Year: 2018

The rumors are true: Walmart has bought a controlling stake in India’s Flipkart. This isn’t a straight-up acquisition, however, because, rather than going it alone, the U.S. retailer is enlisting strategic allies as it takes its fight to Amazon in a new region.

Walmart has an existing offline retail business in India, but enter the online space puts it up against Amazon, which has made massive strides since entering India in 2012.

That perhaps calls for something special, which is one reason why Walmart is buying just 77 percent of Flipkart and leaving space for others with expertise to come join.

Walmart confirmed that “some” existing investors will retain their stakes, including Tencent — the $500 billion Chinese giant — and Tiger Global, both of which have board sets, and Microsoft, which was part of a $1.4 billion investment last year. Added to that, Flipkart co-founder Binny Bansal has committed to stay retain his shares, although there’s no word on fellow co-founder Sachin Bansal who had been tipped to move on.

Beyond those three strategic Flipkart backers, Walmart said it is in ongoing discussions with “with additional potential investors who may join the round.”

Google is one who has been linked with a deal but you can imagine that Walmart — very much a physical retail specialist — will be looking to tap the world of tech and Asian partners to help gain an advantage over Amazon, which is broadly thought to have closed the gap on Flipkart in recent years.

Walmart is indicating that the new backers will buy a part of its equity if they invest, but it said it will “retain clear majority ownership” regardless of who joins.

“One of the things that was important to us here was having partners alongside us as well. So having Tencent, Microsoft and Tiger Global who are already investors in this business is really powerful in terms of the model that we’re creating,” Judith McKenna, Walmart COO, said on a call with investors following today’s announcement.

“[Flipkart] will be run through an independent board who will have some Walmart representation. We think that structure will best keep the entrepreneurial side of this business and guide it strategically, too,” McKenna added.

Walmart declined to give a timeline on when it might have news about the prospective investors.

Despite that, a number of investors have exited entirely with impressive returns, including SoftBank — which sunk a then-Indian record investment into Flipkart via its Vision Fund last year — Naspers and eBay.

In the more immediate future, Walmart is putting $2 billion of fresh capital into the business which Flipkart will be able to spend on growth and existing strategies.

Interestingly, too, Walmart is open to allowing Flipkart to IPO as a listed subsidiary in the future. That would help maintain incentives for employees and fulfill the ambition of management, McKenna said.

Last week, we reported on how Amazon was leveraging a new relationship with home builder Lennar to expand its smart home business, specifically in the sale of home security services. Today, Amazon is taking the next step forward in that strategy: it’s launching a new chain of showrooms it’s calling the Amazon Experience Centers across Lennar model homes to demo and help sell its smart home devices, Amazon Dash Buttons, and other consumer electronics services such as streaming Prime Content with Fire TV.

The model homes will be fully connected up as Alexa-enabled smart homes, Amazon says, with customers able to walk through and see the full effect of being able to use Alexa to control all electronic and connected kit, from TVs and lights to thermostat and window blinds.

These Experience Centers will also become places where people can go to arrange for and order home services through Amazon Home Services, the company’s Thumbtack-style marketplace that lets people search for and book a range of in-home contractors for cleaning, fixing or helping in other ways.

The centers will open first in 15 model homes in the cities of Atlanta, Dallas, Los Angeles, Miami, Orlando, San Francisco, Seattle, and Washington DC, and Amazon will be looking to strike deals with other home builders to replicate the model.

The Experience Centers, and the other work that Amazon is doing to provide a more in-person angle to its smart home strategy specifically is particularly important to the company’s smart home and consumer electronics strategy. If people are buying products to put into their homes, and many of those products represent the next generation of consumer electronics, it’s important for Amazon to provide more real-world touchpoints both to better sell and explain the services, and to help make consumers — the majority of whom will not be early adopters — more comfortable with the purchases.

“We wanted customers to experience a real home environment that showcases the convenience of the Alexa smart home experience, great entertainment available with Prime, and Home Services,” said Bhavnish Lathia, general manager, Amazon Services, in a statement. “We are excited to extend our relationship with Lennar with the launch of Amazon Experience Centers. As one of the nation’s largest homebuilders, Lennar offers the potential to enable this experience within easy driving distance of millions of customers.”

The launch of these Experience Centers is also just the latest move by Amazon to bring its online marketplace and virtual salesrooms into more physical, brick-and-mortar environments. Other efforts have included Go, Amazon’s cashier-free shopping experience launched at the end of last year, and its university campus-based stores, which have been around now for several years. All of these also complement the major investment that Amazon has made in another physical sales environment: last year the company acquired the Whole Foods chain of supermarkets for $13.7 billion.

As with the company’s home services specialists, the people who will staff the Experience Centers will also be employees of Amazon, “experts” in the company’s parlance, “employees who are specially trained on the latest technology and are passionate about helping customers.”

For Lennar, the idea will be to use the format to help it sell more of its homes, as well as the premium packages to add on the numerous extras of making them into high-end smart homes. The company controversially once worked with Apple as its smart home partner but more recently swapped to working with Amazon, reportedly because Amazon sold not only its own devices, but those of third parties.

“Amazon’s ability to bring a home to life with Alexa smart home experiences, entertainment and services – coupled with their obsession with customer experience – is a natural extension of our Everything’s Included approach to homebuilding,” said David Kaiserman, president of Lennar Ventures, in a statement. “We picked Amazon because of our shared commitment to customers, their Amazon experts across the country, and their ability to connect customers with thousands of service providers through Amazon Home Services.”

 

HQ, the live trivia game that is now seeing up to 2 million players per game, is introducing some new social features, including answer sharing with friends.

The company has been testing this feature across a small group of users already, but on Friday the feature will roll out to all HQ users.

Here’s how it works: Users can connect their address book to HQ and add their friends. Once they have added friends, they can see which of their friends are playing the game alongside them. Users can put their own avatar on the answer to a question to share their choice, which is viewable by friends.

The idea is that answer sharing mimics what many people do while playing HQ IRL, yelling out answers to their coworkers in the office or sharing with their friends and family in a bar or at home.

“We understand the power of the crowd and playing together,” said HQ head of product James Ruben. “That doesn’t necessarily exist everywhere. Our goal is to spread that power to people who maybe aren’t playing in the office together.”

This comes on the heels of HQ’s introduction of “Friends on HQ” from April, which let users see friends playing in the same quiz and see their progress through the game. Answer sharing simply takes that a step further.

Interestingly, answer sharing won’t be available on each HQ Trivia quiz. Instead, the feature will debut on Friday of this week, and continue to be available on Friday games.

“We understand that it’s a change to the game play,” said Ruben. “Friday is an interesting time to experiment and try out answer sharing because Fridays tend to be a bit more social than other days.”

Alongside answer sharing, HQ is also adding yet another social layer to the game with Nearby Friends. The feature will allow HQ players to see other people (not in their address book) who are in the same quiz as them and physically nearby, perhaps in the same office building or in the same bar or restaurant.

Finally, HQ is making it easier to upload the address book and connect with friends on the app.

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HQ is an interesting business in that it’s taking an almost old-school approach to advertising/sponsorship. As opposed to social networks like Facebook, which collect as much data as possible about users to sell advertisements against that data, HQ is focused more on getting as many engaged eyeballs in the same place as possible, a bit like television advertising.

HQ doesn’t have that much information on users beyond their phone number, device type, username, and other basic information commonly gleaned by app developers. With the introduction of Friends on HQ, the company gets a bit more insight into users. But that’s not necessarily the reason for the update.

Instead, HQ wants to make these games as engaging as possible, and what’s more engaging than competing with or cheering along your friends and family.

The company is also taking a measured approach to advertising and sponsorship, working with partners that make sense for the HQ community and making those sponsorships as native as possible.

For example, HQ recently ran a $250,000 game with Warner Brothers as a sponsor, plugging the film Ready Player One within the graphics and even in some of the questions. The company also had Duane “The Rock” Johnson host a $300,000 game as part of the actor’s promotion of his upcoming movie Rampage.

Answer sharing will be available to everyone on Friday, but easier address book upload and Nearby Friends are soon to come for Android users.

StubHub is best known as a destination for buying and selling event tickets. The company operates in 48 countries and sells a ticket every 1.3 seconds. But the company wants to go beyond that and provide its users with a far more comprehensive set of services around entertainment. To do that, it’s working on changing its development culture and infrastructure to become more nimble. As the company announced today, it’s betting on Google Cloud and Pivotal Cloud Foundry as the infrastructure for this move.

StubHub CTO Matt Swann told me that the idea behind going with Pivotal — and the twelve-factor app model that entails — is to help the company accelerate its journey and give it an option to run new apps in both an on-premise and cloud environment.

“We’re coming from a place where we are largely on premise,” said Swann. “Our aim is to become increasingly agile — where we are going to focus on building balanced and focused teams with a global mindset.” To do that, Swann said, the team decided to go with the best platforms to enable that and that “remove the muck that comes with how developers work today.”

As for Google, Swann noted that this was an easy decision because the team wanted to leverage that company’s infrastructure and machine learning tools like Cloud ML. “We are aiming to build some of the most powerful AI systems focused on this space so we can be ahead of our customers,” he said. Given the number of users, StubHub sits on top of a lot of data — and that’s exactly what you need when you want to build AI-powered services. What exactly these will look like, though, remains to be seen, but Swann has only been on the job for six months. We can probably expect to see more for the company in this space in the coming months.

“Digital transformation is on the mind of every technology leader, especially in industries requiring the capability to rapidly respond to changing consumer expectations,” said Bill Cook, President of Pivotal . “To adapt, enterprises need to bring together the best of modern developer environments with software-driven customer experiences designed to drive richer engagement.”

Stubhub has already spun up its new development environment and plans to launch all new ups on this new infrastructure. Swann acknowledged that they company won’t be switching all of its workloads over to the new setup soon. But he does expect that the company will hit a tipping point in the next year or so.

He also noted that this over transformation means that the company will look beyond its own walls and toward working with more third-party APIs, especially with regard to transportation services and merchants that offer services around events.

Throughout our conversation, Swann also stressed that this isn’t a technology change for the sake of it.

When it comes to making requests inside a company for new equipment or to learn about HR policies, it can be a frustrating experience for both sides of the equation. HR and IT are probably tired of answering the same questions. Employees are tired of calling a help desk for routine inquiries and waiting for answers. ServiceNow’s new bot-building technology is designed to alleviate that problem by providing a way to create an automated bot-driven process for routine requests.

The company claims that you can build these bots to provide end-to-end service. Meaning if you tell the bot you need a new phone, it can pull your records, understand what you currently have and and order a new one all in the same interaction — and all within a common messaging interface such as Slack or Microsoft Teams.

It also works for customer service transactions to process routine customer inquiries without having to route them to a CSR to answer typical questions.

The new chatbot building tool called Virtual Agent, has been built into the ServiceNow Now platform and provides a way for developers to build conversational interfaces easily, says CJ Desai, chief product officer at ServiceNow. “[The Virtual Agent] enables our customers to develop a wide range of intelligent service conversations from a quick question to an entire business action through the messaging platform of their choice,” Desai said in a statement.

The announcement is part of a broader AI initiative on the part of ServiceNow, which purchased Parlo, a chatbot startup, just last week for an undisclosed amount of cash. The acquisition should help give ServiceNow more AI engineering talent and help them beef up their natural language processing (NLP) to further refine and improve their chatbot products moving forward, as the Parlo team and technology get incorporated into the ServiceNow platform.

The company claims that using these chatbots, customers can reduce call volume to help desks and customer service by 15-20 percent, using the standard argument that it should free humans to handle more difficult inquiries.

The company joins a slew of other platform players including Salesforce, IBM, Oracle, AWS, and others who are incorporating chatbot building technology into their platforms.

When it comes to making requests inside a company for new equipment or to learn about HR policies, it can be a frustrating experience for both sides of the equation. HR and IT are probably tired of answering the same questions. Employees are tired of calling a help desk for routine inquiries and waiting for answers. ServiceNow’s new bot-building technology is designed to alleviate that problem by providing a way to create an automated bot-driven process for routine requests.

The company claims that you can build these bots to provide end-to-end service. Meaning if you tell the bot you need a new phone, it can pull your records, understand what you currently have and and order a new one all in the same interaction — and all within a common messaging interface such as Slack or Microsoft Teams.

It also works for customer service transactions to process routine customer inquiries without having to route them to a CSR to answer typical questions.

The new chatbot building tool called Virtual Agent, has been built into the ServiceNow Now platform and provides a way for developers to build conversational interfaces easily, says CJ Desai, chief product officer at ServiceNow. “[The Virtual Agent] enables our customers to develop a wide range of intelligent service conversations from a quick question to an entire business action through the messaging platform of their choice,” Desai said in a statement.

The announcement is part of a broader AI initiative on the part of ServiceNow, which purchased Parlo, a chatbot startup, just last week for an undisclosed amount of cash. The acquisition should help give ServiceNow more AI engineering talent and help them beef up their natural language processing (NLP) to further refine and improve their chatbot products moving forward, as the Parlo team and technology get incorporated into the ServiceNow platform.

The company claims that using these chatbots, customers can reduce call volume to help desks and customer service by 15-20 percent, using the standard argument that it should free humans to handle more difficult inquiries.

The company joins a slew of other platform players including Salesforce, IBM, Oracle, AWS, and others who are incorporating chatbot building technology into their platforms.

Naspers, the South African tech and media conglomerate, continues to have an incredibly hot hand when it comes to global tech investment.

Famous for owning a huge chunk of the Chinese Internet powerhouse, Tencent and a big chunk of Mail.ru, Naspers just made $2.2 billion off of the sale of Flipkart to Walmart. 

The South African company had an 11.18% stake in Flipkart and the sale represents an IRR of 32%, the company said.

Naspers originally backed Flipkart five years after the company’s launch in 2007 and had invested roughly $616 million into the company since that time.

Naspers said that proceeds from the sale of Flipkart would be funneled back into the company’s balance sheet to fuel the growth of the company’s own classifieds, online food delivery, and fintech businesses globally.

With Flipkart out of the portfolio, Naspers still holds a huge chunk of online tech real estate in India. The company has stakes in PayU, a payment and fintech company; OLX, a classifieds business; the online travel business MakeMyTrip, and Swiggy, a food delivery company.

 

Roughly five years after the launch of its first fund in 2013, Female Founders Fund (F3) has closed on $27 million for its latest seed fund — backed by some of the startup world’s top women entrepreneurs and investors.

Backed by a clutch of seriously impressive names in the startup and tech community, entrepreneurs financed by F3’s latest endeavor can count on a rolodex that includes Melinda Gates, the co-chair of the Bill & Melinda Gates Fooundation; Katrina Lake, the founder and CEO of StitchFix; Jenny Fleiss, the co-founder of Rent the Runway and Code 8; Hayley Barna, the co-founder of Birchbox and a partner at First Round Capital; Elizabeth Cutler, the co-founder of SoulCycle; Reshma Saujani, the founder of Girls Who Code; and Whitney Wolfe Herd, the founder of Bumble .

Launched by Anu Duggal with an $8 million first fund in 2013, F3 managed to amass an impressive portfolio of 30 companies that have gone on to raise some $500 million in capital. Early successes include Zola, Maven Clinic, Tala, WayUp, and ELOQUII. In the last two months alone, Tala has raised $65 million in new capital and Zola just closed on $100 million (Zola founder Shan-Lyn Ma is also backing the latest F3 Fund).

Duggal and her partner Sutian Dong are part of a clutch of female entrepreneurs and investors who are working hard to correct the gender discrimination that has plagued the tech community broadly, and the venture capital community specifically, from its earliest days.

Along with firms like Jesse Draper’s Halogen Ventures and Susan Lyne and Nisha Dua’s BBG Ventures, F3 is laser focused on backing female founded or led companies at the earliest stages, according to Duggal.

“We are continuing to double down on our focus on investing in female-founded companies,” she said.

The industry agnostic company has placed bets in everything from fintech, healthcare information technologies, enterprise software as a service and many other industries, but sees particular opportunities in the emergence of what Duggal calls “alternate communities” and at the confluence of healthcare and wellness.

She points to the startup Peanut, an online community for millennial mothers, and HipSobriety, a new take on Alcoholics Anonymous, as examples of the thesis.

Other companies in the fund’s current portfolio include Thrive Global, Winky Lux, and Billie.

For Sutian Dong, who joined F3 from FirstMark Capital in 2016, the opportunity for seed investment in women entrepreneurs was too compelling to pass up.

“We have seen that capital can create a massive impact down the line,” says Dong of seed investing. But the advantages of F3’s investment go far beyond its money, the two partners said.

“The network and community perspective, and the ability to access other female founders that share knowledge and support each other,” is critical, says Dong. “The reality of early stage companies is that there’s never enough people and there’s never enough time,” she said. But leveraging the largest ecosystem of female founders can help startups with recruiting, customer development services and other unanticipated needs that founders have when getting a business off the ground.

“Female Founders Fund has done an incredible job of consistently creating value for their portfolio founders through their network and events,” said Arianna Huffington, founder of the F3 porfolio company, Thrive Global, in a statement. “Their values of supporting innovative female entrepreneurs and playing active roles in their growth is so important to us, and it’s been such an exciting journey working with them over the past year and-a-half. I’m honored to be a part of this community and to be a part of their growth story.”

“There’s a whole group of women who have really relevant professional and personal experiences and they’re leveraging that to start new businesses,” Duggal said.

While there’s still an overabundance of work that needs to be done, this wave of new investors and entrepreneurs is having an imapct on the community. “I run this women in VC community in New York and keep a directory of female investors internationally,” says Dong. “That group has expanded well into the hundreds of women across a number of countries at the early stage.”

Both Dong and Duggal point to the success of funds like Kirsten Green’s Forerunner Ventures, Aileen Lee’s Cowboy Ventures and Jennifer Fonstadt and Theresia Gouw’s Aspect Ventures as inspiration for their success and see opportunities for more funds to tap the underserved market for investing in good female entrepreneurs.

“We are incredibly excited to continue building on our thesis that it is possible to achieve outsized returns by investing in women,” said Duggal, in a statement. “With the support of our remarkable and successful base of investors, both institutional and strategic, we will continue to build a brand that invests in and champions female founders, while underscoring the larger conversation about the shift in dynamics within venture capital.”

Walmart, the world’s largest retailer, has finally confirmed that it is making a $16 billion investment into Flipkart for a 77 percent share of the online retailer. Tencent, Tiger Global, Microsoft and Flipkart co-founder Binny Bansal will continue to be investors in the company with this deal.

“India is one of the most attractive retail markets in the world, given its size and growth rate, and our investment is an opportunity to partner with the company that is leading transformation of eCommerce in the market,” said Doug McMillon, Walmart’s president and chief executive officer in a statement. “As a company, we are transforming globally to meet and exceed the needs of customers and we look forward to working with Flipkart to grow in this critical market. We are also excited to be doing this with Tencent, Tiger Global and Microsoft, which will be key strategic and technology partners. We are confident this group will provide Flipkart with enhanced strategic and competitive advantage. Our investment will benefit India providing quality, affordable goods for customers, while creating new skilled jobs and fresh opportunities for small suppliers, farmers and women entrepreneurs.”

The deal is still subject to regulatory approval and comes after many months of speculation about a tie-up between the two, which reached a fever pitch this morning with Softbank CEO Masayoshi Son accidentally let the news of the deal slip out in an investor presentation.

The deal sets up India as the latest battleground between Walmart and Amazon, which also had been rumored to be interested in taking a stake in Flipkart. Amazon has already invested billions into its India operations — a move that has heightened competition and even started to impact Flipkart’s own margins and valuation.

This should see a huge infusion of investment into the operations along with Walmart’s immense purchasing and logistics muscle.

“This investment is of immense importance for India and will help fuel our ambition to deepen our connection with buyers and sellers and to create the next wave of retail in India,” said Binny Bansal, Flipkart’s co-founder and group chief executive officer. “While eCommerce is still a relatively small part of retail in India, we see great potential to grow. Walmart is the ideal partner for the next phase of our journey, and we look forward to working together in the years ahead to bring our strengths and learnings in retail and eCommerce to the fore.”

More to come.

Trussle, the U.K. online mortgage broker that competes most directly with Atomico-backed Habito, has closed £13.6 million in Series B funding.

Notably, the round is led by Goldman Sachs Principal Strategic Investments — a division of Goldman Sachs — and Propel Venture Partners, a fund backed by European banking giant BBVA.

In addition, a number of other investors also participated including Finch Capital, which led Trussle’s Series A fund raise, and Seedcamp, which has backed the fintech startup from the get-go.

Launched in 2016, Trussle moves the entire mortgage process online, bringing with it much-needed transparency. One aspect to this — powered by the data it amassing and machine learning — is making it infinitely easier to ‘switch’ mortgage when a better deal or lower interest rate becomes available. The same technology-driven approach is used for those looking to find and apply for a new or first time mortgage.

In a brief call this morning, Trussle co-founder and CEO Ishaan Malhi told me that the new capital will be used to further scale up the company, noting that the Trussle team has grown from 14 to 70 people since its Series A in February 2017. A significant portion of these are in product development as the fintech startup moves from what Malhi describes as a transactional proposition — where customers use Trussle at the point of taking out a mortgage — to a “lifetime proposition” that supports customers when they first start thinking about owning their own home and then throughout their financed home ownership.

As an example of this, he pointed me towards Trussle’s mortgage monitoring service, which launched last year. It constantly monitors the market and alerts you when money can be saved by switching to another deal.

However, the longer term vision — and presumably part of what attracted investors — is to return more value based on the data Trussle captures. This could include telling you when it may be advantageous to overpay and giving you an easy to understand dashboard that clearly shows where you are at in the repayment process.

More broadly, Trussle wants to play a major role and making home ownership a reality for many for whom is it increasingly prohibitive (think: Generation Rent). To do this, he doesn’t rule out partnerships with other fintech startups aligned to that same mission.

Adds Malhi in a statement: “The backing from two prolific and globally renowned fintech investors recognises the brilliant progress we’ve made, but also the scale of our ambition. The funding will enable us to invest significantly in building our brand and our product, but fundamentally will accelerate us towards our vision of digitising the end-to-end journey to make home ownership more affordable and accessible to all”.