Month: September 2020

In the two years since Chinedu Eleanya founded Mulberry to be the warranty service for direct-to-consumer brands, business has boomed. 

Already riding a shakeup in consumer behavior brought by the emergence of startup brands selling just about everything to just about everyone, Mulberry brought a much-needed new spin on the warranty service that retailers had depended on for years to make consumers comfortable with big ticket purchases. Now the company is on its way to $10 million in ARR for 2020, thanks in no small part to the new shift to online shopping.

That’s why investors were wiling to invest $10 million into the company back in March before the pandemic hit. The round was led by the early stage New York-based investment firm, Pace Capital and included returning investors like Founder Collective.

Then the pandemic did hit. With COVID-19 pushing more shoppers (at least the ones that still have money to shop) out of stores and online, the need for warranty services has just ballooned, according to Eleanya.

A serial entrepreneur who moved from Nigeria to New York City and founded companies including Cognical and Zibby, Eleanya has found success with Mulberry and its online model.

To be sure, the company isn’t the only startup working in the e-commerce warranty space. There’s also, Clyde, which raised $14 million around the same time to offer similar services.

But the market for these kinds of online services is still growing rapidly, and Eleanya thinks there’s space fora few winners. “When you think of point of sale financial innovation, the extended warranty space is the most interesting,” he said.

From a retailer perspective, lending is good, but the bigger story is that the cost of customer acquisition continues to go up, Eleanya said. For him, retailers need to maximize the long term value by retaining customers and the way to do that, he contends, is to offer services programs.

“We’re democratizing access for small and medium sized retailers so they can compete in this really expensive environment,” he said.

Mulberry is already working with some big direct to consumer brands like Mirror, the smart workout mirror, the coffee maker Breville, and Nectar Sleep — a Casper mattress competitor.

So far, Mulberry has about $1 million in annual recurring revenue and is on pace to hit $10 million in ARR this year, Eleanya said.

 

India has banned more than 100 additional Chinese apps including popular mobile game PUBG citing cybersecurity concerns as geopolitical tension between the two neighboring nations continues to rise.

On Wednesday, India’s IT Ministry said it had banned 118 apps that it said were “prejudicial to sovereignty and integrity of India, Defence of India, Security of State and Public Order.” The move comes months after New Delhi banned 59 apps including TikTok, UC Browser, and UC News.

Among the new apps that have been banned include Baidu, WeChat Work, Tencent Weiyun, Rise of Kingdoms, APUS Launcher, Tencent Weiyun, VPN for TikTok, Mobile Taobao, Youko, Sina News, and CamCard.

More to follow…

Point72 Ventures, the early stage investment firm that’s now solely investing the personal wealth of the multi-billionaire hedge fund magnate Steven A. Cohen, is getting into healthcare investing.

The firm has hired Scott Barclay, a former partner at the life sciences and frontier technology investment firm, DCVC, to run its new healthcare practice.

Since the investment firm is more like a family office than a traditional fund with limited partners, it’s hard to gauge the size of the firm’s commitment to healthcare — even from its partners. But a back of the envelope calculation should see the firm committing roughly $300 million to its healthcare efforts, according to Point72 Ventures managing partner, Matthew Granade.

Barclay sees the focus of the new investment arm as investing in companies combining technology and empathy for the healthcare industry. That empathy manifests itself in an understanding of how physicians, administrators and patients all navigate the complexities of getting care, he said.

Entrepreneurs can expect the new fund to invest roughly $50 million per year across a range of early stage startups.

“The entry point is anywhere from incubation to large, modern day, Series A deals,” said Barclay. “It’s a wide aperture.”

A typical deal size could range from $200,000 to $3 million to $4 million and the firm will even lead large Series A deals where it could commit as much as $15 million.

For Barclay, there’s no question about the need for new healthcare technologies. “There’s no part of healthcare that we think works very well,” the longtime investor said. While he won’t pursue pure therapeutic investment opportunities — leaving those deals to the Arch Capitals and 5AM Ventures — Barclay said that he would look to invest in care applications that push computing, diagnostics, and therapeutics closer to patients.

Entrepreneurs looking for insights into where Barclay may be looking can see precedents in previous investments like Carbon Health, Swift Medical, and the medical informatics company MIC.

“We’re looking to truly impact outcomes at scale,” Barclay said.

At Point72 Ventures, Barclay and the team he’s bringing on board will compliment efforts that the firm has launched to back startups focused on financial technologies and services, artificial intelligence and machine learning, and enterprise software and cybersecurity.

“At Point72 Ventures, our goal is to be foremost experts in the areas in which we invest,” Granade added. “Scott has a 15-year track record and real passion for working with innovative, healthcare-focused founders. He is the kind of expert-focused investor we want at Point72 Ventures, and we are thrilled to have him on board.”

 

India has a new unicorn startup. On Wednesday, Bangalore-based online learning startup announced it has raised $150 million in a new financing round that valued the Facebook-backed firm at $1.45 billion (post-money).

SoftBank Group — through its Vision Fund 2 — led Unacademy’s Series F financing round while existing investors Facebook, Blume Ventures, Nexus Partners, General Atlantic and Sequoia Capital participated in it.

Unacademy helps students prepare for competitive exams to get into a college and also those who are pursuing graduation-level courses. On its app, students watch live classes from educators and later engage in sessions to review topics in more detail.

Last year, the startup launched a subscription service that offers students access to all live classes. The platform, which has 30 million registered users, has amassed over 350,000 paying subscribers already.

“Our goal always has been to democratise knowledge and make it more affordable and accessible by getting the best experts of the world help everyone achieve their goals. We are just getting started,” said Gaurav Munjal, co-founder and chief executive of Unacademy, in a tweet.

The growing valuation of Unacademy — which was valued at over $400 million in February this year when it closed its Series E financing round — comes as education startups report massive growth in their usage.

Unacademy’s rival, Byju’s — also backed by Sequoia Capital India — was valued at $10.5 billion in its recent financing round from Mary Meeker’s Bond, TechCrunch reported earlier. Byju is now the most valued edtech startup in the world.

As coronavirus outbreak began to spread in India earlier this year, New Delhi enforced a nationwide lockdown that saw schools close across the nation. Even as most Indians tend not to pay for online services — just ask Facebook, which has amassed over 400 million users in India and makes little in the country — the education category has become an outlier. Indian families continue to spend heavily on their children’s education in hopes of paving way for a better future.

More to follow…

Microsoft has added to the slowly growing pile of technologies aimed at spotting synthetic media (aka deepfakes) with the launch of a tool for analyzing videos and still photos to generate a manipulation score.

The tool, called Video Authenticator, provides what Microsoft calls “a percentage chance, or confidence score” that the media has been artificially manipulated.

“In the case of a video, it can provide this percentage in real-time on each frame as the video plays,” it writes in a blog post announcing the tech. “It works by detecting the blending boundary of the deepfake and subtle fading or greyscale elements that might not be detectable by the human eye.”

If a piece of online content looks real but ‘smells’ wrong chances are it’s a high tech manipulation trying to pass as real — perhaps with a malicious intent to misinform people.

And while plenty of deepfakes are created with a very different intent — to be funny or entertaining — taken out of context such synthetic media can still take on a life of its own as it spreads, meaning it can also end up tricking unsuspecting viewers.

While AI tech is used to generate realistic deepfakes, identifying visual disinformation using technology is still a hard problem — and a critically thinking mind remains the best tool for spotting high tech BS.

Nonetheless, technologists continue to work on deepfake spotters — including this latest offering from Microsoft.

Although its blog post warns the tech may offer only passing utility in the AI-fuelled disinformation arms race: “The fact that [deepfakes are] generated by AI that can continue to learn makes it inevitable that they will beat conventional detection technology. However, in the short run, such as the upcoming U.S. election, advanced detection technologies can be a useful tool to help discerning users identify deepfakes.”

This summer a competition kicked off by Facebook to develop a deepfake detector served up results that were better than guessing — but only just in the case of a data-set the researchers hadn’t had prior access to.

Microsoft, meanwhile, says its Video Authenticator tool was created using a public dataset from Face Forensic++ and tested on the DeepFake Detection Challenge Dataset, which it notes are “both leading models for training and testing deepfake detection technologies”.

It’s partnering with the San Francisco-based AI Foundation to make the tool available to organizations involved in the democratic process this year — including news outlets and political campaigns.

“Video Authenticator will initially be available only through RD2020 [Reality Defender 2020], which will guide organizations through the limitations and ethical considerations inherent in any deepfake detection technology. Campaigns and journalists interested in learning more can contact RD2020 here,” Microsoft adds.

The tool has been developed by its R&D division, Microsoft Research, in coordination with its Responsible AI team and an internal advisory body on AI, Ethics and Effects in Engineering and Research Committee — as part of a wider program Microsoft is running aimed at defending democracy from threats posed by disinformation.

“We expect that methods for generating synthetic media will continue to grow in sophistication,” it continues. “As all AI detection methods have rates of failure, we have to understand and be ready to respond to deepfakes that slip through detection methods. Thus, in the longer term, we must seek stronger methods for maintaining and certifying the authenticity of news articles and other media. There are few tools today to help assure readers that the media they’re seeing online came from a trusted source and that it wasn’t altered.”

On the latter front, Microsoft has also announced a system that will enable content producers to add digital hashes and certificates to media that remain in their metadata as the content travels online — providing a reference point for authenticity.

The second component of the system is a reader tool, which can be deployed as a browser extension, for checking certificates and matching the hashes to offer the viewer what Microsoft calls “a high degree of accuracy” that a particular piece of content is authentic/hasn’t been changed.

The certification will also provide the viewer with details about who produced the media.

Microsoft is hoping this digital watermarking authenticity system will end up underpinning a Trusted News Initiative announced last year by UK publicly funded broadcaster, the BBC — specifically for a verification component, called Project Origin, which is led by a coalition of the BBC, CBC/Radio-Canada, Microsoft and The New York Times.

It says the digital watermarking tech will be tested by Project Origin with the aim of developing it into a standard that can be adopted broadly.

“The Trusted News Initiative, which includes a range of publishers and social media companies, has also agreed to engage with this technology. In the months ahead, we hope to broaden work in this area to even more technology companies, news publishers and social media companies,” Microsoft adds.

While work on technologies to identify deepfakes continues, its blog post also emphasizes the importance of media literacy — flagging a partnership with the University of Washington, Sensity and USA Today aimed at boosting critical thinking ahead of the US election.

This partnership has launched a Spot the Deepfake Quiz for voters in the US to “learn about synthetic media, develop critical media literacy skills and gain awareness of the impact of synthetic media on democracy”, as it puts it.

The interactive quiz will be distributed across web and social media properties owned by USA Today, Microsoft and the University of Washington and through social media advertising, per the blog post.

The tech giant also notes that it’s supporting a public service announcement (PSA) campaign in the US encouraging people to take a “reflective pause” and check to make sure information comes from a reputable news organization before they share or promote it on social media ahead of the upcoming election.

“The PSA campaign will help people better understand the harm misinformation and disinformation have on our democracy and the importance of taking the time to identify, share and consume reliable information. The ads will run across radio stations in the United States in September and October,” it adds.

French startup Klaxoon is currently testing a new product called Board. The company expects to launch Board at some point during the second half of September. Board is a new visual interface that connects directly with video-conferencing services, such as Microsoft Teams, Zoom and Google Meet.

If you’re not familiar with Klaxoon, the startup wants to make meetings more engaging and little bit less boring. The startup has built a suite of tools tailored for different use cases. There are voting and brainstorming modules, multiple features that let you gather feedback through questions, surveys and more. Meeting organizers can also get feedback and see analytics their meetings.

While Klaxoon already offers interactive whiteboards for your meeting rooms, chances are your team isn’t in the meeting room right now. That’s why Klaxoon started working on Board during lockdown. It is accessible from your phone, tablet and computer.

Board brings together a set of interactive tools in a video call. It adds a blank canvas that you can use to write text, insert images or videos. You can also start with a template and fill it out during the call. Other people joining the call can react using likes, votes or questions.

And here’s what it’ll look like when it launches:

Given that Klaxoon has been working hard to replace sticky notes and other low-tech solutions used during meetings, the startup seems particularly well-positioned right now. Many companies don’t plan to reopen their offices for the foreseeable future.

Klaxoon has raised around $55 million over the years and now has a team of 240 employees. 15% of Fortune 500 companies use the service.

E-commerce has brought in a logistics boom in China over the last decade, transforming small-town delivery businesses into multinational corporations. One leading player, YTO, is gearing up for international expansion after it secured 6.6 billion yuan or $970 million from its long-time ally and client, Alibaba.

20-year-old YTO announced this week it will sell 379 million shares to Alibaba at a price of 17.4 yuan per share, lifting Alibaba’s stakes in YTO from 10.5% to 22.5%. The founding couple of YTO owns a controlling stake of 41% via their wholly-owned firm after the transaction.

The new investment, according to the notice, will allow Alibaba and YTO to deepen collaboration on areas including delivery, air freight, global network and supply chains and digital transformation as part of their ambition to beef up their global reach.

An Alibaba spokesperson said the company is “pleased to further strengthen the strategic partnership with YTO, focused on digitization and globalization to enhance the customer service capabilities.”

YTO, which commands a 14% share of China’s express delivery market, is among the five logistics behemoths that hail from eastern China’s rural county of Tonglu. Along with rivals STO, ZTO, Best Express and Yunda, YTO’s rise is inseparable from Alibaba, which relies on third-party logistics services rather than building its own infrastructure like Amazon and JD.com.

The e-commerce giant has over the years invested various amounts in all five major couriers from Tonglu, a relationship that anchors its logistics arm Cainiao, which matches vendors and express couriers to handle 50 billion parcels a year.

The duo was already partnering on international expansion back in 2018 when a Cainiao-YTO joint venture began building a digital logistics center at Hong Kong International Airport, the world’s busiest cargo airport. State-owned airline China National Aviation Corporation also holds a stake in the joint venture, and the center is due to begin operation as soon as 2023.

As of 2019, YTO had set up 18 entities and 53 service stations worldwide that support its distribution in 150 countries and regions. The overseas push plays into its larger goal to tap the enormous export potential brought by the Belt and Road Initiative, China’s grand plan to build rail lines, telecommunication networks and other forms of infrastructure around the world.

3one4 Capital, a venture capital firm in India, today announced a $100 million fund as the young investment firm looks to back more early-stage startups in the world’s second largest internet market.

The new fund, third for the five-year-old Bangalore-headquartered investment firm, has already secured $40 million from new and existing investors. 3one4 Capital, which closed its previous fund late last year, now manages over $210 million capital.

In the last four years, 3one4 Capital — founded by Pranav Pai and Siddarth Pai, sons of Mohandas Pai, a widely respected industry figure who served as a senior executive at Infosys — has backed over 50 startups.

Some of his profile investments include neobanking startups Open and Jupiter, digital entertainment firm Pocket Aces, HR software provider DarwinBox, mobility firm Yulu, and Licious, which sells fresh meat digitally.

In an interview with TechCrunch, Pranav said the new fund would enable 3one4 Capital to continue to invest in a wide-range of early-stage startups. 3One4 Capital largely focuses on Seed and pre-Series A financing rounds, but it has also backed startups in Series A and later stage deals.

Pranav said his firm will continue to invest across five categories — namely, direct-to-consumer tech, media and content, fintech, deep technology, and SaaS and enterprise automation, in addition to exploring some new opportunities.

3one4 Capital’s first two funds have performed very well and doubled the investment capital before entering the fourth year, said Siddarth, but he declined to reveal the figures, citing confidentiality agreements.

Neither of the Pai brothers had a background in investment before they started 3one4 Capital, and Pranav said that’s one of the things that differentiates them from others. “We are a very young firm. Nobody has joined 3one4 Capital with prior VC experience. Our approaches are different,” he said.

The brothers said they will invest in 25 to 30 startups through this new fund — which is always exciting to hear.

Scores of VC firms in India including Blume Ventures, Lightspeed India Partners, Sequoia Capital India, Good Capital, and India Quotient are today focusing on early-stage startups, but data from research firm Tracxn — another portfolio startup of 3one4 Capital — suggests that each year we are seeing fewer number of young firms secure capital.

PasarPolis, the Indonesian-based startup focused on making insurance policies more accessible in Southeast Asia, announced today it has closed a Series B round totaling $54 million. Investors include LeapFrog Investments and SBI Investment, both firms that focus on financial services; AlphaJWC; Intudo Ventures; and Xiaomi.

Gojek’s venture capital arm, Go-Ventures, which participated in PasarPolis’ Series A two years ago, also returned for the new round.

Founded in 2015 by chief executive officer Cleosent Randing and chief operating officer Michael Saputra, PasarPolis operates in Indonesia, Thailand, and Vietnam. The company says the number of insurance policies it issues monthly has grown 80 times since August 2018, when it closed its Series A, and that it now partners with more than 30 insurance providers.

Randing said the the insurance penetration rate in the ASEAN region is currently just 3.6%, and the startup’s goal is to reach people who have never purchased insurance before through products including inexpensive “micro-policies” that cover broken device screens.

In 2019, the company says PasarPolis issued more than 650 million policies to people buying insurance for the first time, including ride-hailing drivers, delivery couriers, and online merchants. Sales continued to grow during the COVID-19 pandemic because it increased demand for insurance, while also prompting people to make more purchases online (most of PasarPolis’ policies are sold through its mobile apps). In June alone, the company claims it served more than four million new customers, and has now provided policies to more than 35 million customers in total.

Nishant Kumar, PasarPolis’ chief technology officer, told TechCrunch that the new funding will be used on its AI-based claim automation platform, which allows the company to customize insurance products for different industries.

It also plans to invest in PasarPolis Mitra, an onboarding platform for agents. Soft-launched in May 2020, PasarPolis allows people to apply to become Mitra, or insurance agents, for the company. PasarPolis currently has a network of about 10,000 agents in Indonesia, who help customers chose policies and process claims.

“We plan to invest in infrastructure to help our Mitra be able to engage with our customers more,” said Kumar. “We believe it’s important for us to implement both online and offline strategies as an insurtech player.”

Kumar added that even though technology plays a “pivotal role” in making insurance products accessible to more people, PasarPolis does not “see digital as just a medium to sell insurance. We think that technology can be used to segment risk in real-time and provide more affordable insurance to the masses.”

Two of PasarPolis’ main competitors in Southeast Asia include Qoala, another Indonesia-based insurtech startup that recently raised funding, and Grab Financial Group, which launched a new portfolio of consumer financial services last month, including expanded insurance offerings.

Randing told TechCrunch that PasarPolis’ competitive advantage is its “ability to offer highly customized and modular insurance products that are integrated with partners’ systems,” including health and accident coverage for Gojek’s drivers and passengers; insurance for small- to medium-sized businesses that cover damaged products and missing items; and policies that protect e-commerce customers.

An example of the kind of customized insurance products PasarPolis can create is a policy for Gojek drivers that covers stolen vehicles and costs less than USD $4 a year.

The company is also a licensed insurance broker, which is why it was able to operate PasarPolis Mitra. “The platform is so unique to Indonesians, that it enables anyone, from professional insurance Mitra, Gojek drivers, stay-at-home moms, and furloughed employees, to earn additional income, especially during the new normal,” said Randing.

As the COVID-19 pandemic spread to the United States, a number of automakers and other manufacturers announced plans to retrofit factories to help ease the shortage of personal protective gear and ventilators.

Now, two U.S. automakers have fulfilled their separate multi-million-dollar ventilator contracts — together delivering 80,000 of the devices to the U.S. government.

General Motors said Tuesday that it has completed its contract with the U.S. Department of Health and Human Services for 30,000 critical care ventilators delivered to the Strategic National Stockpile. GM said many of its ventilators have been deployed to hospitals. Ford has also completed its 50,000-ventilator contract, Bloomberg reported.

GM and Ford didn’t go it alone. Both automakers partnered with companies to accelerate the ramp up from 0 to thousands of ventilators within five months. GM partnered with Ventec Life Systems to produce ventilators at its engine plant in Kokomo, Ind., using about 1,000 workers. The GM-Ventec partnership grew out of  StopTheSpread.org, a coordinated effort of private companies to respond to COVID-19.

Meanwhile, Ford teamed up with GE Healthcare to produce ventilators at the automaker’s Rawsonville Road plant in Michigan. Ford’s $336 million contract wrapped up August 28 when it shipped its final Model A-E ventilator unit. Ford’s contract was supposed to be fulfilled by mid-July, but said it was delayed by new suppliers that were ramping up parts production, according to Bloomberg. The company was granted an extension by HHS.

In the early days of the contracts, GM and Ford were criticized, and even attacked, by President Trump, although ultimately he applauded the efforts.

Both efforts stretched and showcased the capabilities of the automakers to convert portions of factories used to assemble vehicles and parts into facilities cranking out medical devices. Before GM even announced its partnership with Ventec, the automaker investigated the feasibility of sourcing more than 700 components needed to build Ventec’s critical care ventilators called VOCSN. Ventec describes these VOCSN devices as multi-function ventilators that were cleared in 2017 by the FDA.

GM initially estimated it would cost about $750 million, a price that included retrofitting a portion of the engine plant, purchasing materials to make the ventilators and paying the 1,000 workers needed to scale up production, the source said. However, the Trump Administration balked at the price tag, putting a contract with the U.S. government in limbo. Eventually, GM reached a $490 million contract with the federal government to produce 30,000 ventilators by the end of August. Under the contract, GM produced a different critical care ventilator from Ventec called the VOCSN V+Pro, a simpler device that has 400 parts. The other more expensive and complex machine had a multi-function capability.

Ford and GM also produced other medical supplies. Ford, which called its effort Project Apollo, said it produced more than 75 million pieces of personal protective equipment, including 19 million face shields, 42 million face masks,1.6 million washable isolation gowns and more than 32,000 powered air-purifying respirators in collaboration with 3M.

GM said its Warren facility has two production lines for face masks and a third line making N95 face respirators. To date, the facility has produced more than 10 million masks, with production going to employees at GM facilities or donated to community organizations, the company said.