Month: June 2019

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s noteworthy venture capital deals, funds and trends. Before I dive into this week’s topic, let’s catch up a bit. Last week, I wrote about the proliferation of billion-dollar companies. Before that, I noted the uptick in beverage startup rounds. Remember, you can send me tips, suggestions and feedback to kate.clark@techcrunch.com or on Twitter @KateClarkTweets.

Now, time for some quick notes on Peloton’s confirmed initial public offering. The fitness unicorn, which sells a high-tech exercise bike and affiliated subscription to original fitness content, confidentially filed to go public earlier this week. Unfortunately, there’s no S-1 to pore through yet; all I can do for now is speculate a bit about Peloton’s long-term potential.

What I know: 

• Peloton is profitable. Founder and chief executive John Foley said at one point that he expected 2018 revenues of $700 million, more than double 2017’s revenues of $400 million.
• There is strong investor demand for Peloton stock. Javier Avolos, vice president at the secondary marketplace Forge, tells TechCrunch’s Darrell Etherington that “investor interest [in Peloton] has been consistently strong from both institutional and retail investors. Our view is that this is a result of perceived strong performance by the company, a clear path to a liquidity event, and historically low availability of supply in the market due to restrictions around selling or transferring shares in the secondary market.”
• Peloton, despite initially struggling to raise venture capital, has accrued nearly $1 billion in funding to date. Most recently, it raised a $550 million Series F at a $4.25 billion valuation. It’s backed by Tiger Global Management, TCV, Kleiner Perkins and others.

 

A bullish perspective: Peloton, an early player in the fitness tech space, has garnered a cult following since its founding in 2012. There is something to be said about being an early-player in a burgeoning industry — tech-enabled personal fitness equipment, that is — and Peloton has certainly proven its bike to be genre-defining technology. Plus, Peloton is actually profitable and we all know that’s rare for a Silicon Valley company. (Peloton is actually New York-based but you get the idea.)

A bearish perspective: The market for fitness tech is heating up, largely as a result of Peloton’s own success. That means increased competition. Peloton has not proven itself to be a nimble business in the slightest. As Darrell noted in his piece, in its seven years of operation, “Peloton has put out exactly two pieces of hardware, and seems unlikely to ramp that pace. The cost of their equipment makes frequent upgrade cycles unlikely, and there’s a limited field in terms of other hardware types to even consider making. If hardware innovation is your measure for success, Peloton hasn’t really shown that it’s doing enough in this category to fend of legacy players or new entrants.”

TL;DR: Peloton, unlike any other company before it, sits evenly at the intersection of fitness, software, hardware and media. One wonders how Wall Street will value a company so varied. Will Peloton be yet another example of an over-valued venture-backed unicorn that flounders once public? Or will it mature in time to triumphantly navigate the uncertain public company waters? Let me know what you think. And If you want more Peloton deets, read Darrell’s full story: Weighing Peloton’s opportunity and risks ahead of IPO.

Anyways…

Public company corner

In addition to Peloton’s IPO announcement, CrowdStrike boosted its IPO expectations. Aside from those two updates, IPO land was pretty quiet this week. Let’s check in with some recently public businesses instead.

Uber: The ride-hailing giant has let go of two key managers: its chief operating officer and chief marketing officer. All of this comes just a few weeks after it went public. On the brightside, Uber traded above its IPO price for the first time this week. The bump didn’t last long but now that the investment banks behind its IPO are allowed to share their bullish perspective publicly, things may improve. Or not.

Zoom: The video communications business posted its first earnings report this week. As you might have guessed, things are looking great for Zoom. In short, it beat estimates with revenues of $122 million in the last quarter. That’s growth of 109% year-over-year. Not bad Zoom, not bad at all.

Must reads

We cover a lot of startup and big tech news here at TechCrunch. Sometimes, the really great features writers put a lot of time and energy into fall between the cracks. With that said, I just want to take a moment this week to highlight a few of the great stories published on our site recently:

A peek inside Sequoia Capital’s low-flying, wide-reaching scout program by Connie Loizos

On the road to self-driving trucks, Starsky Robotics built a traditional trucking business by Kirsten Korosec

The Stanford connection behind Latin America’s multi-billion dollar startup renaissance by Jon Shieber 

How to calculate your event ROI by Sarah Shewey

Why four security companies just sold for $1.5B by Ron Miller 

Scooters gonna scoot

In case you missed it, Bird is in negotiations to acquire Scoot, a smaller scooter upstart with licenses to operate in the coveted market of San Francisco. Scoot was last valued at around $71 million, having raised about $47 million in equity funding to date from Scout Ventures, Vision Ridge Partners, angel investor Joanne Wilson and more. Bird, of course, is a whole lot larger, valued at $2.3 billion recently.

On top of this deal, there was no shortage of scooter news this week. Bird, for example, unveiled the Bird Cruiser, an electric vehicle that is essentially a blend between a bicycle and a moped. Here’s more on the booming scooter industry.

Startup Capital

WorldRemit raises $175M at a $900M valuation to help users send money to contacts in emerging markets 

Thumbtack is raising up to $120M on a flat valuation

Depop, a shopping app for millennials, bags $62M

Fitness startup Mirror nears $300M valuation with fresh funding

Step raises $22.5M led by Stripe to build no-fee banking services for teens

Possible Finance lands $10.5M to provide kinder short-term loans

Voatz raises $7M for its mobile voting technology

Flexible housing startup raises $2.5M

Legacy, a sperm testing and freezing service, raises $1.5M

Equity

Hotstar, India’s largest video streaming service with more than 300 million users, disabled support for Apple’s Safari web browser on Friday to mitigate a security flaw that allowed unauthorized usage of its video streaming service, two sources familiar with the matter told TechCrunch.

The incident comes at a time when the streaming service — operated by Star India, part of 20th Century Fox that Disney acquired — enjoys peak attention as millions of people watch the ongoing ICC World Cup cricket tournament on its platform.

As users began to complain about not being able to use Hotstar on Safari, the company’s official support account asserted that “technical limitations” on Apple’s part were the bottleneck. “These limitations have been from Safari; there is very little we can do on this,” the account tweeted Friday evening.

Sources at Hotstar told TechCrunch that this was not an accurate description of the event. Instead, company’s engineers had identified a security hole that was being exploited by unauthorized users to access Hotstar’s content, they said.

Hotstar intends to work on patching the flaw soon and then reinstate support for Safari, the sources said.

The security flaw can only be exploited through Safari’s desktop and mobile browsers. On its website, the company recommends users to try Chrome and Firefox, or its mobile apps, to access the service. Hotstar did not respond to requests for comment.

Hotstar, which rivals Netflix and Amazon Prime Video in India, maintains a strong lead in the local video streaming market (based on number of users and engagement). Last month, it claimed to set a new global record by drawing more than 18 million viewers to a live cricket match.

Financial troubles have forced Maker Media, the company behind crafting publication MAKE: magazine as well as the science and art festival Maker Faire, to lay off its entire staff of 22 and pause all operations. TechCrunch was tipped off to Maker Media’s unfortunate situation which was then confirmed by the company’s founder and CEO Dale Dougherty.

For 15 years, MAKE: guided adults and children through step-by-step do-it-yourself crafting and science projects, and it was central to the maker movement. Since 2006, Maker Faire’s 200 owned and licensed events per year in over 40 countries let attendees wander amidst giant, inspiring art and engineering installations.

“Maker Media Inc ceased operations this week and let go of all of its employees — about 22 employees” Dougherty tells TechCrunch. “I started this 15 years ago and it’s always been a struggle as a business to make this work. Print publishing is not a great business for anybody, but it works…barely. Events are hard . . . there was a drop off in corporate sponsorship.” Microsoft and Autodesk failed to sponsor this year’s flagship Bay Area Maker Faire.

But Dougherty is still desperately trying to resuscitate the company in some capacity, if only to keep MAKE:’s online archive running and continue allowing third-party organizers to license the Maker Faire name to throw affiliated events. Rather than bankruptcy, Maker Media is working through an alternative Assignment for Benefit of Creditors process.

“We’re trying to keep the servers running” Dougherty tells me. “I hope to be able to get control of the assets of the company and restart it. We’re not necessarily going to do everything we did in the past but I’m committed to keeping the print magazine going and the Maker Faire licensing program.” The fate of those hopes will depend on negotiations with banks and financiers over the next few weeks. For now the sites remain online.

The CEO says staffers understood the challenges facing the company following layoffs in 2016, and then at least 8 more employees being let go in March according to the SF Chronicle. They’ve been paid their owed wages and PTO, but did not receive any severance or two-week notice.

“It started as a venture-backed company but we realized it wasn’t a venture-backed opportunity” Dougherty admits, as his company had raised $10 million from Obvious Ventures, Raine Ventures, and Floodgate. “The company wasn’t that interesting to its investors anymore. It was failing as a business but not as a mission. Should it be a non-profit or something like that? Some of our best successes for instance are in education.”

The situation is especially sad because the public was still enthusiastic about Maker Media’s products  Dougherty said that despite rain, Maker Faire’s big Bay Area event last week met its ticket sales target. 1.45 million people attended its events in 2016. MAKE: magazine had 125,000 paid subscribers and the company had racked up over one million YouTube subscribers. But high production costs in expensive cities and a proliferation of free DIY project content online had strained Maker Media.

“It works for people but it doesn’t necessarily work as a business today, at least under my oversight” Dougherty concluded. For now the company is stuck in limbo.

Regardless of the outcome of revival efforts, Maker Media has helped inspire a generation of engineers and artists, brought families together around crafting, and given shape to a culture of tinkerers. The memory of its events and weekends spent building will live on as inspiration for tomorrow’s inventors.

E3 doesn’t technically start until Tuesday, but the leaks are already arriving fast and furious. Now that winter has come from HBO’s Game of Thrones, creator George R.R. Martin’s got several other projects in the works, including, reportedly, a new video game.

Word is we’ll be hearing more about that last bit on Sunday, during Microsoft’s big kick off press conference. For now, however, we’ve got a smattering of information about Elden Ring from Daniel “ZhugeEX” Ahmed. The perennial game leaker tweeted out a poster for the title, which is said to be a collaboration between Martin and Hidetaka Miyazaki, best known for his role in FromSoftware’s Souls series.

In addition to Xbox One, the title is also set for release on PS4 and the PC. Supernatural powers and monarchical kingdoms abound, making this pretty standard fare from the A Song of Ice and Fire writer. Beyond that, details are pretty thin at the moment, so stay tuned to TechCrunch’s E3 coverage, which kicks off in earnest on Sunday.

Ten years ago, Sequoia Capital began quietly encouraging founders of its portfolio companies to consider which of their founder friends they might like to get behind financially. Sequoia would let them write checks to those companies, and it would share with them any later rewards.

It was a brilliant idea. It allowed Sequoia to keep tabs on entrepreneurs — and nascent technologies — not yet in its universe. It cemented the firm’s ties to the founders who were already in its family. Not last, it grew Sequoia’s already considerable influence in Silicon Valley.

Fast forward, and the ripple effects of the highly successful program have not only been wide-reaching, but they’ve quietly reshaped the industry in ways that only those closest to Sequoia have been able to fully appreciate — until now.

To learn more on the tenth anniversary of Sequoia’s “scouts” initiative — which has since been widely copied by other venture firms — we reached out to Sequoia’s Mike Vernal, the partner who today oversees the program, as well as four scouts whose names you will recognize. What we learned in the process is that their experiences, while fairly different, have had an outsize impact on the way they lead as well, as on the founders whose paths have crossed with their own.

Ready, set. . .

It began working almost immediately, too. Among those first scouts — one of now hundreds to work with Sequoia — was Jason Calacanis, a serial entrepreneur whose then startup, a search engine called Mahalo, quickly raised $20 million from Sequoia and others after its 2007 founding.

Mahalo didn’t wind up putting Google or Yahoo out of business, but even back then, Calacanis, who’d earlier sold a blog network to AOL, had an established network that Sequoia realized was valuable. As Calacanis tells it, he’d told Sequoia about Zynga when its founder, Mark Pincus, was still figuring out the company in 2007. He’d also told Sequoia about a project that his friend Ev Williams was fiddling with. Both times, it passed.

Those decisions seemed to smart. At least, not long after, Sequoia’s Roelof Botha reached out to Calacanis and asked him, “‘What if we’d just given you some money to make those investments?'”

According to Calacanis, Botha explained that if he could turn up other interesting deals, Sequoia would give him money to invest, then split some of the profits with him and other Sequoia-backed founders who it was also inviting to scout deals on its behalf. (One of them was Sam Altman, then the founder of another Sequoia-backed startup called Loopt. Other early scouts included Airbnb CEO Brian Chesky, and Dropbox founders Arash Ferdowsi and Drew Houston.)

Calacanis loved the proposal, though he chafed at Botha’s insistence that he write an investment memo. As pushback, Calacanis says his first deal memo as a scout included two words, “Cabs suck.”

Calacanis laughs about it now. “I was protesting the fact that Roelof was making me do homework.” As it turns out, his short memo was spot on. The company Calacanis wanted to back was Uber. Sequoia approved it, and the small stake ultimately grew to be valued at “over nine figures,” according to Calacanis, who has collectively plugged $600,000 into 20 startups over the years as part of Sequoia’s scouts program.

From scout to VC . . .

As industry watchers may know, Calacanis has since gone on to raise his own funds, including two $10 million vehicles, and, more recently, a $30 million fund. Yet he’s far from the only person to learn the ropes with Sequoia’s help.

Altman, of course, went on to advise Y Combinator companies, then to become the organization’s president, before resigning earlier this year.  Other former scouts who have joined the world of venture capital full-time include Lee Linden of Quiet Capital, David Ulevitch of Andreessen Horowitz, Jana Messerschmidt of Lightspeed Venture Partners, Cat Lee of Maveron, and Deep Nishar of SoftBank Investment Advisors.

Three other former scouts have landed inside of Sequoia itself: Vernal, who before joining Sequoia spent more than eight years at Facebook, including as a vice president of engineering and product; Jess Lee, who previously cofounded the shopping site Polyvore and oversaw its sale to Yahoo; and Alfred Lin, the former COO and chairman of Zappos.

Not every scout has been plucked from Sequoia’s portfolio, as Mike Vernal himself makes plain. Though Vernal declines to delve into certain specifics about the program, including exactly how many scouts have worked with Sequoia, he says that while “early on, in that first batch, the program was biased toward Sequoia companies,” it’s no longer the case that Sequoia taps only the founders it has already backed.

We also know that Sequoia is now in the middle of its fifth batch of scouts, that it chooses two “classes” of scouts for each separate scout fund, and there have been three to date, including a $180 million fund it closed last year.

As for how much they have to spend, scouts are given up to $100,000. Some invest a little bit in a lot of companies; others invest more in a few. Their checks tend to lead to more checks, too, unsurprisingly. Specifically, 230 companies that have received checks written by Sequoia scouts have gone on to raise more than $6 billion in follow-on financing, excluding Uber. Many of these have received further funding from Sequoia itself, including Faire, GenEdit, Guardant Health, Stripe, Thumbtack, and Vector.

It can also prove a lucrative side gig for those in Sequoia’s scouting program. According to Calacanis, for example, Altman wrote a check to Stripe as a scout, a position that’s now worth $25 million. As with Uber, Calacanis says, “It’s likely that everyone in that class will get a taste of that, too.”

No blank checks . . .

Still, being a scout does not mean having carte blanche to do whatever one chooses. When PlanGrid cofounder and CEO Tracy Young was asked by one of the partners to become a scout for Sequoia, “I had no idea what that meant, but they basically give us $100,000 to do whatever we want, assuming it passes a stringent approval process. [Sequoia] wants to know: how big can this get? What’s the market?”

It can take “hours of conversation” with a founder before Young — whose Sequoia-backed construction software company sold last year to Autodesk for a whopping $875 million — is able to “write up this whole thing, almost like a business plan” to pitch Sequoia, she says.

It may sound inconvenient, but she has learned much from this back-and-forth, she says. “Much of what we do as founders centers on our own problems within our own companies in our own industries. I’m in the construction software world every day, and [being a scout] has enabled me to see other companies’ problems in a deeper way.”

Clara Shih, a scout and the founder and CEO of Hearsay Systems, a Sequoia-backed digital marketing platform for financial services, echoes the sentiment, adding that the “series of diligence items that we go through” also helps to sharpen her thinking about her own company.

“When you’re the CEO of a company, that’s your baby and you’re biased in favor of your own startup,” says Shih. Scouting on behalf of Sequoia — along with her role as a director on the board of Starbucks —  “helps me think what would someone from the outside be [prioritize as part of] their strategy for Hearsay. It helps me to think more objectively and gets me out of the minutiae” that can occupy a founder’s thoughts and time otherwise.

Altogether, Young says she has made “six of seven” investments to date on behalf of Sequoia, and “probably talked with 50 companies” altogether, though not always with investing in mind. Shih has made a similar number of bets.

Both say their primary responsibilities are running their companies but that they are often contacted by founders who are looking to them for advice, and that it’s during these meetings that they sometimes wear the hat of investor, too.

“I’m not out there prospecting,” says Shih, “but a lot of women entrepreneurs reach out to me, because there are still too few of us and it’s my mission to change that.” Young meanwhile says she hears from founders in spaces “adjacent” to her own.

Both suggest that becoming a VC that it’s a path to which they’re open — though not yet. “I have a very busy full-time job,” says Shih. Young also says she’s “full time at Autodesk right now, integrating PlanGrid into the company.”

Still, she continues, “We’ll see. I’m pretty sure a lot of [people in the scout program] are going to become future VCs because a lot of them are really good at investing in and valuing companies.”

A lot of them are also women and minorities, she notes. “I’m biased,” says Young, “but having pitched to a lot of white men at different venture firms, including at Sequoia in 2014, when you walk into a room of scouts, it’s super diverse. It just feels different.”

Calacanis tells us the same. “They’ll never get enough credit for this, but one thing Sequoia did was use scouts to radically increase the amount of diversity in the industry,” he says. “Ten years ago, it was a bunch of Stanford people of a certain gender and [skin] color. But they opened the aperture to get more women and underrepresented investors” into their network, and he says it’s now among the most diverse groups in Silicon Valley — even if it’s also one of the lowest-flying.

Down the road . . .

One outstanding question is what happens when a scout sell his or her company, or takes it public, or otherwise becomes wealthy enough to invest on their own. After all, Sequoia tends to work with founders who have the contacts and the industry know-how, but who also need its financial support if they want to invest in their founder friends.

Calacanis falls into this category, yet says he still does the occasional scout deal and happily. “Sequoia is the greatest venture firm in the world. Whatever they ask me to do, it’s like ‘Yes.’ It’s a no-brainer.”

Another member of this particular club is Matt Macinnis, the founder of Sequoia-backed Inkling Systems, which sold for an undisclosed amount to the private equity firm Marlin Equity Partners last year. Macinnis is today the COO of Rippling, the online payroll and HR startup founded by Zenefits cofounder Parker Conrad, and he says that he has written 24 checks for Sequoia over the last five years, including to note-taking app Notion (founder Ivan Zhao spent a year working on product at Inkling) and the education applications company Clever, whose founder was a Harvard classmate of Macinnis.

Macinnis suggests that as he has begun investing more actively as an angel investor, deciding how much of his own money to pour into a company has become a more complicated affair. Yet like Calacanis, he only sings Sequoia’s praises.

He points to a new investment in Memfault, a startup that was among the most popular to graduate from the Y Combinator’s accelerator program this past winter. He says he was “super excited about the company because they’re doing firmware deployment to internet of things devices — doorknobs, cars, temperature sensors.” He also liked that the startup’s CTO came out of Fitbit.

In fact, he excitedly told Sequoia about the company.  The good news: Sequoia partner Bill Coughran — a former SVP of engineering at Google who well understands hardware — grew excited, too. The bad news, he made the company an offer before Macinnis had closed his own investment.  (Says Macinnis, the company was “surprise, surprise, oversubscribed right away.”)

Given different circumstances, Macinnis might have been out of luck. Instead, he says. “It was not problem at all. Bill adjusted the allocation so that both [I] and the scout program and the founder were able to get the desired outcome. He made room.”

There’s allegiance for good reason, suggests Macinnis, who implies that scouts get as much if not more than Sequoia from their relationship. To underscore his point, he points to DoorDash founder and former scout Tony Xu, whose company is currently valued at $7.1 billion,  and to Weebly cofounder David Rusenko, whose Sequoia-backed company sold last year to Square for $365 million. “I’m not Tony or David,” he says, “but those guys wouldn’t hesitate for a millisecond to pitch in and help a scouts company however they could.”

Says Calacanis separately, “I thought angel investing was stupid” before becoming a scout, which he credits with changing his career trajectory. “I thought I should invest in myself, that I was the smartest entrepreneur I know.” Sequoia, he says, knew better. “They know If you’re smart, your friends are probably pretty smart, too.”

Of all of the WWDC announcements this week, Sidecar got me the most excited. I’m on the road a lot these days, and apps like Duet and Luna have been lifesavers. They’ve afforded me the ability to carry around a reasonably sized laptop, with an optional second screen in the form of the iPad.

Both products have their respective strengths, but I’m very interested in seeing how native second display support for iPad plays out, and I’m sure I’m not alone among their current customers. Having already demoed the macOS Catalina feature a few times at the event this week, I’m pretty impressed with the implementation.

The latency is barely perceptible, and the array of features with the Apple pencil is impressive. The iPad Pro was wired in the demos, due to the oversaturated nature of wireless technology at these sorts of shows, but the combination Bluetooth/wireless feature allows users to go unplugged as well — certainly a useful thing when setting up at coffee shops and the like, which I often am when traveling.

Those who’ve offered secondary display technologies have no doubt seen the writing on the wall for a while now — well before rumors of Sidecar’s arrival began swirling in recent weeks. Even so, the arrival of native support could prove detrimental — or potential even fatal for those who’ve staked their claim on these sorts of clever work arounds.

It’s a phenomenon we’ve seen played out nearly every time there’s a new version of an Apple operating system, from Konfabulator with Dashboard to Moment with Screen Time. In fact, it’s a phenomenon that happens so frequently, it’s commonly as “Sherlocking,” a reference to Watson, a search app that was effectively kneecapped by Apple’s Sherlock and later Spotlight. Producing a third-party work around for existing functionality in someone else’s ecosystem is a tough road to hoe.

“I knew that this was something that could happen at any point, that’s something I would have expected from day one,” Duet Founder and CEO Rahul Dewan told TechCrunch. “I don’t think there was a ton of surprise. It’s really just confirmation. We’ve been a top 10 iPad app for five years in a row. I think we basically proved the market.”

Matt Ronge, CEO of Luna maker Astro HQ was less enthusiastic in his assessment of this week’s news. “We are frustrated with the way Apple has treated their third-party developers,” he said in statement offered to TechCrunch. Ronge says Apple initially expressed support for the project and even asked Luna to demo the product, but the relationship ultimately never advanced far beyond that. We’ve reached out to Apple about the specifics of the meetings.

The news has left both Duet and Astro reassessing their respective value propositions. Apple is certainly pitching the product toward creative professionals, as evidenced by the demos at the event, which largely revolved around the use of Apple Pencil for things like 3D design. Both startups believe they can can continue to differentiate themselves by targeting pros. After all, the Catalina implementing will likely — at first — be a more utilitarian approach, given that it’s baked directly into the operating system.

“The plan has been for the past about two year to become more of a company for remote tools, for remote workers and people that are traveling a lot,” says Dewan. “That’s that’s the way we’ve been positioning, first by adding on these features, like remote desktop. We have actually a couple of other big product launches that are not connected to the space this summer. We should be fairly diverse.”

Ronge echoes the sentiment. “Moving forward, we’re going to double down on serving the creative pro community. While Apple builds features to satisfy the masses, we’ve always committed to building products with rich features and deep customization for professional creative workflows. For example, Astropad Studio comes with features like Magic Gestures, per-app shortcuts, and custom pressure curves.”

Both parties also cite Windows users as a potential way forward. “We’ve been hearing about a large number of creative pros moving from Mac to Windows,” says Ronge. “We will go where our customers go, and the future of our company is going to be in cross-platform creative tools.”

Lyft is suing the city of San Francisco, claiming that the city is violating its ten-year contract with Lyft that would give the company exclusive rights to operate bike-share programs. San Francisco, however, says the contract does not apply to dockless bike-share, but only station-based bike-share.

In its lawsuit, Lyft is seeking a preliminary injunction or temporary restraining order to prevent the city from issuing permits to operators for stationless bike-share rentals.

Although SF previously allowed JUMP to operate its stationless electric bikes, that was supposed to be a one-time exception since Motivate, which Lyft eventually bought, was not yet ready to deploy its stationless electric bikes, the lawsuit states. JUMP’s pilot expires on July 9, 2019 but now the city is seeking additional operators to deploy stationless electric bikes.

“We are eager to continue investing in the regional bikeshare system with the MTC and San Francisco,” a Lyft spokesperson said in a statement to TechCrunch. “We need San Francisco to honor its contractual commitments to this regional program — not change the rules in the middle of the game. We are eager to quickly resolve this, so that we can deliver on our plans to bring bikes to every neighborhood in San Francisco.”

Lyft says it has tried to avoid litigation but that the SFMTA has refused to participate in its dispute process.

“As we will explain to the court, the agreement between Motivate and the City was about a docked bike share system,” John Coté, communications director for SF City Attorney Dennis Herrera said in a statement to TechCrunch.  “It does not give Lyft the right to a monopoly on bike sharing in San Francisco. Lyft can seek a permit for dockless bikes on equal footing with everyone else.”

Lyft is suing the city of San Francisco, claiming that the city is violating its ten-year contract with Lyft that would give the company exclusive rights to operate bike-share programs. San Francisco, however, says the contract does not apply to dockless bike-share, but only station-based bike-share.

In its lawsuit, Lyft is seeking a preliminary injunction or temporary restraining order to prevent the city from issuing permits to operators for stationless bike-share rentals.

Although SF previously allowed JUMP to operate its stationless electric bikes, that was supposed to be a one-time exception since Motivate, which Lyft eventually bought, was not yet ready to deploy its stationless electric bikes, the lawsuit states. JUMP’s pilot expires on July 9, 2019 but now the city is seeking additional operators to deploy stationless electric bikes.

“We are eager to continue investing in the regional bikeshare system with the MTC and San Francisco,” a Lyft spokesperson said in a statement to TechCrunch. “We need San Francisco to honor its contractual commitments to this regional program — not change the rules in the middle of the game. We are eager to quickly resolve this, so that we can deliver on our plans to bring bikes to every neighborhood in San Francisco.”

Lyft says it has tried to avoid litigation but that the SFMTA has refused to participate in its dispute process.

“As we will explain to the court, the agreement between Motivate and the City was about a docked bike share system,” John Coté, communications director for SF City Attorney Dennis Herrera said in a statement to TechCrunch.  “It does not give Lyft the right to a monopoly on bike sharing in San Francisco. Lyft can seek a permit for dockless bikes on equal footing with everyone else.”

A year after Walmart’s personal shopping service JetBlack launched in New York, the retailer reports two-thirds of customers engage with the service on a weekly basis, and spend an average of $1,500 per month on JetBlack purchases. To be clear, that doesn’t mean the customers are only buying products from Walmart or its subsidiaries like Jet.com — JetBlack is a standalone e-commerce business incubated by Walmart, and will deliver products from other retailers as well.

In fact, the only things it won’t deliver are fresh groceries, alcohol, CBD-related products, tobacco, and prescription medications and lenses.

The incubated “startup, so to speak, is a concierge-style experiment in conversational commerce where customers text requests, then receive product recommendations from Walmart, Jet.com and other local retailers. The service costs $50 per month, making it more expensive than Amazon Prime, but more affordable than high-end concierge services like Hello Alfred and Magic, which had gained attention in the months and years prior to JetBlack’s debut.

Walmart says the service is aimed at busy, urban parents looking for more efficient ways to shop by combining the convenience of online shopping with the expert attention of a personal assistant.

Co-founded by Jenny Fleiss, who previously co-founded Rent the Runway, Walmart reported in September 2018 — only a few months after launch — that JetBlack members were spending an average of $300 a week for products because the ease of the service encourages more frequent purchases, The Wall Street Journal reported. The average shopper was buying more than 10 items per week, as of March 2019, but the company declined to say how many products were Walmart items.

Walmart didn’t say much more about JetBlack today at its shareholders’ meeting — only the new metrics related to the increased average spend and engagement.

“It brings conversational commerce to life. Customers absolutely love it,” said Walmart’s U.S. eCommerce CEO, Marc Lore, while relating a number of e-commerce updates to the crowd.

 

Uber’s chief operating officer Barney Harford and chief marketing officer Rebecca Messina are stepping down, an organizational shakeup put into motion just a month after the ride-hailing company went public.

CNBC first reported the departures.

The departures, which CEO Dara Khosrowshahi explained in an email to employees, were prompted by his decision to more directly control core parts of the business. Harford left after agreeing that the chief operating officer role “no longer makes sense,” according to the email.

Uber’s marketing, communications and policy teams are also being combined and will be led by Jill Hazelbaker, who was senior vice president of communications and public policy.

Uber has not responded to requests for comment. TechCrunch will update the article if it hears from the company.

Uber hired Coca-Cola veteran Messina in September as its chief marketing officer. Messina, the first person to hold that title at Uber, worked with its international marketing teams on Uber’s branding and marketing strategies. She also oversaw marketing for Uber as it prepared for its initial public offering

A large part of her job was to help to repair Uber’s reputation, which was tainted by a string of scandals, including resignation of co-founder Travis Kalanick and accusations of a toxic work culture.

While Messina is the first person to hold the CMO title at Uber, Bozoma Saint John  href="https://techcrunch.com/2018/06/11/why-bozoma-saint-john-is-leaving-uber-for-endeavor/">previously served as Uber’s first chief brand officer for about a year after joining in June 2017.

Harford, a former CEO of Orbitz, has held the COO position at Uber for about 18 months although hew had been working as an adviser as early as October 2017. Harford was brought on by co-founder and former CEO Travis Kalanick .

Harford had previously worked under Khosrowshahi. Harford, who took on the role of CEO at Orbitz in 2009, later sold the company to Expedia in 2015 for $1.6 billion. Khosrowshahi was the CEO of Expedia. Harford was Expedia company president for Asia Pacific from 2004-2006.