Category: Tech news

This week, Jason Parham takes us inside one of the most influential communities on the internet and shares their stories in their own words.

Face coverings are back. Read our updated tips on how to pick an effective mask—whether you’re heading back to the office or just want to stay safe and stylish.

Wolf puppies can’t understand human gestures as well as their dog cousins. The difference could help explain what makes dogs so special.

Hopes for a “normal” fall have been dashed by variants and low vaccine uptake. Businesses and the White House think requiring shots can turn things around.

The Tokyo Games have taken a unique psychological toll on all of the athletes.

My favorite force belittles me—literally—but also inspires new ways to get high.

Companies like Alibaba, Baidu, and Tencent were once regarded with national pride. Now they’re being slapped with fines and other penalties.

The latest weapons in the global information war are fake vessels behaving badly.

Once home to vibrant live competitions, gaming centers have been bleeding out since before the pandemic. Lockdowns could leave them KO’d for good.

You may well recognize Cassie as the basis of Agility Robotics’ delivery bot, Digit. If you’ve been following the tech’s progression at all, however, you no doubt know that it started life as the ostrich-inspired Cassie. The robot is all legs and not much else.

In addition to fueling Agility’s commercial ambitions, the robot has proven a solid platform for exploring bipedal location. Announced by Oregon State University professor Jonathan Hunt in 2017, Cassie was created with the aim of a $1 million grant from the DoD — a pretty familiar story in the robotics world.

Today, a team from the Dynamics Robotics Laboratory in OSU’s College of Engineering highlighted the ways they’re continuing to push Cassie to its bipedal limits. The team says the robot was able to run a 5K untethered, on a single charge. Cassie’s not going to beat any human world records anytime soon, but the 53-minute (and three second) run was still an impressive exhibition for the tech.

The robot’s run time included around 6.5 minutes of troubleshooting, as the team dealt with an overheated computer and a botched turn that knocked it off its legs.

“Cassie is a very efficient robot because of how it has been designed and built, and we were really able to reach the limits of the hardware and show what it can do,” Ph.D. student Jeremy Dao said in a statement.

According to the team, Cassie essentially taught itself to run using a deep reinforcement learning algorithm, which allowed the system to figure out how to stay upright by shifting its balance while running.

“Deep reinforcement learning is a powerful method in AI that opens up skills like running, skipping and walking up and down stairs,” undergrad student Yesh Godse adds.

In May of this year, the OSU team also demonstrated how Cassie can walk up and down stairs without the aid of lidar or on-board cameras.

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Hello and welcome to Daily Crunch for July 27, 2021. Today is a good day not only because the U.S. women’s national soccer team is heading to the Olympics quarter finals (shoutout Gotham’s Carli Lloyd!), but also because Danny Crichton just published an incredibly interesting EC-1 digging into RapidSOS. Danny has previously written extensively about disaster tech, a growth industry of sorts given the changing climate. OK, now to tech news! — Alex

The TechCrunch Top 3

• Edtech’s shifting center of gravity: The debris is still settling after China’s recent regulatory changes impacted edtech, on-demand and music-streaming businesses in the country. Natasha Mascarenhas dug into the edtech market, asking investors where they planned to invest in the future. The gist is that while China was once the center of the edtech universe, it may rapidly lose that crown to a more global set of edtech hotspots.
• Africa’s burgeoning startup ecosystem: TechCrunch’s long-running dive into the Q2 venture capital market is coming to a close this week, but not before we investigated the African startup market, a growing space that is attracting more and more investor and media attention. Some big exits certainly haven’t hurt. But while capital raised by African startups is growing rapidly, some blank spaces still exist. Let’s see if investors pounce.
• No-code is still super hot: If you want to have a weird day on Twitter, tweet that you don’t like no-code as a concept. You will get many notes from folks who disagree. That passion among the hoi polloi is also reflected in investor interest. This time ‘round the funding tree it’s Bubble, which just closed a $100 million round to help anyone “begin building modern web applications using a click-and-drag interface that can connect data sources and other software together in one fluid interface,” per our reporting.

Startups/VC

Kicking off today’s startup notes, let’s talk about stock. Startup shares, to be precise. Mostly investors get preferred shares, because they can demand better equity as they are bringing capital to the table. Founders and staff tend to get common stock. Which, as the name implies, is not as good as preferred. But there’s a venture capital firm in Boston called Pillar VC that buys common stock in its investments. One of its investors, Jamie Goldstein, wrote an essay for TechCrunch sharing what he’s learned from the process. It’s worth reading.

Before we get into funding rounds, NowRx CEO and co-founder Cary Breese wrote an op-ed for TechCrunch discussing the delivery market. Given how much money is flowing into so-called instant grocery startups, it’s also worth your time.

• $200M for sensors as a service: That’s the news from Wiliot, which has just put a bunch of SoftBank Vision Fund 2 money into its pockets to turn its “ultra thin and light” processor that “runs on ambient power” into a service that it can sell to others. Very cool.
• Meet the latest crypto unicorn: It’s Fireblocks — with its new $310 million round, the company is now worth $2.2 billion. What does it do? According to our own reporting, Fireblocks “aims to offer financial institutions an all-in-one platform to run a digital asset business, providing them with infrastructure to store, transfer and issue digital assets.” Between this and the recent FTX deal, it’s clear that there is still ample investor appetite for continued crypto wagers.
• 1Password raises $100M more: Accel is at it again, putting big checks into largely self-sustaining businesses This time it’s a double down on 1Password, a software service that helps individuals and businesses alike create and manage supersecure passwords. The company competes with LastPass, among other companies. The company is now worth $2 billion and recently crossed the $120 million ARR milestone. That’s pretty darn good, even if the company’s revenue multiple implies that it is no longer growing at startup speeds. (How about an S-1? Anyone?)
• Oova wants to help people conceive: The startup just landed a $1.2 million round to help folks figure out their optimum fertility window and provide information that their healthcare provider may be able to use to confirm ovulation. There are two groups of people in the world. Those who have not dealt with fertility-related issues, and those who have. For the latter set, Oona’s newly released kit and goals are good news.

The RapidSOS EC-1

According to one estimate, Americans place 240 million 911 calls each year.

Sending emergency services to the right location sounds straightforward, but each call is routed through one of thousands of call centers known as public safety answering points (PSAPs).

“Every 911 center is very different and they are as diverse and unique as the communities that they serve,” said Karin Marquez, senior director of public safety at RapidSOS.

One PSAP that serves New York City is a 450,000-square-foot, blast-resistant cube set on nine acres, but “you have agencies in rural America that have one person working 24/7 and they’re there to answer three calls a day,” Marquez noted.

Founded eight years ago, RapidSOS processes more than 150 million emergencies each year across approximately 5,000 PSAPs. The company’s technology helps call centers integrate requests from cell phones, landlines and IoT devices.

“Its technology is almost certainly integrated into the smartphone you’re carrying and many of the devices you have lying around,” Managing Editor Danny Crichton writes in a four-part series that studies the company’s origins:

• Part 1: The early years and why a consumer app company turned to govtech and integrated services for technology and device companies.
• Part 2: How RapidSOS made its pivot and why its current business model has performed so well.
• Part 3: To transform 911 services, RapidSOS established dozens of corporate and individual partnerships.
• Part 4: Examines the future of 911 and RapidSOS in light of limited infrastructure funding.

“I’ve honestly never met a company like RapidSOS with so many signed partnerships,” says Danny, who initially wrote about the firm six years ago.

“It’s closed dozens of partnerships and business development deals, and with some of the biggest names in tech. How does it do it? This story is about how it built a successful BD engine.”

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

Big Tech Inc.

TechCrunch is about to dive into a whole mess of Big Tech earnings in a moment, so we’ll be brief regarding Big Tech news today. Here’s a rapid-fire rundown:

• Shopify allows merchants to sell NFTs directly through their storefronts: The popular Canadian e-commerce platform supporting NFTs could be a boon to their broader adoption.
• Instagram now supports 60-second videos on Reels, its TikTok clone: Every major social network wants a piece of TikTok’s magic. Let’s see if Instagram can capture some of that sparkle.
• Google TV mobile app redesign adds new services and recommendations: Google TV is the updated Chromecast interface, if you were wondering. The redesign includes Rotten Tomatoes scores, just in case you want some extra input on what to watch.
• Pinterest rolls out new features that let creators make money from pins: More shoppable content at Pinterest? Not a surprise, but perhaps something that will allow the company to continue posting above-expectations revenue growth.

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Another excellent quarter for Apple, as the company posted $81.4 billion in revenue. That’s a 36% year-over-year jump for the company, besting Wall Street estimates of $73.3 billion by a considerable margin.

“Our record June quarter operating performance included new revenue records in each of our geographic segments, double-digit growth in each of our product categories, and a new all-time high for our installed base of active devices,” CFO Luca Maestri said in a release. “We generated $21 billion of operating cash flow, returned nearly $29 billion to our shareholders during the quarter, and continued to make significant investments across our business to support our long-term growth plans.”

Some strong figures for the company all around here, but it was iPhone sales and subscription services that continued to lead the way — a familiar story for anyone who’s followed the company the last several quarters.

iPhone sales increased from $26 billion to $39.5 billion, on the continued strength of the company’s long-waited push into linewide 5G, while services rose from $13.1 billion to $17.5 billion for the quarter. Apple has continued to grow its services offerings, which now includes Music, TV+, iCloud, Arcade, News+ and Fitness+. The company clearly sees the subscription portfolio as the future of its revenue model.

Greater China proved a strong market for the company in the third fiscal quarter. The company posted $14.76 billion in sales for the region, a more than 50% increase over the same time last year. The Americas region, meanwhile, rose from $ 27 billion to $35.89.

In the earnings report, CEO Tim Cook made reference to pandemic-related issues, which highlighting broader societal focuses for the company.

“This quarter, our teams built on a period of unmatched innovation by sharing powerful new products with our users, at a time when using technology to connect people everywhere has never been more important,” said Tim Cook, Apple’s CEO. “We’re continuing to press forward in our work to infuse everything we make with the values that define us — by inspiring a new generation of developers to learn to code, moving closer to our 2030 environment goal, and engaging in the urgent work of building a more equitable future.

The company once again declined to offer guidance, owing to uncertainties during the pandemic. On a followup call with investors, however, Maestri noted, “We expect revenue growth to be lower than our June Quarter.” The CFO cited various issues including foreign exchange rates with the U.S. dollar, a slow down in the growth rate of services and continued supply chain issues for its hardware offerings.

 

Today after the bell amidst a deluge of major technology company earnings reports, Alphabet reported its own second-quarter performance. The search-and-services company posted revenues of $61.9 billion in the June 30, 2021 quarter, net income of $18.5 billion, and earnings per share of $27.26. Those figures work out to top-line growth of 62%, and net income expansion of 166%. Naturally Google is currently being compared to pandemic-impacted Q2 2020 results, but its gains are noteworthy regardless.

The Android-maker’s results trounced expectations, with the street only expecting Google’s parent company to post $56 billion in total top line and $19.14 in earnings per share. Notably Alphabet shares are up around a single percentage point after hours, mirroring a similarly muted market reaction to better than officially anticipated earnings results from Microsoft.

Alphabet is a company with a number of moving parts, so let’s unpack the numbers a little bit.

YouTube’s reported revenue of $7 billion is up 84% year over year. This feels like a strong result, frankly, given YouTube’s age. That said, your humble servant wonders how much heavier the ad load can get on YouTube before a rival service steals some of its oxygen. In a separate note, YouTube disclosed that its YouTube Shorts product has “surpassed 15 billion global daily views,” up 131% from the 6.5 billion global daily views that it detailed in March. (Everyone wants to eat TikTok, it seems.)

Google Cloud reported revenue of $4.6 billion, up 54% year over year. That growth rate is slightly above what Microsoft posted for its Azure cloud unit. However, as the Microsoft effort is considered to be larger than Google’s own in revenue terms, investors might have anticipated a larger growth ? than what Mountain View just detailed. Google Cloud cut its operating loss from $1.4 billion in the year-ago Q2 to a far more modest $591 million deficit in its most recent quarter. That’s honestly rather good.

On the Other Bets side of things, revenues rose! But so did losses. The skunkworks group at Alphabet posted $192 million in revenue, up from $148 million in the year-ago period. But the collection of trials and errors lost $1.4 billion in the quarter, up from $1.1 billion in the corresponding year-ago period.

Naturally with operating income of $19.4 billion inclusive of its Other Bets cost center, Alphabet can well afford to continue spending on what projects that may in time generate material future revenues.

Still, everything at Alphabet that is not Google’s core offerings (search, YouTube, etc.) lost money in the quarter:

The real story, however, is in the epic gains that Alphabet posted in operating income from Q2 2020 to Q2 2021. Just look at that acceleration in operating income! It’s a somewhat befuddling result in terms of its quality.

What else to take note of? Google’s share repurchase program has been modified some, but not in a manner that should impact regular investors. So we can leave Alphabet’s quarter content that the company did well enough to defend its market cap of just over $1.75 trillion, even if it did not manage to add too much to the figure in after-hours trading thus far.

It’s a great time to be a huge tech company.

One of the world’s biggest video game companies is reeling after a state discrimination and sexual harassment suit kicked off a firestorm of controversy within the company. California’s Department of Fair Employment and Housing sued Activision Blizzard last week, alleging that the company fostered a “breeding ground for harassment and discrimination against women.”

Following a combative response to the lawsuit from corporate leadership, a group of employees at Blizzard will stage a walkout, which is planned for Wednesday at 10 a.m. PDT. Most employees at Blizzard continue to work remotely, but walkout participants will gather tomorrow at the gates to the company’s Irvine campus.

“Given last week’s statements from Activision Blizzard, Inc. and their legal counsel regarding the DFEH lawsuit, as well as the subsequent internal statement from Frances Townsend, and the many stories shared by current and former employees of Activision Blizzard since, we believe that our values as employees are not being accurately reflected in the words and actions of our leadership,” the organizers wrote.

In the new statement, they called for supporters to donate to organizations including Black Girls Code, the anti-sexual-violence organization RAINN and Girls Who Code.

Activision Blizzard publishes some of the biggest titles in gaming, including the Call of Duty franchise, World of Warcraft, Starcraft and Overwatch. Blizzard came under Activision’s wing through a 2008 merger and the subsidiary operates out of its own Irvine, California headquarters.

In the suit, the state agency describes a “frat house” atmosphere in which women are not only not afforded the same opportunities as their male counterparts, but are routinely and openly harassed, sometimes by their superiors.

The company pushed back last week in a fiery statement, blaming “unaccountable state bureaucrats that are driving many of the state’s best businesses out of California” for pursuing the lawsuit. Activision Blizzard Executive Vice President Frances Townsend, former Homeland Security adviser to George W. Bush, echoed that aggressive messaging in an internal memo, slamming the lawsuit as a “distorted and untrue picture of our company.”

In an open letter published Monday, the walkout’s organizers condemned Blizzard’s response to the lawsuit’s allegations. “We believe these statements have damaged our ongoing quest for equality inside and outside of our industry,” they wrote. “ … These statements make it clear that our leadership is not putting our values first.”

More than 2,600 employees signed the letter, which demands an end to mandatory arbitration clauses that “protect abusers and limit the ability of victims to seek restitution,” improved representation and opportunities for women and nonbinary employees, salary transparency and a full audit of diversity, equity and inclusion at the company.

On Twitter, streamers, gamers, game devs and former employees expressed support for Wednesday’s walkout under the hashtag #ActiBlizzWalkout, with some calling for a blackout on Activision Blizzard games as a show of solidarity. Others called for streamers to use the walkout time slot to raise awareness about rampant sexual harassment and discrimination in gaming culture at large.

One Blizzard employee shared a photo of the company’s iconic statue depicting an axe-wielding orc, a central feature of its Irvine headquarters. Three plaques displaying corporate values that surround the statue had been covered with paper: “Lead responsibly,” “play nice, play fair,” and “every voice matters.”

According to one estimate, Americans call 911 about 240 million times every year.

Sending emergency services to the right location sounds straightforward, but each 911 call is routed through one of thousands of call centers known as public safety answering points (PSAPs).

“Every 911 center is very different and they are as diverse and unique as the communities that they serve,” said Karin Marquez, senior director of public safety at RapidSOS.

One PSAP that serves New York City is a 450,000-square-foot, blast-resistant cube set on nine acres, but you also have “agencies in rural America that have one person working 24/7 and they’re there to answer three calls a day,” Marquez noted.

Founded eight years ago, RapidSOS processes more than 150 million emergencies each year across approximately 5,000 PSAPs. The company’s technology helps call centers integrate requests from cell phones, landlines and IoT devices.

“Its technology is almost certainly integrated into the smartphone you’re carrying and many of the devices you have lying around,” Managing Editor Danny Crichton writes in a four-part series that studies the company’s origins and ensuing success:

---

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

---

• Part 1: The early years and why a consumer app company turned to govtech and integrated services for technology and device companies.
• Part 2: How RapidSOS made its pivot and why its current business model has performed so well.
• Part 3: To transform 911 services, RapidSOS established dozens of corporate and individual partnerships.
• Part 4: Examines the future of 911 and RapidSOS in light of limited infrastructure funding.

“I’ve honestly never met a company like RapidSOS with so many signed partnerships,” says Danny, who initially wrote about the firm six years ago.

“It’s closed dozens of partnerships and business development deals, and with some of the biggest names in tech. How does it do it? This story is about how it built a successful BD engine.”

Thanks very much for reading Extra Crunch this week!

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

How to prepare for M&A, your most likely exit avenue

The headlines might be littered with mega deals, IPOs and SPACs, but in all likelihood, you will exit your startup via a relatively smaller merger or acquisition, Ben Boissevain writes in a guest column.

“The IPO market is healthy again, but M&A still represents 88% of exits: So far this year, there were 503 IPOs and 5,203 deals,” writes Boissevain, founder of Ascento Capital.

“While it is good to strive for a billion-dollar-plus sale, a successful IPO or a SPAC deal, it is practical to prepare your startup for a smaller transaction.”

Duolingo boosts IPO price target in boon to edtech startups

U.S. edtech company Duolingo bumped up its IPO price range Monday morning, targeting $95 to $100 per share, up from previous guidance of $85 to $95 per share.

“The fact that Duolingo is raising its IPO price range indicates that we are more likely on the path for a strong offering than a weak one,” Alex Wilhelm notes.

Data-driven iteration helped China’s Genki Forest become a $6B beverage giant in 5 years

Many Extra Crunch readers will not have heard of China’s fastest-growing bottled beverage company: Genki Forest is a direct-to-consumer startup that started selling its sodas, milk teas and other products just five years ago.

Today, its products are available in 40 countries and the company hopes to generate revenue of $1.2 billion in 2021. After closing its latest funding round, Genki Forest is valued at $6 billion.

Industry watchers frequently compare the upstart to giants like PepsiCo and Coca-Cola, but founder Binsen Tang comes from a tech background, having funded ELEX Technology, a social gaming company that found success internationally.

“China doesn’t need any more good platforms,” Tang told his team in 2015, “but it does need good products.”

Leveraging China’s robust distribution network, lighting-fast manufacturing capabilities and a vast pool of data that enables holistic digitization, Genki Forest sells more than 30% of its products online.

“Everything feels right about the company,” said VC investor Anna Fang. “The space, the founder, the products and the back end … they exemplify the new Chinese consumer brand.“

Sequoia’s Mike Vernal outlines how to design feedback loops in the search for product-market fit

Sequoia’s Mike Vernal joined us on TechCrunch Early Stage: Marketing and Fundraising to discuss how founders should approach product-market fit, with a specific focus on tempo.

It doesn’t mean fast in the kind of uncontrolled, reckless, crashing sense. It means fast in a sort of consistent, maniacal, get-a-little-bit-better-each-day kind of way. And it’s actually one of the top things that we look for, at least when evaluating a team: How consistently fast they move.

As China shakes up regulations, tech companies suffer

Alex Wilhelm spent the end of last week and the beginning of this one looking at Chinese regulations targeting its edtech sector, aiming to understand “precisely what is going on with the various regulatory changes.”

“For startups, the regulatory changes aren’t a death blow; indeed, many Chinese tech startups won’t be affected by what we’ve seen thus far,” he writes. “But on the whole, it feels like the risk profile of doing business in China has risen.”

Automakers have battery anxiety, so they’re taking control of the supply

To ensure a steady supply of batteries, automakers are increasingly looking to joint ventures.

“Like if you’re VW, and you say, ‘We’re going to go 50% electric by whatever year,’ but then the batteries don’t show up, you’re bankrupt, you’re dead,” Sila Nano CEO Gene Berdichevsky said in a recent interview.

“Their scale is so big that even if their cell partners have promised them to deliver, automakers are scared that they won’t.”

Pro tips from the team behind Kickstarter’s most funded app

The team at memoryOS “spent countless hours researching down the rabbit hole of crowdfunding tips and tricks” before it successfully became the most-funded app on Kickstarter, the company’s CEO, Alex Ruzh, writes in a guest column.

“We’re sharing our approach (and secrets) to building a successful crowdfunding campaign because we know just how tough it can be to launch your own product,” he writes.

SOSV partners explain how deep tech startups can fundraise successfully

Startups developing so-called deep tech often find it challenging to raise capital for various reasons.

At TechCrunch Early Stage: Marketing and Fundraising, two experienced investors, SOSV partners Pae Wu and Garrett Winther, spoke on the subject and advised startups facing a challenging fundraising path.

Checkout is the key to frictionless B2B e-commerce

Processing payments, credit and authorizations for B2B purchases is all handled electronically, but that’s not a panacea.

For example, volume sellers prefer to work through traditional accounts payable systems instead of paying the service fees smaller companies accept as the cost of doing business.

However, the combination of fraud and identity protection with credit handling and digital payments “creates a powerful network, the type that can not only build trust but enable one-click transactions at scale,” says Andrew Steele, an investor at Activant Capital.

 

Cowboy Ventures’ Ted Wang: CEO coaching is ‘about having a second set of eyes’

At TechCrunch Early Stage: Marketing and Fundraising, Cowboy Ventures’ Ted Wang spoke about why he encourages founders in his portfolio to work with executive coaches.

I don’t think you need to limit advice from people who are “been there, done that.” I think it is really important to get input from those people, but in terms of personal development, I think you want insight from people who understand how human beings listen and learn and grow.