Category: Tech news

Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s inspired by what the weekday Exchange column digs into, but free, and made for your weekend reading. Want it in your inbox every Saturday? Sign up here. 

Happy weekend, friends. I am writing to you on Friday afternoon after powering through a grilled cheese. But as I have a huge iced coffee on deck, we can dodge a food coma and get right to work. Today we’re talking about a pretty neat venture round, chatting with a founder about verticalization and riffing on Marqeta’s earnings report. So, we have fintech and SaaS and public company notes for your enjoyment. Let’s do it!

HiHello’s ambitious Series A

You may be familiar with Manu Kumar. He’s a venture capitalist at K9 Ventures. But he’s also building a startup at the same time, and it’s the latter effort that we’re interested in today.

The company, called HiHello, raised a $7.5 million Series A, it announced recently. Foundry led the investment, Lux Capital took part, and a host of angels also kicked in checks. So far, so ordinary. But the round is not the interesting bit of the HiHello story. Instead, it’s what the company is building.

A question: When did you last order business cards? I can’t recall, frankly, but somewhere between my last job and coming back to TechCrunch I forgot to get new cards. And not simply thanks to COVID or the fact that I now live far from San Francisco. I just didn’t think of it as they didn’t seem too useful.

HiHello is building something akin to the future of business cards for the internet. Per Kumar, everyone still needs a way to show their identity and introduce themselves, even in a digital world. Sure, for scheduled gatherings, he argued, you can do prep. But for meeting folks in a more unplanned manner, having a way to share your identity is useful.

So, HiHello lets you create virtual business cards of a sort for yourself. But not just one, the idea is to have several, one for each of your personas. Kumar said that I could have one for our podcast (Equity), one for TechCrunch proper and so forth. You can make them for your personal life as well.

I figured that business cards were dead. And that we didn’t need to rebuild them. Kumar doesn’t agree. He sees a future where HiHello can create what are, in effect, personal social networks around context. It’s bold and it’s counterintuitive. Good startup fodder, in other words.

HiHello is monetizing off of consumer revenue today and has a business product as well. Let’s see how quickly the startup can grow. It’s about time we got excited about a new sort of social product.

Going vertical

I’ve written about Skyflow a few times. It’s co-founder, Anshu Sharma, is someone I’ve known for ages. We met when he was at Storm Ventures. Since then he’s invested as an angel and founded a few companies, one of which is Skyflow. The software startup sells a digital vault that allows for PII and other critical information to be secured on customers’ behalf and accessed in a safe manner, allowing companies for whom information security is not their core focus to avoid breaches.

The model is working, with Skyflow raising capital at a pretty aggressive rate. And Sharma seems chuffed thus far with customer progress. (Sharma also provided notes that helped me ground an essay the other day.)

Recently Skyflow announced a particular flavor of product for the healthcare market. Given that I’ve been tracking the company since it first launched, I was curious. So I got Sharma back on the phone to explain his verticalization strategy — I was curious how he was picking markets to pursue and where he might take his company next.

Sharma said that his company’s plan is to prove its technology in complex markets, and then expand its remit over time. Hence the healthcare push and Skyflow’s work with storing financial data. By solving hard problems and selling to complicated customers he said, Skyflow will earn market permission to offer its tech to other folks.

From the CEO’s perspective, we need to “rewire” the internet from the ground up with a privacy focus. Citing a Marc Andreeseen riff about how not building payments tech into the internet from the start was an error, Sharma argued that two things were forgotten in the early days of the web: payments, yes, and privacy.

The verticalization strategy of Skyflow, then, is to tackle the hardest problems that it can — healthcare data is privy to all sorts of rules and regulations — and then broaden its focus until PII is safer for everyone. It’s a fundamentally optimistic take on where the internet could be heading. Not a Facebookian world where privacy is theoretical and adtech is persistent, but a world where your data is yours and is safe, stored and out of reach.

The competitive landscape that Skyflow plays in will harden. But so long as even some of the startups in the market that want to return privacy to individuals wins, I will be content.

Marqeta’s first earnings call

Somewhat lost amidst the wave of IPOs that we’ve seen this year was Marqeta’s debut, a fintech unicorn working in the card issuing space. It reported its earnings publicly for the first time this week, so I got on the phone with its CEO Jason Gardner to yammer about the results.

In brief, Marqeta grew quickly in the second quarter, easily besting expectations. The company lost more money than the markets anticipated however, leading to its shares shedding effectively all their post-IPO gains.

A few notes from the call. First, Gardner seems content to be past the public offering. He said that he’s had the chance to fall back in love with running the company now that his 18-month IPO market is complete. And he said that swapping yearly board-level planning for quarterly reports has been enjoyable, as having more regular disclosures brings a sense of urgency to the company’s work.

As we usually hear private company CEOs worry about distracting earnings calls and the like, it was somewhat refreshing to hear a public executive praise floating their company. It reminded us of the comments that we heard from BigCommerce CEO Brent Bellm on the same topic, even if they like being public for different reasons.

More important to our understanding of the world of startups, however, was Marqeta’s notes on the BNPL market. In the wake of Klarna’s rise, Square buying Afterpay and a zillion startup BNPL rounds, seeing Marqeta note the buy now. pay later space as a growth market for its work caught our eye. Why was BNPL helping a card issuing platform?

Well, it turns out, the virtual cards that Marqeta and others can spin up for customers are often used as part of the software sinew that makes BNPL transactions possible. The fintech world is always more interconnected than you expect. So, when we consider BNPL as a category, we’ll do well to also keep tabs on what other boats its growth may be floating. That expands the number of startups that could be riding the BNPL wave.

One tip before we go. The fastest way to get an explanation of a market dynamic that you are not familiar with is to ask a public CEO to explain it to you. The downside to this particular educational method is that if you were close to understanding the concept before but missed a single key element, you will feel pretty silly when said CEO tells you in small words what you previously failed to grok.

However, as I am, in fact, very dumb, I refuse to be red-faced about not knowing things. Alright, that’s enough for today. There’s an extra Equity episode out today, and The Exchange is back on Monday morning!

Hugs, and get vaccinated. Your friend,

— Alex

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

A sexual assault case at Alibaba has sparked a new round of #MeToo reckoning in China. Industry observers believe this is a watershed moment for the fight against China’s allegedly misogynist tech industry. Meanwhile, social media operators are still undecided on how to deal with the unprecedented public uproar against the powerful internet giant.

In other news, more Chinese tech companies have delayed plans to go public overseas after Didi’s fallout with Chinese regulators over its rushed IPO, including Tencent’s music streaming empire and one of China’s highest-valued autonomous driving startups.

Call for justice

Just past midnight last Sunday, an Alibaba employee posted on the company’s internal forum a detailed account saying her manager and a client had sexually assaulted her on a business trip. She took the case public after failing to obtain support from her superiors and human resources.

The post quickly made its rounds through China’s social media platforms. People stayed up blasting Alibaba’s ignorance, toxic business drinking, and the pervasive objectification of women in the Chinese “tech industry,” which has grown so far-reaching that it’s just the contemporary corporate world.

A day later, on August 9, Alibaba swiftly fired the alleged perpetrator. Two managers resigned and the firm’s head of HR was given a “disciplinary warning.” Alibaba’s CEO Daniel Zhang said he felt “shocked, angry and ashamed” about the incident and called on the company to work with the police to investigate the case.

This is arguably the most high-profile #MeToo case embroiling a major Chinese tech company by far and one that seems to have beckoned the toughest response from the company involved. Alibaba is formulating company policies to prevent sexual assaults, which surprises many that the global tech behemoth didn’t already have those in place.

The case managed to garner widespread public attention in China thanks to social media. Within the first few hours, it seemed as though discussion around the incident was propagating organically and uncensored on microblogging platform Weibo, in which Alibaba owns a majority stake.

But people soon noticed that despite the severity of the event, it took days before the case climbed to the top of Weibo’s trending chart, a bellwether for the most talked about topic on the Chinese internet. The perceived delay recalls Weibo’s censorship of an extramarital affair involving Alibaba executive Jiang Fan last year.

Talang Qingnian, roughly “Surfing Youth,” a social media column under state paper People’s Daily, blasted in an article:

The slow buildup of discussion again raised suspicion over whether Alibaba has manipulated public discourse.

Ever since the Jiang Fan case, the country’s attitude has been very clear that capital must not control the media.

As the basic infrastructure for truthful news in China, Weibo should not be a tool for any stakeholder to manipulate public opinion.

The article fanned up more public outrage but was soon taken down, likely because its wording was too strong. The Chinese state media apparatus is vast and only a few outlets, such as Xinhua, consistently convey top-level leaders’ official opinions. It’s not uncommon to see the less authoritative state-affiliated publications back down on reports that have cause backlashes. Last week, an article from a state-affiliated economic paper removed a piece calling video games “spiritual opium,” a loaded description that had earlier tanked the stocks of Tencent and NetEase, and republished the article with a softer tone.

Smaller war chests

Regulatory uncertainties have always been flagged as a risk by Chinese companies seeking overseas listings, but it was largely up to foreign investors to decide whether they were worthwhile investments. China’s recent regulatory onslaught on its tech darlings, however, has become a real deterrent for Chinese firms’ IPO dream.

This week, reports arrived that NetEase Music, a popular music streaming service, and Pony.ai, an autonomous vehicle startup last valued at $5.3 billion, have respectively postponed their plans to list in Hong Kong and New York.

Beijing has become warier of its data-rich companies getting scrutinized by U.S. regulators. Last month, the U.S. securities regulator said Chinese companies that want to raise capital in the U.S. must provide information about their legal structure and disclose the risk of Beijing’s interference in their business.

Many Chinese tech firms have learned from Didi’s fallout with the government, which had reportedly told the ride-sharing company to hold off on its listing until it sorted out a data protection framework. Didi went ahead regardless, triggering a government probe into its data practice and tanking its shares, which now stand at $8 apiece compared to $16 around its debut in early July.

Beijing’s crackdown has affected every major player in China’s consumer tech sector, wiping as much as $87 billion off the net worth of the country’s tech billionaires, including Pony Ma of Tencent and Colin Huang of Pinduoduo, according to Financial Times. The government wants “hard tech” like semiconductors and clean energy, so it has made it clear to future entrepreneurs where they should allocate their energy. The new generation of startups is listening now.

Advocates of algorithmic justice have begun to see their proverbial “days in court” with legal investigations of enterprises like UHG and Apple Card. The Apple Card case is a strong example of how current anti-discrimination laws fall short of the fast pace of scientific research in the emerging field of quantifiable fairness.

While it may be true that Apple and their underwriters were found innocent of fair lending violations, the ruling came with clear caveats that should be a warning sign to enterprises using machine learning within any regulated space. Unless executives begin to take algorithmic fairness more seriously, their days ahead will be full of legal challenges and reputational damage.

What happened with Apple Card?

In late 2019, startup leader and social media celebrity David Heinemeier Hansson raised an important issue on Twitter, to much fanfare and applause. With almost 50,000 likes and retweets, he asked Apple and their underwriting partner, Goldman Sachs, to explain why he and his wife, who share the same financial ability, would be granted different credit limits. To many in the field of algorithmic fairness, it was a watershed moment to see the issues we advocate go mainstream, culminating in an inquiry from the NY Department of Financial Services (DFS).

At first glance, it may seem heartening to credit underwriters that the DFS concluded in March that Goldman’s underwriting algorithm did not violate the strict rules of financial access created in 1974 to protect women and minorities from lending discrimination. While disappointing to activists, this result was not surprising to those of us working closely with data teams in finance.

There are some algorithmic applications for financial institutions where the risks of experimentation far outweigh any benefit, and credit underwriting is one of them. We could have predicted that Goldman would be found innocent, because the laws for fairness in lending (if outdated) are clear and strictly enforced.

And yet, there is no doubt in my mind that the Goldman/Apple algorithm discriminates, along with every other credit scoring and underwriting algorithm on the market today. Nor do I doubt that these algorithms would fall apart if researchers were ever granted access to the models and data we would need to validate this claim. I know this because the NY DFS partially released its methodology for vetting the Goldman algorithm, and as you might expect, their audit fell far short of the standards held by modern algorithm auditors today.

How did DFS (under current law) assess the fairness of Apple Card?

In order to prove the Apple algorithm was “fair,” DFS considered first whether Goldman had used “prohibited characteristics” of potential applicants like gender or marital status. This one was easy for Goldman to pass — they don’t include race, gender or marital status as an input to the model. However, we’ve known for years now that some model features can act as “proxies” for protected classes.

The DFS methodology, based on 50 years of legal precedent, failed to mention whether they considered this question, but we can guess that they did not. Because if they had, they’d have quickly found that credit score is so tightly correlated to race that some states are considering banning its use for casualty insurance. Proxy features have only stepped into the research spotlight recently, giving us our first example of how science has outpaced regulation.

In the absence of protected features, DFS then looked for credit profiles that were similar in content but belonged to people of different protected classes. In a certain imprecise sense, they sought to find out what would happen to the credit decision were we to “flip” the gender on the application. Would a female version of the male applicant receive the same treatment?

Intuitively, this seems like one way to define “fair.” And it is — in the field of machine learning fairness, there is a concept called a “flip test” and it is one of many measures of a concept called “individual fairness,” which is exactly what it sounds like. I asked Patrick Hall, principal scientist at bnh.ai, a leading boutique AI law firm, about the analysis most common in investigating fair lending cases. Referring to the methods DFS used to audit Apple Card, he called it basic regression, or “a 1970s version of the flip test,” bringing us example number two of our insufficient laws.

A new vocabulary for algorithmic fairness

Ever since Solon Barocas’ seminal paper “Big Data’s Disparate Impact” in 2016, researchers have been hard at work to define core philosophical concepts into mathematical terms. Several conferences have sprung into existence, with new fairness tracks emerging at the most notable AI events. The field is in a period of hypergrowth, where the law has as of yet failed to keep pace. But just like what happened to the cybersecurity industry, this legal reprieve won’t last forever.

Perhaps we can forgive DFS for its softball audit given that the laws governing fair lending are born of the civil rights movement and have not evolved much in the 50-plus years since inception. The legal precedents were set long before machine learning fairness research really took off. If DFS had been appropriately equipped to deal with the challenge of evaluating the fairness of the Apple Card, they would have used the robust vocabulary for algorithmic assessment that’s blossomed over the last five years.

The DFS report, for instance, makes no mention of measuring “equalized odds,” a notorious line of inquiry first made famous in 2018 by Joy Buolamwini, Timnit Gebru and Deb Raji. Their “Gender Shades” paper proved that facial recognition algorithms guess wrong on dark female faces more often than they do on subjects with lighter skin, and this reasoning holds true for many applications of prediction beyond computer vision alone.

Equalized odds would ask of Apple’s algorithm: Just how often does it predict creditworthiness correctly? How often does it guess wrong? Are there disparities in these error rates among people of different genders, races or disability status? According to Hall, these measurements are important, but simply too new to have been fully codified into the legal system.

If it turns out that Goldman regularly underestimates female applicants in the real world, or assigns interest rates that are higher than Black applicants truly deserve, it’s easy to see how this would harm these underserved populations at national scale.

Financial services’ Catch-22

Modern auditors know that the methods dictated by legal precedent fail to catch nuances in fairness for intersectional combinations within minority categories — a problem that’s exacerbated by the complexity of machine learning models. If you’re Black, a woman and pregnant, for instance, your likelihood of obtaining credit may be lower than the average of the outcomes among each overarching protected category.

These underrepresented groups may never benefit from a holistic audit of the system without special attention paid to their uniqueness, given that the sample size of minorities is by definition a smaller number in the set. This is why modern auditors prefer “fairness through awareness” approaches that allow us to measure results with explicit knowledge of the demographics of the individuals in each group.

But there’s a Catch-22. In financial services and other highly regulated fields, auditors often can’t use “fairness through awareness,” because they may be prevented from collecting sensitive information from the start. The goal of this legal constraint was to prevent lenders from discrimination. In a cruel twist of fate, this gives cover to algorithmic discrimination, giving us our third example of legal insufficiency.

The fact that we can’t collect this information hamstrings our ability to find out how models treat underserved groups. Without it, we might never prove what we know to be true in practice — full-time moms, for instance, will reliably have thinner credit files, because they don’t execute every credit-based purchase under both spousal names. Minority groups may be far more likely to be gig workers, tipped employees or participate in cash-based industries, leading to commonalities among their income profiles that prove less common for the majority.

Importantly, these differences on the applicants’ credit files do not necessarily translate to true financial responsibility or creditworthiness. If it’s your goal to predict creditworthiness accurately, you’d want to know where the method (e.g., a credit score) breaks down.

What this means for businesses using AI

In Apple’s example, it’s worth mentioning a hopeful epilogue to the story where Apple made a consequential update to their credit policy to combat the discrimination that is protected by our antiquated laws. In Apple CEO Tim Cook’s announcement, he was quick to highlight a “lack of fairness in the way the industry [calculates] credit scores.”

Their new policy allows spouses or parents to combine credit files such that the weaker credit file can benefit from the stronger. It’s a great example of a company thinking ahead to steps that may actually reduce the discrimination that exists structurally in our world. In updating their policies, Apple got ahead of the regulation that may come as a result of this inquiry.

This is a strategic advantage for Apple, because NY DFS made exhaustive mention of the insufficiency of current laws governing this space, meaning updates to regulation may be nearer than many think. To quote Superintendent of Financial Services Linda A. Lacewell: “The use of credit scoring in its current form and laws and regulations barring discrimination in lending are in need of strengthening and modernization.” In my own experience working with regulators, this is something today’s authorities are very keen to explore.

I have no doubt that American regulators are working to improve the laws that govern AI, taking advantage of this robust vocabulary for equality in automation and math. The Federal Reserve, OCC, CFPB, FTC and Congress are all eager to address algorithmic discrimination, even if their pace is slow.

In the meantime, we have every reason to believe that algorithmic discrimination is rampant, largely because the industry has also been slow to adopt the language of academia that the last few years have brought. Little excuse remains for enterprises failing to take advantage of this new field of fairness, and to root out the predictive discrimination that is in some ways guaranteed. And the EU agrees, with draft laws that apply specifically to AI that are set to be adopted some time in the next two years.

The field of machine learning fairness has matured quickly, with new techniques discovered every year and myriad tools to help. The field is only now reaching a point where this can be prescribed with some degree of automation. Standards bodies have stepped in to provide guidance to lower the frequency and severity of these issues, even if American law is slow to adopt.

Because whether discrimination by algorithm is intentional, it is illegal. So, anyone using advanced analytics for applications relating to healthcare, housing, hiring, financial services, education or government are likely breaking these laws without knowing it.

Until clearer regulatory guidance becomes available for the myriad applications of AI in sensitive situations, the industry is on its own to figure out which definitions of fairness are best.

This week Danny and Alex and Chris took to Twitter Spaces to chat about the current state of the crypto economy, and hang out with friends in a live Twitter Space. We’re doing more of these, so make sure that you are following the show on Twitter.

As a small programming note, I forgot to tell the folks who chimed in during the chat that we were recording it, so we had to cut most the Q&A portion of the show. We got Ezra’s permission, thankfully. The mixup was a bummer as we learned a lot. In the future, we’ll not make that mistake and keep all the voices.

So, what did we talk about? The following:

• The current state of crypto regulation in America, and how the government may screw everything up. In short, tech moves fast, and government moves slow. This creates friction.
• Coinbase kicked the ever-loving shit out of its Q2 earnings. But as it turns out the future for trading-powered companies could include a few quarters of slower results.
• And everyone wants to fund the next Coinbase. You can understand why. The company is printing cash lately, helping drive more investment into localized exchanges in different markets.

Ok, we’re back Monday with your regularly scheduled programming!

Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday morning at 7:00 a.m. PST, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

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“I like to think of successful brand-building as creating a company that customers would be upset to separate from their identity,” growth marketing expert Julian Shapiro told us earlier this week. “For example, they’d cease to be the man with Slack stickers all over his laptop. Or the woman who no longer wears Nike shoes every day. And that bugs them.”

Shapiro comes from a technical background, as a repeat startup founder and open-source web developer. But these days, as the co-founder of growth education company Demand Curve and startup growth agency Bell Curve, he advocates telling your story by speaking from the heart. We interviewed him earlier this week to hear more about how he sees marketing in 2021.

Elsewhere on TechCrunch and Extra Crunch this week, we published guest columns about using influencers in early-stage brands, the global retail media spending trend and talked to Growth Folks, a growth marketing organization in India.

But first, here are a couple of the most recent recommendations from founders in our startup growth marketer survey. (If there’s a growth marketer that you’ve enjoyed working with, please tell us here.)

Marketer: Bili Sule, alGROWithm
Recommended by: Femi Aiki, Foodlocker
Testimonial: “Bili has a proven track record of driving growth, as the former vice president of Growth Marketing at Jumia Nigeria and as a senior growth consultant for Founders Factory Africa. She’s able to cut through the jargon/vanity metrics and has found a way to consistently and reliably engineer growth for us. What’s unique about Bili’s approach is that her strategy moves beyond just marketing. She is data driven and takes an iterative experimental approach to unlocking growth across various business pillars, from marketing to product and operations.”

Marketer: Jack Abramowitz
Recommended by: Marwen Refaat, GameFi
Testimonial: “Jack is incredibly talented at both growth hacking as well as building an automated growth engine. He has been tremendously helpful to our team.”

Building a growth community in India with Ayush Srivastava of Growth Folks: India is producing a huge, well-funded new generation of startups and increasing sophistication in growth marketing is one reason why. “Companies have started realizing the true importance of having a fully functional growth team and they have started acknowledging their one metric that matters as well,” Srivastava told us in a recent interview. “The growth marketers have also started setting up a lot of experiments and have taken a data-driven approach to solving a problem. Now, I see many startups going out of the box and putting in efforts to find new ways of acquisition. They haven’t restricted them to acquiring users via the traditional ways and that’s why you see so many ideas going viral so easily.”

(Extra Crunch) Early-stage brands should also unlock the power of influencers: Jonathan Martinez, an experienced growth marketer, breaks down influencer marketing. Martinez notes, “When reaching out to influencers, it’s a sheer numbers game in capturing their attention and pitching your brand, but there are myriad ways to increase response conversion.”

(Extra Crunch) What’s driving the global surge in retail media spending? Cynthia Luo, head of marketing at Epsilo, discusses what modern marketing is in 2021. Luo also talks about how businesses have had to adapt during the COVID-19 pandemic. Luo says, “As e-commerce turns into a dream marketing channel, reaping the benefits of retail marketing is only possible if the marketplace equips brands with the right tools and data sets.”

The art of startup storytelling with Julian Shapiro: Eric Eldon, Extra Crunch managing editor, spoke with Julian Shapiro, about how companies communicate with the public. Shapiro offered insights from his experience as an angel investor, “I’m interested in businesses with product-led growth, brand affinity moats and who get harder to compete with the larger they get.”

(Extra Crunch) Growth tactics that will jump-start your customer base: Jenny Wang, principal investor at Neo, gives insights on the challenges startups now face to launch their customer base and provides some tactics to help them do so. In this article, Wang discusses what the playbook was like five years ago and says, “ … it’s never been harder to corral eyeballs and hit a breakout adoption trajectory.”

Salesforce State of Marketing: Salesforce published a marketing report that uses data from a double-blind survey they conducted. The survey has five main chapters, “Marketers Embrace Change with Optimism,” “As Customers Go Digital, Marketing Steps Up,” “Collaboration Drives the Market-from-Anywhere Era,” “Marketing Is Spelled D-A-T-A” and “Metrics and KPIs Continue to Evolve.” When looking at digital channels, they mentioned that, “Even those digital channels that may have been classified as emerging in recent years are seeing mass adoption. Mobile messaging, for instance, is used by 69% of marketers, and nearly two-thirds of organizations use audio media like podcasts and streaming ads.” The report lists out the five “Most Valuable Marketing Metrics/KPIs” and looks ahead at “Digital Marketing Tactics.”

Is there a startup growth marketing expert that you want us to know about? Let us know by filling out our survey.

Although older adults are one of the fastest-growing demographics, they’re quite underserved when it comes to consumer tech.

The global population of people older than 65 will reach 1.5 billion by 2050, and members of this cohort — who are leading longer, active lives — have plenty of money to spend.

Still, most startups persist in releasing products aimed at serving younger users, says Lawrence Kosick, co-founder of GetSetUp, an edtech company that targets 50+ learners.

“If you can provide a valuable, scalable service for the older adult market, there’s a lot of opportunity to drive growth through partnerships,” he notes.

Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.

Image Credits: Sukhinder Singh Cassidy

On Thursday, August 19, Managing Editor Danny Crichton will interview Sukhinder Singh Cassidy, author of “Choose Possibility,” on Twitter Spaces at 2 p.m. PDT/5 p.m. EDT/9 p.m. UTC.

Singh Cassidy, founder of premium talent marketplace theBoardlist, will discuss making the leap into entrepreneurship after leaving Google, her time as CEO-in-Residence at venture capital firm Accel Partners and the framework she’s developed for taking career risks.

They’ll take questions from the audience, so please add a reminder to your calendar to join the conversation.

Thanks very much for reading Extra Crunch this week! Have a great weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

Dear Sophie: Can I hire an engineer whose green card is being sponsored by another company?

Image Credits: Bryce Durbin/TechCrunch

Dear Sophie,

I want to extend an offer to an engineer who has been working in the U.S. on an H-1B for almost five years. Her current employer is sponsoring her for an EB-2 green card, and our startup wants to hire her as a senior engineer.

What happens to her green card process? Can we take it over?

— Recruiting in Richmond

3 lies VCs tell ourselves about startup valuations

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

In a candid guest post, Scott Lenet, president of Touchdown Ventures, writes about the cognitive dissonance currently plaguing venture capital.

Yes, there’s an incredible amount of competition for deals, but there’s also a path to bringing soaring startup valuations back to earth.

For example, early investors have an inherent conflict of interest with later participants and many VCs are thirsty “logo hunters” who just want bragging rights.

At some point, “venture capitalists need to stop engaging in self-delusion about why a valuation that is too high might be OK,” writes Lenet.

‘The tortoise and the hare’ story is playing out right now in VC

Image Credits: Getty Images under a GK Hart/Vikki Hart (opens in a new window) license.

Aesop’s fable about the determined tortoise who defeated an arrogant hare has many interpretations, e.g., the value of perseverance, the virtue of taking on bullies, how an outsized ego can undermine natural talent.

In the case of venture capital, the allegory is relevant because a slow, steady and more personal approach generates better outcomes, says Marc Schröder, managing partner of MGV.

“We simply must take the time to get to know founders.”

What’s driving the global surge in retail media spending?

Image Credits: Getty Images under a jayk7 (opens in a new window) license.

As the pandemic changed consumer behavior and regulations began to reshape digital marketing tools, advertisers are turning to retail media.

Using the reams of data collected at the individual and aggregate level, retail media produce high-margin revenue streams. “And like most things, there is a bad, a good and a much better way of doing things,” advises Cynthia Luo, head of marketing at e-commerce marketing stack Epsilo.

New York City’s enterprise tech startups could be heading for a superheated exit wave

Image Credits: Nigel Sussman (opens in a new window)

“We lied when we said that The Exchange was done covering 2021 venture capital performance,” Anna Heim and Alex Wilhelm admit.

Yesterday, they reviewed a detailed report from NYC-based VC group Work-Bench on the city’s enterprise tech startups.

“New York City’s enterprise footprint is now large enough that it must be considered a leading market for the startup varietal,” Anna and Alex conclude, “making its results a bellwether to some degree.”

“And if New York City is laying the groundwork for a huge wave of unicorn exits in the coming four to eight quarters, we should expect to see something similar in other enterprise markets around the world.”

Disaster recovery can be an effective way to ease into the cloud

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

Given the rapid pace of digital transformation, nearly every business will eventually migrate some — or most — aspects of their operations to the cloud.

Before making the wholesale shift to digital, companies can start getting comfortable by using disaster recovery as a service (DRaaS). Even a partially managed DRaaS can make an organization more resilient and lighten the load for its IT team.

Plus, it’s also a savvy way for tech leaders to get shot-callers inside their companies to get on board the cloud bandwagon.

Regulations can define the best places to build and invest

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

“The decisions of government, the broader legal system and its combined level of scrutiny toward a particular subject” can affect market timing and the durability of an idea, Noorjit Sidhu, an early-stage investor at Plug & Play Ventures, writes in a guest column.

There are three areas currently facing regulatory scrutiny that have the potential to “provide outsized returns,” Sidhu writes: taxes, telemedicine and climate.

VCs unfazed by Chinese regulatory shakeups (so far)

Image Credits: Nigel Sussman (opens in a new window)

“China’s technology scene has been in the news for all the wrong reasons in recent months,” Anna Heim and Alex Wilhelm write about the Chinese government’s crackdown on a host of technology companies.

“The result of the government fusillade against some of the best-known companies in China was falling share prices,” they write.

But has it affected the venture capital market? SoftBank this week said it would pause investments in China, but the numbers through Q2 indicate China is steadier than Alex and Anna expected.

Perform a quality of earnings analysis to make the most of M&A

Image Credits: Westend61 (opens in a new window) / Getty Images under a license.

If you’re a startup founder, odds are, at some point, you’ll raise a Series A (and B and C and D, hopefully), perform a strategic acquisition, and maybe even sell your company.

When those things occur, you’ll need to know how to do a quality of earnings (QofE) to maximize value, Pierre-Alexandre Heurtebize, investment and M&A director at HoriZen Capital, writes in a guest column.

He walks through a framework for thinking and organizing a QofE for “every M&A and private equity transition you may be part of.”

VCs are betting big on Kubernetes: Here are 5 reasons why

Image Credits: Getty Images under a akinbostanci (opens in a new window) license.

“What was once solely an internal project at Google has since been open-sourced and has become one of the most talked about technologies in software development and operations,” Ben Ofiri, the co-founder and CEO of the Kubernetes troubleshooting platform Komodor, writes of Kubernetes, which he calls “the new Linux.”

“This technology isn’t going anywhere, so any platform or tooling that helps make it more secure, simple to use and easy to troubleshoot will be well appreciated by the software development community.”

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Hello and welcome to Daily Crunch for August 13, 2021. We made it to Friday, everyone. Congratulations! Despite it being the end of the week, we still have lots to talk about. Reddit taking on TikTok. Valuation changes in a key startup sector. And what it may really mean for a workplace to be apolitical. So read on, friends — there’s a lot to talk about! — Alex

The TechCrunch Top 3

• Reddit takes on TikTok: Recently TikTok announced that it was going to shake up its controls to make its service a bit less addictive. While the social video service works on itself, other companies want to challenge its huge market presence. Reddit is joining YouTube, Snap and others in the war. I wonder where Reddit’s product domain will reach by the time it’s done expanding its feature set.
• Privately loved, publicly panned: The cohort of insurtech companies that went public in the last year were riding high while private. And they had some pretty reasonable IPOs. Then their valuations began to fall. And fall. And fall some more. TechCrunch explores what’s going on and what it could mean for startups.
• What does apolitical mean, anyway? A new essay written by Elastic exec Mandy Andress digs into the question. As some companies attempt to banish politics from their workplace, she asks “What might that mean for me as an LGBTQIA+ person in the workplace?” Read it.

Startups/VC

• Latin American fintech stays busy: This time ‘round it’s Ualá that has raised more money, a $350 million Series D that values the company at $2.45 billion, to be precise. The Argentine company builds personal financial products, and its new round and resulting multi-unicorn valuation helps underscore just how global the fintech revolution is proving to be.
• Gopuff, but for Latin America: Sticking to the region, Orchata just put together $4 million in new capital. The company wants to replicate the magic that Gopuff has managed to conjure, but farther south of where the U.S. company operates. Given how amply SoftBank has backed Gopuff, we’re counting down until the second Vision Fund arrives to pour cash into the hands of the Y Combinator-backed startup.
• Rapid ARR growth helps Kiddom raise more funds: Kiddom, a “platform that offers a digital curriculum that fits the core standards required by states,” per our own reporting, is growing like a weed. Natasha reports that Kiddom’s ARR scaled 300% from 2020 to 2021. That pace of revenue accretion helped the company secure a $35 million Series C.
• Reskilling could be big: Investors just put $7 million into Retrain.ai, a startup that wants to use AI and ML to “help governments and organizations retrain and upskill talent for jobs of the future, enable diversity initiatives, and help employees and jobseekers manage their careers.” All that sounds rather good. Especially as I keep reading about blogging robots that are set to take my job away.
• Tablevibe wants to limit what restaurants pay delivery apps: The food game is a hard one. Margins are low. Customers are whiny. And lately staffing has been an issue. Tablevibe is helping with one particular vector of restaurant pain, namely how much food venues pay the likes of DoorDash and Uber Eats to get their product to customers. Anything to help the small business world makes us sit up and take notice. The company was part of the current Y Combinator batch, notably, so we should hear more from them at demo day.
• If you need more startup news, Equity’s roundup from the week is here. Enjoy!

There could be more to the Salesforce+ video streaming service than meets the eye

Salesforce announced this week that it plans to launch a video streaming service.

The industry analysts enterprise reporter Ron Miller interviewed said the initiative has tremendous potential, but one noted that Salesforce will have to dig deep to compete in today’s crowded media landscape.

Salesforce hasn’t released details on the type of programming it plans to offer, but given its vast and diverse customer base, its options are many. Said Brent Leary of CRM Essentials:

A customer could sponsor a show, advertise a show or possibly collaborate on a show. And have leads generated from the show [which could be] directly tied to the activity from those options and track ROI. And it’s all done on one platform. And the content lives on with ads living on with them.

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

Big Tech Inc.

• Facebook takes privacy stand: As Apple struggles to retain the mantle of the privacy-first technology leader, Facebook is making inroads. Of a sort. The company has “extended the option of using end-to-end encryption for Messenger voice calls and video calls,” TechCrunch reports. Good.
• Lawmakers ask Amazon what it plans to do with biometric data: Amazon’s push to collect palm prints for its brick-and-mortar stores caught the eye of Congress. But don’t worry, when has any megacorp abused the privacy of the citizenry? Never, right? Right?
• To close out today’s news, Twitter’s head of Indian operations is moving to the States in a new role. Twitter and India have been arguing with one another for some time now, a scrap that included the current Indian government straight up trying to intimidate the U.S. company. It’s pretty gross, frankly, and now Manish Maheshwari is shaking up his job. Look, regulation is fine, but trying to abuse companies and harass their staff for political reasons sucks.

TechCrunch Experts: Growth Marketing

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

TechCrunch wants to help startups find the right expert for their needs. To do this, we’re building a shortlist of the top growth marketers. We’ve received great recommendations for growth marketers in the startup industry since we launched our survey.

We’re excited to read more responses as they come in! Fill out the survey here.

Indian startups of all sizes are raising record amounts of investment funding this year and getting public exits, as we’ve been covering in recent months. To hear more about the growth behind the numbers we caught up with Ayush Srivastava, a co-founder of growth marketing group Growth Folks (and a growth marketer at Zynga by day).

The organization, which describes itself as “India’s largest community of growth enthusiasts,” began as in-person events for growth marketers across major cities, but made the jump to online networking during the pandemic. From there it began an online speaker series for its 1,300-some members, introduced more community networking groups and virtual events, and one-on-one mentoring.

In the interview below, part of our ongoing series profiling growth marketers around the world, he says India’s startup scene has quickly gotten more sophisticated about growth in recent years. Companies are centering high-quality user growth as a shared team goal, not as a side job, and are thinking more creatively about where and how to find users. “I am amazed at how the startups are focusing on tier two-three cities here in India. With the pace with which internet access has grown … they are making sure they are solving the problem faced by rural Indians as well. [I] just love the fact that proper solutions are being built in the right manner for the concerned pain point.”

Editor’s note: This interview has been edited for length and clarity.

You describe Growth Folks as “India’s largest community of growth enthusiasts,” with more than 1,300 members. What does “growth enthusiast” mean to you, and how does that term define you?

The terms “growth” and “growth marketing” have picked up a lot in the last five years in the Indian startup ecosystem. All of a sudden there are more than a million heads who are interested to be a part of this circle or are already a part of this community. This had a positive impact as more and more people started to look at their growth problems and not only just promoting their business. For us, growth enthusiasts are everyone and anyone who is even one percent excited about how to grow a particular brand/service.

How did the focus and efforts of Growth Folks change during the pandemic for community engagement?

In the pre-COVID era, Growth Folks was heavily functional in the offline space. We used to manage and engage the community online but most of the efforts went in and success used to come from the offline activities that we used to organize. From December 2018 through the end of 2019, we organized more than 80+ offline events in nine cities of India. These events were previously panel discussions, industry talks or seminars followed by networking sessions.

[H]owever, once COVID came into the picture, our operations shifted completely online and I must say the shift was quite smooth but exciting for me. We started hosting biweekly online webinars with industry leaders and tried giving our community folks (and new attendees) a look and feel of the physical event in the form of this virtual gathering so that they feel connected.

Ever since lockdown began, we have done over 25+ events and have had speakers from companies like SEMRush, Baremetrics, Zynga, Indigo Airlines, Adjust, Myntra and many more. Not only this, we started a lot of interesting threads on our Facebook group to get people to engage more. Within the same period, we launched our website to give people an idea about all our services.

We made sure that we are having dedicated networking sessions after the webinars for people to interact with each other. In October 2020, we relaunched the online version of “Brunch Sessions” that we used to have in the pre-COVID times. These brunch sessions helped the fellow community people to come together on a single day and interact and chill with each other virtually. We started producing more online content knowing the fact that this could be a way to have a value add and it worked.

Help TechCrunch find the best growth marketers for startups.

Provide a recommendation in this quick survey and we’ll share the results with everybody.

Growth Folks is multifaceted, offering traditional growth marketing services as well as hosting a “growth hackathon” and community activities. What can a startup expect when working with Growth Folks? How is it different from existing services?

We have been virtually able to connect with so many people and we continue to do so … [W]e started something which is called “growth huddle.” It is a highly curated one-on-one mentorship session with a few of the best talents out there in the growth space. You can book your session and we will take you through the entire process to make sure that the session is right on point and you learn what you want, not what we want.

All of the mentors who were onboarded vary from experience level to expertise and provide the right set of guidance needed for individuals and startups to grow further. We also partnered with startups and companies for various online events to promote them and make sure that the right voice reaches out to the right set of people who matter to them — the Growth Folks. We have collaborated with companies like Adjust, Microsoft, Rocketium, Canva and many more and we have been able to make people learn the right things.

What are startups doing better now than ever before? In India? Around the world?

Companies have started realizing the true importance of having a fully functional growth team and they have started acknowledging their one metric that matters as well. The growth marketers have also started setting up a lot of experiments and have taken a data-driven approach to solving a problem. Now, I see many startups going out of the box and putting in efforts to find new ways of acquisition. They haven’t restricted them to acquiring users via the traditional ways and that’s why you see so many ideas going viral so easily. And all in different ways.

I see so many founders not restricting themselves to hiring just a growth marketer for leading all growth initiatives. Rather, they have spent time understanding the importance of it and have ended up building a full force growth team of marketers, PMs, tech people, designers, etc. I feel that is the best way to look at any growth problem statement.

I am amazed at how the startups are focusing on tier two-three cities here in India. With the pace with which internet access has grown … they are making sure they are solving the problem faced by rural Indians as well. [I] just love the fact that proper solutions are being built in the right manner for the concerned pain point.

Lastly, companies have started considering the importance of the entire customer experience more seriously than ever before. This is helping brands to grow via communities easily and create a strong brand presence.

Way back in January 2020, Sonos sued Google over patent infringement. Today, the streaming speaker company scored an early victory with the U.S. International Trade Commission. A preliminary ruling penned by ITC chief administrative law judge Charles Bullock finds that Google infringed on five patents.

“Today the ALJ has found all five of Sonos’ asserted patents to be valid and that Google infringes on all five patents,” Sonos Chief Legal Officer Eddie Lazarus said in a statement to TechCrunch. “We are pleased the ITC has confirmed Google’s blatant infringement of Sonos’ patented inventions. This decision re-affirms the strength and breadth of our portfolio, marking a promising milestone in our long-term pursuit to defend our innovation against misappropriation by Big Tech monopolies.”

The finding is still very much early days for what’s likely to be an even more protracted battled battle between the two companies. Sonos’ complaint stems from Google’s own family of streaming speakers. Google entered the category, long dominated by Sonos, roughly four and a half years ago with the original Home speaker. The line now includes a number of products now listed under the Nest banner.

“Google has been blatantly and knowingly copying our patented technology,” Sonos CEO Patrick Spence said in a statement when the suit was initially filed. “Despite our repeated and extensive efforts over the last few years, Google has not shown any willingness to work with us on a mutually beneficial solution. We’re left with no choice but to litigate.”

Sonos noted similar issues with Amazon devices (Google’s chief competitor in the category) at the time, but the company opted to focus its time, money and resources on a battle with Google, instead.

Ultimately, Sonos is hoping to use the ITC to block the import of those smart speakers, along with other Google hardware, including the Chromecast and Pixels. Such a decision would be a massive hit to Google’s hardware ambitions. A final ruling isn’t expected until December 13, however, after which point a potential import ban would take 60 days to go into effect.

After teasing its new font in January, Twitter made some major changes to its website and app design this week. But while Twitter framed these updates as making the platform “more accessible,” some accessibility experts say that these changes missed the mark.

Most noticeably, tweets now appear in “Chirp,” Twitter’s proprietary typeface, and the display has even more visual contrast between the background and text. Other updates made the interface less cluttered, removing unnecessary divider lines. For people with low vision, high-contrast design can make websites more legible, but the current contrast level is so high that it’s causing strain for some users. Twitter far exceeds the minimum contrast standards set by the Web Content Accessibility Guidelines (WCAG), which provides recommendations for making websites accessible to disabled people. But web accessibility isn’t one-size fits all — while some users may need a high-contrast display, others who suffer from chronic migraines might require a more muted experience. Research has also shown that dyslexic people tend to read faster when presented with lower-contrast text.

“When the update hit, I could immediately feel pain in my eyes, and within about half an hour, I was having a tension headache,” said Alex Haagaard, a design researcher and founding member at The Disabled List. “I have a lot of chronic pain, and I cannot deliberately expose myself to something that is going to be exacerbating my levels of pain, because then that has cascade effects.”

Up until last year, Twitter’s accessibility team was volunteer-based — paid employees at Twitter would take on accessibility projects on top of their existing jobs, TechCrunch reported. In September, a few months after Twitter had released an audio tweet feature without accessibility considerations, Twitter introduced two dedicated accessibility teams within its company. But experts emphasize that including disabled people in design decisions from the get-go is necessary when implementing new features.

“They talked a good talk about how they were going to change this, that they were going to integrate accessibility and disabled perspectives more into their design processes, and from this, it seems they have not done an adequate job with that,” said Haagaard. “Engaging people from disabled communities as consultants at the high-level stages, within the research and conceptualization phase, would prevent designers from getting to a point where you’re testing something and you realize it’s fundamentally problematic and it’s too late.”

Twitter told TechCrunch that “feedback was sought from people with disabilities throughout the process, from the beginning. However, people have different preferences and needs and we will continue to track feedback and refine the experience. We realize we could get more feedback in the future and we’ll work to do that.”

On its accessibility account Twitter, acknowledged the problems that users were reporting with eye-strain and migraines after the update. This afternoon, the platform added that due to user feedback, it is making contrast changes on all buttons to make them “easier on the eyes.”

“When a design organization makes an announcement, and the accessibility organization alongside it actually has things to say about it, that means they work together, and that’s always a good thing,” said Matt May, head of Inclusive Design at Adobe. “The key thing is to continue to listen and find the people who aren’t being represented, and try to synthesize them within the rest of the system.”

It’s odd that Twitter neglected to add customization capabilities when it rolled out its higher-contrast display and new default typeface, since the company has a history of offering customization elsewhere in its user experience. Currently, users can toggle among dark, light and dim modes, make their default font size bigger or smaller, and even change the look of buttons and hyperlinks to colors like purple, orange and pink. Even before this week’s update, Twitter’s accessibility panel allowed users to enable a higher contrast mode. But still, there is no way for users to reduce the contrast or change what font the site uses, which experts cite as a design flaw. With its first proprietary typeface Chirp, Twitter sought to “improve how we convey emotion,” but users reported the font to be more difficult to read than Helvetica, which Twitter used before Chirp.

According to Shawn Lawton Henry — a researcher at the Massachusetts Institute of Technology, editor of the WCAG recommendations, and leader of the World Wide Web Consortium’s accessibility education and outreach — websites should include customization options for users to toggle among fonts, contrast levels and more. WCAG doesn’t require this currently, but Henry says that future updates of the guidelines will recommend that websites give users the option to change contrast.

“The main issue is that the default contrast should [meet the WCAG standards] and users should be able to change it. It’s not hard, right?” Henry said. “It’s fine to have a default font, but you have to make it customizable. Even if it was the most readable font known, it would still be important to allow people to change it because of individual differences.”

When asked about adding ways for users to change typefaces and contrast levels, a Twitter spokesperson said that the company had “no concrete plans to share right now, but we’re always looking at ways to improve the experience and listening to feedback.”

“I think part of the disappointment here is that they’re framing this as an accessibility thing, but it’s also really clear that it was equally about building brand identity,” Haagaard said.

While some users will override website settings with USS (User Style Sheets), Henry’s research for the World Wide Web Consortium showed that user agents like web browsers and e-book readers should provide users the ability to customize these settings more easily. Not all users are tech-savvy enough to write USS, and it’s easier for users to toggle among the accessibility settings specific to an app. This level of customization isn’t unprecedented — in June, Discord added a saturation slider in its accessibility settings, for example.

“The beauty of the web is that it’s not paper, and we can change it,” Henry said.

Carta, the nine-year-old, San Francisco-based cap table management and valuation software company, just raised $500 million in its eighth round of funding, at a $7.4 billion valuation. That’s more than double where the company was valued eight months ago when it closed its seventh round of funding at a valuation of $3.1 billion.

With so much money flooding into privately held companies, giant leaps in valuation are no longer all that notable. What’s different about this particular story is how Carta’s new valuation was established, which it says was to run an auction using its own trading platform to sell $100 million of its shares to secondary buyers, then use the valuation at which the shares sold — $6.9 billion — as evidence to primary investors of Carta’s true value.

For a company that’s trying to raise awareness of its trading platform — Carta wants to sell more of the secondary shares of other companies, too — it was a smart marketing play. It was Carta eating its own dog food, in the somewhat repellant parlance of the startup world. Still, it’s unclear whether we’re likely to see it replicated by other companies going forward.

First, what Carta did is — we think — unprecedented in establishing a price for secondary shares. Typically, a small group comes together and negotiates a price or, if it’s 20 or more sellers who are willing to offload shares to buyers, it’s considered a “tender offer” and involves a prospectus-type document, including financial statements, risk factors and all that other jazz, which is sent to an established group of potential buyers.

In Carta’s case, as Carta CEO Henry Ward suggests in a new Medium post, by running an auction process, many more investors participated in the price discovery of its shares than might have been possible otherwise. (A prior post by Ward says that 414 participants participated in 1,484 executed orders.)

The endeavor makes a lot of sense, says longtime startup attorney Tim Harris of Morrison & Foerster, who was not involved in the process but is a student of market efficiencies. “Ward is basically saying, ‘We’re using a broader market price-seeking process instead of what he describes as one-off. You see it in real estate listings all the time,” adds Harris. “There’s no reason companies can’t do the same.”

The question that startup founders may be wondering right now is whether an auction process like Carta’s can truly help establish a price for primary shares. Naturally, Ward says it can. In his Medium post, he argues that the auction very much strengthened the case that Carta could make to investors, including Silver Lake, which ultimately led Carta’s newest $500 million round. (It was a Series G, and Carta has now raised $1.29 billion altogether, it tells us.)

While we don’t doubt it was a useful data point, Silver Lake is a sophisticated investment firm that has been valuing companies for 21 years; likely, it would have arrived at the valuation it did without that earlier auction.

Meanwhile, there are other reasons to think an auction like Carta’s will remain an outlier.

For his part, attorney Anthony McCusker, who co-chairs the tech practice at Goodwin Proctor, questions whether “companies are going to outsource their valuation discovery to Carta.” Most founders and CEOs would prefer to talk directly with investors when it comes to establishing the valuation of their company rather than leave it to the wisdom of crowds, he suggests.

Markets can also “be gamed,” as notes Harris of MoFo, observing that the integrity of any platform “depends on oversight and the quality of bids on a platform,” (Harris half-kiddingly wonders what happened, for example, to the bidder who said he or she would pay $28 million to join Jeff Bezos on his trip to space, then later cited “scheduling conflicts.”)

As for us, we wonder how many founding teams are willing to open up the secondary sale of their shares to a potentially much wider circle of backers when historically, they have not. We also wonder whether, for some companies, that discovery process could backfire. Carta is a hot commodity, after all, but it’s easy to imagine scenarios in which companies’ secondary shares aren’t worth to outsiders what founders think that they are.

Of course, the industry is changing so fast that little would surprise us at this point. Indeed, whatever happens, the auction is clearly part of a larger trend toward transparency that continues to play out in interesting new ways all the time.

As Harris notes, when he began practicing law 26 year ago, “venture was a completely closed ecosystem.” Now, he says, “There’s a wealth of data being shared and disseminated to maker smarter business decisions. You can just go to Pitchbook or Crunchbase to learn a lot of what you need to know.”

Featured above: Carta founder and CEO Henry Ward.

After all the leaks and teases, Lamborghini has finally announced its new hybrid-engine Countach.

Thankfully, almost everything you need to know about the car is in its model designation: LPI 800-4.

The first part is short for Longitudinale Posteriore Ibrido, referencing how the powertrain is mounted lengthwise toward the back of the supercar and the fact that it’s a hybrid.

Meanwhile, the two numbers point to the approximately 802 horsepower the Countach’s V12 6.5-liter engine and 48-volt electric motor can output together, as well as the fact that it has four-wheel drive.

Lamborghini

All of that makes for one powerful car. The Countach can accelerate from zero to 60 miles per hour in less than three seconds and zero to 124 miles per hour in just under nine seconds. As for a top speed, you can push it to 221 miles per hour, and it has a maximum torque of 531 lb-ft.  

Lamborghini

Powering the Countach’s electric motor is a supercapacitor Lamborghini claims delivers three times more power compared to a lithium-ion battery of the same weight. The automaker says it mounted the electric motor directly to the gearbox to preserve the feeling of power transfer you get from a V12 engine.

Carbon fiber makes up most of the chassis and exterior of the Countach LPI 800-4. “It imagines how the iconic Countach of the 70s and 80s might have evolved into an elite super sports model of this decade,” Lamborghini says of the design, which is more reminiscent of the Aventador than its original namesake. Inside, you’ll find an 8.4-inch touchscreen display that includes CarPlay integration and a button labeled “Stile.” Pressing it “explains the Countach design philosophy to its privileged audience.”

Speaking of a privileged audience, Lamborghini will only make 112 units of the Countach LPI 800-4. The press release the automaker sent over doesn’t even mention a price tag. It seems Lamborghini is keen on looking forward, but the Countach was too important not to acknowledge with a limited run.

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

Five years ago, the playbook for launching a new company involved a tried-and-true list of to-dos. Once you built an awesome product with a catchy name, you’d try to get a feature article on TechCrunch, a front-page hit on Hacker News, hunted on ProductHunt and an AMA on Quora.

While all of these today remain impressive milestones, it’s never been harder to corral eyeballs and hit a breakout adoption trajectory.

In this new decade, it is possible to first out-market your competitor, and then raise lots of money, hire the best team and build, rather than the other way around (building first, then marketing).

Outbound marketing tools and company newsletters are useful, but they’re also a slow burn and offer low conversion in the new creator economy. So where does this leave us?

With audiences spread out over so many platforms, reaching cult status requires some level of hacking. Brand-building is no longer a one-hit game, but an exercise in repetition: It may take four or five times for a user to see your startup’s name or logo to recognize, remember or Google it.

Below are some growth tactics that I hope will help jump-start the effort to building an engaged user base.

Laying the groundwork for user-generated content

Before users are evangelists, they are observers. Consider creating a bot to alert you of any product mentions on Twitter, or surface subject-matter discussions on Reddit (“Best tools to manage AWS costs?” or “Which marketplace do you resell your old electronics on?”), which you can then respond to with thoughtful commentary.

Join relevant communities on Discord, infiltrate Slack groups of relevant conferences (including past iterations of a conference? — ?chances are those groups are still alive with activity), follow forums on StackOverflow and engage in the discussions on all these channels.

The more often you post, the better your posts convert. The more your handle appears on newsfeeds, the more likely it will be included on widely quoted “listicles.”

Most “user-generated content” in the early innings should be generated by you, from both personal accounts and company accounts.

Build in public …

Building in public is scary given the speed at which ideas can be copied, but competition will always exist, since new ideas are not born in vacuums. Companies like Railway and Replit post to Twitter every time they post a new changelog. Stir brands its feature releases as “drops,” similar to streetwear drops.

Building in public can also lend opportunities for virality, which requires drama, comedy or both. Hey.com’s launch was buoyed by Basecamp’s public fight against Apple over existing App Store take rates.

Mmhmm, the virtual camera app that adds TV-presenter flair to video meetings, launched with a viral video that hit over 1.5 million views. The company continues to release entertaining YouTube demos to showcase new use cases.

Help TechCrunch find the best growth marketers for startups.

Provide a recommendation in this quick survey and we’ll share the results with everybody.

… or build in private

Like an artist teasing an upcoming album, some companies are able to drum up substantial anticipation ahead of exiting stealth mode. When two ex-Apple execs founded Humane, they crafted beautiful social media pages full of sophisticated photography without revealing a single hint of what they set out to build.

Sequoia is one of the most prestigious and successful venture firms to ever exist. The firm’s portfolio includes Airbnb, 23andMe, Docker, Dropbox, Figma and GitHub — and that barely covers the first half of the alphabet. (The Sequoia website lists portfolio companies in alphabetical order.)

So it should go without saying that we are absolutely thrilled to have Sequoia partner Stephanie Zhan and Rec Room founder Nick Fajt join us on Extra Crunch Live in the coming weeks.

Rec Room is a Seattle-based startup that allows users to not only play games, but to build them collaboratively with their friends. The gaming world has seen a huge boost in the wake of the pandemic, and Rec Room is thinking way out in the future about what gaming looks like not only as a user, but as a creator.

The company has raised nearly $150 million, and Sequoia led Rec Room’s seed and Series A financing rounds.

Stephanie Zhan has been with Sequoia as part of the early-stage and seed investment team, with a portfolio that includes Sunday (outdoor home subscription service), Linear (issues tracking tool for modern developers) and Middesk (background checks for businesses). She has also helped lead investments in Graphcore (microprocessors for machine intelligence), Evervault (dev tools for data privacy) and Doppler (secrets management for developers).

Before joining Sequoia, Zhan held product roles at Google and Nest.

We’ll hear from this founder/investor duo about how they met, what made them choose each other and how they’ve worked together and tackled obstacles moving forward. REGISTER HERE FOR FREE!

Extra Crunch Live also features the ECL Pitch-off, where founders in the audience will have the opportunity to virtually raise their hand and pitch on our stage to our guests, who will give live feedback.

Anyone can attend Extra Crunch Live, but accessing the content on-demand is reserved exclusively for Extra Crunch members. And damn, the Extra Crunch library is quite a resource. If you’re not yet a member, what are you waiting for? Sign up here.

This episode of Extra Crunch Live, which goes down on August 18 at 3 pm ET/noon PT, is a can’t miss. See you there!

Food delivery apps offer convenience for customers, but a host of headaches for restaurants, like commissions as high as 40% and very few tools to build customer loyalty. Based in Singapore, Tablevibe wants to help restaurants reduce their reliance on third-party delivery apps and help them get more direct orders and returning customers. The startup is part of Y Combinator’s current batch, which will hold its Demo Day at the end of this month.

Tablevibe’s founding team includes two former Googlers: Jeroen Rutten, formerly head of Google Search’s product strategy in APAC and Sneep, who was responsible for its app development go-to-market strategy and led large sales teams. They are joined by Guido Caldara, a lead teacher at coding bootcamp Le Wagon and Tablevibe’s chief technology officer.

The idea for Tablevibe came after Rutten, its chief executive officer, visited a restaurant in Singapore that used paper feedback forms.

“We thought, if they use a paper feedback form, it actually creates a lot of hassle, like entering all the data into an Excel spreadsheet,” he told TechCrunch. “How’s the restaurant owner going to get actionable feedback based on data in an Excel spreadsheet?”

The team began working on the first version of Tablevibe, with simple Google Forms for dine-in customers and Google Data Studio dashboards, and tested it with three restaurants a few months before COVID-19 emerged. They found that using Tablevibe instead of paper forms increased response rates by up to 26x and also had the benefit of creating more repeat customers, since they are given an incentive for filling out surveys.

Then the pandemic hit and restaurants had to suddenly pivot to deliveries. The team kept the same idea behind their feedback forms, but started using QR codes affixed to takeout packaging. The QR codes (usually in the form of stickers so food and beverage businesses don’t need to order new packaging) also offer an incentive if customers scan it and fill out a survey—but the discount or free item can’t be redeemed through third-party delivery apps, only through direct orders with the restaurant.

Restaurants can customize surveys, but about 80% use Tablevibe’s templates, which are quick to fill out, since most questions just ask for a rating from one to five stars (there’s also an optional form for customers to write their opinions). Customers fill out their name, email addresses, and then rank the food and atmosphere (for dine-in). For delivery, customers are also asked what app they used.

Tablevibe is integrated with Google Reviews, so if someone gives the restaurant a high rating, they are asked if they want to make it public. They also have the option to follow its Facebook or Instagram profile.

For dine-in customers, Tablevibe primarily works with F&B businesses that have multiple venues, including Merci Marcel and Lo and Behold Group. For its delivery survey, most users are smaller restaurants that have one location. It also serves cloud kitchens, like CloudEats in the Philippines.

“As a restaurant, you want to own and grow your customer relationships,” said Sneep, Tablevibe’s chief operating officer. “The first part is actually knowing who your customers are, what they experienced and how you can contact them, which is how we can help. The second piece is growing a customer relationship, which we do by giving a reward, but only if a customer reorders directly with a restaurant.”

Customers have generated over 25,000 reviews through Tablevibe so far, which gives the company data to help determine what kind of incentives will convince someone to scan a restaurant’s QR code and take a survey.

Tablevibe’s founders say it can deliver more than 100x return on investment to its clients. For example, Merci Marcel did an evaluation and determined that it got a 103x ROI, based on the number of customers who claimed incentives, average order value, how many people left a five-star Google Review and how much more business those reviews drove to their venues.

The startup plans to expand into other English-speaking markets, focusing first on Northern Europe and then North America later this year. Aside from Singapore, it’s already used by customers in the Philippines, the Netherlands, Belgium, the United Kingdom and Portugal.

Rutten said that Tablevibe plans to build its development team, with the goal of becoming a “Salesforce for restaurants” that can help them build engagement through delivery or dine-ins, capture data and turn them into useful insights.

“Our roadmap has two levers—one is to get more data and the other is to provide more intelligence,” he said. “We’re working on API integrations so Tablevibe can integrate with point-of-sale systems. The second thing is to pull in more publicly available data from sources like Google Reviews. We will also build out more marketing features to leverage customer databases so businesses can send out emails about new restaurant launches, etc.” Eventually, Tablevibe also plans to use AI to help restaurants determine exactly what they need to do to improve customer experience, like change a menu item.