“Then I took your ancestor Abraham from the other side of the Euphrates River and led him through the entire land of Canaan. I multiplied his descendants, and gave him his son Isaac.” That’s a passage from Joshua 24:3 in describing how Abraham “crossed over” the demarcation line into a spiritual awakening. It’s also the inspiration for the name of Cross River Bank (CR), led by its charismatic founder Gilles Gade.
The Hudson River may not have the holy resonance of the Euphrates; however, there’s no denying the special character of this Fort Lee, New Jersey-based bank that supports fintech companies including Affirm, Circle, Best Egg, Coinbase, Rocket Loans, Stripe, Upstart and Transferwise.
From its modest beginnings as a one-branch bank in nearby Teaneck, to its leading position within the marketplace lending industry, to its current aspiration to be a standard-bearer of bank-fintech cooperation, CR has been a model of adaptability. A constant, says Gade, is a belief that it’s possible to simultaneously protect customers and deliver more and better services to them. In CR’s latest iteration, those services involve a variety of technology-infused offerings which have defied skeptics, regulatory uncertainty created by court decisions such as Madden vs. Midland Funding and increased competition. To preserve its momentum, the bank recently closed on an eye-popping $100-million growth equity round led by a KKR division and purchased a sizable office building near the George Washington Bridge. That latter move may be unconventional for a fintech high-flier, but as anyone familiar with CR knows, the bank plays by the rules — but it doesn’t play by conventional wisdom. And so far, that’s working out divinely.
GS:Gilles, it’s good to see you. Let’s start with a quick overview on CR, which may not be familiar to everyone.
GG:Thanks, Gregg. We are deeply rooted as a community bank from our founding 11 years ago and we’re one of the last banks chartered by the FDIC before it shut down the program due to the banking debacle. As you know, now the program has reopened.
GS:CR’s foray into fintech is, of course, your claim to fame. That journey started with GreenSky. How did that come about?
GG:GreenSky was on the verge of signing a sizable contract with Home Depot. But it needed a home for the prime and super prime loans that it was going to generate across 1,600 stores. We signed an agreement with GreenSky so that it could use us as the balance sheet.
GS:Fast forward to today, and you’ve grown from that initial use-case into a key banking partner for a who’s-Who of fintech. But you still have a branch that does actual, honest-to-goodness banking, right?
GG:Absolutely. We would not be able to do all the things that we do on behalf of our clients without eating our home cooking.
GS:I know you’ve expanded your offerings quite a bit, but is the marketplace lending business still your biggest segment?
GG:Yes, but it’s rapidly changing because lines are getting blurred. For example, if a payments company wants to become a lender or a lending company wants to do payments, then they have the ability to do that on our rails.
GS:Yes, I get that fintech lines are blurring. Here’s the thing, though. You’re an FDIC-regulated New Jersey bank.
GG:Yes.
GS:Is it fair to say, then, that you’re wearing the reputation of your clients?
GG:Absolutely.
GS:So if Affirm’s Max Levchin were to break character and do something harebrained, the regulators would come knocking on your door—
GG:—And come after us, yes.
GS:As CR moves towards a broader model that embraces payments, you’re entering a vastly complicated world, with all sorts of different actors. I would imagine you’re turning down as many prospective clients as you are taking in new ones, right?
GG:Much more, actually. About two years ago, we saw a slew of new entrants into our marketplace, and we signed north of 250 non-disclosure agreements. But we only signed up 19 platforms, or less than ten percent.
GS:I’ve dug into your financials, Gilles, which shows the benefit of your selective strategy. Given your success thus far, and the zaniness in the crypto world, why get involved in crypto? Do you need it?
GG:That’s a great question. I would say we’re not going say no if we think we can do something right. When we do anything, we start with a white paper, a full-blown risk assessment of the enterprise and how the regulatory environment is evolving. If the policy and procedures pass muster with the third-party folks that we hire to provide an opinion on them, then and only then would we consider launching a program.
In the January letter, among other things, Elliott suggested the company lacked operational discipline and it believed that with some tweaking, it could get much better stock performance. “Today eBay suffers from an inefficient organizational structure, wasteful spend and a misallocation of resources,” Elliott wrote at the time. At the same time, Elliott encouraged the company to concentrate on what it saw as its primary value proposition, as an eCommerce marketplace. That meant getting rid of any pieces that didn’t serve that mission including StubHub, the online ticket selling marketplace.
Perhaps it’s not surprising then that today’s announcement indicates the company is going through a review of operations and taking stock of its assets including StubHub. “These initiatives include an operating review and the commencement of a strategic review of the Company’s portfolio of assets, including StubHub and eBay Classifieds Group. eBay has worked collaboratively with Elliott Management, Starboard Value, and other significant shareholders on these initiatives, which include the addition of two new independent directors to the Board,” eBay indicated in the announcement.
These new board members include Jesse Cohn from Elliott Management and Matt Murphy from Marvell Technology, as the company begins to shift its focus.
The company announced earlier it was also moving the online marketplace, the key strategic asset of the company, according to Elliott, under a single global management team instead of the regional approach it had been taking. The company also announced plans to increase the advertising budget for the marketplace, according to the release.
These moves come as eBay tries to find a way to increase shareholder value to please activist investors like Elliott Management and Starboard Value. In a statement, Devin Wenig, company president and CEO tried to put the best face on these changes. “The bottom line is that we all share common ground: we see tremendous opportunity ahead and want to see eBay’s full potential realized over the long-term. The initiatives we are announcing today are the result of this constructive dialogue,” he said.
There is a deep dilemma facing startup founders that I think just isn’t brought to light often enough. On one hand, almost all (and I do mean almost all) founders are reasonably ethical people. They can be over-optimistic, they can over-promise, they can be inexperienced around management, but at their core, they want to improve the world, build something new, and yes, make (a lot) of money while doing it.
Yet, if you really want to grow fast — so fast that you can go from piddling startup to $1.7 billion valued banking unicorn in less than four years — then there are only so many ways to do that ethically. Or even legally, given that the laws around industries like banking aren’t designed for high growth, but rather sedentary expansion.
Here’s a lesson that I think founders internalize very, very early: growth solves all problems. And it is absolutely, 100% true. Growth absolutely solves all problems. Want to make your next fundraise a cinch? If you grow 5x or 7x year-over-year, watch as dozens of venture firms squabble to get access to that cap table. Want to hire faster and attract better talent? Growing at top speed is an easy way to lock in those people.
And if you think the board acts as a guardrail, you have never seen the giddy excitement of a VC who is seeing their yacht / Napa vineyard / Atherton estate being financed before their very eyes. Boards don’t ask tough questions in periods of high growth, they double down: “do everything to keep this rocket ship shooting for the stratosphere.”
In these situations, it is nearly impossible to balance growth and ethics. You can’t just say, “turn on the money laundering thing again and we will accept 5x instead of 7x” or whatever. The whole organism of the startup has been geared for growth. Hell, even the people not working for the company (but want to) are geared for growth. Every salary bump, equity distribution, performance evaluation, feedback, KPI, and firing is predicated on growth.
Sometimes you get away with it, and sometimes you don’t. Uber got away with it, Zenefits did not.
So where does Revolut sit, which I’ve been foreshadowing here? By now, you might have come across the three-part story arc of Revolut, a digital banking service based in London. In part one, Revolut is a fintech darling founded in July 2015 that has since raised $336 million in venture capital within four years at a $1.7 billion valuation according to Crunchbase.
Insane growth, huge market, real product. It’s the best first act for a startup one can possibly hope for.
Then the bad news started hitting hard this week. In act two, we get this Wired exposé by Emiliano Mellino that discusses the atrocious working conditions of the company along with deeply questionable employee interview tactics:
She did a 30-minute job interview over Google Hangouts with the London-based head of business development, Andrius Biceika, and was immediately told she had passed to the next round, which would involve a small test. “The surprise came when I received the task and it asked me to get the company as many clients as possible, with each one depositing €10 into the app,” says Laura.
And using fear to goad performance:
Last spring, CEO Nikolay Storonsky sent an announcement to all staff through the company’s Slack messaging service, saying that any members of staff “with performance rating [sic] ‘significantly below expectations’ will be fired without any negotiation after the review”.
…
Around this time, CEO Nikolay Storonsky gave an interview to Business Insider where he said Revolut’s philosophy was to “get shit done”, a slogan that is emblazoned on the company’s London office walls in bright neon lights. In an echo to what was going on in these calls, Storonsky would go on to say in the interview that the company attracted people that want to grow and “growing is always through pain”.
Well, there is more growth to come, because act three is going to bring a very painful episode for the company. My colleague Jon Russell noted that Revolut’s CFO has resigned in the wake of a Daily Telegraph investigation showing that Revolut had switched off the anti-money-laundering safeguards at the company, because, well, it got in the way of growth.
Let’s be clear: we all love a rapidly-growing startup. We all want to invest or join a winner. But what are we willing to forego to get it? Are we willing to push ethical boundaries? Are we willing to use dark patterns to force those numbers higher? Are we willing to break the law and potentially go to prison? Our love of growth often knows no bounds.
In context, I’m sure Revolut’s decision came easily, but of course, for disinterested observers, the idea that you would switch off the AML system at a banking startup just looks like complete stupidity. Yet, I am not sure I am ready to blame the employees of Revolut (or its leaders frankly) before I place the blame on a culture that demands extreme growth, and dislikes it when the consequences come to bear. You can’t get extreme growth without something breaking. We need to decide which value is more important for us.
Extra Crunch ethics series
Not sure we are going to be able to answer all the questions posed by Revolut, but Extra Crunch will be hosting a series of dialogues around tech ethics in the coming weeks that will try to parse some of the tough challenges that come from technology and startups these days. Stay tuned.
Why fundamental self-interest causes US infrastructure to fall flat on its face
Simon McGill via Getty Images
Written by Arman Tabatabai
Yesterday, DJ Gribbin, a fellow at Brookings and a senior US government infrastructure official, published an op-ed in which he attributes the US’ infrastructure struggles largely to 1) a misunderstanding of federal fund availability, 2) the fragmentation and variability of local infrastructure needs, and 3) misaligned incentives for local politicians and contractors.
Local politicians push heavily for the federal government to cover a portion of their bill, advertising the money as free to their constituents. In reality, investing federal funds is a zero-sum game that requires either more taxation, higher debt, or pulling money from elsewhere. What results are the competitive bid and bureaucratic review processes we discussed earlier this week that ultimately lead to gamesmanship and misinformation.
The federal-local coordination has grown more difficult as projects have become more localized with region-specific needs and benefits, compared to national projects of old like the highway system. Now, executing local developments depends on coordination between federal, state, and local governments, leading to the political pissing contests we all know and love.
The complexity of approval and funding processes causes local politicians to either delay projects as they lobby for federal funding or to “overpromise and underdeliver” on costs and benefits to push a project through.
Similarly, competitive RFP bidding used to reduce cost estimates encourages contractors to similarly overpromise, leading to plan revisions, construction issues, and delays that seem to be inevitable for every major project. Clearly more needs to be done to align the incentives of each of these players.
Software and infrastructure
JayLazarin via Getty Images
Written by Arman Tabatabai
New York City rail operators grew frustrated this week with the contractors hired to install a new safety system. Fumbled management and failed execution on what was thought to be a simple tech integration have caused multi-year delays, potentially pushing completion past the deadline set by the Federal Railroad Administration for railroads across the country to upgrade their safety systems.
Only about one-tenth of the mandated rails had successfully upgraded their system as of last year as local agencies continue to struggle with designing software and hardware platforms compatible with other trains that may use their lines. That pattern is also found in New York. From the Wall Street Journal article:
The projects have suffered a series of setbacks because of understaffing by the contractors as well as software and hardware failures. Those failures include the recall of antennas that were installed on more than 1,000 rail cars and that were later found to be defective.
“It was a novice error and we did not believe we had hired novices,” MTA board member Susan Metzger said.
The New York project mimics issues plaguing projects throughout the US, where contractors use the “overpromise, underdeliver” strategy to win competitive bids. Add in software incompetence, and you get the mess that New York is facing now.
DC commutes suck more than in NYC and SF, even before Amazon materializes
Richard Sharrocks via Getty Images
Written by Arman Tabatabai
According to a new data set from Bloomberg, the cost of commuting into Washington D.C. is higher than any other metro in the US. Though density is clearly a factor here, workers in the greater D.C. area face the longest commute time in the country at nearly 80 minutes on average. Bloomberg then derived a “score” for the opportunity cost of commutes based on average annual incomes and average total annual commuting hours per worker, weighted based for other externalities such as how early or late average departures were.
D.C. is in the midst of seriously expanding its Metrorail system but, unsurprisingly, the project has gone far from smoothly. Bloomberg’s findings stress the need for an improved transit system in the region but based on precedent and progress to date it’s unclear if and when the full expansion will be complete and at what ungodly cost.
We’re planning on diving deeper into D.C.’s Metrorail expansion project as we read The Great Society Subway by Zachary Schrag, which just arrived at Extra Crunch HQ this week.
Obsessions
We have a bit of a theme around emerging markets, macroeconomics, and the next set of users to join the internet.
More discussion of megaprojects, infrastructure, and “why can’t we build things”
Thanks
To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people, and companies. If I can ever be of assistance, hit reply, or send an email to danny@techcrunch.com.
This newsletter is written with the assistance of Arman Tabatabai from New York
DVR maker TiVo is preparing to split its company into two businesses: one, focused on its products like its Bolt family of DVRs, and the other on its licensing and intellectual property businesses. The move will help to address some of the complexities with those businesses, TiVo Interim CEO Raghu Rau, explained, which may make it more attractive to buyers.
By splitting the company into two, TiVo may be able to “facilitate strategic transactions,” with interested parties, Rau said, on the company’s Q4 earnings call this week with investors.
The CEO also noted that TiVo was in active discussions with parties who were interested in each its product and its IP businesses, but the overall strategic review process – which began a year ago – was taking longer than TiVo had anticipated.
“So we do agree that this process has taken longer than we had hoped particularly because of the complexity and uniqueness of our two businesses,” Rau told investors. “We’re hoping that we’ll give you another update the next quarter based on the ongoing discussions that we are having. But beyond that, I’m not willing to put a time limit on when this will happen because the interest of the Board and the management is to ensure that we get the best outcome for the shareholders and that’s what this whole review process has been focused on,” he said.
The issue seems to be that potential acquirers may want either the licensing business or the products business, but not both.
According to a report from LightReading, that’s definitely the case with potential buyers, sources told them. In addition, TiVo was described as being reluctant to move forward on anything significant until it knew more about the outcomes of its legal battles with Comcast over licensing and patents.
Rau noted that TiVo hadn’t actually announced that TiVo is separating, only that it’s now working on the various logistics issues that have to be addressed in order to separate the business, like the preparation of historical financials, audits and understanding of tax implications.
The company also said it ruled out a “transformative acquisition” a couple of quarters into its ongoing strategic review process, which began in February 2018.
TiVo itself was acquired by Rovi Corp. for $1.1 billion in 2016, and the combined entity kept the name TiVo. The deal enhanced TiVo’s patent portfolio, and today 9 of the top 10 pay TV service providers in the U.S. license its portfolio of IP, except for Comcast, whose license lapsed (which is why it’s in the courts.)
Given the relative recency of that merger, TiVo’s decision to now split the business again strongly hints that it’s had trouble finding a deal for the company as it stands today.
TiVo remains a household name, thanks to its line of TiVo branded DVRs which cater to pay TV subscribers and cord cutters alike. But the company has made some missteps along the way, as it tried to keep up with the increasingly competitive market. For instance, in an effort to differentiate itself, its newer Bolt DVR adopted an odd, angled shape that some found aesthetically displeasing. That matters, of course, because these DVRs have to be on display in your living room. (Unlike, says, Amazon’s new Fire TV Recast which can be hidden away in a back room of the house.)
In addition, TiVo’s model which relies on monthly subscriptions (or a larger “lifetime” fee) are harder for consumers to stomach at a time when there’s so much choice among media devices.
Combined with the larger shift away from pay TV and consumer adoption of players like Roku and Amazon Fire TV – even among pay TV subscribers – TiVo’s business is not what it once was.
The company in its earnings reported this Tuesday brought in a loss of $2.33 per share to end fiscal year 2018. In the year-ago quarter, TiVo had posted a profit of 28 cents. Its revenue for the period was $168.46 million, 21 percent down from Q4 2017, and under analysts’ estimates of $173.85 million.
Rode promised multitrack support for the Rodecaster Pro in February — and delivered with no time to spare. The Australian company dropped news about the firmware update at 10PM PT on February 28, bringing the podcasting board’s most eagerly awaited feature as part of its first update since hitting retail late last year.
I reviewed the board just ahead of Christmas and found very little to complain about, save for the fact that the system recorded everything to a single track — a fact that makes shows a real pain to edit. The company said the limitation was a feature, not a bug, for a plug-and-play system designed to be as simple as possible for live recording. Clearly not everyone agreed.
The system is designed for recording shows on the fly, right down the sound pads that can be used to fire up effects or bed music. But most podcast producers prefer to edit post-recording, and saving multiple voices to the same track makes it tricky. With the update, the system records to up to 14 tracks when connected to a computer via USB (while it will just record a stereo mix to a microSD card).
Those are as follows, per Rode,
2 tracks (stereo left and right) ‘live mix’, as featured on the RØDECaster Pro since its release
A mono track for each of the 4 microphone inputs
2 tracks (stereo left and right) each for the USB, 3.5mm TRRS, Bluetooth and sound-effects-pad channels
As of this week, the feature can be accessed through the board’s “Advanced Setting” menu.
Launching around the globe a few days ahead of the world’s largest mobile show was the ultimate big-dog move. Samsung celebrated the 10th anniversary of its flagship phone line by launching its latest device on Apple’s sometimes-stomping grounds at San Francisco’s Bill Graham Civic Center.
The timing was less than ideal for all of us jet-lagged gadget reviewers, but the effect clearly paid off. Dozens of the world’s highest-profile reviewers have been roaming the streets of Barcelona with the S10 in hand and Galaxy Buds in ears. You couldn’t pay for that kind of publicity.
And, naturally, none of us minded testing those new photo features in one of Europe’s most beautiful cities.
But the 10th anniversary Galaxy arrives at a transitional time for Samsung — and the industry at large. The last couple of years have seen smartphone sales plateau for the first time since anyone started keeping track of those sorts of numbers, and big companies like Samsung and Apple are not immune.
That manner of existential crisis has led to one of the most eventful Mobile World Congresses in memory, as companies look to shake the doldrums of a stagnant market. It also led Samsung to open last week’s Unpacked event with the Galaxy Fold — first the cryptic product video and then the product unveil.
It’s a heck of a lead in, and, quite frankly, a recipe for disappointment. Here’s a look at the future, and now let’s talk about the present. Several people saw that I was carrying around a new Samsung device, got excited and were ultimately disappointed with the fact that I couldn’t unfold the thing.
None of this is any reflection on the quality of the S10 as a device, which I will happily state is quite high. But unlike the iPhone X, Apple’s 10th anniversary handset, the new Galaxy isn’t an attempt at a radical departure. Instead, it’s a culmination of 10 years of phone development, with new tricks throughout.
The Galaxy S10 doesn’t offer the same glimpse into the future as the Fold. But it does make a strong claim for the best Android smartphone of the moment. Starting at $1,000, it’s going to cost you — but if Samsung’s $1,900 foldable is any indication, smartphones of the future could make it look like a downright bargain.
Screen time
The Samsung Galaxy S10+ has been my daily driver for a week now. It joined me on an international road trip, through several product unveils from the competition and is responsible for all of the images in this post. Sometimes the best camera is the one in your pocket, as the saying goes.
Like other recent Samsung flagships, it’s going to be a tough device to give up when review time comes to a close. It’s a product that does a lot of things well. Tending, as Samsung often does, toward jamming as much into a product as possible — the polar opposite of chief competitor Apple’s approach.
But in the case of the Galaxy line, it all comes together very nicely. The S10 doesn’t represent a radical stylistic departure from its predecessor, maintaining the same manner of curved design language that helps the company cram a lot of phone into a relatively limited footprint, including a 93.4 percent screen-to-body ratio in the case of the S10+.
That means you can hold the handset in one hand, in spite of the ginormous 6.4-inch screen size. This is accomplished, in part, by the curved edges of the display that have been something of a Samsung trademark for a few generations now. It has also helped the Infinity-O design display, a laser cutout in the top-right of the screen, to fit the front-facing camera in as small a space as possible. In the case of the S10+, it’s more like an Infinity-OOO display.
Samsung was going to have to give in to the cutout trend sooner or later, opting to go ahead and skip the whole notch situation. The result is a largely unobtrusive break in the screen. Just for good measure, the phone’s default wallpapers have gradually darkening gradients that do a good job obscuring the cut out while not in use.
But while the whole more-screen-less-body deal is generally a good thing, there is a marked downside. I found myself accidentally triggering touch on the sides of the display with the edge of my palms, particularly when using the device with one hand. This has been a known issue for some time, of course.
Oh, and there’s one more key aspect in helping the S10+ go full screen.
Putting your finger on it
As with many of the features here, Samsung can’t claim to be the first to have the under-display fingerprint sensor. OnePlus, in a rare push to be first to market, added a similar technology to the 6T, which arrived last fall. But Samsung’s application takes things a step further.
The S10 and all of its variants are among the first to implant the fingerprint technology that Qualcomm announced at its Snapdragon Summit in Hawaii last year. The key differentiator here is an extra level of security. If the OnePlus’ fingerprint sensor is akin to your standard face unlock, this is more in line with what you get on the iPhone or LG’s latest handset.
The ability to sense depth brings another layer of security to the product — quite literally. Here’s how Qualcomm describes it:
Combining a smartphone’s display and fingerprint reader for a seamless and sleek look, 3D Sonic uses technological advances and acoustics (sonic waves) to scan the pores of a user’s finger for a deeply accurate 3D image. An ultra-thin (0.2 mm) sensor enables cutting-edge form factors such as full glass edge-to-edge displays, and can be widely used with flexible OLED displays.
Setup proved a bit fussier than the standard physical fingerprint button. Once everything is squared away, the reader is actually fairly responsive, registering a rippled water animation and unlocking the phone in about a second.
Getting your finger/thumb in the right spot might take a couple of tries on the first go, but after that, it’s muscle memory. There’s also a small fingerprint shaped guide that pops up on the lock screen for help. It can still be a bit tricky for those times you’re not looking directly at the display, or if you switch between hands.
It’s also worth noting that the unlock can be tricky with some screen protectors. Samsung will be working with accessory manufacturers to design compatible ones, but picking the wrong company could severely hamper the unlock function.
In some ways, though, the in-display fingerprint reader beats face unlock. I tend to lay my device down next to my keyboard when I work. Lifting the phone up to my eyes in order to read notifications is a bit of a pain. Same goes for when I need to check messages in bed. Here you can simply touch, check the notifications and go on with your life.
Ports in a storm
Around the edge is a mirrored metal band that houses the power button on one side and volume rocker and devoted Bixby button on the other. Yes, the Bixby button is back. And no, it won’t be going anywhere anytime soon. Samsung is wholly devoted to the smart assistant, and the company’s mobile devices are the one foothold Bixby currently commands.
The complaint about the Bixby button mostly stems from the fact that the assistant was, quite honestly, pretty useless at launch — particularly when compared to Android’s default assistant. In fact, when Google announced this week at Mobile World Congress the upcoming arrival of Assistant buttons on third-party devices, the news was generally welcomed by the Android crowd.
Samsung, meanwhile, gets hounded about the Bixby button, as though its inclusion is a way of forcing its assistant on users. Once again, Samsung relented, giving users the ability to remap the button in order to launch specific apps instead. This has played out time and again with the last several Galaxy devices.
The fact is, after an admittedly rocky start, Bixby has slowly been getting better, feature by feature. But the assistant still has catching up to do with Google’s headset, and frankly doesn’t offer a ton of reasons to opt into it over Android’s built-in option. Samsung has certainly made big promises of late, coupled with the imminent arrival of the Galaxy Home Hub.
Of course, that device was announced more than half a year ago, and when it does finally arrive, it will likely be carrying a prohibitive price tag. Beyond that, Bixby is currently the realm of things like Samsung refrigerators and washing machines. None of this adds up to a particularly compelling strategy for a multi-million-dollar AI offering that has become something of an inside joke in the industry.
But Samsung sticks to its guns, for better or worse. Sometimes that means Bixby, and sometimes that means defiantly clinging to the headphone jack. Turns out if you avoid a trend for long enough, you can become a trendsetter in your own right — or at least a respite from the maddening crowd.
It’s been a few years since the beginning of the end came for the jack, and the whole thing still leaves plenty of users with a sour taste. Even the once-defiant Google quickly gave in and dropped the jack. Samsung, however, has stood its ground and the decision has paid off. What was ubiquitous is now a differentiator, and even as the company hawks another pair of Bluetooth earbuds, it’s standing its ground here.
All charged up
The back of the device, like the front, is covered in Gorilla Glass 6. The latest from Corning, which debuted over the summer, promises to survive “up to 15 drops.” But don’t try this at home with your shiny new $1,000 smartphone, as your results may vary.
The material also helps facilitate what is arguably the device’s most compelling new feature: Wireless PowerShare. Samsung’s not the first company to roll out the feature — Huawei introduced the feature on the Mate 20 Pro last year. Still, it’s a cool feature and, perhaps most importantly, it beat Apple to the punch.
The feature needs to be activated manually, by swiping down into notifications (it will also automatically shut off when not in use). From there, tapping Wireless PowerShare will pop up a dialog box, letting you know the feature is ready to us. Turn the phone face down on a table and place a compatible phone on top, face up, and the S10 will go to work charging it.
Placement can be a bit tough to get right the first couple of times. The trick is making sure both devices are centered. Once everything is where it should be, you’ll hear a quick notification sound and the phone will register as charging. In the case of the new Galaxy Buds, the sound is accompanied by the appearance of the case’s charging light.
It’s a neat feature, for sure. I can certainly imagine lending some ill-prepared friend a little juice at the bar one night. I wouldn’t go throwing out my power bank just yet. For one thing, one of the phones needs to be face-down the whole time. For another, wireless charging isn’t nearly as fast as its wired counterpart, so beyond the initial novelty of the feature, it may not ultimately be one you end up using a lot.
And, of course, you’re actively draining the battery of the phone sharing power. It’s a little like a Giving Tree scenario, albeit with the lowest stakes humanly possible. Thankfully, the handsets all sport pretty beefy batteries. In the case of the S10+, it’s a massive 4,100 mAh (with the 5G model getting an even nuttier 4,500 mAh).
It’s clear the days of Samsung’s Note 7-induced battery cautions are well behind it, thanks in no small part to the extensive battery testing the company implemented in the wake of a seemingly endless PR nightmare. As it stands, I was able to get around a full day plus two hours with standard usage while roaming the streets and convention center halls of Barcelona. That means you shouldn’t have to worry about running out of energy by day’s end — and you may even have a bit to spare before it’s all over.
Camera ready
You know the drill by now, Samsung and Apple come out with a new flagship smartphone, which quickly shoots to the top of DxOMark’s camera ratings. The cycle repeats itself yet again — with one key difference: It’s a three-way tie.
[Left: Standard, Right: Full zoom]
Really, there’s no better distillation of the state of the smartphone industry in 2019 than this. The latest iPhone, which is now half-a-year-old, is now a few spots down the list, with Samsung in a three-way tie for first. The other two top devices are, get this, both Huawei handsets. It’s been a banner year for the Chinese handset maker on a number of fronts, and that’s got to leave the Apples and Samsungs of the world a bit nervous, all told.
For now, though, there’s a lot to like here… 109 points’ worth, in fact. The last several generations of camera races have resulted in some really well-rounded camera gear. It’s a setup that makes it difficult to take bad shots (difficult, but hardly impossible, mind), with the combination of hardware and software/AI improvements we’ve seen over the course of the last few devices.
The camera setup varies from device to device, so we’re going to focus on the S10+ — the device we’ve spent the past week with (though, granted, the 5G model’s camera warrants its own write-up). The plus model features a three-camera array, oriented horizontally in a configuration that brings nothing to mind so much as the original Microsoft Kinect.
[Left: Samsung S10+, Right: Pixel 2]
It’s been fascinating watching companies determine the best use for a multi-camera array. Take Nokia’s new five-camera system, which essentially compiles everything into one super-high-res shot. Here, however, the three lenses capture three different images. They are as follows:
The system is configured to let you seamlessly switch between lenses in order to capture a shot in a given situation. The telephoto can do 2x shots, while the ultrawide captures 123-degree shots. The 5G model, meanwhile, adds 3D-depth cameras to the front and rear, which is a pretty clear indication of where Samsung plans to go from here.
That said, the current setup is still quite capable of pulling off some cool depth tricks. This is no better exemplified than with the Live Focus feature, which applies a Portrait Mode-style bokeh effect around the objects you choose. The effect isn’t perfect, but it’s pretty convincing. Above is a shot I took on the MWC show floor and used in the led for a story about the HTC Vive.
There are some fun tricks as well, like the above Color Point effect. I’m not sure how often I’d end up using it, but damn if it doesn’t look cool.
All of that, coupled with new touches like wide-image panorama and recent advances like super-slow-motion and low-light shooting make for an extremely well-rounded camera experience. Ditto for scene identification, which does a solid job determining the differences between, say, a salad and a tree and adjusting the shooting settings accordingly.
Oh, and a low-key solid upgrade here are the improved AR Emojis, as seen above. They’re 1,000 times less creepy than the originals. I mean, I’m still not going to be sharing them with people unironically or anything, but definitely a step in the right direction.
Today’s Galaxy
The present moment is an exciting one for the mobile industry. There were glimmers of promise all over the MWC show floor and a week prior at Samsung’s own event. A stagnant industry has caused the big players to get creative, and some long-promised technologies are about to finally get real.
The Samsung Fold feels like a clear peek into the future of one of the industry’s biggest players, so it’s only natural that such an announcement would take some of the wind out of its flagship’s sails.
The S10 isn’t the smartphone of the future. Instead, it’s the culmination of 10 solid years of cutting-edge smartphone work that’s resulted into one of today’s most solid mobile devices.
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.
February is now behind us, but we gathered the troops to send it off in style: Connie Loizos was here, Kate Clark was in, I was around, and NEA’s Jonathan Golden joined us, as well.
It was good to have a full contingent on hand, as there was a lot to get through:
ThirdLove raises $55 million: Direct-to-consumer undergarment company ThirdLove raised a huge round this week, picking up $55 million on top of the roughly $13 million it had raised before. The company is well-known for having a plethora of sizes for bodies of all types. The company’s round was one of four from women-led businesses that we wanted to highlight this week.
Dipsea raises $5.5 million: Dipsea just , but it’s launching out the gate with $5.5 million in capital. The company’s subscription app ($8.99 per month, or yearly at a discount) provides short-form audio erotica aimed at the women in the market. The company is female-founded and fits into a recent trend we’ve seen of audio content picking up new money as the genre’s listening base expands during this, the second golden era of podcasting.
Rockets of Awesome raises $19.5 million: Our third woman-led startup that picked up capital this week is Rockets of Awesome, which sells subscription-based clothing for kids to parents. The new round contains a strong infusion of money from Foot Locker, a brand that we’re all aware of. Notably, Rockets of Awesome intends to dip its toe into the physical realm with its new money.
Coterie raises $2.75 million: Wrapping up our list of women-led companies that have raised this week, Coterie raised a smaller round to help fuel its Instagram-ready-party-in-a-box business. Sadly I didn’t get to mock Instagram during the show, but we did get to learn all about what a “friendaversary” is.
Wrapping the topic on women in venture, and women founding and running startups, we looked at a few data points here, and here. Summary: There’s more work to do.
Motif raises $90 million: Returning to our running look at companies that have raised outsized rounds, Motif, a spinout, raised a $90 million Series A. I wanted to know if we can all such a thing a Series A, and Jonathan told me to stop being such a square.
Uber versus Lyft: Closing out, we wanted to call ourselves out for being wrong about Uber and Lyft not taking shots at one another this close to their IPOs via discounts. They are, indeed, back on their bullshit.
All that and February is behind us. Here’s to March and what’s next.
Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Pocket Casts, Downcast and all the casts.
Amazon has confirmed it’s retired physical stick-on Dash buttons from sale — in favor of virtual alternatives that let Prime Members tap a digital button to reorder a staple product.
It also points to its Dash Replenishment service — which offers an API for device makers wanting to build Internet connected appliances that can automatically reorder the products they need to function — be it cat food, batteries or washing power — as another reason why physical Dash buttons, which launched back in 2015 (costing $5 a pop), are past their sell by date.
Amazon says “hundreds” of IoT devices capable of self-ordering on Amazon have been launched globally to date by brands including Beko, Epson, illy, Samsung and Whirlpool, to name a few.
So why press a physical button when a digital one will do? Or, indeed, why not do away with the need to push a button all and just let your gadgets rack up your grocery bill all by themselves while you get on with the importance business of consuming all the stuff they’re ordering?
You can see where Amazon wants to get to with its “so customers don’t have to think at all about restocking” line. Consumption that entirely removes the consumer’s decision making process from the transactional loop is quite the capitalist wet dream. Though the company does need to be careful about consumer protection rules as it seeks to remove all friction from the buying process.
The ecommerce behemoth also claims customers are “increasingly” using its Alexa voice assistant to reorder staples, such as via the Alexa Shopping voice shopping app (Amazon calls it ‘hands free shopping’) that lets people inform the machine about a purchase intent and it will suggest items to buy based on their Amazon order history.
Albeit, it offers no actual usage metrics for Alexa Shopping. So that’s meaningless PR.
A less flashy but perhaps more popular option than ‘hands free shopping’, which Amazon also says has contributed to making physical Dash buttons redundant, is its Subscribe & Save program.
This “lets customers automatically receive their favourite items every month”, as Amazon puts it. It offers an added incentive of discounts that kick in if the user signs up to buy five or more products per month. But the mainstay of the sales pitch is convenience with Amazon touting time saved by subscribing to ‘essentials’ — and time saved from compiling boring shopping lists once again means more time to consume the stuff being bought on Amazon…
In a statement about retiring physical Dash buttons from global sale on February 28, Amazon also confirmed it will continue to support existing Dash owners — presumably until their buttons wear down to the bare circuit board from repeat use.
“Existing Dash Button customers can continue to use their Dash Button devices,” it writes. “We look forward to continuing support for our customers’ shopping needs, including growing our Dash Replenishment product line-up and expanding availability of virtual Dash Buttons.”
So farewell then clunky Dash buttons. Another physical push-button bites the dust. Though plastic-y Dash were quite unlike the classic iPhone home button — always seeming temporary and experimental rather than slick and coolly reassuring. Even so, the end of both buttons points to the need for tech businesses to tool up for the next wave of contextually savvy connected devices. More smarts, and more controllable smarts is key.
Amazon’s statement about ‘shifting focus’ for Dash does not mention potential legal risks around the buttons related to consumer rights challenges — but that’s another angle here.
In January a court in Germany ruled Dash buttons breached local ecommerce rules, following a challenge by a regional consumer watchdog that raised concerns about T&Cs which allow Amazon to substitute a product of a higher price or even a different product entirely than what the consumer had originally selected. The watchdog argued consumers should be provided with more information about price and product before taking the order — and the judges agreed. Though Amazon said it would seek to appeal.
While it’s not clear whether or not that legal challenge contributed to Amazon’s decision to shutter Dash, it’s clear that virtual Dash buttons offer more opportunities for displaying additional information prior to a purchase than a screen-less physical Dash button. So are more easily adapted to meet any tightening legal requirements across different markets.
The demise of the physical Dash was reported earlier by CNET.
This hasn’t been a good week for challenger bank Revolut . The company, which offers digital banking services and is valued at $1.7 billion, confirmed today that embattled CFO Peter O’Higgins has resigned and left the business.
The startup and O’Higgins have been under pressure after a Daily Telegraph report that revealed that Revolt switched off an anti-money laundering system that flags suspect transactions because it was prone to throwing out false positives.
According to the Telegraph, the system was inactive between July-September 2018, which potentially allowed illegal transactions to pass across the banking platform. Revolut did not contact the Financial Conduct Authority to inform the regulator of the lapse, Telegraph reporter James Cook said.
O’Higgins, who joined the company from JP Morgan three years ago, made no mention of the saga in his resignation statement:
Having been at Revolut for almost three years, I am immensely proud to have taken the company from £1m revenue to £50m revenue during this time. However, as Revolut begins to scale globally and applies to become a bank in multiple jurisdictions, the time has come to pass the reigns over to someone who has global retail banking experience at this level. My time at Revolut has been invaluable and I’m so proud of what myself and the team have achieved. There is no doubt in my mind that Revolut will go on to build one of the largest and most trusted financial institutions in the world.
In a separate statement received by TechCrunch, Revolut CEO Nik Storonsky said that O’Higgins had been “absolutely pivotal to our success.”
The resignation caps a terrible few days for Revolut, which was the subject of a report from Wired earlier this week that delved into allegations around its challenging workplace culture and high employee churn rate.
“Former Revolut employees say this high-speed growth has come at a high human cost – with unpaid work, unachievable targets, and high-staff turnover,” wrote guest reporter Emiliano Mellino, citing the experiences of numerous former employees.
Those incidents included prospective staff being told to canvass for new customers as part of the interview process. The candidates were not compensated for their efforts, according to Wired. Revolut later removed the demands from its hiring processes.
Revolut is headquartered in the UK, where it launched its service in the summer of 2015. Today, it claims over four million registered users across Europe — it is available in EEA countries — although it plans to extend its presence to other parts of the world are taking longer than expected.
Revolut is generally considered to be the largest challenger bank in Europe, in terms of valuation and registered users, but other rivals include N26, Monzo and Starling. Even Transferwise, the global remittance service, now includes border-less banking features and an accompanying debit card.
The remit of the new “Fund II” is largely unchanged from the first fund, promising to write the first cheque of between $50,000 and $75,000 for the most promising founders in the region.
In total, the size of The Nordic Web Ventures’ second fund is $1.5 million, which should see it have enough capital to make another 20 or more investments across the next 18-24 months, making the firm one of the most active investors in the region. Existing portfolio startups from Fund I include Engaging Care, TPH, Uizard, Meeshkan, SafetyWing, Confrere.
In addition to an all-star investor line up of Fund I LPs who are returning for a second bite — such as Index’s Martin Mignot, Point Nine’s Christoph Janz, and Philipp Moehring and Andy Chung of AngelList — Fund II sees a number of new LPs join. Most notably, perhaps, Skype and Atomico founder Niklas Zennström has invested, in addition to Atomico partner Sophia Bendz, who was previously an exec at Spotify and is already a very active angel investor in the Nordics and beyond.
Revealing that The Nordic Web Ventures plans to raise a much larger fund in the future, Murray tells me the plan for Fund II is to “fundamentally change” the early-stage landscape in one of Europe’s most interesting regions. He says the fund is also a great example of how Europe’s investment landscape is changing, with individuals from major European venture capital firms invested, as well as receiving backing “from some of the Nordic’s most successful entrepreneurs”.
Cue a statement from Atomico’s Sophia Bendz: “Neil and I share the same passion for entrepreneurship and both care a lot about the early stage ecosystem… The Nordic Web Ventures can, through their LP networks and expertise, provide dealflow, hands-on support and advice for Nordic pre-seed and seed companies, something that is super helpful for the founders and that’s what it’s all about in the end, being valuable to the entrepreneurs in a meaningful and relevant way”.
To that end, I’m also told that having raised Fund II, The Nordic Web publication and The Nordic Web Ventures will merge into a single entity, with The
Nordic Web’s core focus moving forward “to support and strengthen the Nordic ecosystem through investment, analysis and community”.
