Author: azeeadmin

Seed investment firm Hummingbird VC, which previously invested in Deliveroo, Peak Games, MarkaVIP, and Kraken has a new Managing Partner. Firat Ileri, previously a Partner – who at 28 became one of Europe’s youngest VCs when he joined in 2012 – takes over from Founding Partner Barend Van den Brande, who will now take on a more strategic role at the firm.

Ileri grew up in Cyprus and went on to study electrical engineering, computer science, and operations research at MIT. At Hummingbird he has lead the firm’s first investments in Latin America and in South East Asia.

Ileri initially introduced the cofounders of Gram Games, led their first investment, and helped exit the company to Zynga for half a billion. He also led the sale process of Peak Games in 2020, which exited at $1.8Bn, making history as Turkey’s largest tech exit to date.

Founded in 2010, Hummingbird is currently on its fourth fund of $200M, raised in Q4 2020, and says it invests from Europe to India, SEA, LATAM, Turkey and more recently in the US.
 
Firat most recently led Hummingbird’s first investments in engineering biology, investing in Billiontoone, the SF-based precision diagnostics company in the prenatal and liquid biopsy space, which has raised a $55M Series B round. It’s also invested in Kernal Biologics, an mRNA 2.0 therapeutics company focused on oncology.

Van den Brande said: “From the moment Firat joined us in the very early days of Hummingbird, he hit the ground running. His eye for unique and ambitious founding teams, and unparalleled expertise in Seed investing, persistence and really understanding what Early Stage companies need has made him an invaluable asset to Hummingbird and all of the founders we work with. I’m only pleased to have Firat take on the role and lead the Hummingbird family and portfolio for years to come.”

Ileri said the firm’s thesis was to invest in stand-out founders: “We’re spending much more time trying to understand who these people are and what makes them special. In a way, we’re looking for anomalies in people, and we believe that the best companies are created with nonlinear backgrounds. So, this is the thesis.”

He said the team has expanded to drive this vision: “We used to be a boutique fund, but we have the ambition to be more and especially to look for founders who have an independent mind and huge ambitions. To be able to find more companies we’ve gone more global, in order to have a better chance of finding these special stories.”

The narrative suggests that Germany is lagging behind its European neighbors when it comes to building a globally competitive venture capital market. But I think that the next five years will be huge for the German venture capital sector, and that the signs for the future are very positive.

German startups raised €6.4 billion in 2020. That’s more than France, which came in at €5.7 billion. Another upside is that there is a healthy blend of local and international investment in the early-stage market. German funds dominate investments in German startups at the seed and Series A stages. As companies grow, overseas investment plays a huge part — half of the deals exceeding $50 million funding rounds are led entirely by foreign investors, while only 5% are run by German investors and 45% see a mix of foreign and domestic investors at the cap table.

I think this is where the German VC market needs to be right now. Great innovation is being sourced and backed by local funds. As these companies grow and become winners, they attract the best investors from around the globe, enabling the companies to internationalize from a German base, and the early-stage VCs reap the rewards and continue investing in local German talent. As the market matures, I am confident we will see more German VC money invested at the growth stages.

And the outlook is favorable. The German market is thriving. Even the pandemic did little to impact this fundamentally positive trend for the technology sector.

In addition to the growing level of both local and international investment into German tech, policymakers have created better conditions for startups and VC funds to thrive in Germany.

The German Federal Government launched the €10 billion Future Fund and has committed additional funds to the Deep Tech Future Fund. Not only does this immediately inject more capital into the market at the growth stage, but it also indicates that Germany is “open for business.” It sends a clear signal to the rest of the world that Germany understands the link between innovation and tangible improvements in society. It is a powerful and welcome indicator to funds from around the world.

Germany is incredibly attractive to tech talent, in addition to investors. More and more tech workers wish to relocate to Germany, with the welfare state providing a model for the future.

The long term looks good, too. Germany is famous the world over for its manufacturing and engineering sector. Germany is one of the few countries that still generates foreign trade surpluses through local production. Manufacturing and engineering are still yet to experience a massive leap in innovation. Therefore, German startups are extremely well positioned to benefit from the increasing activity in “Industry 4.0” innovation, with talent from Germany’s manufacturing heartland poised to blend with the ever-increasing pool of tech talent in Berlin and Munich.

Share options and spinoffs are the Achilles’ heel of the German startup scene

I think German VC and the tech market are due to take off and achieve new heights. However, there are two areas that need to be substantially improved: employee stock options and the regulations around spinoffs.

Germany is choking on its bureaucracy, and that threatens innovation. Tesla’s new Gigafactory is the latest example of how bureaucratic processes can slow everything down.

For startups in Germany, reforms on employee stock option plans (ESOP) are urgently needed for startup workers to benefit from the success of their companies and for the startup ecosystem to grow on its own.

The current bill to offer better tax benefits does not reflect the needs of the industry. For example, tax relief is only available for employees in companies that are younger than 10 years. If an employee changes employers, they must pay tax on company shares beforehand, which poses a significant risk of bankruptcy. Because many startups are still not profitable after 10 years, taxes should only be due when an employee makes an actual profit from their holdings — when they sell the shares. In the end, startups simply won’t offer new ESOPs to their employees.

Another example: spinoffs. Germany has the highest number of patent applications in Europe. However, startups often are not able to turn innovative technology into product-market fit. Spinoffs from the leading German research institutes have had a hard time gaining a foothold because they have been imposed with high institutional fixed and license costs when spinning off. Here, Germany needs to be more flexible and give startups the space and funding they need.

Lower the fixed costs and the enormous bureaucracy founders face when spinning off. Investors have to render more operational and organizational support for researchers-turned-founders. Furthermore, VCs must have the courage to invest more in innovative ideas and technologies that may take a bit longer to thrive. BioNTech is the best example of how this pays off in the long run.

More German unicorns?

As it stands, 2021 has already seen numerous new unicorns from Germany — with Personio, Mambu, Sennder, Gorillas and Trade Republic achieving billion-dollar valuations — and there are almost certainly more to come.

If regulators finally cut through the red tape around stock options and spinoffs, the German tech and VC industry will achieve new heights. I look forward to positive changes and an entire roster of German unicorns being minted in the years to come.

Temasek and an affiliate of Warburg Pincus are investing $500 million in Indian ride-hailing giant Ola, the Bangalore-headquartered startup said in a short statement Friday.

This is the first time SoftBank-backed Ola has raised money in nearly two years. In a statement on Friday, it said the investment comes ahead of “Ola’s IPO” but it didn’t elaborate.

“Over the last 12 months we’ve made our ride hailing business more robust, resilient and efficient. With strong recovery post lockdown and a shift in consumer preference away from public transportation, we are well positioned to capitalize on the various urban mobility needs of our customers. I welcome Warburg Pincus and Temasek to Ola and look forward to collaborating with them in our next phase of growth,” said Bhavish Aggarwal, Chairman and Group CEO of Ola, in a statement.

This is a developing story. More to follow…

DN Capital, one of Europe’s most active VCs has launched its latest $350 million (£220m, €300m) fund off the back of a pretty stand-out year when the firm saw four of its portfolio companies hit billion-dollar-plus valuations. DN’s ‘Fund V’ will invest across Europe, the UK and the US, but with strongly European LPs, DN has garnered a reputation for digging up some of continental Europe’s hottest startups from, North, Western, Central, and Eastern Europe.

Led by industry veterans Nenad Marovac (based in Europe) and Steve Schlenker (based Stateside), DN led the Series A round in Auto1, which IPO’d on the German Stock Exchange earlier this year at a $10 billion valuation and over 150x their entry price per share.

As Marovac explained: “We spend vast amounts of time with entrepreneurs understanding the market, their team, their product and to get to the heart of what they’re trying to achieve, long before we even talk about money… The launch of our fifth fund gives us further scope to uncover new entrepreneurs with the biggest, brightest global ambitions.”

Schlenker added that he thinks the “full impact of the pandemic on society, work, and behaviors is only just being understood. There are tech founders across the globe right now on critical missions to accelerate this recovery and help address the needs, and solve the biggest problems, of the post-COVID world.”

In July 2021 MrSpex, the Germany-born online eyewear retailer, IPO’d at over $1.0bn. DN Capital also counts unicorns Remitly, Jobandtalent, and GoStudent in its portfolio.

The company, which has a 20-year history, said Fund V was “substantially oversubscribed” and will focus on the funds main specialities in software, fintech, marketplaces and the consumer internet.

Schlenker said: “Europe has really come into its own now. It is competing very successfully versus the US in terms of returns to investors.”

Were they seeing more US VC in Europe, I asked?

“We’ve done deals with Sequoia with Lightspeed, with Battery. It seems like the competition is very strong in the UK market, because the Americans come over where they can speak the language first. It’s still more of a competitive landscape with the US players in the series B or C stages when you get to France, Germany, etc.” said Schlenker.

“That is changing, but it’s still mostly them following people like DN in those rounds, whereas at series A-level, which is really our sweet spot, they seem to be more combatative specifically in the UK market. And we do a disproportionate share of our investments on the continent, as opposed to the UK,” said Schlenker.

I put it to Marovac what he thought had attracted LPs back to the fund. “Honestly?” he said, “Performance. We had the auto1 IPO in February which is worth three and a half times Fund III. We just had the Mr Spex IPO last week, which is another one times Fund II. We invested in GoStudent last June, at a $20 million valuation and they just raised money at $1.4 billion.”

Before some of those events he said fundraising for the fund was going “okay” but it wasn’t going “gangbusters”. “I think since those things happened – and I guess also maybe a difference in investors perceptions or mentality in Q1 this year. But Q1 Q2 Q3 last year were tough. They weren’t easy for fundraising. But it really came about, maybe, due to changes in the market and then also the performance of the funds. They are now going into our fund three with a 3x, already,” he pointed out.

Marovac also outlined how the fund had quickly moved to support its portfolio last year when the pandemic hit: “The first thing we did when the pandemic hit was go through the portfolio and triage, making sure every company was funded for at least till the end of December 2021. Then we said we want to invest in companies that are, firstly, COVID resistant, in the short to medium term, and, secondly, companies that are going to benefit from this digital transformation since COVID accelerated things that were happening already.”

He points to the example of UiPath and software automation – the most valuable company to ever come out of Europe: “Digital payments: no one wants to touch cash anymore. And also just different forms of FinTech for digital inclusion. Remitly is probably our key example there, which does remittances for people to send money back home to emerging markets.”

Certainly, with this new $350m fund, it’s clear DN Capital is poised to power though the rest of 2021 and well into the next few years of Europe’s startup growth.

As environmental issues really came of age in the 1990s, certain German automakers were meeting in secret groups to make sure their cars would continue to industriously contribute to greenhouse gas emissions. According to the European Union, Volkswagen, Audi, Porsche, BMW and Mercedes-Benz parent company Daimler have been illegally colluding to restrict competition in emission cleaning for new diesel passenger cars, essentially slowing the deployment of cleaner emissions tech. On Thursday, the EU issued fines of $1 billion (€875 million) to Volkswagen and BMW for their involvement in the emissions cartel.

“The five car manufacturers Daimler, BMW, Volkswagen, Audi and Porsche possessed the technology to reduce harmful emissions beyond what was legally required under EU emission standards,” said executive VP of the EU Commission Margrethe Vestager in a statement. “But they avoided to compete on using this technology’s full potential to clean better than what is required by law. So today’s decision is about how legitimate technical cooperation went wrong. And we do not tolerate it when companies collude. It is illegal under EU Antitrust rules. Competition and innovation on managing car pollution are essential for Europe to meet our ambitious Green Deal objectives. And this decision shows that we will not hesitate to take action against all forms of cartel conduct putting in jeopardy this goal.”

All parties acknowledged their involvement and agreed to settle. Volkswagen, which owns Audi and Porsche, will have to pay around $595 million, and BMW will pay $442 million. Daimler would have had to pay around $861 million, but the company is evading fines by being the whistleblower. So we guess Daimler just gets off scot-free?

BMW made a net profit of $4.62 billion last year, and VW made about $12.2 billion and nearly $23 billion in 2019, so this fine sort of feels like a slap on the wrist. And let us remember, this is not the first time VW has gotten into an emissions scandal.

In 2015, the U.S. Environmental Protection Agency issued a notice of violation of the Clean Air Act to VW for intentionally adding software into its diesel engines to make it look like it was following emissions controls, when in reality its cars were actually producing far more than the legal amount.

In its action against the companies, the EU specifically homed in on the agreement reached by the companies on the sizes of tanks used for AdBlue, a solution that mixes with diesel car exhaust to neutralize harmful pollutants. The companies agreed not to compete on making cars cleaner even though they had the tech to do so.

Der Spiegel first broke the news about the cartel in 2017, and the companies set to work greenwashing. In the same year, all of the involved parties, as well as Ford Motor Company, joined forces to create a high-power charging network for EVs called Ionity. The plan was to build and operate around 400 charging stations across Europe by 2020, but it looks like Ionity only managed to install 300 across Europe, and it even significantly increased the price of a charge by 500% last year.

Earlier this week, VW’s heavy-truck business, the Traton Group, Daimler Truck and Volvo group joined up to invest nearly $593 million in a network of public charging stations for electric heavy-duty long-haul trucks and buses around Europe.

5G technology has generated a lot of hype for its potential to power driverless cars using a remote operator, but for the past few years that’s all it’s been – hype. Las Vegas-based startup Halo and telecom giant T-Mobile are teaming up to change that, with a driverless electric car service in Las Vegas powered on 5G to launch later this year.

The service, which will start with five vehicles, will work by connecting users to Halo’s pilot fleet of vehicles via an app. After a user has ordered a vehicle, a remote operator will drive it to the waiting customer. Once the car is delivered, the user can get behind the steering wheel and operate the vehicle as normal for the duration of their trip. When the trip is complete, the remote operator takes back over and drives it to the next waiting customer.

Halo departs significantly from companies like Waymo or Cruise, which are developing a full self-driving technology stack that aims to completely remove the human – remote or in-car – from the equation. Instead, Halo vehicles will be equipped with 9 cameras, radars and ultrasonics as backup (no lidar), and it will connect to remote operators via T-Mobile’s Ultra Capacity mid-band 5G network.

Halo CEO Anand Nandakumar told TechCrunch that the service can also run on Extended Range low-band 5G network and on LTE as needed.

Halo said in a press release that its cars will be equipped with an algorithm that “learns in the background while humans control the vehicle, building a unique feedback loop to achieve Level 3 capabilities over time,” suggesting that the company has its sights set on autonomy in the long-term. (“Level 3” refers to the Society of Automotive Engineers’ five levels of autonomous driving. L3 indicates features that allow the driver to be out of the loop under very limited conditions.)

“Full autonomy is a massive challenge from both a technical and social trust perspective that won’t be solved for years to come,” Nandakumar said in the release. “But Halo has been designed to address these challenges by building automation over time starting with a solution that consumers will feel comfortable using today.”

The startup also said its vehicles will be equipped with an Advanced Safe Stop mechanism, which will immediately bring cars to a full stop if a potential safety hazard is detected.

Last year, Halo joined the 5G Open Innovation Lab T-Mobile cofounded, giving the startup access to the telecom’s engineers and mid-spectrum network. Nandakumar declined to specify if T-Mobile is one of the company’s investors.

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Hello and welcome to Daily Crunch for July 8, 2021. Forget about Hot ___ Summer. It’s Hot IPO Summer in technology land, and today’s news underscores just how inviting the global exit market is proving to be.

But before we get into the TechCrunch Top 3, the good news from the site is that our latest super-deep company teardown, or EC-1, is live. This time, we looked at NS1, a company that we wrote is building “a strategic node at the core of the modern web delivery tech stack.” The whole series is fire. — Alex

The TechCrunch Top 3

When we said it was IPO season, we weren’t kidding. Here’s the day’s biggest exit news, which has a theme, as you’ll see:

• Instacart hires new CEO as it preps to go public: Big news from the world of grocery delivery today as longtime Instacart CEO and co-founder Apoorva Mehta promoted himself to chairman of the company’s board. Facebook exec Fidji Simo is taking the helm. Back during my first stint at TechCrunch, Mehta would send me Facebook messages when his company added new Bay Area markets. How times change!
• India’s Zomato sets IPO price range: The day’s other big news from the world of delivery comes from India’s Zomato, which will price its IPO “shares in the range of 72 Indian rupees (96 cents) to 76 ($1) and is targeting an upper limit valuation of $8.56 billion,” TechCrunch reports.
• Crypto-powered Circle is going public via a SPAC: If you are a crypto-minded person, you’ve heard of Circle. If you aren’t, it’s the company that bought SeedInvest and is helping build stablecoin USDC. It’s going public via a SPAC at a multibillion-dollar valuation. Call it riding the Coinbase wave.

Startups/VC

Flipping the script and going back to the earlier stages of startup life, here’s a rundown of news from startup land:

• PowerZ raises $8.3M to fuse gaming and education: The French startup is both a gaming company and edtech startup. The startup thinks that “educational games will become mainstream really quickly,” TechCrunch reports. This makes sense: I have learned more about the Middle Ages from Crusader Kings III than any book I’ve read.
• Rootly raises $3.2M to bring SRE tooling into Slack: Look, we all live inside of Slack or Teams, so why not bring more functionality into the services? Rootly wants to bring “an incident-response solution inside” of the work platform that Salesforce is buying. The round and company are neat, as is the fact that startups are building atop Slack itself.
• Z1 wants to bring fintech to LatAm zoomers: Homebrew is putting early-stage money to work in Latin America in hopes that Z1 can mimic what Nubank has managed in the region, namely build a fintech titan and raise a zillion dollars. Per TechCrunch, Z1 was a recent Y Combinator grad, which means that Homebrew acquired around 0.8 bips worth of equity in the $2.5 million the transaction. We kid.
• Popshop Live raises $20M for modern QVC: Now worth around $100 million, Popshop Live has built a “standalone business that taps into the millennial taste for shopping from smaller and more edgy brands and individuals as much as bigger retailers.” With new capital and retailer momentum, it’s a startup to watch.
• Smile Identity raises $7M Series A to verify identities: Focused on the African market, Smile Identity has put together a lettered round for KYC and ID services on the continent. TechCrunch reports that Costanoa Ventures co-led the deal with CRE Venture Capital.

To close out, Natasha scooped that “Peter Boyce II has left General Catalyst to start his own firm, a little over a year after the venture capital firm promoted him to partner.” It’s a busy week for new venture funds, with Acrylic and Renegade also making news.

The NS1 EC-1

For the latest entry in our series of long-form articles that explore the inner workings of notable startups, we looked at NS1, an internet infrastructure company best known for its software-defined domain name services (DNS).

Part 1: Origin story: How three engineers decided to rebuild the internet’s core addressing system.

Part 2: Product development and roadmap: Experimentation, open-source efforts and expanding beyond DNS.

Part 3: Competitive landscape: A look at the broader internet infrastructure market.

Part 4: Customer development: How their top competitor’s stumble became “the gift that kept on giving.”

If you’re curious about how NS1 transformed “a slumbering and dreary yet reliable aspect of the internet” into “a strategic moat and an enterprise win” in just eight years, read on.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

A few notes from Big Tech before we wrap our news coverage. Enjoy:

• Dropbox reinvents work(places): No, not in the product sense, but in terms of how it is approaching offices as COVID slowly wanes. The result? Something that looks more like a fancy, private coffee spot than an office. I demand that all companies mimic this immediately.
• Tendies from $BYND: Yep, Beyond Meat has launched plant-based “chicken” tenders at some 400 U.S. restaurants. The company, long a public firm and thus befitting of our Big Tech moniker, has had a tumultuous life since it went public. Its shares have traded as high as $239 since it debuted. Today, the company is still worth a healthy $140 per share, far above its original $25 IPO price.

TechCrunch Experts: Growth Marketing

Image Credits: SEAN GLADWELL (opens in a new window) / Getty Images

TechCrunch wants to help startups find the right expert for their needs. To do this, we’re building a shortlist of the top growth marketers. We’ve received great recommendations for growth marketers in the startup industry since we launched our survey.

We’re excited to read more responses as they come in! Fill out the survey here.

Our editorial coverage about growth marketing includes articles from the TechCrunch team, guest columns and posts like “Demand Curve: 10 lies you’ve been told about marketing” by Nick Costelloe on Extra Crunch. If you’re interested in writing a column, learn more here.

Between our work at Demand Curve and our agency, Bell Curve, we’ve rewritten over 1,000 websites for startups across most industries.

Want to convert twice as many visitors into customers? Follow these copywriting tactics.

Everything “above the fold” must have a purpose

The section of your homepage that’s immediately visible to a visitor before they start scrolling is called “above the fold.” (Think of a print newspaper: Everything above the literal fold in the paper is the most important information.) When a visitor sees the content above the fold, they decide to either keep scrolling or exit your site.

In seconds, they’re trying to figure out what you do and whether you’re a fit for them.

The most common mistake we see startups make? Their “above the fold” is either uninteresting or confusing. This often happens when marketers attempt to squeeze too much content above the fold.

The truth is, most of the information on your website is irrelevant to new visitors. So the area above the fold should be used to explain how you can help new visitors solve a specific problem.

For example, you might see a homepage that promotes the newest technical blog post that the company published. But that’s not useful to a visitor who doesn’t yet understand what you do.

To further confuse the visitor, many companies add an extensive navigation bar to the top of their site. In theory, this allows your visitors to easily access any part of your website. In practice, it leads to decision fatigue and low conversion rates.

Unless the content directly helps answer what you do and whether you’re a good fit for that visitor, it should be removed.

There are three things you can do to improve the conversion rate of your homepage:

1. Craft a sharp header.
2. Use a complementary subheader.
3. Design with intention.

Let’s get into the tactics of these three areas of improvement.

Help TechCrunch find the best growth marketers for startups.

Provide a recommendation in this quick survey and we’ll share the results with everybody.

Write headers that speak to an individual (not a crowd)

Your header is the largest piece of text on your website. In under 10 words (about the longest we’d recommend), your header needs to accomplish three things:

1. Identify how customers get value from your product.

This is your most important value proposition. If you can’t explain how someone gets value from your product in fewer than 10 words, it’ll be a challenge to keep visitors’ attention for much longer.

Here’s how we uncover your key value proposition:

• What bad alternative do people resort to when they lack your product?
• How is your product better than the bad alternative?
• Now turn the last step into an action statement — that’s your value proposition.

Take Airbnb:

• The bad alternative is being stuck in a sterile hotel without experiencing any real culture.
• Airbnb’s product is better than the bad alternative because it allows you to stay in a local’s home.
• So if we turn the second question into an action statement, we’d get a value proposition like: Experience new cities like a local.

Here are some more examples from top startups:

Image Credits: Demand Curve

2. Include an enticing hook that keeps visitors reading.

Telling your visitors what you do is a good start, but now we need to get them excited about your product.

A huge missed opportunity we see a lot of startups make with their website copy? It’s not action oriented. In a world where customers can shop 24/7, there’s very little urgency for your visitors to take action now.

Adding a hook will increase the likelihood that a visitor buys from you on their first visit.

There are two ways we like to write hooks:

• Offer a bold claim: something highly specific that triggers the thought, “Wow, I didn’t know that was possible.”

Image Credits: Demand Curve

• Or address common objections: questions or pushback that your visitor is likely already thinking about. Addressing objections right away might seem counterintuitive, but bringing attention to your weaknesses will actually make your visitor trust your brand more. With no direct sales team, your copy is going to need to work hard to answer as many questions as possible.

Here are some value propositions of top startups that incorporate their biggest objections upfront.

Image Credits: Demand Curve

3. Speak directly to your ideal customer persona

To truly make the message in your header grab the attention of your visitor, rewrite your value proposition to speak directly to your customer personas.

To do so, list your top two to three customer personas. Rewrite your headers to address the part of your product they value most. Use their own language, not industry jargon. The best way to learn what your customers love about your product is through one-on-one customer interviews or reading customer success tickets.

Now you’ve got headers that speak directly to your ideal customer persona. You can either A/B test which header leads to a higher conversion rate or create custom landing pages using each header to drive traffic from different sources to specific pages.

For example, if you include a link to your website in a guest blog post, send that audience to the page with the most relevant header.

Here are some examples of writing multiple value propositions for the same startup:

Image Credits: Demand Curve

Use a subheader to explain how your header can be possible

We suggest spending about 50% of your time working on writing the header and 25% of your time on the subheader. Why? Because if your header isn’t interesting, your visitors won’t even bother reading the subheader.

Your subheader should be used to expand on two things:

1. How does your product work exactly?
2. Which of your features make our header’s bold claim believable?

You can use your top two to three features to explain how your header is achieved.

For example, let’s say Airbnb’s header is: Experience your getaway vacation like a local. No minimum stays.

To make this statement believable, we need to explain how it’s possible to vacation like a local and how “no minimum stays” is possible.

A subheader could read something like: An online rental marketplace with thousands of short-term rentals in your area.

Do not use industry jargon or technical terms in your subheader or header. Use words that a fifth-grade reader would understand. Use short sentences. Lengthy paragraphs will kill the momentum of your reader.

Here are a few more examples of using the subheader to explain the header:

Image Credits: Demand Curve

Make your homepage feel familiar and function as expected

The last aspect to consider when creating a high-converting homepage is the design. We see a lot of high-tech startups try to use their website to show off their creativity.

From our experience, your website is not the place to try to be original.

A website’s design should rarely be unique. It’s your product that should be unique. Your website is just a familiar medium for communicating your product’s uniqueness.

Functionality

Using familiar buttons and navigation that other websites have popularized will save your visitor the hassle of having to learn how your website works. For example, we’ve come to expect there to be a “home” button in the top left of the page. Attempting to place the same button in the bottom right for the sake of uniqueness will lead to confusion and possibly a lost customer. Stick with what works.

Images

Consider these goals when adding images to your homepage:

• Remove uncertainty by showing your product in action. GIFs or looping videos are a terrific way of demonstrating how it works without taking up any additional space.
  

  Image Credits: Judy

• If you sell physical goods, use images to show off various use cases and close-ups of the material and texture. This will help your visitor assess the quality of the product and further validate that the product is right for them.

Image Credits: Allbirds

Call-to-action buttons

Your call-to-action buttons (CTA) are where you’ll convert a visitor of your webpage into an active shopper. Therefore, your CTAs should be a continuation of the magic that you teased in your header copy.

Make the CTA button copy action focused and tell your visitor what will happen once they click it.

Here are some examples of CTA buttons that feel natural because they continue the narrative that began with the header copy:

Image Credits: Demand Curve

One of VR’s prospective revenue streams is ad placement. The thought is that its levels of immersion can engender high engagement with various flavors of display ads. Think billboards in a virtual streetscape or sporting venue. Art imitates life, and all that.

This topic reemerged recently in the wake of Facebook’s experimental ads in Blaston VR. As TechCrunch’s Lucas Matney observed, it didn’t go too well. The move triggered a resounding backlash, followed by the game publisher, Resolution Games, backing out of the trial.

This chain of events underscored Facebook’s headwinds in VR ad monetization, which stem from its broader ad issues. In fairness, this was an experimental move to test the VR advertising waters … which Facebook accomplished, though it didn’t get the result it wanted.

Regardless, we’ve taken this opportunity to revisit our ongoing analysis and market sizing of VR advertising in general. The short version: There are pros and cons on both qualitative and quantitative levels.

The pros of VR advertising

VR advertising’s opportunity goes back to factors noted above: potentially high ad engagement given inherent levels of immersion. On that measure, VR exceeds all other media, which can mean higher-quality impressions, brand recall and other common display-ad metrics.

Historical evidence also suggests that VR could follow a path toward ad monetization. VR shows similar patterns to media that were increasingly ad supported as they matured. These include video, social media, mobile apps and games (just ask Unity).

To put some numbers behind that, 75% of apps in the Apple App Store’s first year were paid apps — similar to VR today. That figure declined to 15% in 2014 and hovers around 10% today. Over time, developers learned they could reach scale through free downloads.

Prevalent revenue models today include in-app purchases — especially in mobile gaming — and advertising. The question is whether VR will follow a similar path as developers learn that they can reach scale faster through free apps that employ “back-end monetization” like ad support.

This trend also follows audience dynamics: Early adopters are more likely to pay for content and experiences. But as a given technology or media matures, its transition to mainstream audiences requires different business models with less upfront commitment and friction.

“Today, there are only about 18% of applications in VR stores such as Steam and Oculus that are free,” Admix CEO Samuel Huber said. “This is fine for now because we are still very early in the market and most of these users are early adopters. They are willing to pay for content, just like they were willing to pay for prototype unproven hardware and generally, they have higher purchasing power than the average person.”

Drawbacks of VR advertising

Considering the above advantages, VR advertising is a bit of a double-edged sword (or beat saber). Those advantages are counterbalanced by a few practical disadvantages in the medium’s early stage. Much of this comes down to the requirement for scale.