Year: 2021

In October, TechCrunch broke the news that PopSockets was developing its own line of MagSafe-compatible products that will support the new wireless charging capabilities of the iPhone 12 devices. Today, at the (virtual) 2021 Consumer Electronics Show, the company formally introduced its upcoming products for the first time. The new line will include three MagSafe-compatible PopGrips, a wallet with an integrated grip, and two mounts.

The first of these is the new PopGrip for MagSafe, which will magnetically attach to MagSafe-compatible cases for iPhone 12 devices.

The design of this PopGrip clears up some confusion over how a PopGrip (the round, poppable dongle that people normally think of when they think of “PopPockets”) will work with a MagSafe device. Instead of attaching just at the base of the grip itself, the grip is integrated into a larger base which attaches to the case.

Meanwhile, the grip has a swappable top so you can change the style of your PopGrip whenever you want without having to buy a whole new accessory.

This grip will also be compatible with PopSockets PopMount 2 phone mounts, including the new PopMount 2 for MagSafe, introduced today.

The PopMount 2 for MagSafe will launch as two solutions: PopMount for MagSafe Multi-Surface and PopMount for MagSafe Car Vent. As described by their name, both products will magnetically attach to iPhone 12 devices either at home or while on-the-go.

For those who use the new PopGrip for MagSafe grip, they’ll be able to leave the grip on then let the mount’s magnets attach to the base.

Image Credits: PopMount Multi Surface for MagSafe

Also new is an updated PopWallet+ for MagSafe, which is combination wallet and grip that lets users carry up to 3 cards that now attaches magnetically to MagSafe-compatible phone cases for iPhone 12 devices. The wallet has an elastic sock so you can extract your cards without having to remove the wallet from the back of the device, and it now includes a shield to protect credit cards from magnetic damage. The grip here is swappable, too.

Image Credits: PopWallet+ for MagSafe

There are also two versions of the PopGrip Slide becoming available. One, the PopGrip Slide Stretch will have expanding arms that attach mechanically to the sides of most phone cases, including iPhone 12 cases. You can slide this grip to the bottom of the phone to serve as a portrait stand or to attach MagSafe accessories, without having to remove the grip.

Image Credits: PopGrip Slide Stretch for MagSafe

The PopGrip Slide for iPhone 12 is basically the same thing, but designed to fit the Apple Silicone cases for iPhone 12 devices, more specifically.

Among the first of the new accessories to hit the market will be the PopGrip for MagSafe and PopWallet+ for MagSafe in spring 2021.

The PopGrip Slide Stretch will launch March 21st on PopSockets.com and in select Target locations ahead of a broader rollout. The PopGrip Slide will launch May 1st on PopSockets.com and in Apple Stores. And the PopMount for MagSafe line will launch in summer 2021.

The company also announced a few other non-MagSafe products, including the PopGrip Pocketable, which streamlines the grip when collapsed so the the surface is flat; the PopGrip Antimicrobial, which has an embedded silver-based treatment for protection; and the PopSockets x SOG PopGrip Multi-Tool, made in collaboration with SOG Speciality Knives, which includes a PopGrip with a detachable multi-tool.

The company didn’t share an exact timeframe for these products besides “early 2021.”

When Sony teased the AirPeak late last year, it didn’t give us much to go one. We knew the consumer electronics giant was finally getting in the drone business — but beyond that, not much else. Just a dark image or two from some piece of the UAV.

At CES this week, the company’s finally prepared to show off a bit more. “Today, we’re going to introduce a product that integrates AI and robotics,” CEO Kenichiro Yoshida said in an announcement video, “designed for adventurous creators.”

The drone is designed to carry Sony’s own imaging technology — specifically the Alpha series of mirrorless. And while it’s large compared to what we’re used to seeing on the consumer side from companies like DJI, Sony say it’s going to be the smallest drone on the market that can be equipped with its cameras.

Along with the announcement, the company’s also debuting footage of the drone in action, along with video captured with its on-board camera. The drone was flown through snow and managed to capture some lovely, stable footage, all things considered. Also of note: The car in the video is the Vision-S concept the company unveiled this time last year.

The system looks to compete with some of the more pro-focused models. DJI has that market under lock — along with practically all drone categories. Though while DJI owns a majority stake in Hasselblad, Sony’s system looks like a proprietary, purpose-built design. That could certainly be a bonus from the standpoint of compatibility, though it doesn’t seem like you’ll be able to swap the Alpha out for different cameras.

The company is targeting a spring release for the system. No word yet on pricing.

Last week and throughout the weekend, technology companies took the historic step of deplatforming the president of the United States in the wake of a riot in which the US Capitol was stormed by a collection of white nationalists, QAnon supporters, and right wing activists.

The decision to remove Donald Trump, his fundraising and moneymaking apparatus, and a large portion of his supporters from their digital homes because of their incitements to violence in the nation’s Capitol on January 6th and beyond, has led a chorus of voices to call for the regulation of the giant tech platforms.

They argue that private companies shouldn’t have the sole power to erase the digital footprint of a sitting president.

But there’s a reason why the legislative hearings in Congress, and the pressure from the president, have not created any new regulations. And there’s also a reason why — despite all of the protestations from the president and his supporters — no lawsuits have effectively been brought against the platforms for their decisions.

The law, for now, is on their side.

The First Amendment and freedom of speech (for platforms)

Let’s start with the First Amendment. The protections of speech afforded to American citizens under the First Amendment only apply to government efforts to limit speech. While the protection of all speech is assumed as something enshrined in the foundations of American democracy, the founders appear to have only wanted to shield speech from government intrusions.

That position makes sense if you’re a band of patriots trying to ensure that a monarch or dictator can’t abuse government power to silence its citizens or put its thumb on the lever in the marketplace of ideas.

The thing is, that marketplace of ideas is always open, but publishers and platforms have the freedom to decide what they want to sell into it. Ben Franklin would never have published pro-monarchist sentiments on his printing presses, but he would probably have let Thomas Paine have free rein.

So, the First Amendment doesn’t protect an individuals’ rights to access any platform and say whatever the hell they want. In fact, it protects businesses in many cases from having their freedom of speech violated by having the government force them to publish something they don’t want to on their platforms.

Section 230 and platform liability 

BuT WhAt AbOUt SeCTiOn 230, one might ask (and if you do, you’re not alone)?

Unfortunately, for Abbott and others who believe that repealing Section 230 would open the door for less suppression of speech by online platforms, they’re wrong.

First, the cancellation of speech by businesses isn’t actually hostile to the foundation America was built on. If a group doesn’t like the way it’s being treated in one outlet, it can try and find another. Essentially, no one can force a newspaper to print their letter to the editor.

Second, users’ speech isn’t what is protected under Section 230; it protects platforms from liability for that speech, which indirectly makes it safe for users to speak freely.

Where things get complicated is in the difference between the letter to an editor in a newspaper and a tweet on Twitter, post on Facebook, or blog on Medium (or WordPress). And this is where U.S. Code Section 230 comes into play.

Right now, Section 230 protects all of these social media companies from legal liability for the stuff that people publish on their platforms (unlike publishers). The gist of the law is that since these companies don’t actively edit what people post on the platforms, but merely provide a distribution channel for that content, then they can’t be held accountable for what’s in the posts.

The companies argue that they’re exercising their own rights to freedom of speech through the algorithms they’ve developed to highlight certain pieces of information or entertainment, or in removing certain pieces of content. And their broad terms of service agreements also provide legal shields that allow them to act with a large degree of impunity.

Repealing Section 230 would make platforms more restrictive rather than less restrictive about who gets to sell their ideas in the marketplace, because it would open up the tech companies to lawsuits over what they distribute across their platforms.

One of the authors of the legislation, Senator Ron Wyden, thinks repeal is an existential threat to social media companies. “Were Twitter to lose the protections I wrote into law, within 24 hours its potential liabilities would be many multiples of its assets and its stock would be worthless,” Senator Wyden wrote back in 2018. “The same for Facebook and any other social media site. Boards of directors should have taken action long before now against CEOs who refuse to recognize this threat to their business.”

Others believe that increased liability for content would actually be a powerful weapon to bring decorum to online discussions. As Joe Nocera argues in Bloomberg BusinessWeek today:

“… I have come around to an idea that the right has been clamoring for — and which Trump tried unsuccessfully to get Congress to approve just weeks ago. Eliminate Section 230 of the Communications Decency Act of 1996. That is the provision that shields social media companies from legal liability for the content they publish — or, for that matter, block.

The right seems to believe that repealing Section 230 is some kind of deserved punishment for Twitter and Facebook for censoring conservative views. (This accusation doesn’t hold up upon scrutiny, but let’s leave that aside.) In fact, once the social media companies have to assume legal liability — not just for libel, but for inciting violence and so on — they will quickly change their algorithms to block anything remotely problematic. People would still be able to discuss politics, but they wouldn’t be able to hurl anti-Semitic slurs. Presidents and other officials could announce policies, but they wouldn’t be able to spin wild conspiracies.”

Conservatives and liberals crowing for the removal of Section 230 protections may find that it would reinstitute a level of comity online, but the fringes will be even further marginalized. If you’re a free speech absolutist, that may or may not be the best course of action.

What mechanisms can legislators use beyond repealing Section 230? 

Beyond the blunt instrument that is repealing Section 230, legislators could take other steps to mandate that platforms carry speech and continue to do business with certain kinds of people and platforms, however odious their views or users might be.

Many of these steps are outlined in this piece from Daphne Keller on “Who do you sue?” from the Hoover Institution.

Most of them hinge on some reinterpretation of older laws relating to commerce and the provision of services by utilities, or on the “must-carry” requirements put in place in the early days of 20th century broadcasting when radio and television were distributed over airways provided by the federal government.

These older laws involve either designating internet platforms as “essential, unavoidable, and monopolistic services to which customers should be guaranteed access”; or treating the companies like the railroad industry and mandating compulsory access, requiring tech companies to accept all users and not modify any of their online speech.

Other avenues could see lawmakers use variations on the laws designed to limit the power of channel owners to edit the content they carried — including things like the fairness doctrine from the broadcast days or net neutrality laws that are already set to be revisited under the Biden Administration.

Keller notes that the existing body of laws “does not currently support must-carry claims against user-facing platforms like Facebook or YouTube, because Congress emphatically declined to extend it to them in the 1996 Telecommunications Act.”

These protections are distinct from Section 230, but their removal would have similar, dramatic consequences on how social media companies, and tech platforms more broadly, operate.

“[The] massive body of past and current federal communications law would be highly relevant,” Keller wrote. “For one thing, these laws provide the dominant and familiar model for US regulation of speech and communication intermediaries. Any serious proposal to legislate must-carry obligations would draw on this history. For another, and importantly for plaintiffs in today’s cases, these laws have been heavily litigated and are still being litigated today. They provide important precedent for weighing the speech rights of individual users against those of platforms.”

The establishment of some of these “must-carry” mandates for platforms would go a long way toward circumventing or refuting platforms’ First Amendment claims, because some cases have already been decided against cable carriers in cases that could correspond to claims against platforms.

This is really happening already so what could legislation look like

At this point the hypothetical scenario that Keller sketched out in her essay, where private actors throughout the technical stack have excluded speech (although the legality of the speech is contested), has, in fact, happened.

The question is whether the deplatforming of the president and services that were spreading potential calls to violence and sedition, is a one-off; or a new normal where tech companies will act increasingly to silence voices that they — or a significant portion of their user base — disagree with.

Lawmakers in Europe, seeing the actions from U.S. companies over the last week, aren’t wasting any time in drafting their own responses and increasing their calls for more regulation.

In Europe, that regulation is coming in the form of the Digital Services Act, which we wrote about at the end of last year.

On the content side, the Commission has chosen to limit the DSA’s regulation to speech that’s illegal (e.g., hate speech, terrorism propaganda, child sexual exploitation, etc.) — rather than trying to directly tackle fuzzier “legal but harmful” content (e.g., disinformation), as it seeks to avoid inflaming concerns about impacts on freedom of expression.

Although a beefed up self-regulatory code on disinformation is coming next year, as part of a wider European Democracy Action Plan. And that (voluntary) code sounds like it will be heavily pushed by the Commission as a mitigation measure platforms can put toward fulfilling the DSA’s risk-related compliance requirements.

EU lawmakers do also plan on regulating online political ads in time for the next pan-EU elections, under a separate instrument (to be proposed next year) and are continuing to push the Council and European parliament to adopt a 2018 terrorism content takedown proposal (which will bring specific requirements in that specific area).

Europe has also put in place rules for very large online platforms that have more stringent requirements around how they approach and disseminate content, but regulators on the continent are having a hard time enforcing htem.

Keller believes that some of those European regulations could align with thinking about competition and First Amendment rights in the context of access to the “scarce” communication channels — those platforms whose size and scope mean that there are few competitive alternatives.

Two approaches that Keller thinks would perhaps require the least regulatory lift and are perhaps the most tenable for platforms to pursue involve solutions that either push platforms to make room for “disfavored” speech, but tell them that they don’t have to promote it or give it any ranking.

Under this solution, the platforms would be forced to carry the content, but could limit it. For instance, Facebook would be required to host any posts that don’t break the law, but it doesn’t have to promote them in any way — letting them sink below the stream of constantly updating content that moves across the platform.

“On this model, a platform could maintain editorial control and enforce its Community Guidelines in its curated version, which most users would presumably prefer. But disfavored speakers would not be banished enitrely and could be found by other users who prefer an uncurated experience,” Keller writes. “Platforms could rank legal content but not remove it.”

Perhaps the regulation that Keller is most bullish on is one that she calls the “magic APIs” scenario. Similar to the “unbundling” requirements from telecommunications companies, this regulation would force big tech companies to license their hard-to-duplicate resources to new market entrants. In the Facebook or Google context, this would mean requiring the companies open up access to their user generated content, and other companies could launch competing services with new user interfaces and content ranking and removal policies, Keller wrote.

“Letting users choose among competing ‘flavors’ of today’s mega-platforms would solve some First Amendment problems by leaving platforms own editorial decisions undisturbed,” Keller writes.

Imperfect solutions are better than none 

It’s clear to speech advocates on both the left and the right that having technology companies control what is and is not permissible on the world’s largest communications platforms is untenable and that better regulation is needed.

When the venture capitalists who have funded these services — and whose politics lean toward the mercenarily libertarian — are calling for some sort of regulatory constraints on the power of the technology platforms they’ve created, it’s clear things have gone too far. Even if the actions of the platforms are entirely justified.

However, in these instances, much of the speech that’s been taken down is clearly illegal. To the point that even free speech services like Parler have deleted posts from their service for inciting violence.

The deplatforming of the president brings up the same points that were raised back in 2017 when Cloudflare, the service that stands out for being more tolerant of despicable speech than nearly any other platform, basically erased the Daily Stormer.

“I know that Nazis are bad, the content [on The Daily Stormer] was so incredibly repulsive, it’s stomach turning how bad it is,” Prince said at the time. “But I do believe that the best way to battle bad speech is with good speech, I’m skeptical that censorship is the right scheme.

“I’m worried the decision we made with respect to this one particular site is not particularly principled but neither was the decision that most tech companies made with respect to this site or other sites. It’s important that we know there is convention about how we create principles and how contraptions are regulated in the internet tech stack,” Prince continued.

“We didn’t just wake up and make some capricious decision, but we could have and that’s terrifying. The internet is a really important resource for everyone, but there’s a very limited set of companies that control it and there’s such little accountability to us that it really is quite a dangerous thing.”

Building on a policy that the company said has been in place since the Charlottesville protests back in 2017, Airbnb said it will take additional steps to beef up community protections for the DC metro area ahead of the presidential inauguration.

Airbnb already removes people from the platform who are associated with violent hate groups ahead of specific events, the company said.

And ahead of the inauguration, the company said it would use a seven-step plan to ensure that the DC metro-area isn’t overwhelmed with white supremacists, neo-Nazis, or “western chauvinists.”

Airbnb said it would ban individuals identified as involved in criminal activity around the Capitol at last week’s riot. “When we learn through media or law enforcement sources the names of individuals confirmed to have been responsible for the violent criminal activity at the United States Capitol on January 6, we investigate whether the named individuals have an account on Airbnb,” the company said. “This includes cross-referencing the January 6 arrest logs of D.C. Metro Police. If the individuals have an Airbnb account, we take action, which includes banning them from using Airbnb.”

That’s in addition to another sweep of existing reservations at locations around the Capitol in the days leading up to the inauguration to ensure that no one associated with hate groups slips through its dragnet.

The company will also tighten up booking requirements, with additional identity verification measures and other security checks to ensure that background checks are up-to-date.

As final steps, the company said that it is communicating with booking guests to inform them that if they’re bringing people who are associated with hate groups then they could face legal action from Airbnb. Hosts are also being told by the company that if they suspect anything about individuals staying on their properties that they should contact the company’s Urgent Safety Line.

Launched in South Korea five years ago, content discovery platform Dable now serves a total of six markets in Asia. Now it plans to speed up the pace of its expansion, with six new markets in the region planned for this year, before entering European countries and the United States. Dable announced today that it has raised a $12 million Series C at a valuation of $90 million, led by South Korean venture capital firm SV Investment. Other participants included KB Investment and K2 Investment, as well as returning investor Kakao Ventures, a subsidiary of Kakao Corporation, one of South Korea’s largest internet firms.

Dable (the name is a combination of “data” and “able”) currently serves more than 2,500 media outlets in South Korea, Japan, Taiwan, Indonesia, Vietnam and Malaysia. It has subsidiaries in Taiwan, which accounts for 70% of its overseas sales, and Indonesia.

The Series C brings Dable’s total funding so far to $20.5 million. So far, the company has taken a gradual approach to international expansion, co-founder and chief executive officer Chaehyun Lee told TechCrunch, first entering one or two markets and then waiting for business there to stabilize. In 2021, however, it plans to use its Series C to speed up the pace of its expansion, launching in Hong Kong, Singapore, Thailand, mainland China, Australia and Turkey before entering markets in Europe and the United States, too.

The company’s goal is to become the “most utilized personalized recommendation platform in at last 30 countries by 2024.” Lee said it also has plans to transform into a media tech company by launching a content management system (CMS) next year.

Dable currently claims an average annual sales growth rate since founding of more than 50% and says it reached $27.5 million in sales in 2020, up from 63% the previous year. Each month, it has a total of 540 million unique users and recommends five billion pieces of content, resulting in more than 100 million clicks. Dable also says its average annual sales growth rate since founding is more than 50%, and in that 2020, it reached $27.5 million in sales, up 63% from the previous year.

Before launching Dable, Lee and three other members of its founding team worked at RecoPick, a recommendation engine developer operated by SK Telecom subsidiary SK Planet. For media outlets, Dable offers two big data and machine learning-based products: Dable News to make personalized recommendations of content, including articles, to visitors, and Dable Native Ad, which draws on ad networks including Google, MSN and Kakao.

A third product, called karamel.ai, is an ad targeting solution for e-commerce platforms that also makes personalized product recommendations.

Dable’s main rivals include Taboola and Outbrain, both of which are headquartered in New York (and recently called off a merger), but also do business in Asian markets, and Tokyo-based Popin, which also serves clients in Japan and Taiwan.

Lee said Dable proves the competitiveness of its products by running A/B tests to compare the performance of competitors against Dable’s recommendations and see which one results in the most clickthroughs. It also does A/B testing to compare the performance of articles picked by editors against ones that were recommended by Dable’s algorithms.

Dable also provides algorithms that allow clients more flexibility in what kind of personalized content they display, which is a selling point as media companies try to recover from the massive drop in ad spending precipitated by COVID-19 pandemic. For example, Dable’s Related Articles algorithm is based on content that visitors have already viewed, while its Perused Article algorithm gauges how interested visitors are in certain articles based on metrics like how much time they spent reading them. It also has another algorithm that displays the most viewed articles based on gender and age groups.

Platforms and infrastructure providers dump Parler, Microsoft unveils a new Surface and a Chinese fitness app raises $360 million. This is your Daily Crunch for January 11, 2021.

The big story: Parler sues Amazon after going offline

President Donald Trump has found himself banned from most of the major social media and internet platforms, with companies pointing to his role in inciting the violent takeover of the U.S. Capitol last week, as well as his continuing statements expressing support for the rioters.

Right-wing social network Parler might seem like an obvious beneficiary of those bans, but the app itself has come under scrutiny — Apple and Google removed it from their respective app stores for failing to moderate comments calling for violent or criminal behavior, and Amazon Web Services followed suit, resulting in the social network going offline.

In response, Parler sued Amazon over alleged antitrust issues. Meanwhile, alternative social media and messenger apps have suddenly become much more popular.

The tech giants

Microsoft’s latest business-focused Surface is focused on remote work — Pricing for the Surface Pro 7+ starts at $899 for the Wi-Fi version and $1,149 for LTE.

Snap acquires location data startup StreetCred — Four StreetCred team members are joining Snap, where they’ll be working on map and location-related products.

Samsung’s upcycling program is designed to give new life to old tech — Samsung says the program “reimagines the lifecycle of an older Galaxy phone and offers consumers options on how they might be able to repurpose their device to create a variety of convenient IoT tools.”

Startups, funding and venture capital

Vision Fund backs Chinese fitness app Keep in $360M round — The latest fundraise values the six-year-old startup at about $2 billion post-money.

Revolut applies for UK banking license — It’s hard to believe that fintech startup Revolut doesn’t already have a proper banking license in its home country.

Orange spins out Orange Ventures with $430M allocation — With this new corporate structure, Orange Ventures could attract third-party investors.

Advice and analysis from Extra Crunch

Affirm boosts its IPO price target, more than doubling its latest private valuation — Who is mispricing whom?

Flexible VC: A new model for startups targeting profitability — A new category of investors has emerged offering a hybrid between VC and revenue-based investment.

Get live feedback on your pitch deck from big-name VCs on Extra Crunch Live — As a part of Extra Crunch Live, we’ll be offering EC members the chance to get live feedback on their pitch decks from our guests.

(Extra Crunch is our membership program, which aims to democratize information about startups. You can sign up here.)

Everything else

Hulu discounts its on-demand service to $1.99 per month for students — This represents a more than 65% discount off Hulu’s ad-supported subscription.

Original Content podcast: Despite some odd choices, ‘The Undoing’ lays out a satisfying mystery — Your podcast hosts caught up on their mystery viewing over the holidays.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

Noopl looks like one of the more interesting hardware startups to come out of CES day one. The Sacramento-based company has designed an accessory that it says can help drown out background noise for users in a loud environment.

The little accessory sports a Lightning plug (it’s currently iOS only), which connects to the bottom of an iPhone. The little dongle features a trio of microphones, coupled with an audio signal processor designed to reduce background noise.

Image Credits: Noopl

The Noopl app launches when the device is plugged in, setting up a connection with a pair of AirPods Pro. It’s designed to utilize head tracking to determine the direction the wearer is facing, in order to offer clearer sound in that direction. The app can then be used to broaden the direction beam and adjust volume.

The company was founded by Steven Verdooner and Kevin Snow, building on technology from Sydney’s National Acoustic Laboratories (NAL).

“The genesis for the idea occurred when Verdooner was at a noisy restaurant with his father and both of them experienced challenges hearing each other, even with the father’s state-of-the-art hearing aids in ‘restaurant mode,’ ” it writes in a press release. “Realizing an immense opportunity to potentially help millions of people, Verdooner partnered with NAL and a small team of seasoned scientists and engineers to create Noopl. Hearing industry veteran, Tim Trine, was brought on in 2020 as President and CEO to create a scalable technology platform, commercialize products, and grow the company.”

Image Credits: Noopl

The device is currently up for pre-order from Noopl’s site, priced at $199.

WhatsApp has enjoyed unrivaled reach in India for years. By mid-2019, the Facebook-owned app had amassed over 400 million users in the country. Its closest app rival at the time was YouTube, which, according to the company’s own statement and data from mobile insight firm App Annie, had about 260 million users in India then.

Things have changed dramatically since.

In the month of December, YouTube had 425 million monthly active users on Android phones and tablets in India, according to App Annie, the data of which an industry executive shared with TechCrunch. In comparison, WhatsApp had 422 million monthly active users on Android in India last month.

Factoring in the traction both these apps have garnered on iOS devices, WhatsApp still assumes a lead in India with 459 million active users¹, but YouTube is not too far behind with 452 million users.

With China keeping its doors closed to U.S. tech giants, India emerged as the top market for Silicon Valley and Chinese companies looking to continue their growth in the last decade. India had about 50 million internet users in 2010, but it ended the decade with more than 600 million. Google and Facebook played their part to make this happen.

In the last four years, both Google and Facebook have invested in ways to bring the internet to people who are offline in India, a country of nearly 1.4 billion people. Google kickstarted a project to bring Wi-Fi to 400 railway stations in the country and planned to extend this program to other public places. Facebook launched Free Basics in India, and then — after the program was banned in the country — it launched Express Wi-Fi.

Both Google and Facebook have scaled down on their connectivity efforts in recent years after India’s richest man, Mukesh Ambani, took it upon himself to bring the country online. After he succeeded, both the companies bought multibillion-dollar stakes in his firm, Jio Platforms, which has amassed over 400 million subscribers.

Jio Platforms’ cut-rate mobile data tariff has allowed hundreds of millions of people in India, where much of the online user base was previously too conscious about how much data they spent on the internet, to consume, worry-free, hours of content on YouTube and other video platforms in recent years. This growth might explain why Google is doubling down on short-video apps.

The new figures shared with TechCrunch illustrate a number of other findings about the Indian market. Even as WhatsApp’s growth has slowed² in India, it continues to enjoy an unprecedented loyalty among its users.

More than 95% of WhatsApp’s monthly active users in India use the app each day, and nearly its entire user base checks the app at least once a week. In comparison, three-fourths of YouTube’s monthly active users in India are also its daily active users.

The data also showed that Google’s eponymous app as well as Chrome — both of which, like YouTube, ship pre-installed³ on most Android smartphones — has also surpassed over 400 million monthly active users in India in recent months. Facebook’s app, in comparison, had about 325 million monthly active users in India last month.

When asked for comment, a Google spokesperson pointed TechCrunch to a report from Comscore last year, which estimated that YouTube had about 325 million monthly unique users in India in May 2020.

A separate report by research firm Media Partners Asia on Monday estimated that YouTube commanded 43% of the revenue generated in the online video market in India last year (about $1.4 billion). Disney+ Hotstar assumed 16% of the market, while Netflix had 14%.

^{1 For simplicity, I have not factored in the traction WhatsApp Business and YouTube Kids apps have received in India. WhatsApp and YouTube also maintain apps on KaiOS, which powers JioPhone feature handsets in India. At last count — which was a long time ago — more than 40 million JioPhone handsets had shipped in India. TechCrunch could not determine the inroads any app has made on this platform. Additionally, the figures of YouTube on Android (phones and tablets) and iOS (iPhone and iPad) will likely have an overlap. The same is not true of WhatsApp, which restricts one phone number to one account. So if I have WhatsApp installed on an iPhone with my primary phone number, I can’t use WhatsApp with the same number on an Android phone — at least not concurrently.}

^{2 WhatsApp Business appears to be growing fine, having amassed over 50 million users in India. And some caveats from No. 1 also apply here.}

^{3 Users still have to engage with the app for App Annie and other mobile insight firms to count them as active. So while pre-installing the app provides Google an unprecedented distribution, their apps still have to win over users.}

In the wake of last week’s violence at the U.S. Capitol, Facebook today announced it will be taking additional steps to removing content referencing the phrase “stop the steal” on its platform. The phrase is associated with the right-wing campaign that falsely alleges the democratic U.S. elections have been rigged and aims to keep Trump in power by any means necessary, including now, violent insurrection. Facebook had previously removed some of the original Stop the Steal groups in November, and says it has continued to remove Pages, groups and events that violate its policies, including calls for violence.

As TechCrunch had previously reported, Facebook had also began to block election conspiracy hashtags back in November 2020, including #sharpiegate and #stopthesteal. Searches for those would not return groups or posts, as result.

However, the cleanup effort was not as widespread or as ongoing as Facebook would have you believe. As of the time of writing, we’re aware of several active Facebook Groups that are still literally called “stop the steal,” for example.

Facebook says its decision to take this further action has to do with the increased calls for violence in the U.S.

“We’ve been allowing robust conversations related to the election outcome and that will continue,” explained Facebook in an announcement co-authored by Facebook VP of Integrity, Guy Rosen, and Monika Bickert, VP Global Policy Management. “But with continued attempts to organize events against the outcome of the U.S. presidential election that can lead to violence, and use of the term by those involved in Wednesday’s violence in D.C., we’re taking this additional step in the lead up to the inauguration,” the blog post read.

“It may take some time to scale up our enforcement of this new step but we have already removed a significant number of posts,” the authors noted.

The company clearly wants to distance itself from being thought of as one of the platforms was used by the organizers of the U.S. Capitol riot. In fact, Facebook COO Sheryl Sandberg said in an interview with Reuters on Monday that the riot was “largely organized” on other internet services, not Facebook. She said that Facebook had taken down content from fringe groups, like QAnon, as well as Proud Boys and Stop the Steal groups, and anything that was talking about violence.

Facebook is not the only mainstream social platform actively removing content that violates its terms as the ramifications of social media’s more permissive policies have now resulted in violent protests and an attempted coup, as well as people’s deaths.

Several social media companies have also now removed Trump from their platforms, as Congress weighs impeachment for his incitement of violence. Meanwhile, the app stores and web services provider for the alternative social network Parler have also now given it the boot for the hate speech and calls for violence it hosted, as well.

Facebook says it will continue to staff its Integrity Operations Center on a 24/7 basis at least through January 22 in order to monitor and respond to threats in real time. This time frame is likely because the FBI now is warning of plans for armed protests in all 50 state capitals and Washington in the days leading up to President-Elect Joe Biden’s inauguration on Jan. 20, according to a report this morning from the AP. This is why Facebook’s Integrity Operations Center will need to be highly available during these days.

The Center had already been active ahead of Georgia’s runoff elections and Congress’s counting of the Electoral College votes. Its operations were extended due the Capitol protests, Facebook says.

The company notes, too, it will continue to work with law enforcement to remove content, disable accounts and respond to legal requests for user data.

Of the Inc. 5000 companies, only 6.5% raised money from VCs and 7.7% raised from angels. Where else can fast-growing companies get funding?

More and more startups are pursuing revenue-based VCs, but it’s not a good fit for everyone. A new category of investors has emerged offering a hybrid between VC and revenue-based investment (RBI), which we call “flexible VC.”

From RBI, flexible VCs borrow the ability to reap meaningful returns without demanding founders build for an exit. From traditional equity VC, flexible VC borrows the option to pursue and reap the rewards of an outsized exit. Every flexible VC structure allows founders to access immediate risk capital while preserving exit, growth trajectory and ownership optionality.

Our categorization is not a technical one. Rather, we want to accommodate the wide variety of instruments currently offered by flexible VC investors, detailed below. As two fund managers employing flexible VC, we think it is a healthy addition to the ecosystem and will yield more predictable and stable healthy returns for investors.

Flexible VC 101: Equity meets revenue share

This is currently the most common investment structure: The flexible VC investor purchases either equity ownership, or a convertible right to equity, and a right to regularly scheduled payments based on a percentage of revenues.

By tying payments to actual revenues, founders and investors remain aligned around the company’s real-time performance, good or bad.

“Too often, investment structures force the management team to make decisions between misaligned growth and investment (return) objectives. This structure allows for alignment on the front end, and real-time flexibility for performance metrics,” says Samira Salman, a family office investor and advisor.

Payments are commonly delayed for a grace period of 12-36 months. John Berger, director of Operations and Impact Solutions at Toniic, observed that this has clear investor benefits: “The grace period became a feature because it benefits investors in regions like the U.S. where there can be tax differences between short- and long-term gains. It has moved from its origins as a tax benefit and can be viewed as a feature that benefits founders.” After the grace period, the return payments begin, often lasting until a return cap is hit, such as 2-5 times the original investment.

To account for these revenue share payments, the investor’s ownership (or convertible right to ownership) is simultaneously reduced. Once the return cap is reached, the investor is typically left with a residual stake — a fraction of the pre-revenue share ownership. At any point, should the founder wish to pursue a traditional equity VC round, or get bought, the revenue share is paused, and the investor’s then-current ownership converts to equate to a traditional equity VC investor.

Flexible VC 102: Variations

Flexible VCs have created structures based on other company performance metrics than revenues, such as profits or founder salaries. These different company performance metrics provide a slight variation in how the investor and founder relationship is defined. For example, profit-sharing structures ensure payments do not begin until the company is profitable, though likely delaying returns to the investor and complicating payment calculations.

Similarly, when flexible VC structures are based off of the founder’s own compensation (often via salary or dividends), investors are specifically tying their returns to the financial success of the founder. This translates less directly to company performance compared to a revenue or profit share, but offers uniquely personal alignment. These variations in founder alignment allow flexible VCs to specialize in the types of companies they work with.

The state of flexible VC

In all these cases, capital is provided to fuel forecasted growth without creating a commitment to a particular vision for future funding rounds, exit goals and associated blitzscaling. The founder retains full control over whether they want to optimize for hypergrowth (usually at the expense of profitability) or for organic, profitable growth. Flexible VC opens up a new risk capital option for bootstrappers, minorities, family-owned and countless other founder segments left out by the traditional funding landscape.

A range of small VCs are deploying with flexible VC structures, but we believe the total amount of AUM deployed with this strategy is well under $50 million. Similar to the explosion of seed funds in the past decade, we (and some limited partners too) believe these Flexible VCs are on the forefront of what will become a major segment of the venture ecosystem.

We detail below the major categories of VC:

Flexible VC versus other venture capital models

Flexible VC investors offer founders some of the same advantages as equity VCs:

• Aligned incentives. Whether it is a breakout success or complete failure and loss of capital, investors are along for the ride. When the company hits potholes, flexible VC investors usually don’t have the nuclear options of firing management and/or doing a recapitalization. Their only option is to work with management to try to fix the problems.
• Few strings attached. Founders have autonomy to spend the funds in whatever way they like.
• Long-term alignment. Many flexible VCs retain a small residual stake in the company after the return cap is reached, driving alignment well beyond the horizon of the revenue share, similar to the long-term orientation of equity VC.
• Seed-stage compatible. Like traditional equity VC investors, flexible VCs accommodate early-stage investment risk within their portfolios better than a traditional RBI funder.
• Eligible for favorable treatment under qualified small business stock exemption, if structured as equity. This applies if the investment converts into common stock; details are beyond this essay’s scope.

Flexible VCs also offer investors some of the same advantages as RBI:

• Clear return expectations. The return cap is a stated multiple of the investment, typically 2x-5x.
• Early liquidity. Equity VC is a “get rich slow” business. Flexible VC creates early liquidity that can be either reinvested or distributed to LPs.
• Improved financial management. All parties want the company to be able to afford the payment obligations and, ideally, deliver a quick return. As a result, unfounded hockey-stick graphs and unicorn promises give way to financial fluency, realistic expectations, frank conversations about what a business can credibly achieve and transparency.
• Profitability is prioritized. The revenue that is going to grow the company immediately is the same revenue that is going to get investors to their return cap. If the company is profitable, the revenue share becomes increasingly affordable. This drives an earlier focus on profitability than is typical for a company backed by traditional equity VC.
• Founder retains control. Flexible VCs typically purchase nonvoting common stock, if they purchase stock (one even assigns their voting rights to the founders). This keeps the founder in the driver’s seat of the company.
• Attractive to women and underrepresented founders. See Why Are Revenue-Based Investors Investing in Women & Diverse Entrepreneurs?

Flexible VC also offers some unique advantages:

• Straightforward equity interface. If an equity round is needed to fund breakout growth beyond what the flexible VC funds, the mechanics of including a flexible VC in an equity VC round are predetermined and simple.
• Prepared for blitzscaling, but neither required nor expected. Blitzscaling typically means prioritizing user growth over revenue growth and revenue growth over profitability. Tim O’Reilly, CEO, O’Reilly Media, argues, “Blitzscaling isn’t really a recipe for success but rather survivorship bias masquerading as a strategy.” With flexible VC, not every company is expected to achieve breakout growth, but that possibility is accounted for up front.
• Particular application in impact capital. Our research has found that impact investors appear to be particularly interested in flexible VC. An impact investor typically needs some economic return to function, but doesn’t necessarily want the company as a whole to exit, given exits often have a negative impact on the company’s founding mission. Flexible VC allows impact VCs to thread this needle.

That said, nothing is cost-free. The unique disadvantages of flexible VC include: