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Saturday, 27 June 2020

Startups Weekly: US visa freeze is latest reason to build remote-first

新素女艳谭Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

While the US tech industry relentlessly tries to do business with the rest of the world, this week it became further embroiled in national politics. High-skill immigration visas have been suspended until the end of the year by the Trump administration, precluding thousands of present and future startup employees and founders from coming to the US and building companies here.

Instead, the suspension is another accelerant to the global remote work trend that had already been a thing for many of us this decade, that has just been pushed to the mainstream because of the pandemic. For anyone trying to find great people to hire, the next funding check, or new markets, virtual solutions are often the only solutions available today.

Our resident immigration law expert, Sophie Alcorn, has been covering the issue in-depth this week, including an explainer about the crucial role of immigration in the economy for TechCrunch, and for Extra Crunch, an overview of what you can do if you’re affected. For subscribers, she also wrote about the impact of the Supreme Court overturning Trump’s termination of DACA.

On a personal note, our global editorial staff is looking forward to resuming our global events schedule as soon as possible regardless of these national political issues. We’re here for the startup world. In the meantime, here’s Alex Ames on how we’re connecting virtual Disrupt attendees this year.

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The big industries and big-city amenities that have made New York City what it is are going to help power it forward even as more people and jobs appear to be heading away from city centers. At least that’s my takeaway from reading the 11 investors who Anthony Ha talked to this week in an Extra Crunch survey about the future of the startup hub. First, even if you can work from anywhere, millions of people will prefer that place to be New York — with the big-city housing supply, networking opportunities and amenities to attract people like before. Second, many key industries like finance, real estate, enterprise software, health care, media and other consumer products are not dying but being reinvented, and appear to be maintaining their centers in the city. Here’s Alexa von Tobel of Inspired Capital:

I’ve seen NYC grow into the powerful startup hub it’s become over the last decade, and I think that momentum will continue. Now that we’ve learned high productivity is indeed possible remotely, we expect to see companies maintain some element of a remote workforce within their broad hiring plans. But for startups in their earliest stages, I think there’s still a power to sitting side by side as you build a business. When founders are making their first hires and inking their first deals, NYC remains an incredible place to do that.

Some of those industry reinventions are more exciting than others. In a separate survey, Anthony talked to 5 investors who have tended to focus on advertising and marketing tech… the good news is that advertising and marketing costs are dropping and tech-driven efficiency is improving for the world. For founders in the space, though, the challenges have only grown as the pandemic has forced more ad budget cuts on top of shifts to the largest platforms. As John Elton of Greycroft put it:

Only the next technology breakthrough will provide fertile ground for the next wave of innovation, just as mobile and internet breakthroughs gave rise to today’s giants. Perhaps machine learning is that type of breakthrough, so we are looking at companies that use machine learning to dramatically improve what is possible in the space. The issue there is the scaled players are also very good at machine learning, so it may not be a technology that provides the same opportunity as prior disruptions.

TIm O’Reilly

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Tim O’Reilly has been going a different route from much of Silicon Valley in recent years. While his publishing company, series of conferences, essays and investments have helped to shape the modern internet for decades, he says that venture capital has gone wrong. Here’s more from an interview on with Connie Loizos on TechCrunch this week:

[I]’ve been really disillusioned with Silicon Valley investing for a long time. It reminds me of Wall Street going up to 2008. The idea was, ‘As long as someone wants to buy this [collateralized debt obligation], we’re good.’ Nobody is thinking about: Is this a good product? So many things that what VCs have created are really financial instruments like those CDOs. They aren’t really thinking about whether this is a company that could survive on revenue from its customers. Deals are designed entirely around an exit. As long as you can get some sucker to take them, [you’re good]. So many acquisitions fail, for example, but the VCs are happy because — guess what? — they got their exit.

His firm, O’Reilly AlphaTech Ventures, has instead been focused in recent years on funding founders who are creating a product that is valued by customers and generates sustainable cash flow, on terms that incentivize organic growth.

 

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Last week we launched a new effort to highlight investors who were the first to back your big and (increasingly) successful idea. It’s gotten a great response so far. From Danny Crichton:

Well, the TechCrunch community came through, since in just a few days, we’ve already received more than 500 proposals from founders recommending VCs who wrote their first checks and who have been particularly helpful in fundraising and getting a round closed.

If you haven’t submitted a recommendation, please help us using the form linked here.

The short survey takes five minutes, and could save founders dozens of hours armed with the right intel. Our editorial team is carefully processing these submissions to ensure their veracity and accuracy, and the more data points we have, the better the List can be for founders.

Check out Danny Crichton’s full post on TechCrunch for answers to questions that we’ve gotten frequently so far.

Across the week

TechCrunch:

A look at tech salaries and how they could change as more employees go remote

Apple will soon let developers challenge App Store rules

China’s GPS competitor is now fully launched

GDPR’s two-year review flags lack of ‘vigorous’ enforcement

The Exchange: IPO season, self-driving misfires and a fintech letdown

Extra Crunch:

What went wrong with Quibi?

Four perspectives: Will Apple trim App Store fees?

4 enterprise developer trends that will shape 2021

Ideas for a post-COVID-19 workplace

Plaid’s Zach Perret: ‘Every company is a fintech company’

Volcker Rule reforms expand options for raising VC funds

Around TechCrunch

Register for next week’s Pitches & Pitchers session

Join GGV’s Hans Tung and Jeff Richards for a live Q&A: June 30 at 3:30 pm EDT/12:30 pm PDT

Airtable’s Howie Liu to join us at Disrupt 2020

Zoom founder and CEO Eric Yuan will speak at Disrupt 2020

How to supercharge your virtual networking at Disrupt 2020

#EquityPod

From Alex Wilhelm:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week was a bit feisty, but that’s only because Danny Crichton and Natasha Mascarenhas and I were all in pretty good spirits. It would have been hard to not be, given how much good stuff there was to chew over.

We kicked off with two funding rounds from companies that had received a headwind from COVID-19:

Those two rounds, however, represented just one side of the COVID coin. There were also companies busy riding a COVID-tailwind to the tune of new funds:

But we had room for one more story. So, we talked a bit about Robinhood, its business model and the recent suicide of one of its users. It’s an awful moment for the family of the human we lost, but also a good moment for Robinhood to batten the hatches a bit on how its service works.

How far the company will go, however, in limiting access to certain financial tooling, will be interesting to see. The company generates lots of revenue from its order-flow business, and options are a key part of those incomes. Robinhood is therefore balancing the need to protect its users and make money from their actions. How they thread this needle will be quite interesting.

All that and we had a lot of fun. Thanks for tuning in, and follow the show on Twitter!

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.



Upcoming STEM Virtual Forum Promotes Women in the Field

Event post - June 26, 2020

If there is anything the lockdown has shown, it is the importance of technology. And the technologies people used to work, communicate and play are the result of STEM-based education. And the Executives’ Club of Chicago is looking to get more girls in those fields with the annual Women in Technology Forum event.

Degrees in Science, Technology, Engineering, and Mathematics (STEM) are still dominated by males. This is despite the fact more female students are taking up these courses than ever.

However, more needs to be done to bring in more girls when they are young. The goal of this event is to inspire young girls with female tech executives, founders, non-profit leaders, and advocates.

They will discuss how communities can support and encourage female tech talent starting in the classroom all the way into their career.

You can attend the event Wednesday, July 15, 2020, from 4-5 p.m. on Zoom.

Click the red button and register now.

Register Now



Featured Events, Contests and Awards

20 Hacks to Get ‘er Done with Virtual Teams20 Hacks to Get ‘er Done with Virtual Teams
July 7, 2020, Online

Everybody has discovered the benefits of working virtually. But did you know that hiring an outsourced contractor is different from hiring an employee? Join us live on Facebook on Tuesday, July 7, 2020 at 1:00 p.m. ET to learn where and how to find remote workers to build the right team, dos and don’ts for interviewing remote workers, how to manage people you’ve never met in person and much more. BONUS: Send us your best hack for working with a virtual team and we just might invite you to come and join us live during the event! Share it here: https://zfrmz.com/BySrTfaFDNvIWUgouC3A


Fostering Girls in STEM to be Women in Tech Fostering Girls in STEM to be Women in Tech
July 15, 2020, Chicago, IL

How can we create an environment, in both schools and businesses, which encourages women to enter and advance in the tech field? This event will focus on opportunities in Chicago to engage young girls in STEM education and prepare them for studies and careers in technology. Whether you are a parent, child, manager, or CEO – our discussion will bring relevant insight for all.


Small Business Expo 2020 - BOSTONSmall Business Expo 2020 – BOSTON
August 13, 2020, Boston, Massachusetts

Small Business Expo is the most anticipated business-to-business networking & educational event, trade show & conference for business owners, entrepreneurs, start-ups, decision-makers or anyone who works for a small business or is interested in starting a Small Business. Small Business Expo is a FREE one-day event to attend for small businesses to network, attend great business-growth workshops, build new business relationships, exchange ideas, shop from new vendors and learn from leading industry experts.


More Events

More Contests

This weekly listing of small business events, contests and awards is provided as a community service by Small Business Trends.

You can see a full list of events, contest and award listings or post your own events by visiting the Small Business Events Calendar.

Image: Depositphotos.com

This article, "Upcoming STEM Virtual Forum Promotes Women in the Field" was first published on Small Business Trends



10 Tips for Learning Lessons and Evolving Your Small Business Marketing Strategy

Learning Lessons and Evolving

Running a business requires being open to new concepts and ideas. Whether it’s a new product or a new marketing strategy, entrepreneurs must always be prepared to learn and grow through the years. Here’s some tips and ideas from members of the online small business community to help you adapt and learn about new concepts that might help your small business marketing today.

Learn the Four P’s of Marketing

Before you can get really specific with your marketing strategy, you need to cover the basics. Simple tricks to help you remember the important things can be beneficial in this area. Neil Patel shares one in this blog post.

Differentiate Your Brand with Text Message Marketing

While tons of brands are focusing on social media and search marketing, fewer offer text messages to communicate with their customers. So educating yourself in this area may help you set your small business apart. Greg Sterling elaborates in this Search Engine Land post.

Focus on Social Media Engagement

A lot of brands create social media marketing campaigns that involve sharing messages with customers. But engagement may be more important than marketing, as Muhammad Shoaib argues in this Pixel Productions post. You can also see commentary from the BizSugar community here.

Implement Branded Hashtag Campaigns on TikTok

TikTok is still a fairly new social media platform. But it’s already making a major impact for a lot of brands. If you’re still learning how to make the most of this tool for your marketing, you may be interested to learn about the company’s case study on branded hashtag campaigns. Get the facts in this Social Media Today post by Andrew Hutchinson.

Re-Balance Your Advertising Strategy

Through the years, marketing and advertising trends come and go. And some brands tend to get hung up on specific ideas and concepts. But 2020 is changing things for a lot of companies. So it may be time to adjust your way of thinking when it comes to advertising. This Target Marketing post by Chao Liao has more.

Adapt Your Marketing to a New Normal

Businesses and customers have been undeniably impacted by COVID-19. So your marketing plan should probably change as well. In this CorpNet post, Nellie Akalp offers tips for adjusting your messaging to help customers feel comfortable and confident doing business with you.

Get the Facts About Franchise Profits

If you’re thinking about starting a franchise business, you probably want your operations to be profitable as quickly as possible. Everything from your marketing to your location costs money, so there are a lot of things to consider when making this calculation. Joel Libava of The Franchise King discusses further here.

Learn About Google’s New Ranking Factors

Since search engines can make such a big impact on your marketing strategy, it’s essential to keep up with Google’s ranking factors. This SMA Marketing post by Ryan Shelley includes a guide to the latest update. And BizSugar members shared their thoughts on the post here.

Look at the Impact of Technology on Your Business

Technology is constantly evolving and changing the way small businesses operate. So it’s important to be intentional about the tech you use and how it can impact your marketing and overall success. In this Small Biz Daily post, Smith Johnes outlines some of the most impactful ways that technology has changed business operations.

Improve Online Sales with Great Images

The visuals you include with your content and website can make a major impact on the customer experience. This part of your marketing plan may be overlooked, so it’s important to learn what makes a powerful image and how to integrate them into your small business content and website. Learn more in this Biz Penguin post by Ivan Widjaya.

If you’d like to suggest your favorite small business content to be considered for an upcoming community roundup, please send your news tips to: sbtips@gmail.com.

Image: Depositphotos.com

This article, "10 Tips for Learning Lessons and Evolving Your Small Business Marketing Strategy" was first published on Small Business Trends



HelloWoofy Updates Offer Affordable Social Media Management to Small Business

hellowoofy updates

HelloWoofy, a smart social media management platform, just announced a series of new features, including integration with Hootsuite. This means that Hootsuite’s existing 18 million customers can now access HelloWoofy’s intelligent technology on top of the Hootsuite dashboard for $49 a year.

Founder Arjun Rai said in a phone interview with Small Business Trends, “A lot of Hootsuite customers were using our product in conjunction with their existing workflows, so we reached out to Ryan Holmes, Hootsuite’s founder, and now the tools are fully integrated so social media professionals and marketers all over the world can save time optimizing and sharing their content.”

HelloWoofy Updates

In addition to the integration with Hootsuite, HelloWoofy also announced a series of other new features and updates, including:

  • Autocompleting text in social posts and long-form posts, including text, emojis, hashtags, and copyright-free images
  • The ability to add GIFs from Giphy to TikTok and Instagram
  • An updated Discover section that allows users to automatically generate relevant social posts
  • A new Chrome Extension that lets users autocomplete and see emoji recommendations wherever they’re typing online
  • A new Android app to allow users automate scheduling on Instagram and TikTok, in conjunction with the platform’s existing iOS app

Going forward, HelloWoofy plans to continue adding new features that evolve with the changing marketing trends for small businesses. Specifically, the company is working on smart speaker marketing tools to help customers make the most of the Amazon Alexa and Google Home devices that are making a major impact on consumers’ daily life.

Though these updates are not ready for release just yet, customers can feel confident that the company will continue to offer interesting features that are relevant to the needs of small business users.

About HelloWoofy

HelloWoofy, which launched in late 2019, aims to stand out from the existing social media marketing platform landscape by integrating AI and data science to make the experience extra simple and intuitive for small business users.

For example, the dashboard uses a color coded system to separate various tasks: purple represents ongoing social campaigns, blue represents single posts, etc. You can also add photos or spreadsheets with multiple posts and then sort them into categories so you can easily automate separate campaigns going forward. You can even connect it to platforms like WordPress and Medium and use the predictive text feature to help you craft blog posts and long-form content.

There are also plenty of “magic tricks,” as Rai calls them, like the ability to quickly find relevant GIFs or see which emojis are trending and automatically add them to your social posts. He also cautions businesses against discounting these fun little touches, since they can actually drive a ton of engagement to posts.

Rai says, “Emojis are driving an insane amount of uplift. We see it in social posts and even email newsletters that emojis get more engagement and drive just an insane amount of uplift from customers.”

Overall, Rai hopes that by integrating all of these little features into one platform, it makes it easier for small businesses to create fun and effective content without spending a ton of time learning how to use complicated tools.

He says, “As a small business owner, you don’t want a tool that holds you back and forces you to do more grunt work. You want something that runs like the iPhone of the marketing world, where even a ten year old influencer can easily learn how to use it visually.”

READ MORE: 

Image: hellowoofy.com

This article, "HelloWoofy Updates Offer Affordable Social Media Management to Small Business" was first published on Small Business Trends



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TuSimple seeking $250 million in new funding to scale self-driving trucks

TuSimple, the self-driving truck startup backed by Sina, Nvidia, UPS and Tier 1 supplier Mando Corporation, is headed back into the marketplace in search of new capital from investors. The company has hired investment bank Morgan Stanley to help it raise $250 million, according to multiple sources familiar with the effort.

Morgan Stanley has sent potential investors an informational packet, viewed by TechCrunch, that provides a snapshot of the company and an overview of its business model, as well as a pitch on why the company is poised to succeed — all standard fare for companies seeking investors.

TuSimple declined to comment.

The search for new capital comes as TuSimple pushes to ramp up amid an increasingly crowded pool of potential rivals.

TuSimple is a unique animal in the niche category of self-driving trucks. It was founded in 2015 at a time when most of the attention and capital in the autonomous vehicle industry was focused on passenger cars, and more specifically robotaxis.

Autonomous trucking existed in relative obscurity until high-profile engineers from Google launched Otto, a self-driving truck startup that was quickly acquired by Uber in August 2016. Startups Embark and the now defunct Starsky Robotics also launched in 2016. Meanwhile, TuSimple quietly scaled. In late 2017, TuSimple raised $55 million with plans to use those funds to scale up testing to two full truck fleets in China and the U.S. By 2018, TuSimple started testing on public roads, beginning with a 120-mile highway stretch between Tucson and Phoenix in Arizona and another segment in Shanghai.

Others have emerged in the past two years, including Ike Robotics and Kodiak Robotics. Even Waymo is pursuing self-driving trucks. Waymo has talked about trucks since at least 2017, but its self-driving trucks division began noticeably ramping up operations after April 2019, when it hired more than a dozen engineers and the former CEO of failed consumer robotics startup Anki Robotics. More recently, Amazon-backed Aurora has stepped into trucks.

TuSimple stands out for a number of reasons. It has managed to raise $298 million with a valuation of more than $1 billion, putting it into unicorn status. It has a large workforce and well-known partners like UPS. It also has R&D centers and testing operations in China and the United States. TuSimple’s research and development occurs in Beijing and San Diego. It has test centers in Shanghai and Tucson, Arizona.

Its ties to, and operations in China can be viewed as a benefit or a potential risk due to the current tensions with the U.S. Some of TuSimple’s earliest investors are from China, as well as its founding team. Sina, operator of China’s biggest microblogging site Weibo, is one of TuSimple’s earliest investors. Composite Capital, a Hong Kong-based investment firm and previous investor, is also an investor.

In recent years, the company has worked to diversify its investor base, bringing in established North American players. UPS, which is a customer, took a minority stake in TuSimple in 2019. The company announced it added about $120 million to a Series D funding round led by Sina. The round included new participants, such as CDH Investments, Lavender Capital and Tier 1 supplier Mando Corporation.

TuSimple has continued to scale its operations. As of March 2020, the company was making about 20 autonomous trips between Arizona and Texas each week with a fleet of more than 40 autonomous trucks. All of the trucks have a human safety operator behind the wheel.



Commenting platform Spot.IM becomes OpenWeb

Spot.IM, which offers a platform for publishers (including TechCrunch) to manage their user comments, announced this week that it’s rebranding as OpenWeb.

CEO and co-founder Nadav Shoval told me that the new name reflects a vision that’s far grander and more ambitious than the company’s initial product, a location-based messaging service.

“We all felt that this is the time to be proud of what we actually do,” Shoval said. “It’s about saving the open web.”

Specifically, Shoval is hoping to move more online conversations away from the big social platforms like Facebook and back to independent publishers. To illustrate this, he pointed to recent discussions about reexamining or revising Section 230 of the Communications Decency Act, a crucial legal protection for the big online platforms.

While you don’t have to take President Donald Trump’s complaints of Twitter censorship at face value, Shoval said the key is that “no one big tech company should control the conversation.”

To that end, the company has also unveiled an upgraded version of its platform, which includes features like scoring the overall quality of conversation for a specific publisher, incentivizing quality comments by allowing users to earn reputation points and even asking users to reconsider their comment if it appears to violate a publisher’s standards — OpenWeb describes these warnings as “nudges,” so you can still go ahead and post that comment if you want.

“We stopped focusing only on algorithms to identify bad behavior, which we’ve done for years and have become commodity,” said Ido Goldberg, OpenWeb’s senior vice president of product. “What we did here is, we put a lot of time into understanding how we should look at quality and scale in millions of conversations.”

A big theme in our conversation and demonstration was civility — for example, Goldberg showed me how OpenWeb’s nudges had convinced some users to adopt less incendiary language. But I argued that civility doesn’t always lead to quality conversations. After all, racist (and sexist and homophobic and otherwise hateful) ideas can be expressed in ostensibly polite language.

“For us, civility is the baseline,” Goldberg replied. “When things become incivil folks that want to [have a productive conversation] don’t want to be there.”

Shoval added, “There is no silver bullet for quality conversations.” He argued that OpenWeb is trying to encourage quality conversations without being seen as “East Coast lefties who are censoring the Internet” — a balance it tries to find by working with each of its publishers and being aware of different standards in different geographies. “What we want to do is a neverending journey.”



Friday, 26 June 2020

Agora starts life as a public company by more than doubling to $50 a share

Shares of Agora, a China and U.S.-based “real-time engagement” API company, soared today after it went public.

Yesterday Agora priced 17.5 million shares at $20 apiece, up from its target range of $16 to $18 per share. The firm raised $350 in its debut, or around 10 times its Q1 2020 revenue and is now amply capitalized and has runway for effectively forever, given its modest cash consumption as an ongoing concern.

But while the debut was a success, seeing Agora’s share price rise as quickly as it did was not universally popular. Regular critic of the traditional IPO process Bill Gurley — a venture capitalist, so someone with a stake in this particular gambit — weighed in:

Let me translate. Gurley is irked — rightly, to at least some degree — that as Agora opened at $45 per share, the company’s IPO was awfully priced. By that we mean that the company should have sold its IPO shares not at $20, but at $45, the value at which the market quickly repriced them.

As $45 is more than twice $20, its bankers “missed by more than [their] original guess.” Given the number of shares the company sold, the mis-pricing could be worth up to $437.5 million!

There’s merit to this argument, but it’s not as complete a slam dunk as it might appear. Chat with CEOs of public companies and they will tell you about how important it is to have steady, stable, long-term shareholders of their equity. Those you might, say, meet on a roadshow and get to invest in your IPO shares.

Those groups — the long-term investors that tech folks claim to love so dearly — are likely a bit more price conscious than the momentum traders eager to find upside in recent debuts. That is, folks more likely to hold onto shares for a shorter period of time.

So, if you want long-term shareholders, you may have to price you IPO under the price the market may initially bear once trading begins.

 

Still, holy shit $20 per share is not close to $45. Gurley has a point.

The future

Change may be coming. The Agora news rotates back to what the NYSE, an American exchange, is doing. Namely trying to come up with a way to let companies direct list (to just start trading, sans pricing or raising new capital), and raise capital. This gets rid of the issues that Gurley highlighted above. At least in theory.

Obviously, if that model becomes possible and long-term investors are willing to pay for shares in a slightly different manner, the new method will be far superior than the old for companies that are great. What sort of companies get burned from first-day pops the most? I reckon it’s the most attractive, or hyped companies.

The companies that would make the most attractive IPOs would use the new method, leaving — what? The detritus to go out the old-fashioned way? Signaling issues abound!

Anyway, it was a zany first day for Agora.



Airvet, a telehealth veterinary platform, just clawed its way to a $14 million Series A round

Telemedicine is becoming more widely embraced by the day — and not just for humans. With a pet in roughly 65% of U.S. homes, there is now a dizzying number of companies enabling vets to meet with their furry patients remotely, including Petriage, Anipanion, TeleVet, Linkyvet, TeleTails, VetNOW, PawSquad, Vetoclock and Petpro Connect.

One of these — a two-year-old, 13-person, LA-based startup called Airvet — unsurprisingly thinks it is the best among the bunch, and it has persuaded investors of as much. Today, the company is announcing $14 million in Series A funding led by Canvas Ventures, with participation by e.ventures, Burst Capital, Starting Line, TrueSight Ventures, Hawke Ventures and Bracket Capital, as well as individual investors.

The pandemic played a role in Canvas’s decision, as did a smart model, suggests general partner Rebecca Lynn, who says she has looked at many telemedicine startups over the last 11 years and that she fell for Airvet after using the service for the animals that live on her own small farm. While vets were initially slow to embrace the shift to more telehealth visits, Airvet has “solved” some of the “objections unique to the space,” she says. Plus, “COVID has been a massive accelerant to adoption.”

We asked Airvet’s founder and CEO, Brandon Werber, to make the company’s case to us separately.

TC: Why start the company?

BW: My dad is one of the most well-known vets in the U.S. — celebrity vet Dr. Jeff Werber. We saw the impact that telehealth was making in the human world and wanted to bring the same access and level of care we get for ourselves to our pets. Since I grew up in the pet space, I know it intimately and recognized a lot of inefficiencies in the delivery of care and how vets have been unable to meet the evolving expectations of pet owners.

TC: How are you connecting vets with their pet patients?

BW: We have two apps. One is for pet-owners to download to talk with a vet, and one is for vets to download to organize workflows and talk to their clients. We do not usurp any existing vet relationships. Instead, we partner with vet clinics and enable them to conduct telehealth visits and simultaneously enable pet-owners to have access to vets 24/7, even if they don’t live nearby a vet hospital.

A huge portion of pet owners in the U.S. don’t even have a primary vet. For serious health issues like surgery, animals still need to go in-person, and network vets can even refer them. We’ve also seen Airvet used as curbside check-in, where pet-owners can chat and follow their pet’s in-person vet appointment via live video from the parking lot.

TC: I see there is a minimum charge of $30 per visit. How do you make this model work financially for vets?

BW: Vets view us as an additional revenue-generating tool on top of their base income. We don’t hire vets. Our network of 2,600+ vets are largely the same vets who use Airvet within their own hospital. They can decide at will, like an Uber driver, to swipe online to be part of the on-demand network and take calls from pet parents anywhere in the country to generate additional income.

TC: What have you learned from startups that tried this model before?

BW: All the startups that came before us are not consumer-first and are just focused on building tools for vets, so their platforms cannot be used by every pet owner. Instead, they can only be used by pet owners whose own vets use that specific platform, which is a tiny fraction of vets and therefore a tiny fraction of pet parents.

TC: Do you have ancillary businesses? Beyond these vet visits, are you selling anything else?

BW: For now, just the vet visits, which range from a $30 minimum to higher, based on the vet and specialty. Over time, we have plans and partnerships lined up to expand into other pet health verticals.

A projected $99 billion will be spent on pets in the U.S. alone in 2020, and for us, telemedicine is only the beginning.

TC: Does Airvet involve specific practice management software?

BW: No. We provide the workflow layer enabling vets to schedule virtual appointments, which will soon be able to be fully integrated with their existing systems and workflows.

TC: When a customer calls a vet for $30, is there a time limit?

BW: There is no time limit and cases will usually stay open for three full days, so pet parents can continue to access the vet via chat for any follow-up questions or concerns.

TC: Are you competing at all on pricing?

BW: Our goal is to work alongside the hospitals, not to compete with them or replace them. You can’t take blood virtually or feel a tumor or do a dental. People always will need to go to the vet.

What we want to do is help [pet owners] understand when [to come in]. The average pet parent only goes to the vet 1.5 times a year. A huge segment of users on Airvet have already connected with a vet six times more than that and save time and stress in doing so.

It’s not about competing for us, it’s about being the provider of care in between office visits [and helping] pet parents who have used our service ultimately avoid an unnecessary emergency visit.



Who really benefits from reskilling?

Nearly 40 million Americans are unemployed, and a recent study that examined more than 66,000 tech job layoffs found that sales and customer success roles are most vulnerable amid COVID-19. In response, some quarters of Silicon Valley are abuzz about a long-standing technology: reskilling, or training individuals to adopt an entirely new skillset or career for employment.

As millions look for a way to reenter the workforce, the question arises: Who really benefits from reskilling technology?

That depends on how you look at it, said Jomayra Herrera, a senior associate at Cowboy Ventures. Reskilling for a well-networked manager looks a lot different than it does for someone who doesn’t have as much leverage, and the vast majority of people fall into the latter. Not everyone has a friend at Google or Twitter to help them skip the online application and get right to the decision-makers.

Beyond the accessibility offered by live online classes, she pointed to the difference between assets and opportunities.

“You can give someone access to something, but it’s not true access unless they have the tools and structure to really engage with it,” Herrera said. In other words, how useful is content around reskilling if the company doesn’t support job placement post-training.

Herrera said companies must give individuals opportunities to test skills with real work and navigate the career path. Her mother, who did not go to college and speaks English as a second language, is looking to pursue training online. Before she can proceed, however, she has to surmount hurdles like language support, resume creation, job search and other challenges.

All of a sudden, content feels like a commodity, regardless of if it has active and social learning components. It’s part of the reason that MOOCs (massive open online courses) feel so stale.

Udacity, for example, was almost out of cash in 2018 and laid off more than half of its team in the past two years, according to The New York Times. Now, like other edtech companies, it is facing surges in usage.



YC to cut the size of its investment in future YC startups

In a blog post this Friday afternoon, Y Combinator’s president Geoff Ralston said that the accelerator would make two changes to its terms for startups.

The first would see the size of the standard deal for YC startups decline from $150,000 for 7% (roughly a $2.1 million post-money valuation) to $125,000 for the same equity (or roughly a $1.79 million post-money valuation). The deal will continue to be offered using a SAFE, which YC and a group of others pioneered as a simpler investment option compared to convertible notes.

Interestingly, the firm is always writing into its terms that it will only take pro rata up to 4% of a subsequent round’s size, which is obviously smaller than the 7% ownership that the company is buying in its financing. That 4% number is a ceiling — in cases where the accelerator has less ownership than 4%, the smaller percentage applies. Full terms of Y Combinator’s deal are available on its website.

The new deal will apply to startups who join Y Combinator in the Winter 2021 batch, and doesn’t include startups in the current summer batch (who have already presumably been funded)

YC’s deal has varied over the years. When it first launched more than a decade ago, it offered terms of $20,000 for 6%.

A Y Combinator spokeswoman said that the change was in line with the fundraising and budget realties of the accelerator going forward. “The future of the economy is unpredictable, and we feel it is prudent during these times to switch to a leaner model,” she said. “In our case, we want to be set up to fund as many great founders as possible — especially during a time that is creating an unprecedented change to consumer and business behavior; with these changes comes endless opportunities for startups. And with the changes made to our standard deal, we can fund as many as 3000 more companies.”

Outside of budget, at least a couple of factors are potentially at work here. One is the increased use of Work From Anywhere, which presumably can help lower some of the running costs of a startup, particularly in its earliest days (i.e. no need to pay for that WeWork flex desk).

Y Combinator has also invested more of its funds into emerging markets startups, which can have dramatically lower costs of development given prevailing wages for talent in local markets.

Yet, the cutback is also a sign that the flood of capital entering the Valley in recent years has receded — if ever so slightly — in the wake of COVID-19. Valuations are depressing, and while $25,000 is not a massive loss considering the scale of later venture financings, the 16% valuation haircut is inline with other numbers we have seen in the Valley in recent weeks.



Only 12 hours left to apply for Startup Battlefield at Disrupt 2020

It’s now o’clock, founders. A mere 12 hours stands between you and a chance to compete in Startup Battlefield and launch your pre-Series A startup during Disrupt 2020 — in front of the world’s influential technorati.

You won’t find a bigger launching pad, and this window of extraordinary opportunity slams shut on June 26 at 11:59 pm (PT). Apply to Startup Battlefield right here, right now.

This year’s legendary pitch competition is virtual, but the benefits and opportunity that comes from competing are very real and often life changing — for all participants not just the ultimate winner. Let’s explore that a bit more.

The top prize — $100,000 equity free cash — will do wonders for your bottom line. The TechCrunch feature article – brings you into the league of legends. The Disrupt cup and the acclaim that comes with winning, well, who doesn’t love bragging rights? But it’s the huge exposure — on a global scale — to media, investors, potential customers and big tech players looking to acquire promising startups, that can take Battlefield competitors on a whole new trajectory.

Here’s a quick look at how Startup Battlefield works. We accept applications from founders of any background, geography and industry as long as your company is early stage, has an MVP with a tech component (software, hardware or platform) and hasn’t received much major media coverage.

Our editors screen every application and will choose only startups they feel possess that certain je ne sais quoi. The epic pitch-off takes place during Disrupt 2020, which runs from Sept. 14 – 18. Note: This opportunity is 100 percent free. TechCrunch does not charge any application or participation fees or take any equity.

You’ll receive six weeks of free pitch coaching from TC editors to whip you into prime fighting trim. Plus a virtual webinar series with industry experts. You’ll have just 6 minutes to pitch and demo to the judges — a panel of expert VCs, entrepreneurs and TechCrunch editors. Then you’ll answer their questions — and they’ll have plenty.

Founders who survive the first round move to the finals on the last day of Disrupt. It’s lather-rinse-repeat as you pitch to a fresh set of judges. Then it’s time for the big reveal: one startup takes the title, the Disrupt cup and the $100,000.

Have you clicked the application link yet? No? Here are more reasons to apply. If you earn a spot in the competition, you get a Disrupt Digital Pro pass and you get to exhibit to people around the world in Digital Startup Alley — for free.

You’ll network with CrunchMatch, our AI-powered platform, to set up virtual 1:1 meetings with investors, media, potential customers and the throngs of folks eager to meet a Battlefield competitor.

Need more perks? We got you covered.

  • A launch article featuring your startup on TechCrunch.com
  • Access to Leading Voices Webinars: Hear top industry minds share their strategies for adapting and thriving during and after the pandemic
  • A YouTube video promoted on TechCrunch.com
  • Free subscription to Extra Crunch
  • Free passes to future TechCrunch events

This no-cost, perk-packed opportunity disappears in just 12 hours. Do whatever it takes to keep your startup moving forward. Apply to compete in Startup Battlefield before the deadline expires on June 26 at 11:59 pm (PT).

Is your company interested in sponsoring or exhibiting at Disrupt 2020? Contact our sponsorship sales team by filling out this form.



Tim O’Reilly makes a persuasive case for why venture capital is starting to do more harm than good

Tim O’Reilly has a financial incentive to pooh-pooh the traditional VC model, wherein investors gamble on nascent startups in hopes of seeing many times their money back. Bryce Roberts, who is O’Reilly’s longtime investing partner at the early-stage venture firm O’Reilly AlphaTech Ventures (OATV), now actively steers the partnership away from these riskier investments and into companies around the country that are already generating revenue and don’t necessarily want to be blitzcaled.

Yet in an interview with O’Reilly last week, he nonetheless argued persuasively for why venture capital, in its current iteration, has begun to make less sense for more founders who genuinely want to build sustainable businesses. The way he sees it, the venture industry is no longer as focused on finding small companies that might one day change the world but more on creating financial instruments for the wealthy — and that shift has real consequences.

Below, we’re pulling out parts of that conversation that may be of interest to readers who are either debating raising venture capital, debating raising more venture capital, and even those who have been turned away from VCs and perhaps dodged a bullet in the process. At a minimum, O’Reilly — who bootstrapped his own company, O’Reilly Media, 42 years ago and says it now produces “couple hundred million dollars in revenue” yearly — provides a lot of food for thought.

TechCrunch: A lot of companies celebrated Juneteenth this year, which is a big deal. There’s been a lot of talk about making the venture industry more inclusive. How far — or not — do you think we’ve come in the venture industry on this front?

Tim O’Reilly: The thing that I would say about VC and about really everything in tech is, this concept of structural racism [is really the problem]. People think that all it matters is, ‘Well, my values are good, my heart’s in the right place, I donate to charities,’ and we don’t actually fix the systems that cause the problems.

With VCs, the networks from which they’re drawing entrepreneurs are not that different [than they have been historically]. But more importantly, the goals of the VC model are not that different. The industry sets a goal, and it has a certain kind of financial shape, which is inherently exclusionary.

How so?

The typical VC model is looking for this high-growth company with exit potential, because it’s looking for this big financial
return from an IPO or acquisition, and that selects for a certain type of founder. My partner Bryce decided two funds ago [to] look for companies that are kind of disparaged as lifestyle companies that are trying to build sustainable businesses with cash flow and profits. They’re the kind of small businesses, and small business entrepreneurs, that have banished from America, partly because of the VC myth, which is really about creating financial instruments for the wealthy.

He came up with a version of a SAFE note that allows the founders to buy out the VC at a predetermined amount if they ever become sufficiently profitable but also gives them the optionality, because periodically, some of them do end up becoming a rocket ship. But the founder is not on the treadmill of: you have to get out.

How does that relate to Juneteenth?

When you start saying, ‘Okay, we’re going to look for sustainable businesses,’ you look all over the country, and Bryce ended up [with a portfolio] that’s made up of more than 50% women founders and 30% people of color, and it has been an incredible investment strategy.

That’s not to say that people who are African-American or women can’t also lead companies that are part of the high-growth VC model that’s typical of Silicon Valley.

No, of course not. Of course, they could lead. The talent pool is just much greater [when you look outside of Silicon Valley]. There’s a certain kind of bro culture in Silicon Valley and if you don’t fit in, sure [you could find a way], but there are a lot of impediments. That’s what we mean by structural racism.

To your point about insular networks, a prominent Black VC, Charles Hudson, has noted that a lot of [traditional VCs] just don’t know have regular or professional associations with Black people, which hampers how they find companies. How has Bryce fostered some of these connections, because it does feel like traditional VCs are right now trying to figure out how to better do this.

It’s breaking the geographic isolationism of Silicon Valley. It’s breaking the business model isolationism of Silicon Valley that says: only things that fit this particular profile are worth investing in. Bryce didn’t go out there and say, ‘I want to go find people of color to invest in.’ What he said was, ‘I want to have a different kind of investment in different places in the United States.’ And when he did that, he naturally found entrepreneurs who reflect the diversity of America.

That’s what we have to really think about. It’s not: how do we get more Black and brown founders into this broken Silicon Valley model. It’s: how do we go figure out what the opportunities are helping them to grow businesses in their communities?

Are LPs interested in this kind of model? Does it have the kind of growth potential that they need to service their endowments?

It was a bit of a struggle when we did fund four, which was focused on [this newer model]. It was about a third of the size of fund three. But for fund five, the fundraising is [going] like gangbusters. Everybody wants in because the model has proven itself.

I don’t want to name names, but there are two companies [in the portfolio] that are kind of in similar businesses. One was in third fund and was sort of a traditional Silicon Valley-style investment. And the other was an investment in Idaho of all places. The first company, which involved a more traditional seed round, we’ve ended up putting in $2.5 million for a 25% stake. The one in Idaho we put in 500,000 for a 25% stake, and the one in Idaho is now twice the size of the Silicon Valley one and growing much faster.

So from what you’re seeing, the returns are actually going to be better than with a traditional Silicon Valley venture [approach].

As I said, I’ve been really disillusioned with Silicon Valley investing for a long time. It reminds me of Wall Street going up to 2008. the idea was, ‘As long as someone wants to buy this [collateralized debt obligation], we’re good.’ Nobody is thinking about: is this a a good product?

So many things that what VCs have created are really financial instruments like those CDOs. They aren’t really think about whether this is a company that could survive on revenue from its customers. Deals are designed entirely around an exit. As long as you can get some sucker to take them, [you’re good]. So many acquisitions fail, for example, but the VCs are happy because — guess what? — they got their exit.

But now, because funds are raised so quickly, VCs have to show much more traction, which is where things like blitzscaling come in.

Just the way you’re describing it. Can’t you hear what’s wrong with that? It’s for the benefit of the VCs, the VCs have to show, not the entrepreneurs have to show.

Aren’t the LPs addicted to that crack? Don’t they want to see that quick financial traction?

Yeah, but you know that VC returns have actually lagged public markets for four decades now. It’s a little bit like the lottery. The only sure winners are the VCs because the VCs that don’t return their fund get their management fees every year.

A huge amount of the VC capital doesn’t return. Everybody just sees the really big wins. And I know when they happen, it’s really wonderful. But I think [those rare wins] have gotten an outsize place, and they’ve displaced other kinds of investment. It’s part of structural inequality in our society, where we’re building businesses that are optimized for their financial return rather than their return to society.



Running a queer dating startup amid a pandemic and racial justice uprising

The events of the past few months have shaken the lives of everyone, but especially Black people in the U.S. COVID-19 has disproportionately impacted members of the Black community while police violence has recently claimed the lives of George Floyd, Tony McDade, Breonna Taylor, Rayshard Brooks and others. 

Two weeks ago, two Black transgender women, Riah Milton and Dominique “Rem’mie” Fells were murdered. In light of their deaths, activists took to the streets to protest the violence Black trans women face. Two days after Floyd’s killing, McDade, a Black trans man was shot and killed by police in Tallahassee, Florida. 

In light of Pride month coinciding with one of the biggest racial justice movements of the century amid a pandemic, TechCrunch caught up with Robyn Exton, founder of queer dating app Her, to see how her company is navigating this unprecedented moment. 

Exton and I had a wide-ranging conversation including navigating COVID-19 as a dating startup, how sheltering in place has affected product development, shifting the focus of what is historically a month centered around LGBTQ people to include racial justice work and putting purpose back into Pride month.

“Pride exists because there is inequality within our world and within our community and still there is no clear focus on what it is we should be fighting for as a community,” Exton says. “It almost feels like since equal marriage was passed, there’s a range of topics but no clear voice saying this is what everyone should focus on right now. And then obviously everything changed after George Floyd’s murder. Over the course of the following weekend, we canceled pretty much everything that was going out that talked still about Pride as a celebration. Especially for Black people within our community, in that moment of so much trauma, it felt completely wrong to talk about Pride just in general.”

Worldwide, Pride events have been canceled as a result of the pandemic. But it gives people and corporations time to reflect on what kind of presence they want to have in next year’s Pride celebrations.



Volcker Rule reforms expand options for raising VC funds

It’s time to put on our thinking caps so we can discuss an esoteric but important policy change and how it is going to impact the VC world.

The 2008 financial crisis devastated the global economy. One of the reforms that came from the detritus of that situation was a policy known as the Volcker Rule.

The rule, proposed by former Fed chairman Paul Volcker and passed into law with the Dodd-Frank reform bill, was designed to limit the ways that banks could invest their balance sheets to avoid the kind of cataclysmic systemic risks that the world witnessed during the crisis. Many banks faced a liquidity crunch after investing in mortgage-backed securities (MBSs), collateralized debt obligations (CDOs), and other even more arcane speculative financial instruments (like POGs, or Piles Of Garbage) in seeking profits.

A number of reforms are underway to the Volcker Rule, which has been a domestic regulatory priority for the Trump administration since Inauguration Day.

One of the unintended consequences of the Rule is that it limited banks from investing in certain “covered funds,” which was written broadly enough that it, well, covered VC firms as well as hedge funds and other private equity vehicles. Reforms to that policy (and to the Rule in general) have been proposed for a decade with little traction until recently.

Now, a number of reforms are underway to the Volcker Rule, which has been a domestic regulatory priority for the Trump administration since Inauguration Day.

First, a a simplification to some of the Rule’s regulations was passed late last year and went into effect in January. Now, a final rule to reform the Volcker Rule’s applications to VC firms among other issues was agreed to by a group of U.S. regulatory agencies, and will go into effect later this year.



Near Space Labs expands high-altitude Earth imagery to Texas and ramps remote deployment

The ongoing COVID-19 crisis has had a number of unexpected impacts on global economic activity – most of them negative. But the pandemic has also highlighted the need for alternative solutions to challenges where traditional solutions now prove either too costly, or too difficult to do while maintaining good health and safety practices. Near Space Labs, a startup focused on providing timely, location-specific, high resolution Earth imaging from balloons in the stratosphere, is one company that has found its model remarkably well-suited to the conditions that have arisen due to the coronavirus crisis.

Near Space Labs is in the process of expanding its offering to Texas, with some imagery already collected, and the team in active conversations with a number of potential customers about subscribing to its imaging services ahead of launching the first full batch of collected imagery by early next month. Adding a new geography in the middle of a pandemic required Near Space Labs to move up the development of a way for it to easily ship and deploy its balloon-lofted imaging equipment using remote instruction with local technical talent, which now means it’s ready to effectively spin up an imaging operation very quickly, on-demand basically anywhere in the world, with simple, minimal training to onboard and equip local operators on-demand.

“With travel restrictions, we had to figure out how to deploy hardware in a fully remote way,” explained Near Space Labs’ CEO Rema Matevosyan. “That had been a challenge that we wanted to tackle at some point, for our scalability – but instead we had to tackle that ASAP. Today, I’m really proud to say that the Swift, our robotic vehicles are able to be shipped anywhere on the globe in a small suitcase. And with a few videos, and a manual, it’s super easy to train new people to launch.”

Swift is basically a sophisticated camera attached to a balloon that flies between 60,000 and 85,000 feet, with short duration flights that can nonetheless capture up to 270 square miles of imagery at 30cm per inch resolution in a single pass. Swift is also designed to be able to go up frequently, making trips up to as frequently as twice per day, and it’s designed to provide quick turnaround times for processed images, compared to long potential waits for imaging from geosynchronous or even LEO satellites based on orbital schedules, ground station transmission times and other factors.

Image Credits: Near Space Labs

And because Near Space Labs can basically ship its imaging equipment in a suitcase and have just about anyone train quickly to use it effectively, vs. having to build a satellite that requires delivery via rocket and operation by highly trained engineers, it can offer considerable savings vs. the space-based competition – at a time when cost sensitivity for public institutions and the organizations looking for this kind of data aren’t eager to open their wallets.

“In these uncertain economic times, margins and fiscal responsibility become very important for people,” Matevosyan explained. “We have the perfect solution for that – our approach is very flexible, very low-cost. Even states are ‘bankrupt,’ – so everybody’s looking for ways to improve their margins, and to improving their spend.”

Matevosyan told me that Near Space Labs has seen an uptick in interest in its product from two directions as a result of the ongoing global economic shifts – first, there are customers who have traditionally sourced this imaging from satellite providers and who are looking for cost savings and a product that more closely fits their geographic and timing needs. Second, there are organizations looking to start using this kind of imagery for the first time, as an alternative to in-person inspection or sensing, because of the ways in which COVID-19 has put restrictions on workforces.

“COVID also put a spotlight in general on the remote sensing industry, because people are unable to, for instance, go down to the assets or the sites that they usually would check manually,” she said. “So that started looking into remote sensing solutions, and we saw an uptick in applications and signups to our imagery. One example industry where that’s happening is conservation. Conservation wasn’t a vertical that was super active in our pipeline. But suddenly with COVID, it became pretty active.”

Matevosyan says that it took Near Space just “days” to ramp a new technical team to be able to launch its Swifts in Texas, and that’s representative of the speed at which it can now scale to establish imaging basically anywhere in the world. Flexibility and scalability were always key assets of the business, she says, but the COVID crisis pushed that essential value to the forefront, and could help propel the company’s growth a lot quicker than expected.



Automating payments for the corporate sales force leads to a $10 million windfall for Spiff

Salt Lake City’s Spiff has announced a $10 million round of funding to expand the sales and marketing efforts for its service that automates commission payments for sales people.

Some of the biggest names in startup tech are using the service to pay their sales force, including Brex, Workfront, Algolia and the publicly traded startup Qualys.

The idea at Spiff is to create a new software category around sales compensation management, and it’s gotten buy-in from investors at Norwest Venture Partners, Next World Ventures and Epic Ventures. Seed investors, including Kickstart Album Ventures, Pipeline Capital and Peterson Ventures, returned to invest in the company as well.

“Commissions are a major cause of anxiety for teams who don’t understand or trust their incentive plan and many waste hours every month correcting mistakes or arguing with finance, which hits bottom lines,” said Spiff chief executive, Jeron Paul. “Norwest’s investment will help us automate commission calculations so sales teams have one less thing to worry about in these challenging times.”

Paul, a serial entrepreneur whose most recent business, Capshare, was sold to Solium in 2017, has spent the better part of his professional career developing services businesses for enterprises.

“The world of sales compensation software is long overdue for a revamp,” said Sean Jacobsohn, partner at Norwest Venture Partners, in a statement. “With 85 percent of companies still calculating sales commissions manually in Google Sheets or Excel, I’m excited to partner with Spiff to help transform the way people think about sales compensation and provide  sales teams with a deeper level of  visibility into their commissions.”