Year: 2020

Facebook’s bad week just got worse: It’s being investigated in Germany for linking usage of its VR product, Oculus, to having a Facebook account.

The tech giant raised the hackles of the VR community this summer when it announced it would be merging users of the latest Oculus kit onto a single Facebook account — and would end support for existing Oculus account users by 2023.

New users were immediately required to have a Facebook account in order to log in and access content for the virtual reality kit.

In August Facebook also announced that it was changing the name of the VR business it acquired back in 2014 for around $2BN — and had allowed to operate separately — to “Facebook Reality Labs“, signalling the assimilation of Oculus into its wider social empire.

(Related: The last of Oculus’ original co-founders left the company last year.)

In recent years Facebook has been pushing to add a ‘social layer’ to the VR platform — but the heavy-handed requirement for Oculus users to have a Facebook account has not proved popular with gamers.

Now antitrust authorities are taking an interest in the move.

Germany’s Federal Cartel Office (aka, the Bundeskartellamt) said today that it’s instigated abuse proceedings against Facebook to examine the linkage between Oculus VR products and its eponymous social network.

In a statement, its president, Andreas Mundt, said: In the future, the use of the new Oculus glasses requires the user to also have a Facebook account. Linking virtual reality products and the group’s social network in this way could constitute a prohibited abuse of dominance by Facebook. With its social network Facebook holds a dominant position in Germany and is also already an important player in the emerging but growing VR (virtual reality) market. We intend to examine whether and to what extent this tying arrangement will affect competition in both areas of activity.

The FCO has another ‘abuse of dominance proceeding’ ongoing against Facebook — related to how it combines user data for ad profiling in a privacy-hostile way the authority contends is an abuse of its market dominance.

That case is seen as highly innovative in how it combines privacy and antitrust concerns so is being closely watched.

The latest FCO proceeding against Facebook comes at an awkward time for the tech giant, which has been hit with a massive antitrust lawsuit from 46 U.S. States — which accuse it of suppressing competition through monopolistic business practices.

As antitrust regulators have stepped up their scrutiny of Zuckerberg’s empire in recent years Facebook has responded by announcing a plan to consolidate its messaging products onto a single technical backend, as well as adding Facebook branding to its acquisitions — in an apparent bid to make it harder for competition regulators to order a break up.

Facebook’s PR has sought to cloak the move by claiming it will increase user privacy.

Yet the states’ antitrust case against the company includes filings that show an executive discussing using moments of perceived increased competition for Facebook as an opportunity to decrease Facebook user privacy.

So, uh, awkward….

Reached for comment on the FCO Oculus proceeding, a Facebook spokesperson sent us this statement: “While Oculus devices are not currently available for sale in Germany, we will cooperate fully with the Bundeskartellamt and are confident we can demonstrate that there is no basis to the investigation.”

The tech giant has used a series of legal tactics to block the FCO’s order against ‘superprofiling’ users.

Last year Facebook successfully applied to block the order banning it from combining user data. However Germany’s Federal Court of Justice reversed the decision of the Higher Regional Court — confirming the FCO’s decision. Although the hearing on the main proceeding is still pending at the Düsseldorf Higher Regional Court — currently scheduled for March 26, 2021 (after being postponed from a date in November).

Facebook responded to the Federal Court of Justice ruling by filing another emergency appeal against the FCO’s order — succeeding for a second time in blocking the order against combining user data.

The FCO says it does not have a route to appeal this preliminary block on points of law — meaning it’s had to lodge a complaint with the Federal Court of Justice, which it did on December 2.

In a statement, Mundt criticized Facebook for resorting to “legal remedies” to block the order which he said is delaying relief for consumers and competitors against Facebook’s abusive practices.

“The fact that Facebook has resorted to various legal remedies is not surprising in view of the significance which our proceedings have for the group’s business model. Nevertheless, the resulting delay in proceedings is of course regrettable for competition and consumers,” he said.

“This is the second time that the Higher Regional Court has preliminarily granted an emergency appeal filed by Facebook. The deadline imposed on Facebook for implementing our demands has again been suspended. As in our view the reasons for this are not sustainable, we have immediately filed a complaint with the Federal Court of Justice. We want the clock to be ticking again for Facebook.”

Facebook using courts to block attempts to hold its business model accountable for violating regional laws is par for the course in Europe.

The tech giant has recently succeeded in blocking a preliminary order from Ireland’s Data Protection Commission to suspend personal data transfers to the US by applying for a judicial review of the regulator’s process, for example.

It also sought to block Irish courts from referring the Schrems II case, which underpins that decision, to the CJEU in the first place — though it did not succeed.

In public remarks in September, Facebook VP Nick Clegg claimed it’s taking that legal action not to defend its own business model but to “try to send a signal that this is a really big issue for the whole European economy, for all small and large companies that rely on data transfers” — which he suggested would be “absolutely disastrous” for the EU as a whole.

More than one billion people in India today have a mobile connection, thanks in part to the proliferation of low-cost Android smartphones and the world’s cheapest mobile data plans in recent years.

This scale was unimaginable just three decades ago, when India had fewer than 2.5 million telephones in the country. One of the earliest and most pivotal efforts that expanded the reach of telephones in the country took place in the late 1980s.

That was when the Indian government backed the idea of setting up telephone booths, or public call offices, across cities and towns. No longer did people need to buy expensive telephones, or pay exorbitant fees and bills. A person could just walk to a nearby mom and pop store, place a call for a couple of cents and move on.

On Wednesday, India’s cabinet approved a proposal that seeks to replicate the decades old strategy — and its success — with democratizing Wi-Fi in the world’s second largest internet market.

India’s IT Minister Ravi Shankar Prasad said that the government will launch PM WANI (Prime Minister Wi-Fi Access Network Interface) to “unleash a massive network in the country.”

The neighborhood stores that served as public call offices could now be public data offices, he said. To make the program a success, the government will not charge any license or registration fee, he said.

These public data offices will work in tandem with public data aggregators that are tasked to collaborate with small and large telecom companies to utilize their optical fibre network.

The program will “create millions of inter-operable Wi-Fi hotspots in the country and democratise content distribution and broadband access to millions at affordable rates,” said R.S. Sharma, former chairman of Indian telecom regulator TRAI. He likened the program to UPI, a payments infrastructure built by retail banks, which has become the most popular way Indians pay digitally today.

Hundreds of millions of people came online in India for the first time in the last decade. But just as many are still unconnected. The new program from the Indian government, in part, aims to bridge this gap.

“This is expected to be more business friendly and in line with efforts for ease of doing business.COVID-19 pandemic has necessitated delivery of stable and high speed Broadband Internet (data) services to an increasingly large number of subscribers in the country including areas which do not have 4G mobile coverage. This can be achieved by deployment of Public Wi-Fi,” the cabinet said in a statement. “Further, the proliferation of public Wi-Fi will not only create employment but also enhance disposable incomes in the hands of small and medium entrepreneurs and boost the GDP of the country,” it added.

Wednesday’s announcement is the latest effort to bring more people online in India. Global giants Google and Facebook, both of which are counting on emerging markets such as India to sustain their growth, have previously attempted to make internet access more affordable in the country. While Facebook’s marquee effort, Free Basics, was banned in the country over net neutrality violation charges, Google voluntarily shut down its free Wi-Fi program at 400 railway stations this year.

As mobile data prices got cheaper in many markets, including India, Google Station was no longer necessary, Caesar Sengupta, VP of Payments and Next Billion Users at Google, said at the time.

Jayanth Kolla, chief analyst and founder of consulting firm Convergence Catalyst, told TechCrunch that the Indian government should have launched this program seven to eight years ago.

He said the launch of Jio Platforms, which has become the largest telecom operator in India in just four years thanks to its cutrate mobile data tariffs, solved much of the challenges that PM WANI seeks to address.

Instagram today is launching Shopping in Reels, its TikTok competitor. The new feature was announced in October as something the company had in the works, as part of a ongoing series of shopping-related updates to the Instagram app. With today’s launch, both businesses and creators will be able to tag products when they create Reels — the short-form videos that now have their own tab in Instagram following last month’s redesign.

The company says many Reels already feature shopping content, like fashion looks, makeup and skincare, or other product how-tos. When people view an Instagram Reel with this content, they’ll be able to now tap a “View Products” button to either buy, save or learn more about the featured products.

In addition, creators can add a “Branded Content” tag to their Reels to be transparent about when they’re working with a brand to promote their products, which is a form of paid promotion.

The update makes shopping an even larger focus for Instagram than it already was, and arrives at a time when video-based shopping is seeing increased adoption. In particular, a growing number of startups focused on live-stream video shopping are finding traction. In recent months, investors have backed companies like live shopping platforms Popshop Live and Bambuser, for example, while major tech companies, including Alibaba, Amazon, Google and JD.com, have also joined the video shopping trend in various ways.

Most importantly, perhaps, is that Instagram rival TikTok recently partnered with Shopify on e-commerce and today caters to brands that either advertise directly or work with influencers on its platform, eating into Instagram’s market. TikTok had also fielded interest from Walmart, when the Trump ban had forced the company to enter negotiations around a U.S. exit. And TikTok’s app in 2020 beat out Instagram as one of the world’s most downloaded apps, indicating a seismic shift in how younger users interact with social media.

Hoping to not be left behind, Instagram has revamped its app — to much user criticism when it relocated key home screen features — with the goal of becoming a top online shopping destination, as well. The company generates revenue when customers checkout in the app using Facebook Pay, which will allow it to make money outside of running ads.

Today, Instagram users can shop from videos in Feed, Stories, Live, IGTV and, with this latest launch, Reels.

The company says the feature is rolling out globally, starting today.

Cleo, the London founded “financial assistant” that takes the form of an app and chatbot and now counts the U.S. as its largest market, has raised $44 million in Series B funding.

Leading the round, which I understand actually closed earlier this year, is EQT Ventures. Also participating are existing investors Balderton Capital, LocalGlobe and SBI.

They join much earlier investors such as Entrepreneur First, Taavet Hinrikus, Matt Robinson, Errol Damelin, Niklas Zennstrom, Alex Chesterman, and Ian Hogarth — all well-known names in London’s tech investment community.

Targeting “Gen Z” and with a rather lofty sounding mission to “fight for the world’s financial health,” Cleo’s AI/machine learning-powered app connects to your bank accounts and gives you proactive advice and information on your finances, including timely nudges, to help you stay on top of your spending. Over time, the idea is that Cleo can help change your financial behaviour for the better.

The broader premise is that Cleo can replace your bank’s own app, and by speaking to you in a more human and user-friendly way, improve your financial health. In addition, and crucially — as Cleo founder Barney Hussey-Yeo is fond of arguing — the company can do all of this without having the same cost base or misaligned incentives of an actual bank.

The assumption made in 2017, when Cleo really got off the ground, was that through a combination of data science and machine learning, delivered in a fun and openly gamified way, the company’s financial assistant chatbot could attract and retain gen z and millennial users. Then, after engaging with the app, users would have experienced enough value to upgrade to a paid subscription or various financial services offered through Cleo now or in the future. With 4 million registered users — 96 percent of whom are in the U.S. — the first part appears to be panning out.

Hussey-Yeo tells me the new funding round gives him a “mandate” to take some big product bets in order to move forward the financial health of Cleo’s users. “[Those product bets] won’t all work out, but if one or two of them connects, we’ll fundamentally change the game in some of the most broken areas in financial services”.

In addition, the company will expand its operations in the U.S., including building out executive and product teams in San Francisco.

“When we launched in the U.S it became quickly apparent that it would be our dominant market,” says the Cleo founder. “We were signing up about 1,000 users per day in the U.K. at the time. After [just] a week, we were at 10,000 per day in the U.S. and kept growing”.

Hussey-Yeo attributes a lot of the success state-side to better banking APIs in the U.S. with Plaid, which he says “dramatically drove up” conversion rates and lowered customer acquisition costs. “This combined with a much larger market focused us 100% on winning in the U.S. first. This race is far from played out”.

Hussey-Yeo says Cleo will always offer a free version “because everybody needs the ability to make smarter decisions about their financial lives”. In contrast, the premium product costs $5.99 per month and is intended for people who “need a little extra help,” providing features such as gamified savings, and “levelled up” credit scores with coaching. Premium users can also trigger a $100 salary advance designed to stop them dipping into a costly bank overdraft.

Meanwhile, Cleo says it has grown revenue by 400 percent in the last twelve months, and Hussey-Yeo tells me the company is now doing $10 million-plus AAR. In a further nod towards stronger unit economics, the cost to acquire a user is now less than $2 with the vast majority of users acquired organically.

“So we’re definitely not in growth at all costs mode,” he says. “We’ve worked hard over the last 12 months to bring our payback period comfortably under 12 months which is an incredibly rare feat at scale for fintech”.

One interesting aspect of Cleo’s mission and the strong “personality” its chatbot exhibits, is that the problem space the company is tackling is potentially based on behavioural science as much as it is data science. Hussey-Yeo doesn’t disagree.

“This is where the idea of a conversational interface came from,” he says. “I realised you could break the complexity down into a language anyone could engage with, and I mean actually look forward to engaging with it, to ultimately change their behaviour.

“Today we have an outstanding machine learning department but just as importantly is the behavioural researchers and writers at Cleo. We know this is the combination that makes Cleo special and, I hope, will eventually lead to us being the financial advisor for a billion people”.

German fintech Solactive, a technology-enabled provider of indices and index solutions to the global financial services industry, has taken a $60.4m / €50 million minority investment from growth investor Summit Partners.

Widely regarded as something of a disruptor in the global indexing industry, Solactive is benefitting from the ongoing and significant shift of active to passive investment strategies. Although Europe-based, it has more than 400 clients worldwide, including major investment banks, ETF providers and hedge funds, with more than $200 billion of global assets linked to more than 17,000 Solactive indices.

The idea behind Solactive is to take a customer-centric and technology-first approach to the creation, development, calculation and distribution of indices and related services. Because it is technology-first, it can offer tailor-made index solutions for ETFs and other index-linked investments across equity, fixed income and multi-asset class strategies.

Steffen Scheuble, the CEO of Solactive who founded Solactive in 2007, said: “We are proud to be one of the fastest-growing index providers in the world and widely regarded as a disruptor in the global index market. We are excited to join forces with Summit Partners and work together to further accelerate our journey.”

Summit brings significant experience in the technology and financial services sectors, as well as deep resources in supporting the expansion of our businesses across products, regions and client segments.”
Mr.

Johannes Grefe, a Principal with Summit Partners who will be joining the Solactive Board of Directors, commented: “Steffen and the Solactive team have recognized and responded to this trend with a highly automated and customer-centric approach based on a robust technology platform. With a strong combination of vision, product and client reach, we believe Solactive is well-positioned to continue its innovative disruption of the indexing market.”

Solactive serves its global customer base from its headquarters in Frankfurt am Main, Germany, and offices in Toronto, Hong Kong, Berlin and Dresden.

UK-based Orbex has raised a new $24 million funding round, led by BGF and Octopus Ventures, and including participation from existing investors High-Tech Gründerfonds, Heartcore Capital, and Elecnor S.A. This new investment help “secure the roadmap” that Orbex was already working towards regarding its launch vehicle development and deployment, which is currently targeting 2022 for its first commercial launches.

Orbex is set to launch its Orbex Prime rocket from the new Space Hub Sutherland spaceport in Scotland, and has six launch contracts on the books already. Its debut launch vehicle is a small payload rocket, which is unique in the industry in that it makes use of bio-propane, a fuel source that offers 90% emissions reduction vs. the traditional kerosene-based rocket fuels generally used for liquid rockets, and which is a renewable fuel source. Orbex also aims to reduce its impact in other ways, including through recoverability and reusability, and says that Prime’s design is intended to leave no post-launch debris either in the ocean on Earth, or even in orbit.

The startup is already in the process of building out its first Prime rockets, at two factories it operates in Scotland and in Denmark. The company uses 3D-printing heavily in its rocket facbbrication process. It has raised around $63 million to date, with its last round of around $39 million announced in 2018.

Productivity software has been getting a major re-examination this year, and human resources platforms — used for hiring, firing, paying, and managing employees — have been no exception. Today, one of the startups that’s built what it believes is the next generation of how HR should and will work is announcing a big fundraise, underscoring its own growth and the focus on the category.

Hibob, the startup behind the HR platform that goes by the name of “bob” (the company name is pronounced, “Hi, Bob!”), has picked up $70 million funding at a valuation that sources close to the company tell us is around $500 million.

“Our mission is to modernize HR technology,” said Ronni Zehavi, Hibob’s CEO, who cofounded the company with Israel David. “We are a people management platform for how people work today. Whether that’s remotely or physically collaborative, our customers face challenges with work. We believe that the HR platforms of the future will not be clunky systems, annoying, giant platforms. We believe it should be different. We are a system of engagement rather than record.”

The Series B is being led by SEEK and Israel Growth Partners, with participation also from Bessemer Venture Partners, Battery Ventures, Eight Roads Ventures, Arbor Ventures, Presidio Ventures, Entree Capital, Cerca Partners, and Perpetual Partners, the same group that also backed Hibob in its last round (a Series A extension) in 2019. It has raised $124 million to date.

The company has its roots in Israel but these days describes its headquarters as London and New York, and the funding comes on the back of strong growth. In an interview, Zehavi said that Hibob specialises in the mid-market customers and says that it has over 1,000 of them currently on its books across the US, Europe and Asia, including Monzo, Revolut, Happy Socks, Ironsource, Receipt Bank, Fiverr, Gong, and VaynerMedia. In the last year Hibob has had “triple digit” year-on-year growth (it didn’t specify what those digits are).

Human resources has never been at the more glamorous end of how a company works, and it can sometimes even be looked on with some disdain. However HR has found itself in a new spotlight in 2020, the year when every company — whether one based around people sitting at desks or in more interactive and active environments — had to change how it worked.

That might have involved sending everyone home to sign in from offices possibly made out of corners of bedrooms or kitchens, or that might have involved a vastly different set of practices in terms of when and where workers showed up and how they interacted with people once they did. But regardless of the implementations, they all involved a team of people who needed to be linked together and still feeling connected and managed; and sometimes hired, furloughed, or let go.

That focus has started to reveal the strains of how some legacy systems worked, with older systems built to consider little more than creating an employee identity number that could then be tracked for payroll and other purposes.

Hibob — Zehavi said they chose the name after the person who owned the bob.com domain wanted too much to sell it, but they liked bob for the actual product — takes an approach from the ground up that is in line with how many people work today, balancing different software and apps depending on what they are doing, and linking them up by way of integrations: its own includes Slack, Microsoft Teams, and Mercer and other packages that are popular with HR departments. 

While it covers all of the necessary HR bases like payroll and further compensation, onboarding, managing time off, and benefits, it further brings in a variety of other features that help build out bigger profiles of users, such as performance and culture, with the ability for peers, managers and workers themselves to provide feedback to enhance their own engagement with the company, and for the company to have a better idea of how they are fitting into the organization, and what might need more attention in the future.

That then links into a bigger organizational chart and conceptual charts that highlight strong performers, those who are possible flight risks, those who are leaders and so on. While there have been a number of others in the HR world that have built standalone apps that cover some of these features, what’s notable here is how they are all folded into one system together.

[gallery ids="2085416,2085417,2085418,2085419"]

The end effect, as you can see here, looks less like word salad and more interactive, graphic interfaces that are presumably a lot more enjoyable and at least easier to use for HR people themselves.

The importance for investors has been that the product and the startup has identified the opportunity, but has delivered not just more engagement, but a strong piece of software that still provides the essentials.

“This is certainly not a Workday,” said Adam Fisher, a partner at Bessemer, in an interview. “Our overall thesis has been that HR is only growing in importance. And while engagement is super important, that opportunity is not enough to create the market.”

The end result is a platform that has a significant shot at building in even more over time. For example, another large area that has been seeing traction in the world of enterprise and B2B software is employee training. Specifically, enterprise learning systems are creating another way to help keep people not only speed on important aspects of how the work, but also engaged at a time when connections are under strain.

“Training, a SuccessFactors-style offering, is definitely in our roadmap,” said Zehavi, who noted they are adding new features all the time. The latest has been compensation, sometimes known as merit increase cycles. “That is a very complex issue and requires deeper integrations finance and and the CFO’s office. We streamlined it and made it easy to use. We launched two months ago and it’s on fire. After learning and development the are other modules also down the road.”

Two months ago, Kubernetes observability platform Pixie Labs launched into general availability and announced a $9.15 million Series A funding round led by Benchmark, with participation from GV. Today, the company is announcing its acquisition by New Relic, the publicly traded monitoring and observability platform.

The Pixie Labs brand and product will remain in place and allow New Relic to extend its platform to the edge. From the outset, the Pixie Labs team designed the service to focus on providing observability for cloud-native workloads running on Kubernetes clusters. And while most similar tools focus on operators and IT teams, Pixie set out to build a tool that developers would want to use. Using eBPF, a relatively new way to extend the Linux kernel, the Pixie platform can collect data right at the source and without the need for an agent.

At the core of the Pixie developer experience are what the company calls “Pixie scripts.” These allow developers to write their debugging workflows, though the company also provides its own set of these and anybody in the community can contribute and share them as well. The idea here is to capture a lot of the informal knowledge around how to best debug a given service.

“We’re super excited to bring these companies together because we share a mission to make observability ubiquitous through simplicity,” Bill Staples, New Relic’s Chief Product Officer, told me. “[…] According to IDC, there are 28 million developers in the world. And yet only a fraction of them really practice observability today. We believe it should be easier for every developer to take a data-driven approach to building software and Kubernetes is really the heart of where developers are going to build software.”

It’s worth noting that New Relic already had a solution for monitoring Kubernetes clusters. Pixie, however, will allow it to go significantly deeper into this space. “Pixie goes much, much further in terms of offering on-the-edge, live debugging use cases, the ability to run those Pixie scripts. So it’s an extension on top of the cloud-based monitoring solution we offer today,” Staples said.

The plan is to build integrations into New Relic into Pixie’s platform and to integrate Pixie use cases with New Relic One as well.

Currently, about 300 teams use the Pixie platform. These range from small startups to large enterprises and as Staples and Asgar noted, there was already a substantial overlap between the two customer bases.

As for why he decided to sell, Pixie co-founder (and former Google AI CEO Zain Asgar told me that it was all about accelerating Pixie’s vision.

“We started Pixie to create this magical developer experience that really allows us to redefine how application developers monitor, secure and manage their applications,” Asgar said. “One of the cool things is when we actually met the team at New Relic and we got together with Bill and [New Relic founder and CEO] Lou [Cirne], we realized that there was almost a complete alignment around this vision […], and by joining forces with New Relic, we can actually accelerate this entire process.”

New Relic has recently done a lot of work on open-sourcing various parts of its platform, including its agents, data exporters and some of its tooling. Pixie, too, will now open-source its core tools. Open-sourcing the service was always on the company’s roadmap, but the acquisition now allows it to push this timeline forward.

“We’ll be taking Pixie and making it available to the community through open source, as well as continuing to build out the commercial enterprise-grade offering for it that extends the New Relic one platform,” Staples explained. Asgar added that it’ll take the company a little while to release the code, though.

“The same fundamental quality that got us so excited about Lew as an EIR in 2007, got us excited about Zain and Ishan in 2017 — absolutely brilliant engineers, who know how to build products developers love,” Bessemer Ventures General Partner Eric Vishria told me. “New Relic has always captured developer delight. For all its power, Kubernetes completely upends the monitoring paradigm we’ve lived with for decades.  Pixie brings the same — easy to use, quick time to value, no-nonsense approach to the Kubernetes world as New Relic brought to APM.  It is a match made in heaven.”

This morning Candu, a software startup that provides no-code web tools for SaaS apps, announced a $5 million funding round.

TechCrunch caught up with founder Jonathan Anderson and lead investor Villi Iltchev, a partner at Two Sigma Ventures, to chat about the deal.

First thing: This round, a bit like Scotch, has aged. It’s from March. And while it is very common for venture capital rounds to get announced after the fact, a nearly nine-month delay would normally be a stretch. However, Anderson explained that he wanted to hold off on releasing the news until Candu’s product was in the market. That’s a valid reason, so we’re going to chat about the investment despite its age.

The round we’re discussing today is not Candu’s first, as the startup previously raised around $1 million after its graduation from Entrepreneur First, an accelerator with a global footprint.

The $5 million investment began like many venture investments do, with an investor getting in touch with a young company months before a transaction is put together. Iltchev reached out to Candu in September of 2019 after hearing about the startup and liking its effort to allow for far-greater personalization of onboarding experiences inside of SaaS apps.

Anyone who has fired up a new business service, only to be given a walkthrough of how a few of the buttons work — a set of directions that I am sure you also skip — knows that the help can be generic, and annoying. Candu wants to work on the problem, offering no-code development tools to help non-engineers at companies build tailored pages to help with onboarding. What does that mean? With Candu, a SaaS app could offer different user cohorts nigh-personalized onboarding experiences.

So what? For SaaS companies big and small, effective onboarding is an important method of driving user engagement, a key metric for any modern software company. Why? Active users are less likely to churn, and more likely to expand spend on a service over time. So getting users activated well is no small task.

WalkMe and Pendo have built material business by approaching the issue from a different angle. WalkMe last raised $90 million last December, while Pendo picked up $100 million last October.

Candu’s project was interesting, and it had an obvious market, but the deal didn’t come together for a few months after the investor and startup met each other. Iltchev asked Candu to stay in touch, and toward the end of 2019 Anderson reached out to alert the investor that some of his peers were circling. That call led to the round that was announced today.

Superpowers

No-code startups have the potential to empower workers at companies who have to fight for engineering resources. If more groups in a company can build and deploy product, they will be able to move more quickly, and get more done. And they won’t have to beg the engineering team for help.

For that reason no-code startups — and other no-code and low-code projects — are incredibly interesting. In the case of Candu, if its service finds adoption, marketing and customer success teams may be able to create and tweak onboarding experiences without needing help from other teams. That would not only save time, but could lead to better results as more iterations would be possible.

Candu is not done figuring itself out, however. Co-founder Anderson told TechCrunch that his company is still working on solidifying its product-market fit. That is perfectly reasonable for a startup that is still grinding its way through early seed checks.

Asked what the company expects its annual contract value (ACV) to average out to, Anderson said that the market would guide the company, which only launched its service in late October. For now, Candu lists its prices starting from around $200 per month on up. Those targets provide some context about who it expects to sell to.

Regardless, it’s now up to the startup to scale its customer base, and turn those early customers into both revenue and learnings, which it can furrow back into its operations and product. Let’s see how far it can get with its March-era seed investment.

The worldwide shift to virtual workplaces has been a blessing and a curse to people with hearing impairments. Having office chatter occur in text rather than speech is more accessible, but virtual meetings are no easier to follow than in-person ones — which is why real-time captioning startup Ava has seen a huge increase in users. Riding the wave, the company just announced two new products and a $4.5 million seed round.

Ava previously made its name in the deaf community as a useful live transcription tool for real-life conversations. Start the app up and it would instantly hear and transcribe speech around you, color-coded to each speaker (and named if they activate a QR code). Extremely useful, of course, but when meetings stopped being in rooms and started being in Zooms, things got a bit more difficult.

“Use cases have shifted dramatically, and people are discovering the fact that most of these tools are not accessible,” co-founder and CEO Thibault Duchemin told TechCrunch.

And while some tools may have limited captioning built in (for example Skype and Google Meet), it may or may not be saved, editable, accurate, or convenient to review. For instance Meet’s ephemeral captions, while useful, only last a moment before disappearing, and are not specific to the speaker, making them of limited use for a deaf or hard of hearing person trying to follow a multi-person call. And the languages they are available in are limited as well.

As Duchemin explained, it began to seem much more practical to have a separate transcription layer that is not specific to any one service.

Thus Ava’s new product, a desktop and web app called Closed Captioning, which works with all major meeting services and online content, captioning it with the same on-screen display and making the content accessible via the same account. That includes things like YouTube videos without subtitles, live web broadcasts, and even audio-only content like podcasts, in more than 15 languages.

Individual speakers are labeled, automatically if an app supports it, like Zoom, or by having people in the meeting click a link that attaches their identity to the sound of their voice. (There are questions of privacy and confidentiality here, but they will differ case by case and are secondary to the fundamental capability of a person to participate.)

The transcripts all go to the person’s Ava app, letting them check through at their leisure or share with the rest of the meeting. That in itself is a hard service to find, Duchemin pointed out.

“It’s actually really complicated,” he said. “Today if you have a meeting with four people, Ava is the only technology where you can have accurate labeling of who said what, and that’s extremely valuable when you think about enterprise.” Otherwise, he said, unless someone is taking detailed notes — unlikely, expensive, and time-consuming — meetings tend to end up black boxes.

For such high quality transcription, speech-to-text AI isn’t good enough, he admitted. It’s enough to follow a conversation, but “we’re talking about professionals and students who are deaf or hard of hearing,” Duchemin said. “They need solutions for meetings and classes and in-person, and they aren’t ready to go full AI. They need someone to clean up the transcript, so we provide that service.”

Ava Scribe quickly brings in a human trained not in direct transcription but in the correction of the product of speech-to-text algorithms. That way a deaf person attending a meeting or class can follow along live, but also be confident that when they check the transcript an hour later it will be exact, not approximate.

Right now transcription tools are being used as value-adds to existing products and suites, he said — ways to attract or retain customers. They aren’t beginning with the community of deaf and hard of hearing professionals and designing around their needs, which is what Ava has striven to do.

The explosion in popularity and obvious utility of their platform has led to this $4.5M seed round, as well, led by Initialized Capital and Khosla Ventures.

Duchemin said they expected to double the size of their team with the money, and start really marketing and finding big customers. “We’re very specialized, so we need a strong business model to grow,” he said. A strong, unique product is a good place to start, though.