Velodyne signed a deal on November 4 that finds the two firms maintaining 50% of the stock in the newly formed company. The key factors at play here, as Rebecca points out in her article, are (1) there are a lot of companies in the lidar space — A LOT, a lot — and (2) things are returning to Earth after the big SPAC land grab. Ouster co-founder and CEO Angus Pacala will become the CEO of the combined firms, while Velodyne CEO Ted Tewksbury will serve as executive chairman of the board.
Image Credits: Wing
Meanwhile, drone delivery service Wing continues to expand its Australian operations. The Alphabet-owned firm struck a deal with DoorDash that will provide drone delivery of convenience and grocery items in 15 minutes or less through the popular app.
“While Wing has traditionally provided delivery services directly to residential and business customers, to further accelerate our technology development, we’ll be increasingly working with marketplaces and logistics partners to expand their delivery options,” says Wing Australia GM Simon Ross. “[We’re focused on] making fast drone delivery affordable and sustainable for them and their customers.”
Image Credits: Bryce Durbin/TechCrunch
Read next week’s dispatches next week by subscribing to Actuator.
Dispatches from the conference room by Brian Heater originally published on TechCrunch
https://techcrunch.com/2022/11/10/dispatches-from-the-conference-room/
Okta CEO opens up about Auth0 acquisition, SaaS slump and Lapsus$ attack
Okta launched a cloud identity product back in 2009 when most people were locked into Microsoft Active Directory, an on-prem incumbent so entrenched that nobody believed that anyone could touch it. It took a little audacity to go after a giant like that, but Okta took a cloud-first approach, a markedly different strategy from Active Directory at the time.
The company raised over $230 million before going public in 2017. It reached unicorn status with a $75 million raise on a $1.2 billion valuation back in 2015 when the designation meant a little more than it does these days.
With ownership of the workforce side of the market, Okta decided to make another bold move when it acquired Auth0 for $6.5 billion during the stock market bubble that accelerated in 2020. The idea behind the deal was not simply to own an identity tool favored by developers — although that was certainly a big part of it — it was really about owning another large piece of the market, one that could make Okta a one-stop identity shop.
“There’s a very deep divide between legacy and modern in this market.” Okta CEO Todd McKinnon
Okta wanted to own both the workforce market, the core of its approach to that point, as well as the customer identity market where Auth0 lived. And Okta made a substantial bet for a company of its size to make that happen.
Okta isn’t alone in the identity space; competitors include companies large and small like ForgeRock, SAP, IBM, Ping Identity, Salesforce, Microsoft and Akamai, among others.
Like every other SaaS company out there, Okta has had a rough year in the public markets, down over 80% in the past year (although it was up almost 10% in midday trading Thursday). It also had to deal with an attack spearheaded by the group Lapsus$ that happened in January but was reported in March — and the fallout from its response.
Despite these headwinds, the company has big long-term goals to own the cloud identity market and believes it can ride out the current temporary macroeconomic conditions and the legacy vendors to get there.
We sat down with CEO and co-founder Todd McKinnon recently and asked him about how he is navigating these times — and the lessons he’s learned along the way.
Growing Auth0
McKinnon emphasized that he spent 14% of his stock value at the time to acquire Auth0, a number he knows off the top of his head, because he wants his company to own the cloud identity market, and he doesn’t think he could do it without Auth0.
“We bought them to change, and we bought them because we needed change to win this customer identity market,” he told TechCrunch. “Our strategy is that we have to win both the workforce market and the customer identity market. And the only way we’re going to turn identity into one of these most important platforms for every company is we have to [own] both use cases.”
He said integrating two companies like this didn’t come without challenges, and he may have moved too quickly to bring the products together.
Okta CEO opens up about Auth0 acquisition, SaaS slump and Lapsus$ attack by Ron Miller originally published on TechCrunch
Even Healthcare lands additional capital to advance primary care adoption in India
Even Healthcare, an Indian “healthcare membership” company, landed new financial support in the form of $15 million to further drive its mission of providing affordable care to communities across India.
Even isn’t insurance, but allows members to access primary and preventative care at any of over 100 partnered hospitals. Typically, the way Indians access healthcare is through emergency services as opposed to the preventative care model followed in Western countries. They most often pay for services out of pocket, but Even provides what it describes as a more affordable, comprehensive care model. The company said last year when they last raised money that less than 5% of the Indian population has insurance and plans that do exist mainly cover emergency services.
“For us, Even is about giving members access to complete healthcare and building trust like a family doctor,” said co-founder Matilde Giglio. “Right from preventive care to diagnostics to hospitalization, our members will be assured of our support throughout their healthcare journey.”
Depending on a user’s financial capabilities, there are three plans they can choose from. The cheapest is ₹ 40 per month ($0.50 USD) which includes unlimited consultations and a care team, but according to the company is meant for individuals looking to still pay for some services out of pocket. The plan gives users a glimpse at the care provided to then transition individuals to the second tier plan, Even Lite. Even Lite costs users ₹ 320 ($4 USD) per month and includes tests, consultations and a care team. For ₹ 528 ($6.54 USD) per month care becomes more comprehensive including COVID-19-specific services, emergency care across India and cashless hospitalization.
The company’s standard pricing is for individuals, but it does have group plans for companies and groups.
Even currently has 20,000 active members and has partnered with over 100 hospitals since its launch in 2020. Just a year ago the company had 5,000 on a waitlist.
The Bangalore-based company asks new users to talk to a doctor to collect health information and assess risk for underlying conditions. According to Giglio, conditions like diabetes, high cholesterol, high BP and obesity are common in India, but often go uncontrolled due to a lack of primary care. The company claims half their new users learned they suffered from diabetes during the onboarding process.
The new capital raised comes from Alpha Wave and Aspada (Lightrock). They are joining existing investors Khosla Ventures, Founders Fund, Lachy Groom, Palo Alto Networks CEO Nikesh Arora, CRED CEO Kunal Shah and DST Global partner Tom Stafford. Even first raised a $5 million seed round in 2021 led by Khosla Ventures.
This round’s funds will be used to expand its clinical team and scale preventive care in conditions like diabetes, PCOS (polycystic ovary syndrome) and obesity.
Even Healthcare lands additional capital to advance primary care adoption in India by Andrew Mendez originally published on TechCrunch
Galaxy, Gradient and Lux VCs will judge the TC Sessions: Crypto pitch-off
One of the most popular activities at a TechCrunch conference is watching top-notch early-stage founders square off in a pitch competition. Seriously, who doesn’t love a pitch-off? And the Crypto Pitch-off is just one more compelling reason to go to TechCrunch Sessions: Crypto on November 17 in Miami. Let’s take a look at the judges our intrepid startups will need to impress.
But first (hey, you had to see this coming), if you have not yet done the deed, buy your pass right now. Changes in the crypto world are fast and furious — like Binance aiming to purchase FTX but just over 24 hours later backing out. Did you know Binance founder CZ will speak at the event? You do not want to miss that.
Okay, back to the pitch-off. Be in the room when three of the brightest early-stage crypto startups take the stage in front of a live audience — for glory, for media and investor interest, and, drumroll please, for an automatic spot in the Startup Battlefield 200 at Disrupt 2023. TechCrunch handpicks a cohort of 200 early-stage startups to receive a VIP Disrupt experience that includes, for starters, exhibiting all three days of the show — for free.
The contenders will pitch their tech to this panel of expert VCs: Grace Isford, principal, Lux Capital; Wen-Wen Lam, partner, Gradient Ventures; and Will Nuelle, general partner, Galaxy Ventures — check out their bonafides below.
Grace Isford invests at the nexus of web3, data infrastructure and applications of AI/ML. She focuses on crypto and blockchain infrastructure companies building the next-gen web3 stack, as well as on data and machine-learning startups that hyper-personalize user experiences and transform legacy industries.
At Lux, Isford works with companies such as Tactic, Goldsky and RunwayML. Prior to joining Lux, she worked at Canvas Ventures and Handshake (in product management), and she earned her BS and MS from Stanford University.
Before joining Gradient Ventures, Wen-Wen Lam was the CEO and co-founder of NexTravel (YCW15), a leading corporate travel solution that serviced thousands of customers like Lyft, Twilio and Stripe. She grew the business to over $100 million in annual sales before exiting to TravelPerk in 2020.
Prior to founding NexTravel, Lam worked with startups in leadership roles. She received a BA in economics from UC Berkeley and her MBA from the USC Marshall School of Business, and she began her career in tech at LinkedIn.
Will Nuelle focuses on early-stage investments in protocol layer infrastructure, DeFi applications and software products. Nuelle started at Galaxy Ventures in research, where he developed quantitative risk software for trading.
Prior to joining Galaxy, he built incentive simulations for Ethereum protocol FOAM as an intern. He holds BS degrees in mathematics and architecture from Stanford University. He is a board member for Skolem Technologies and has led more than 13 investments for Galaxy.
TC Sessions: Crypto takes place on November 17 in Miami. Don’t miss your opportunity to connect with our partners and to tap into the tech, trends and controversy spanning the blockchain, cryptocurrency, DeFi, NFT and web3 cryptoverse. Buy your ticket today!
Is your company interested in sponsoring or exhibiting at TC Sessions: Crypto? Contact our sponsorship sales team by filling out this form.
Galaxy, Gradient and Lux VCs will judge the TC Sessions: Crypto pitch-off by Lauren Simonds originally published on TechCrunch
Crypto’s crown prince stumbles
Welcome back to Chain Reaction.
Last week on the podcast, we talked about trouble brewing for bitcoin miners. This week, we had to tear up our plans to cover pretty much anything else and turn our attention to what we think is the biggest story in crypto to unfold this year: the fall from grace of once-revered crypto exchange FTX and its former billionaire founder Sam Bankman-Fried (SBF).
Do you want Chain Reaction in your inbox every Thursday? Sign up here: techcrunch.com/newsletters.
this week in web3
Here are some of the biggest crypto stories TechCrunch has covered this week.
Sam Bankman-Fried says FTX in talks to raise capital, Alameda Research to wind down trading
Sam Bankman-Fried said on Thursday that he will be winding down the trading firm Alameda Research and is attempting to raise liquidity for the troubled FTX International, as he scrambles to keep the world’s second largest crypto exchange alive after a bailout deal with Binance failed earlier this week. Bankman-Fried said in a series of tweets that he is engaging with a “number of players” to raise capital for FTX’s international business and those discussions are at various stages, including letters of intent and term sheet deliberations.
Troubled crypto exchange FTX investigated by US regulators over customer funds
Crypto trading behemoth FTX fell from grace this week after the exchange experienced a liquidity crunch and agreed to give its rival, Binance, the option to purchase the company’s non-U.S. operations in what appears to be a bailout. Now, U.S. regulators, including the SEC and CFTC, are looking into whether FTX potentially mishandled customer funds on its platform.
Say hello to the newest crypto startups from web3 accelerator Alliance DAO’s demo day
New crypto startups forged ahead during Alliance DAO’s demo day on Wednesday amid the FTX implosion. The most recent cohort, known as All9, for Alliance DAO, a web3 accelerator and builder community, presented their ideas on Wednesday during a demo day, exclusively covered by TechCrunch. There were about 953 applications for this cohort, but only 17 teams were chosen and graduated from the program.
Sequoia Capital marks its FTX investment down to zero dollars
Sequoia Capital just marked down to zero the value of its stake in the cryptocurrency exchange FTX — a stake that accounted for a minor percentage of Sequoia’s capital but as of last week likely represented among the most sizable unrealized gains in the venture firm’s 50-year history. It alerted its limited partners in a letter that it sent out to them this evening, a copy of which TechCrunch obtained and shared in this article.
Some crypto VCs see decentralization as the future following FTX collapse (TC+)
As the crypto market digests the past few days of chaos, venture capitalists see the moment as a warning, but also as an opportunity for the growth of decentralization and maturation of the larger blockchain space. TechCrunch spoke with some investors to understand their long-term view of the industry following this week’s news from FTX.
the latest pod
We had to talk about the news that rocked the crypto world this week in our Thursday episode: the Binance/FTX deal that never was. To begin, we gave you a rundown of WTF just happened with the beef between two of the largest crypto exchanges in the world and how Sam Bankman-Fried’s storied exchange fell so far so fast, bringing down investors, cryptocurrencies and other companies in the space tumbling down with it.
Once we ran through the background behind the situation that’s been unfolding in real time this week, we shared our thoughts on the massive implications this fiasco might have for the rest of the crypto industry, from venture capitalists and startups to regulation across the globe.
It’s a fascinating backdrop for our conversation at our crypto event in Miami next week, where we’ll be chatting with Binance CEO Changpeng Zhao (CZ), the billionaire who is seen as the catalyst for FTX’s downfall. You can use the promo code REACT for 15% off a General Admission ticket to the event to hear from CZ and plenty of other crypto market players about what the future of this tumultuous industry might hold in the coming months.
Chain Reaction comes out every Tuesday and Thursday at 12:00 p.m. PT, so be sure to subscribe to us on Apple Podcasts, Spotify or your favorite pod platform to keep up with the action.
follow the money
- Web3 messaging infrastructure platform Notifi raised a $10 million seed round co-led by Hashed and Race Capital.
- Web3 API provider Ramp secured $70 million in a Series B funding round, co-led by Mubadala Capital and Korelya Capital.
- Blockchain fraud prevention startup TRM Labs expanded its Series B funding round by $70 million led by Thoma Bravo with participation from existing investors PayPal, American Express and Citigroup.
- Eterlast emerged from stealth with $4.5 million to develop web3 games for sports fans.
- Decentralized search engine Sepana raised $10 million from Hack VC, Pitango First and others.
This list was compiled with information from Messari as well as TechCrunch’s own reporting.
Hear CZ for free at TC Sessions: Crypto
Who better to give an insider take on the recent Binance/FTX news than Binance chief executive CZ himself? Score a free ticket, get the lowdown and explore the many conversations and networking opportunities at TC Sessions: Crypto on November 17 in Miami. The first 25 readers to register with this will join us in Miami on November 17 for free!
Crypto’s crown prince stumbles by Anita Ramaswamy originally published on TechCrunch
https://techcrunch.com/2022/11/10/cryptos-crown-prince-stumbles/