Category: TECHNOLOGY
Former Palantir engineers raise $20M to simplify web3 tooling
Kurtosis, a crypto-focused developer tool system, has raised $20 million in a Series A round led by tech-focused hedge fund Coatue.
Investors in the round include Coinbase Ventures, the Chainsmokers’ Mantis VC and angel investor Olivier Pomel, who is the CEO and founder of Datadog, among others. The round comes about two years after its $2.5 million seed round in August 2020, which was led by Signalfire with participation from Hustlefund, Alchemy Ventures, Figment, and NEAR protocol’s co-founder Ilia Polosukhin.
The two-year-old company was founded by former Palantir engineering leads Galen Marchetti and Kevin Today in hopes to simplify the tools for developers building on web3. It currently provides services for the Ethereum, Avalanche and NEAR ecosystems.
“We needed to raise capital because the company started as just me and my co-founder and the more we learned about the problems people are facing in these [blockchain] environments, the more we realized the software we would have to build as two developers would take us five years, which is way too long,” Marchetti said. “We developed enough conviction that this tool is genuinely useful for the people we’re working with and we want to go faster.”
The fresh capital will be used to hire new engineers and product experts in the developer tooling space so it can release a new product within the next six to 12 months, Marchetti said.
“The biggest demand circles around testing use cases,” Marchetti noted. “A lot of folks want to do more advanced testing that involves shadow forking different types of production systems.” (Shadow forking is having the data that a normal mainnet has, but being able to use it and mess around with the software tools without financial risk.)
A lot of developers today don’t have a private or secure test net environment to build on, Marchetti said. So as a result, many hacks and bugs in the web3 space occur because the production system is poorly put together due to lack of ability to build in an early-stage environment, Marchetti said.
“Developers need a place to play around and see whether their modifications to the system are safe or work,” Marchetti said. “It’s like building an airplane without using an air tunnel on the ground. There’s a bunch of instances where the airplane immediately crashes. It’s the same thing here.”
Long term, Kurtosis plans to continue building tools that simplify engineers’ ability to build on web3, Marchetti said. “I think we’re going to have every organization able to spin up their own test nets and dev nets that are private and they don’t want the outside world to see or a public one with many different forms of them so they can be configured for the exact use case they’re testing for.”
https://techcrunch.com/2022/08/04/former-palantir-engineers-raise-20m-to-simplify-web3-tooling/
Mosey secures fresh capital to help companies comply with payroll rules
It’s clear that remote and hybrid work are here to stay — the pandemic forever changed the way many companies do business. But it’s introduced roadblocks from an HR perspective. For example, for payroll, businesses with employees in multiple states face barriers to opening the necessary accounts for disbursements. Others — fearful of the consequences from noncompliance — are letting vague regulations dictate day-to-day operations. A recent Deloitte report found that slightly over half of companies won’t permit employees to work in locations in which the company isn’t already established for tax purposes.
There’s no one solution to the perennial challenge of ensuring a company complies with multiple tax and employment laws. But Alex Kehayias makes the case that Mosey, the company he founded in 2021, comes close. Mosey offers customers automation tools designed to help U.S.-based companies hire workers remotely and stay compliant, leveraging a database of reporting requirements for all 50 states.
“Decoupling where we work from where we live is one of the most important problems to solve for the future of work. It has enormous potential to improve access to opportunity, but many businesses currently struggle because multi-state compliance is too difficult,” Kehayias told TechCrunch in an email interview. “Our customers are fast-growing businesses ranging from early-stage startups like Watershed, Mystery, Common Room all the way up to scaling companies such as Coda, ReCharge, Rallybio. Nearly every industry is being transformed by remote work, and our customers are retooling the back office.”
Setting the stage for future growth, Mosey today closed an $18 million Series A round led by Canaan with participation from Gusto, SemperVirens and Charge, bringing the startup’s total raised to $21 million. Kehayias says that the funding will be used to expand Mosey’s team, scale the platform, and establish new partnerships.
Compliance focus
Prior to founding Mosey, Kehayias was a product manager at Morgan Stanley and an engineering manager at Stripe, where he led the new user experience team. While at Stripe, Kehayias built and headed Stripe Atlas, a platform for early-stage startups that — for a fee — tackles bookkeeping blockers, including incorporation and tax filing.
Kehayias notes that most companies rely on a mix of legal, financial and HR consultants to figure out and manage their compliance requirements. This quickly becomes expensive, however, where multiple states are involved. Excepting states that have no income tax, each has its own rules for income tax withholding that companies must navigate. Things get more complicated if employees spend short periods in other states, or if the business is located in a state that implemented a temporary reprieve during the pandemic.
One source pegs the collective cost to corporations of complying with U.S. income taxes at $2 billion.
“The pandemic accelerated the move to remote work, and employee demand for location flexibility has never been higher. Out-of-state hiring increased from 35% before the pandemic to 62% in 2022, and office occupancy rates have stagnated,” Kehayias said. “Yet, the …read more
Kontempo lands fresh capital amid the boom for B2B BNPL
Kontempo, a startup offering buy now, pay later (BNPL) and interest-free installment plans to business-to-business (B2B) customers, today announced that it raised a $30 million seed round in a mix of equity ($6.5 million) and debt ($25 million). CEO and co-founder Matthew Meehan tells TechCrunch that the new cash will be used to hire staff, grow Kontempo’s merchant network and further develop the technology underlying its platform.
While BNPL has gotten a lot of play in the consumer market, with giants like Klarna, Afterpay and Affirm doing their best to corner it, alternative, installment-based payment plans have been slower to penetrate the traditionally conservative enterprise. While most B2B purchases and procurements are spread out over time (e.g, net 30-day terms), the deals aren’t structured in the way consumer-style BNPL plans typically are. High processing fees are frequently involved, with 35% of businesses in an Ardent Partners survey reporting that it costs $8 to process a single supplier payment. And delays are frequent. A separate report found that it takes an average of 30 days to complete a payment and that 47% of suppliers are paid late for their products or services.
Meehan says he and Kontempo’s other co-founders, Antonia Marino and Kwesi Steele, saw an opportunity to address these challenges in a single platform.
“Three important insights garnered from our prior work formed the basis of the rationale for starting Kontempo,” Meehan told TechCrunch in an email interview. “Most companies selling to small- and medium-sized businesses need to offer point of sale financing, or ‘net terms,’ to be competitive. Moreover, there are currently no viable options to outsource this function. Lastly, fast and flexible payment terms at the point of sale lead to higher average order values and higher overall sales — much like with BNPL in the consumer segment.”
Meehan was previously an analyst at Morgan Stanley and an associate at Lehman Brothers before becoming the VP of Latin America trading at Merrill Lynch. Marino was a senior regional operations manager at Uber in Mexico City, while Steele was a senior sales manager at Google.
Kontempo allows sales teams to approve credit for offline or online purchases with net terms of 30, 60, or 90 days. Alternatively or in addition, enterprises can use Kontempo’s API to deploy a BNPL option at checkout that doesn’t require a credit card or bank account information.
Meehan says that, to mitigate risk, Kontempo captures data from merchant partners to feed an algorithm that determines creditworthiness. The algorithm — which takes into account a range of factors that Meehan declined to reveal — allows Kontempo to reach a broader segment of small- and medium-sized enterprises (SMEs) that are typically rejected for credit.
“Kontempo sees an opportunity with its BNPL product to increase the use of digital payments in the B2B space, boost sales for both online and offline distributors and suppliers to SMEs, and be an early mover in building critical payments infrastructure for the still small but fast growing B2B …read more
https://techcrunch.com/2022/08/04/kontempo-lands-fresh-capital-amid-the-boom-for-b2b-bnpl/
European EV rental startup UFODrive launches in San Francisco
UFODrive, an Europe-based electric vehicle rental company, landed in San Francisco on Thursday, marking the startup’s expansion into the U.S.
The startup, which gives users an easy and contact-free way of renting and subscribing to EVs, comes to California at a time when gas prices are still incredibly high at $5.56. While that number has dropped in recent weeks, it’s still cresting the national average. Combine that with an ongoing rental car shortage and a cultural zeitgeist that’s embracing all things electric, and UFODrive has got itself a potentially winning product-market fit.
UFODrive’s U.S. launch follows the company’s rapid growth in 16 cities across Europe, including London, Paris, Berlin, Amsterdam and Dublin since its founding in 2018. The startup is also planning separate launches for New York and Austin in October.
Other companies have cropped up around the world to provide a similar service. For example, Onto and imove provide monthly EV subscriptions in the UK and Norway, respectively. Where UFODrive differs is it offers a combination of classic daily or weekly rentals and monthly subscriptions. That said, the San Francisco launch will initially offer pure rentals.
Bookings can be made on UFODrive’s app, where each customer is guided through the entire process – registration, identity verification, locating the vehicle, damage check, contract signature and driving away, according to Adain McLean, UFODrive’s CEO.
Customers in the Bay Area can visit one of two vehicle bays in downtown San Francisco on either side of Market Street where they can then use the app to be granted keyless access to their vehicle.
UFODrive worked with Inspiration, the EV asset financing firm that supplied New York-based Revel with its own set of Teslas for ride-hailing purposes, to get around 20 Tesla Model 3s and Model Ys on site for the launch. As the startup has done in Europe, UFODrive plans to lead with the dazzle of Tesla for the first locations and expand its range based on customer input and availability, according to McLean, who noted UFODrive is also looking forward to including Ford in that lineup.
In Europe, the fleet is predominantly made up of Tesla Model 3, Model S and Model Y with Volkswagen ID3, ID4, Hyundai Kona EV, Cupra Born, Polestar, and others, said McLean.
A software platform designed to minimize EV angst
Customers can unlock rented electric vehicles via the UFODrive app. Image Credit: UFODrive
“One of our biggest concerns when we started UFODrive was making people comfortable using an EV and minimizing or removing anxiety throughout the rental – not just at pick-up,” McLean told TechCrunch. “From Day 1, our platform was built to identify issues before they happen. The team is notified if a customer hasn’t completed any of the pick-up stages, fails to start the vehicle, is driving with a battery level below 30%, struggling to charge at a station, etc. In those cases, our team can proactively reach out to make sure the customer is ok if they haven’t already reached out to us. As a result we …read more
https://techcrunch.com/2022/08/04/european-ev-rental-startup-ufodrive-launches-in-san-francisco/
Kakao says emoji subscription purchases fell by a third due to Google’s new in-app policy
The number of emoji subscription purchases on the South Korean messaging app KakaoTalk has dropped by a third over the year, parent firm Kakao said in quarterly earnings call Thursday, blaming Google’s new in-app payment policy, which forces apps to use Android-maker’s own billing system.
KakaoTalk’s Emoticon Plus subscription service, which costs approximately $3.8 per month, allows users to access unlimited emojis. TechCrunch reported in June that South Korean app developers and content providers stand to see their paid subscription and service fees rise because of a recent change in Google’s Play marketplace that corners a 15-30% commission fee.
Kakao chief executive Whon Namkoong said that the negative impact of Google’s new billing policy is “inevitable,” adding that the number of KakaoTalk emoji purchases had dropped after Google introduced its new payment policy in June of this year.
“From the users’ perspective, because of Google’s new in-app payment policy, the [digital goods] price hurdle has gone up,” Namkoong said. “As a result, if you look at [KakoTalk’s] Emoticon Plus [subscription] service, the number of new users has gone down to one-third of what we had seen over the year.”
Kakao plans to work on countermeasures to respond to the change, Namkoong said. “We are planning on running a promotion for users, using Google’s in-app payment, and also for our subscribers in order to make sure we minimize the impact from the in-app payment in the second half of the year,” he said.
The U.S. tech giant enforced changes to its in-app payment system this June to charge transactions overflowing from non-game apps and other types of digital goods including over-the-top (OTT), music streaming, web cartoons, digital book apps and more. The non-games apps, prior to the change, were permitted to direct consumers to outside payment sources through in-app links.
Google said earlier this year in a blog post that “all developers selling digital goods and services in their apps are required to use Google Play’s billing system,” and clarified that apps using external payment links will be removed from Google Play Store starting in June to comply with Google’s new payment system.
Kakao runs two businesses: the platform business (Kakao Talk, Kakao Mobility, Kakao Pay) and the content business (Kakao games, Kakao Webtoons and Melon music streaming). The South Korean internet company posted its second-quarter revenue of $1.3 billion (1.82trillion WON), up 34.8% from the same period a year earlier, and a net income of $77.3 million (101.2 billion WON) for the quarter, down 68% from a year earlier.
Tutanota cries antitrust foul over Microsoft Teams blocking sign-ups for its email users
Microsoft is being called out for blocking users of the end-to-end encrypted email service, Tutanota, from registering an account with its cloud-based collaboration platform, Teams, if they try to do that using a Tutanota email address.
The problem, which has been going on unrectified for some time — with an initial complaint raised with Microsoft support back in January 2021 — appears to have arisen because it treats Tutanota as a corporate email, rather than what it actually is (and has always been), an email service.
This misclassification means that when a Tutanota email user tries to use this email address to register an account with Teams they get a classic ‘computer says no’ response — with the interface blocking the registration and suggesting the person “contact your admin or try a different email”.
“When the first Tutanota user registered a Teams account, they were assigned the domain. That’s why now everyone who logs in with Tutanota address should report to their ‘admin’ (see screenshot),” explains a spokeswoman for Tutanota when asked why they think this is happening.
Screengrab: Tutanota
To get past this denial — and register a Teams account — the Tutanota user has to enter a non-Tutanota email. (Such as, for example, a Microsoft email address.)
Unsurprisingly, Tutanota is crying foul over Microsoft’s failure to fix an obvious SNAFU — and urging action from antitrust authorities to ensure that competition generally, and pro-privacy business models like its own, are not harmed by over powerful, gatekeeping tech giants failing to provide a level playing field.
In a blog post detailing the saga, Tutanota co-founder, Matthias Pfau, dubs Microsoft’s behavior a “severe anti-competitive practice”.
“Politicians on both sides of the Atlantic are discussing stronger antitrust legislation to regulate Big Tech. These laws are badly needed as the example of Microsoft blocking Tutanota users from registering a Teams account demonstrates,” he writes. “The problem: Big Tech companies have the market power to harm smaller competitors with some very easy steps like refusing smaller companies’ customers from using their own services.”
“This is just one example of how Microsoft can and does abuse its dominant market position to harm competitors, which in turn also harms consumers,” he adds.
The German company behind Tutatnota was founded all the way back in 2011, going on to launch its encrypted email client in 2014 — so Microsoft can’t exactly be accused of having its finger on the pulse here.
But Tutanota says that when it asked he company’s support staff to fix the problem they’d created they were told it simply wasn’t “feasible”.
“We have reviewed this internally and as of now, it is currently not feasible for the domain to become a public domain and this is because the domain has used the Microsoft Teams services,” wrote Microsoft support staff in one unhelpful email response to Tutanota which TechCrunch has reviewed.
“As earlier discussed, we are unable to make your domain a public domain. The domain has already been used for Microsoft Teams. If teams have been used …read more
Club Feast quietly pivoted to catering and left its consumer customers in a lurch
A year ago, Club Feast, a subscription-based service aiming to disrupt the food delivery industry, emerged from stealth with $3.5 million in seed funding and the backing of prominent investors, including General Catalyst and Pika Capital. Co-founders Atallah Atallah, Ghazi Atallah and Chris Miao claimed that, by working with hundreds of restaurants to create low-priced meals, they could offer delivery that only cost $5.99 per dish plus a $2 delivery fee (and a $1 fee for single-meal orders).
The business appeared to be going strong, even hiring travel bloggers for promotional spots on TikTok. But earlier this year, subscribers started seeing higher tabs and fees. Then, within the last few months, Club Feast ditched its consumer offering completely in favor of corporate catering, leaving its original customers with meal credits that they say they can’t use (although the company disputes this).
“The advertised price didn’t last long, and by the time I stopped using the service, the prices were the same as Seamless and Uber Eats,” one former Club Feast user told TechCrunch via Twitter. “I would literally look in the [mobile] app and the price was different. Then they tried to say it was because of rising prices of ingredients, etc., [but] the issue for me was lack of transparency and accountability.”
Low-cost food delivery
At launch, Club Feast had diners sign up for a weekly meal plan and reserve lunch or dinner orders several hours ahead of time. Subscribers got a set number of meal credits, which could be topped up, paused or spent at any time. Club Feast’s restaurant partners offered four or five meals to choose from, which came to between $8.50 and $9 with the fees factored in — or less for customers enrolled in a $7.99-per-month “Feast Pass” plan that did away with delivery fees.
The idea was to give restaurants an estimate of purchase volume so they could plan ahead and cook economically — passing the savings on to diners. While operators accepted lower profit margins on Club Feast meals, they did so with the expectation that higher order volumes would make up for it. Club Feast’s bike-riding delivery drivers, too, had more predictability than with on-demand ordering platforms in the sense that routes were chosen for “efficiency” and meals were dropped off on a regular schedule.
In a January 2021 interview with TechCrunch, Atallah Atallah said that — while Club Feast might eventually introduce higher-priced fancier meals — the base price point would remain intact. “We want to make sure that does not affect the $5.99 concept,” he said.
There was reason to believe Club Feast would keep its promise. Atallah Atallah is also a co-founder of restaurant rewards company Seated, which claims to have brought in tens of millions of dollars in revenue for its restaurant partners. And Club Feast was on an expansion tear for a year, adding New York City and the larger Bay Area to its delivery zones after running pilots in San Francisco and San Mateo.
<div …read more
Pro-Beijing Online Campaign Targets U.S.-Based Xinjiang Researcher, Cybersecurity Firm Says
A pro-Beijing online propaganda campaign has used phony websites and social-media postings to try to discredit a prominent German anthropologist who has investigated China’s crackdown on Muslims, according to cybersecurity researchers. …read more
Lyft assured no layoffs were coming — now employees are scrambling for their next gig
The day before Lyft shut down its in-house rental service and laid off close to 60 employees, the team in charge of the program was consumed by what they thought was a much bigger problem.
Throughout June, the rentals team had attempted to get the service up and running in New York without success. The launch was delayed repeatedly and for a variety of reasons, including the need to get a new insurance provider in the state. But even after the new insurance policy began July 1, Lyft had still not opened up its rental business in New York, leaving the team with questions, according to sources who spoke with TechCrunch on condition of anonymity.
Leadership eventually told the team it was punting on New York altogether and would instead shift operations to opening the in-house rental program in Austin where there are fewer regulatory hurdles.
Within three weeks, Lyft executives would shutter the entire rental program, leaving workers scrambling to find other positions within the company or risk losing their employment status altogether. Lyft also announced that around 60 employees would be laid off.
The layoff announcements came just ahead of Lyft’s second-quarter earnings, which will be released Thursday. The earnings call could provide more clarity on the direction of the company and whether further cuts are expected.
July surprise
Throughout the failed attempt to launch in New York, alarm bells went off for at least one staffer, who spoke to TechCrunch on the condition of anonymity. The employee, seeking some peace of mind, held on to Lyft co-founder and president John Zimmer’s comments during a company-wide meeting in May when he spoke about reprioritization, slowing hiring and budget cuts and assured everyone that layoffs were not being considered.
What happened next took many employees by surprise. Employees received an email July 19 from Cal Lankton, VP of fleet and global operations — which TechCrunch has viewed — informing them that Lyft had finished its reprioritization after the first-quarter earnings call and decided to shut down its in-house rentals program and continue to provide a similar service through its partnerships with Hertz and Sixt.
The email also said Lyft would consolidate some regions in global operations and centralize its market operations team — this is mainly on-the-ground operations like driver support and vehicle service centers. Lankton said that two locations — the San Francisco vehicle service center and the Detroit Hub — would be closed down.
“We worked hard to place as many team members as possible in other roles across the business,” Lankton wrote in the email sent to employees. “However, there won’t be a role for everyone in this new structure. Following this message, impacted team members in the Lyft Rentals central teams and Global Operations will receive a calendar invite by 10:45 a.m. PST to learn what this means for their roles.”
Most of the 60 affected employees found out via a memo. Meanwhile, hourly employees who worked on the ground at local service …read more
TikTok Music’s trademarks spotted in multiple countries, hinting toward global launch plans
ByteDance may be preparing for a global launch of TikTok Music service, according to trademarks filed in several countries found by TechCrunch. The China-based conglomerate has filed TikTok Music trademark in countries like the U.K., Singapore, New Zealand, Mexico, Malaysia and Costa Rica.
This comes after a Business Insider report last week, which pointed toward a “TikTok Music” trademark filing in the U.S. ByteDance had also filed another trademark in Australia under a similar name.
All of these trademark filings include similar text about the application’s functionality of listening to music, creating playlists, commenting on songs and participating in karaoke.
The trademark application says it would allow “users to purchase, play, share, download music, songs, albums, lyrics, quotes, create, recommend, share his/her playlists, lyrics, quotes, take, edit and upload photographs as the cover of playlists, comment on music, songs and albums.”
ByteDance already operates a music streaming service called Resso in India, Brazil and Indonesia, and a former ByteDance employee told us it had previously considered bringing this service to more markets under a “TikTok Music” title. Specifically, it had been considering launches in mature markets like the U.K. and Australia, the source said.
Resso has identical features to the ones described above, with TikTok-like vertical scrolling to go through songs, the ability to change cover photos for playlists, lyrics displayed on the lock screen, and comments on songs and albums.
Since its launch in 2020, Resso has seen solid progress in its existing markets, mobile data indicates. According to analytics firm Sensor Tower, the company saw 42.3 million downloads from the App Store and Google Play from January to May this year — growth of 19% year over year for the same period. The music streaming app has had 184 million overall lifetime downloads, as well.
TikTok, meanwhile, has had a major impact on the music industry with many hits being driven by different viral videos on the platform. A report released by the company last year suggested that 175 songs that trended on the short-video platform ended up on the Billboard 100 chart. In addition, a recent report published by a U.K.-based music investor noted that songs that are popular on TikTok drive additional views on YouTube and streams on other music streaming platforms, like Spotify. Record labels are also benefitting from TikTok’s success in the music sector. Reports estimate that TikTok paid $179 million to recorded music right owners in 2021.
ByteDance would want to grab all that traffic and streaming money from its own music service, and its recently launched music marketing and distribution platform SoundOn. Last week the company launched a pre-release feature so the artists can “leak” their songs to the TikTok audience before the official release.
The launch of TikTok Music would mean an additional revenue stream for ByteDance and a complete music solution service that can …read more