Author: azeeadmin

As coronavirus-hit financial markets continue to flip-flop in the wake of bad news followed by pockets of hope, a startup that aims to introduce ordinary consumers to investing has raised a big round of funding.

New York-based Stash, which provides a mobile-first route to managing money through investment — as well as retirement, custodial and more routine banking — accounts has picked up $112 million, money that it will use to continue expanding its business, which as of this month had 4.5 million users and $1 billion in assets under management.

The company says it will use the funding to continue expanding its customer base, marketing and adding more services.

The Series F round is being led by publicly-listed online lending platform LendingTree, with accounts advised by T. Rowe Price Associates, Inc., Breyer Capital, Goodwater Capital, Greenspring Associates, Union Square Ventures, and others participating. Several of these were previous investors in the company.

We’re asking for a valuation, but for some context, the first close of this Series F ($85 million) appeared to value the startup at $785 million, according to PitchBook. Potentially, this puts the valuation here at around $812 million.

Stash is part of a growing list of fintech startups that are disrupting the financial industry, and specifically big banks and brokerages, by making some of the more arcane aspects of engaging in financial services like investing and borrowing money more transparent and accessible to the consumer masses, using smartphones, automated services and easily explained instructions. Others in the same category include Robinhood, Acorns, YieldStreet, Kabbage and Revolut.

As we’ve pointed out before, the average age of a Stash user is 29 and average income is less than $50,000 per year. Users can invest in increments as small as $28, with flat fees on top of that at $1, $3, and $9 for monthly subscriptions depending on what services you are using. (It also entices people with a Stock-Back loyalty rewards program to incentivise people with extra shares based on their investing. This launched a year ago with Green Dot and has now reached the 10-million mark.)

What’s interesting is that even with all the economic turmoil we’ve seen — economists believe that the US, for example, could see unemployment in the double digits for at least a year after this health pandemic subsides — investing, at least via Stash, has not been as impacted as you might think.

It notes that in its most recent quarter, it had an over 100% increase in weekly customer deposits across banking and investing, “a proof point to the power of the platform even amid recent market volatility and economic downturn.”

“We are very fortunate to bring together world class investors, to help accelerate Stash’s goal of bringing digital banking, investing plus financial education and advice to the millions of middle class Americans working hard every day to make ends meet,” said Brandon Krieg, Stash cofounder and CEO, in a statement. “This massive group has attempted to make financial progress within a system that simply does not serve their best interests or meet their needs. It’s time for them to reconsider the current financial servicing industry as the ‘status-quo’ and take control of their financial life with the customer-obsessed solutions we provide at Stash.”

One reason for this might be exactly what one would hope would be the reason for many investing: the bar is relatively low thanks to apps like these, and one thing that this current downturn has shown us is that not all of us can rely on our jobs and savings to get us through all crises. Having a nest egg by way of investments could be one way to diversify and offset that volatility.

(Indeed, Stash cites data from the Federal Reserve’s Annual Economic Wellbeing report that notes the average American often doesn’t even have $400 put away for emergencies.)

It’s not clear if LendingTree is a strategic or financial backer here, but you can see where having connections with credit lines might make sense for an investing app.

“We’ve always seen ourselves as a consumer champion—committed to helping people get the most out of their hard-earned money,” said Doug Lebda, founder and CEO of LendingTree, in a statement. “Stash’s mission to help Americans achieve financial progress is complementary to ours in every way, and we’ve been impressed with Stash’s speed of execution and commitment to positive customer outcomes. The focus on meaningful financial progress is so relevant, especially in today’s economic environment which has only been amplified by the current pandemic. Giving customers a way to make real strides in achieving financial security is incredibly powerful to our combined missions.”

Twitter has said that tweets posted early Tuesday morning by Tesla and SpaceX CEO Elon Musk that irresponsibly call for restrictions put in place to defend against the spread of COVID-19 don’t violate its guidelines around inaccurate or disputed information about the coronavirus that could cause harm. Musk tweeted a series of things on Tuesday, including an endorsement of a controversial Wall Street Journal op-ed with the caption “Give people their freedom back!”

A Twitter spokesperson told TechCrunch that these tweets, which also include an urging to “FREE AMERICA NOW,” are “not currently in violation of the Twitter rules. According to the company, it has said previously that it’s not enforcing punitive or corrective action on each instance of tweets about COVID-19 that don’t provide a full picture or that appear to contain info that’s disputed by other sources.

Twitter says that it has removed over 2,400 Tweets since March 18 when it implemented its new policy, and that it’s automated filtering systems have addressed in some way or another as many as 3.4 million accounts which seemed to be spamming or providing manipulative info regarding COVID-19 discussions. Thus far, however, some of the most influential sources of have not been subject to punitive or corrective action under the policy.

President Trump’s tweets calling to “liberate” states, for instance, which bear a content and formatting similarity to the new tweets by Musk, have not been removed or disputed by the social network, and Twitter provided a similar statement about those missives not currently violating its rules.

Trump and Musk represent some of the most influential Twitter users, with 78.9 million and 33.3 minion users respectively, so their voices have outweighed impact on the community and public discourse relative to spam or automated misinformation accounts. In both cases, these messages indirectly seek to encourage the curtailing or disruption of social distancing, isolation and quarantine measures, even as the U.S. surged past 1 million diagnosed cases this week, with many more likely undiagnosed and therefore unaccounted for in the total.

States are already beginning to ease restrictions, and seeing resurgences in case numbers. Some more rural states that previously seemed less impacted are seeing spikes, even as they began to partially reopen, including Iowa. Leading experts including Dr. Anthony Fauci of the U.S. federal coronavirus task force have warned against the consequences of relaxing rules too soon, and the WHO and CDC are still warning of the impact of opening up too soon as well.

Over the last number of years, Latin America has emerged as a significant growth market for big tech, including Uber, Airbnb, Amazon, Facebook, Coursera and others.

It has also become a growing and vibrant homegrown startup ecosystem. The region has sprouted 19-plus unicorns, several exits and even a billion-dollar, single-round financing. The coronavirus pandemic, however, is having an outsized impact on Latin America’s startup activity compared to other regions, judging by Q1 2020 activity numbers — and this is just the beginning.

When including the U.S., Western Europe (WEU), U.K., China and Latin America, the global startup innovation landscape experienced a 27% drop in Q1 2020 in terms of the number of deals completed compared to the previous quarter. Giving some comfort to venture capitalists and startup founders alike is that the amount of invested capital remained essentially constant. The average deal size increased across these regions — up a matching 27%. So, from a global perspective, the venture capital community did fewer but larger deals, on average, during the quarter where COVID-19 started wreaking major havoc in the economy.

Looking at each of these innovation hubs individually, we see different levels of impact from, presumably, COVID-19 between Q4 2019 and Q1 2020. Deal count for the U.S., WEU and U.K. each went down approximately 20% each. Fairly modest, all things considered. China’s deal count, however, suffered almost a 50% drop while Latin America’s deal count went down almost 60%.

We also see a stark difference between these regions from an invested capital perspective. The U.S., WEU and U.K. each invested approximately 28% more capital in Q1 2020 as compared to Q4 2019, while China’s and Latin America’s invested capital both went significantly down. China deployed a bit over one-third less capital and Latin America deployed a very significant two-thirds less.

You know that old saying, “you don’t know what you’ve got until it’s gone?” Sometimes that’s quite literally true. Take Shoelace, a social app introduced by Google’s Area 120 incubator last summer. There are a number of reasons you likely haven’t heard of the thing. For starters, it was considered an “early experiment” by Google. Also, it was limited to New York City users with an invite.

In her writeup, Sarah described the project as, “ a bit like a mashup of Facebook Events with a WhatsApp group chat, perhaps. But it’s wrapped in a clean, modern design that appeals more to the millennial or Gen Z user.”

And now it’s gone. It is, after all, easy come, easy go in the world of social app. And in the world of Google social apps in particular, it’s seemingly more go than anything. Of course, while the company has had a rocky history with social networks like Google+, the on-going COVID-19 pandemic has caused a many to reprioritize their life and work.

The Shoelace team suggests that that’s ultimately what caused Google to pump the brakes on this experiment. Understandably, an app built around fostering in-person meetings is also probably not anyone’s top priority, these days.

“Like all projects within Area 120, Shoelace was an experiment,” the company writes on its Google Doc. “We’re proud of the work that we accomplished and the community that we built, but given the current health crisis, we don’t feel that now is the right time to invest further in this project.”

The team has no plans to revive the product after the COVID crisis.

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Yesterday news broke that Uber’s CTO Thuan Pham would leave the company (confirmed), and that the American technology giant is contemplating a huge staffing cut to reduce its cost structure. COVID-19 has changed how much people move around, hampering the ride-hailing company’s business.

If the cuts come to pass at the scale The Information reports is possible, they would be the steepest layoffs that we’ve heard of at Uber. And they would cap a reversal in fortune the company, which after a somewhat rocky IPO was enjoying fresh momentum in the later parts of 2019 and the start of 2020.

This morning we’re going back in time to rewind through Uber’s post-IPO financial timeline. The company reports earnings on May 7, 2020, a little over a week from today. With that event coming up, we’d best be caught up.

Uber’s last year

It’s hard to choose where to start today. We could go all the way back to Uber’s May 2019 IPO, for example. Instead, we’re going to kick off a month later (it will be clear why in a moment). Also we must be somewhat summary in the following, so not everything that happened is included. We’re only talking about the bits we need most. Let’s go:

The coronavirus pandemic has sent record numbers of new users to video chat apps. Now, video messaging app Marco Polo aims to capitalize on the increases it’s also seeing to launch its new subscription business, Marco Polo Plus. The service delivers a handful of new features — including support for HD video, voice-only messaging options, custom emoji, expanded speed controls and more — for $5 per month with an annual subscription of $59.99.

On a monthly basis, the service costs $10 per month.

Marco Polo had already carved out its own space on the market before the coronavirus outbreak. Instead of focusing on live video calls or group video chats, Marco Polo focuses on asynchronous communication. That is, users leave a video message for friends and family, which the other party can watch at their convenience, then reply to.

This works particularly well for people who have different work schedules or those who are spread out among various timezones. It also works for adults who have less free time to chat than the teens who virtually “hang out” in group video chat apps, like Houseparty.

With the new Marco Polo Plus subscription, the company is offering an expanded feature set that will appeal to its most frequent users. However, it will remain an optional upgrade — free users will still be able to use Marco Polo as before.

Subscribers, meanwhile, will be able to message their friends and family in HD or have the option to respond using only their voice, for those times you’re not camera-ready.

The subscription will also expand its set of built-in reaction emoji, which today includes a smiley face, sad face, heart, prayer hands, and thumbs up — to now include support for adding any emoji from your keyboard.

In addition, subscribers will have more granular control over playback speed. While free users can choose to 2x their video messages, paying users will be able to access speed control options of anywhere between 1.5x and 3x speed.

They’ll also gain a time scrubber for more easily moving to different parts of the video and a scratchpad for personal notes. The latter is especially helpful for jotting down the different parts of the message you want to respond to — something that can be hard to remember after listening to a long video.

Subscribers will be able to share their $5 per month subscription in the form of “Plus Passes” you can dole out to friends and family, as well.

Like many apps in the space, Marco Polo has seen a sizable jump in usage due to the COVID-19 pandemic, it says.

In March 2020, Marco Polo saw a 16x increase in new sign-ups for its service and a 3x increase in activity versus the prior month. In one 24-hour period in April, Marco Polo even saw a record 20 million video messages shared in its app. And its social media campaign designed at reaching out to others, #PoloTogether, resulted in over 1 million check-ins.

According to data from Sensor Tower, Marco Polo has seen nearly 56 million lifetime installs across iOS and Android since January 2014. Publicly, Marco Polo says it has “millions” of users and 3 billion messages sent to date. Across its 1.7 million user reviews on both app stores, the app averages a 4.8 rating.

The new subscription program is only one way Marco Polo is working to gain traction for its app in the coronavirus era.

The company also recently launched a program called Channels by Marco Polo into beta testing, which allows creators to reach fans through the Marco Polo platform, but via a dedicated app.

The program is aimed at those with a following — like leaders, speakers, facilitators, creators, fitness instructors, and health and career coaches — who want to offer their content to a paid membership base.

While these creators could publish to social media platforms and then try to monetize in other ways, like through ads or brand deals, Marco Polo offers a way to facilitate more private one-to-many interactions.

The advantages of this program is that the content won’t be at the mercy of changing algorithms or interrupted with ads. However, as a paid membership program, it limits exposure. That means it would likely only supplement the efforts creators made across social media to raise awareness of their offerings and their personal brand, in order to gain new subscribers.

The program is not broadly available, but is being used by a handful of testers today.

The Channels program is also aimed at helping Marco Polo generate revenue, as the company takes a 10% cut of the monthly membership fees charged by the creators.

The new Marco Polo Plus subscription service replaces an older, less feature-rich service that never gained traction. Along with the new Channels program, the company hopes stay ad-free and turn a profit.

“From the time Marco Polo was founded, we’ve never shown ads in the app. We will never use social comparisons or manipulate algorithms, as so many social networking companies must do for their business model,” explains CEO and co-founder Vlada Bortnik. “We believe that Marco Polo Plus is the best version of our app to date, and subscription is an important part of our strategy to achieve profitability. Based on our early pilot of Channels by Marco Polo, we’re optimistic that it also has the potential to contribute significantly to our monetization goals,” she continued.

“I know we can become a sustainable business in a way that feels true to our brand values of authenticity and trust,” Bortnik added.

Marco Polo’s parent company Joya Communications has raised at least $25 million in funding from investors including Benchmark, Stanford’s StartX Fund, Matrix Partners, Battery Ventures, Altos Ventures, Evolve Ventures, and others, according to Crunchbase. The company declined to comment its total raise or investor lineup, however.

Zoom is an enterprise software company built to help employees meet virtually, it was never intended to be the social platform that guided a disconnected world through a lockdown.

On the back of a big quarantine usage bump, Squad, a social screen-sharing mobile app popular with teen girls, is looking to eat away at Zoom’s social growth and widen its app’s appeal with the launch of a desktop web version designed to help people binge TV shows and movies together.

While the quarantine has upended plenty of consumer-centric startups, Squad has seen record growth with teens stuck at home and socially distanced from friends. Over the first two weeks of March, CEO Esther Crawford says usage of the platform climbed 54%. As teens further settled into lockdown and schools went fully remote, usage of Squad exploded, climbing 1100% in the last two weeks of March.

Squad has designed a social platform around watching friends browse through stuff on their phones, virtually. On mobile, the most common use case has been teens hanging out while browsing through TikTok clips. Crawford hopes that where the mobile app has succeeded in allowing users to bond over short-form content, Squad’s new desktop web app will let users settle in and binge long-form content.

Crawford hopes that the app’s youthful users can use the platform to bond during an unprecedented time of social distancing.

“There’s already this global loneliness epidemic and it’s even worse for Gen-Z,” Crawford says. “I would imagine the coronavirus is accelerating this trend.”

The killer feature of Squad’s new desktop app is watching TV shows and movies with each other on streaming networks like Netflix; this hasn’t been possible on Squad previously.

To combat piracy, most premium video mobile apps disable screen sharing functionality, a total blackout that has stopped apps like Squad from even sharing video with a few friends, something that the big platforms historically haven’t seemed to mind. Desktop browsers don’t have these same limitations and can allow desktop Squad users to watch premium content together, all streamed from a single user’s account.

Quick controls in the desktop interface allow users to quickly bring up YouTube videos, TikToks and free access content from Pluto TV.

Squad is still focused on intimate hangs and won’t be allowing groups to swell beyond 9 people. Keeping groups small will help minimize some of the issues faced by Zoom, but will likely also help the social app sidestep pissing off a Netflix or a Hulu.

As Squad looks to outdo Zoom on social screen-sharing, one thing Crawford has no intention of doing is competing with their own workplace product. This, despite Crawford hearing that Squad has ended up in the toolsets of some designers and PMs that use the app to commiserate over mobile builds.

“If we were to expand to enterprise and have a Squad for business, it would just be a distraction,” she says.

Squad raised a $5 million Series A last year from First Round Capital, and Crawford tells me the company recently topped up on a bit of new funding to ensure the company is well-positioned to handle some of the broader economic uncertainty. The startup has now raised $7.2 million to date.

Puppet, the Portland-based infrastructure automation company, today announced that it has named former Cloud Foundry Foundation executive director Abby Kearns as its new CTO. She’s replacing Deepak Giridharagopal, who became CTO in 2016.

Kearns stepped down from her role at the Cloud Foundry Foundation earlier this month after holding that position since 2016. At the time, she wasn’t quite ready to reveal her next move, though, and her taking the CTO job at Puppet comes as a bit of a surprise. Despite a lot of usage and hype in its early days, Puppet isn’t often seen as an up-and-coming company anymore, after all. But Kearns argues that a lot of this is due to perception.

“Puppet had great technology and really drove the early DevOps movement, but they kind of fell off the face of the map,” she said. “Nobody thought of them as anything other than config management, and so I was like, well, you know, problem number one: fix that perception problem if that’s no longer the reality or otherwise, everyone thinks you’re dead.”

Since Kearns had already started talking to Puppet CEO Yvonne Wassenaar, who took the job in January 2019, she joined the product advisory board about a year ago and the discussion about Kearns joining the company became serious a few months later.

“We started talking earlier this year,” said Kearns. “She said: ‘You know, wouldn’t it be great if you could come help us? I’m building out a brand new executive team. We’re really trying to reshape the company.’ And I got really excited about the team that she built. She’s got a really fantastic new leadership team, all of them are there for less than a year. they have a new CRO, new CMO. She’s really assembled a fantastic team of people that are super smart, but also really thoughtful people.”

Kearns argues that Puppet’s product has really changed, but that the company didn’t really talk about it enough, despite the fact that 80% of the Global 5,000 are customers.

Given the COVID-19 pandemic, Kearns has obviously not been able to meet the Puppet team yet, but she told me that she’s starting to dig deeper into the company’s product portfolio and put together a strategy. “There’s just such an immensely talented team here. And I realize every startup tells you that, but really, there’s actually a lot of talented people here that are really nice. And I guess maybe it’s the Portland in them, but everyone’s nice,” she said.

“Abby is keenly aware of Puppet’s mission, having served on our Product Advisory Board for the last year, and is a technologist at heart,” said Wassenaar. “She brings a great balance to this position for us – she has deep experience in the enterprise and understands how to solve problems at massive scale.”

In addition to Kearns, former Cloud Foundry Foundation VP of marketing Devin Davis also joined Puppet as the company’s VP of corporate marketing and communications.

Despite the implications of its name, edtech platform Niche took nearly a decade-and-a-half to find its place within the world of the college search process.

The company started as College Prowler, selling informational books, which looked like a hybrid between CliffsNotes and a Zagat guide, about colleges. It sold hundreds of thousands of copies and amassed millions in revenue, but then had to face the economic crisis of 2008 and figure out a new go-to-market strategy.

Today, and a few pivots later, Niche partners with college campuses and schools to provide information to prospective students. The focus is the same as in 2002, according to founder Luke Skurman, as it tries to make the college search process more clear and student-focused.

Think of Niche as a focused platform for students to review their college options without having to track multiple browser tabs and messy spreadsheets. It allows users to compare metrics like historic acceptance rate, cost and post-graduate earnings for each school, as well as topics like majors and campus life. Niche uses the data to grade each school, and it lists reviews and similar schools. Beyond a college by college look, Niche has ranking lists spanning topics like best dorms and most diverse colleges.

Skurman noted that, historically, April is a month when students make decisions about where to commit for college and squeeze in a visit before they put down their deposit.

“In the world we’re living in right now, that’s not possible,” he said. “Many colleges are trying to find new vendors and new solutions to help them for the fall 2021 to help them market.”

Beyond coronavirus’s impact, the founder noted that colleges should consider digital tours as a way to be “equitable and inclusive, because we recognize that a lot of families don’t have the means to be able to visit all these campuses across the country.”

Despite rocky days in the past, Niche went from zero to 1,400 clients in the past three years. In 2019, Niche increased its ARR more than 100% and client base by more than 60% year-over-year. Niche was cash-flow positive for the majority of the year.

The digitization of the college admissions experience brought similar growth to CampusReel, a startup that virtualizes tours for colleges through student-generated videos.

“Traditional visit days are essentially no longer options,” said Nick Freud, founder of CampusReel. “So colleges are scrambling to find a solution even if they can’t completely replace how you capture the look and the feel and the culture of a campus in a virtual setting.” Freud said that he’s seeing colleges start to supplement their marketing materials with video and student-generated content. He claims that CampusReel has tools to allow a college to post a profile in less than 15 minutes.

Optimal, another college rankings and review company, similarly offers information to students about schools. The platform has less of a data focus than Niche, and focuses more on reviews and lists. Optimal also connects students to coding schools and online bootcamps.

It’s this broad growth amid consumer-facing platforms for college searchers, coupled with a potential market of 40,000 schools, that led Niche to raise a $35 million Series C, it announced today. The round was led by Radian Capital, with additional participation from Salesforce Ventures. Existing investors Allen & Company LLC and Tim Armstrong participated, as well.

Niche’s new capital comes as the way schools do business changes by the day. With new cash in the bank, we’ll see see how a company born from adaptation fares in the coming months.

Tax policy is surely a complex beast, and depending on your political leanings, you probably have some strong feelings about how it should be implemented. Salesforce AI researchers are trying to build a model to bring artificial intelligence to bear on what will undoubtedly always be a highly political process.

Richard Socher, who heads up AI research at Salesforce, says the company is researching all kinds of solutions related to AI and business, and how it could improve the Salesforce product family; however, he also looks at how his team could use AI to solve a set of broader social issues beyond what it can do for the product line.

Socher says when you look at the biggest issues of our time, one of the largest is economic inequality, and how we could use policy to solve that. To that end, the company created a model it calls an AI economist that could look at various economic variables, a broad set of economic models and using the power of AI begin to demonstrate how various policies affect economic inequality versus productivity.

“We are using reinforcement learning to try to identify what’s optimal taxation,” Socher said. That involves building a model, one that’s fairly simple at first with some basic economic inputs like buying and selling resources and building houses to see how different scenarios affect inequality.

In a Q&A on the company website, Stephan Zheng, a member of the research team explained how this could work:

The AI Economist uses a collection of AI agents designed to simulate how real people might react to different taxes. In the simulation, each AI agent earns money by collecting and trading resources and building houses. The agents learn to maximize their utility (or happiness) by adjusting their movement, trading, and building behavior. One way to do this is to maximize income while minimizing effort, for example, making as high of an hourly wage as possible.

The modeling is designed to play to the strength of AI, by looking across a huge body of economic research and feeding all of that data into the AI economist to help build optimal models. This level of data would be impossible for even the most gifted economists to understand, but this is what AI is really good at, looking across a corpus of complex data and using all of that information to help humans make better decisions.

Ultimately, the company hopes the model can help economists and policy makers set a more equitable tax system, however an individual government might define that.

“The objective that we chose here was productivity x equality, and we hope that that will help move the pure shareholder capitalism to a more equal stakeholder capitalism — and we hope that we find a more optimal point on the quality versus productivity spectrum,” Socher explained.

While Socher admits this is an early attempt, and they hope to layer on more complex inputs over time, he likens it to early genome research. It didn’t produce concrete results right away, but over time we have seen tools like CRISPR develop, and he hopes that this approach could have a similar impact on tax policy as they build on their initial research.

“We think we found a point, at least in our first simulated environments that is even more optimal than the most commonly used baselines for taxation,” he said.