Author: azeeadmin

Following similar moves by Apple, Google, and more recently Amazon, among others, e-commerce platform Shopify announced today it’s also lowering its cut of developer revenue across its app marketplace, the Shopify App Store, as well as the new Shopify Theme Store. The news was announced today alongside a host of other developer-related news and updates for the Shopify platform at the company’s Unite 2021 Conference, including updates to Checkout, APIs, developer tooling and frameworks, among other things.

Shopify says its app developer partners earned $233 million in 2020 alone, more than 2018 and 2019 combined — an increase that can likely be attributed, in part, to the COVID-19 pandemic and the rapid shift to e-commerce that resulted. Today, there are over 6,000 publicly available apps across the Shopify App Store, and on average, a merchant will use around six apps to run their business.

Now, Shopify says it will drop its commissions on app developer revenue to 0%, down from 20%, for developers who make less than $1 million annually on its platform. This benchmark will also reset annually, giving developers — and, particularly those on the cusp of $1 million — more earning potential. And when Shopify’s revenue share kicks in, it will now only be 15% of “marginal” revenue. That means developers will pay 15% only on revenue they make that’s over the $1 million mark.

The same business model will apply to Shopify’s Theme Store, which opens to developer submissions July 15.

As the two stores are separate entities, the $1 million revenue share metric applies to each store individually. The new business model will begin on August 1, 2021 and will be made available to developers who register by providing their account details in their partner dashboard.

Shopify says the more developer-friendly business model will mean a drop in company revenue, but says it doesn’t expect this impact “to be material” because it will encourage greater innovation and development.

The changes to Shopify’s App Store follow a shift in the broader app store market around developer commissions.

Last year, amid increased regulatory scrutiny over how it runs its App Store, Apple announced it would reduce the App Store commissions for smaller businesses under a new program where developers earning up to $1 million per year would only have to pay a 15% commission on in-app purchases. Google and Amazon have since followed suit, each with their own particular spin on the concept. For example, in Google’s case, the fee is 15% on the first million the developer earns. Amazon is still charging a higher percentage at 20%, but is tacking on AWS credits as a perk.

Apple and Google, in particular, hope these changes can help shield them from antitrust investigations over their alleged app store monopolies, while also giving developers a better reason to participate in their own slice of the app economy.

Outside of mobile, Microsoft this year agreed to match the 12% cut on game sales that Epic Games takes on its Windows Store, as a means of increasing the pressure on its rivals. With the larger update to the new Windows 11 Store, it will allow developers to use their own payment platforms, while keeping its commission at 15% on apps.

To date, much of the momentum in the market has been focused on lowering the cut of app and games sales. Shopify’s app platform is different — it’s about apps that are used to enhance an e-commerce business, like those that help with shipping and delivery, marketing, merchandising, store design, customer service and more. These are not consumer-facing apps, but they are still marketed in an app store environment.

While the changes to developers’ businesses is the big news today from Unite 2021, that’s not to diminish from the host of updates Shopify announced related to its larger platform.

Among the updates are: the debut of Online Store 2.0, a more flexible and customizable update to Shopify’s Liquid platform (its templating language), which Netflix was the first to test; investments in custom storefronts for faster response times; a new React framework for building custom storefronts called Hydrogen; a way to host Hydrogen storefronts on Shopify called Oxygen; support for more Metafields for products and product variants and custom content that’s built on top; speedier Spotify Checkout; Checkout Extensions (customizations built by developers); easier and more powerful Shopify Scripts; a Payments Platform for integrating third-party payment gateways into Checkout; updates to its Storefront API; and more.

The company today also shared a few more business metrics, noting, for instance, that last year over 450 million people checked out on Shopify, totaling $120 billion in gross merchandise volume. It said its Shopify partners — which include app developers, theme builders, designers, agencies and experts — earned $12.5 billion in revenue in 2020, up 84% year-over-year, and 4x the revenue of Shopify’s own platform.

While the ambitions of crypto investors have swelled even faster than the market has in recent months, institutional players have had a mountain of blockchain data to try to make sense of without particularly mature analytics products at their disposal.

Blockchain analytics startup Nansen is building a product for crypto traders and hedge funds to more confidently navigate the world of decentralized finance. Their product analyzes public blockchain information across some 90 million Ethereum wallets to clue users into evolving opportunities.

“Nansen’s high quality data enables investors to follow where the smart money is moving, where influential investors are taking positions as well as for discovering new projects to invest and perform due diligence,” Nansen CEO Alex Svanevik tells TechCrunch in an email.

The startup just closed a $12 million Series A led by Andreessen Horowitz (a16z), which recently unveiled a whopping $2.2 billion crypto fund designed to bankroll the firm’s crypto land grab. Other investors in the round include Coinbase Ventures, Skyfall Ventures, imToken Ventures, Mechanism Capital and QCP Capital.

Nansen’s primary product is a network of dashboards designed around specific verticals in the crypto space.

Beyond the very hot DeFi space, Nansen is tapping their labeled database to find investor opportunities in yield farming, liquidity pools, DEX data, and even helping traders scout out particular hot NFT collections. One of its popular dashboards called “Token God Mode” allows investors to tap into blockchain data on a particular ERC20 token, witnessing movement across exchanges over time as well as notable transactions across individual wallets.

Image via Nansen

As the crypto industry largely aims to bring more retail investors into its fold, Nansen’s pricing showcases an effort to bring in a fairly wide range of customers. The startup sells a $116 per month package designed to help traders tap into real-time analytics across a variety of market indicators, while also shopping a $2,500 per month plan designed to foster a closer relationship with more bespoke support access including weekly calls, exclusive chat groups and vertical-specific information sessions.

The team has been publishing some of its higher-level data publicly on its site, but saves the more granular up-to-the-moment data for its network of paying customers. Some of Nansen’s customers include crypto-centric funds like Polychain, Three Arrows, Pantera, and Defiance Capital.

The importance of the U.S. startup ecosystem was made crystal clear during the pandemic: Many of us came to rely on new technologies that had been developed over the past decade, including revolutionary vaccines and testing devices, cutting-edge video-conferencing software that kept workers productive and kids learning online, and financial technology that allowed restaurants and other small businesses to move their operations online to survive.

As we move into this period of national recovery, high-tech startup companies — and the venture-capital investors who back them — are poised to play a critical role in creating higher-paying jobs across the country. These jobs can be created in both the traditional U.S. technology centers and regions hit hard by the decline in manufacturing. Venture investors also help create and deploy technology (think advanced computer chips and electric-car batteries) that increase America’s economic competitiveness vis-à-vis China and help address the climate crisis. All of these are key goals of the Biden administration’s ambitious new jobs plan.

But these worthy goals could be hamstrung by policies that fail to account for the unique business model of high-tech startups. We must realize that we are in an increasingly fierce global competition for innovation. The share of global venture-capital dollars going to U.S. companies has dropped precipitously over the last two decades, from 84% in 2004 to 51% last year. Given that venture capital plays an enormous role in creating economic value, including new jobs, innovation, economic growth and tax revenues, we must refocus our efforts to keep the U.S. positioned as a global innovation and research and development leader.

Here are five policy recommendations we encourage Washington to consider:

Make it easier for brilliant entrepreneurs from other countries to start companies in the U.S. There is a guaranteed way to create new American companies: Pass a startup visa that recruits the world’s most talented entrepreneurs to our shores. Immigrant entrepreneurs have created thousands of U.S. companies, including Zoom, Intel and Moderna. But our immigration policy pushes away foreign-born founders because the U.S. does not have a dedicated visa category for job creators, while more than 20 other countries now have a startup visa category.

Enact policies like the Endless Frontier Act to grow economies in all regions and communities. The United States is the global leader in science and technological ingenuity and innovation. To maintain this leadership at a time when new technological capabilities are being adopted across all elements of our society, we must prioritize technology-focused economic development and create the jobs of the future here.

The key legislative proposal that the president’s plan relies on to achieve this is the Endless Frontier Act. This bipartisan bill, which is now moving through Congress, proposes a generational investment in federal basic research and technology commercialization activities that would lead to new high-tech companies being formed across the country, more technologies designed to address critical societal challenges, increased domestic manufacturing capacity, and greater economic opportunities for workers and communities. The Endless Frontier Act rightfully prioritizes new company formation and growth to encourage the participation of venture capital investors and entrepreneurs who will ultimately create and scale new American companies.

Utilize the innovative power of startups to address the climate crisis. Global carbon emissions are driving a rapidly increasing environmental crisis that will be one of the greatest challenges for our generation to solve. Fortunately, there are thousands of American entrepreneurs at work today building technologies to address the crisis, including new energy sources and storage, clean transportation technologies, carbon capture and utilization, and new, environmentally focused agricultural technologies. The president’s bold plan must take advantage of this generation of innovative startups because their success will be a major factor in the rate of our progress, and we know this is a race we can’t afford to lose.

Coordinate workforce development programs with new job creation opportunities at emerging companies. The jobs of the future are being created every day at VC-backed startups and emerging companies. As Congress considers how to craft workforce development programs, they should consider those that provide on-ramps to workers for jobs in the next generation of American companies, such as offering a refundable tax credit for emerging companies that create training programs for prospective employees. This could prove particularly effective at training non-college-educated workers for positions at high-growth companies.

Coordinate tax policy with the administration’s jobs strategies. We want to be constructive partners in these worthy efforts to expand economic opportunity and address societal challenges. But we caution that the administration’s proposals to increase taxes on capital gains, including carried interest, by more than 80% undercut our goals by specifically targeting the very entrepreneurs and long-term investment funds whose participation will ultimately determine whether the Build Back Better agenda is successful. We urge the administration to give the jobs plan every chance to succeed and avoid creating unintentional bottlenecks in the technology commercialization process with unprecedented tax increases.

As our economy continues to recover from the pandemic and we address the societal challenges of access to economic opportunity, climate and U.S. global competitiveness, we must remember that our country boasts the most vibrant startup ecosystem in the world. This ecosystem has provided technology to help us weather the pandemic and hopefully bring it to a close; launched the internet, biotechnology and climate technology industries; and led to the creation of millions of high-paying jobs.

The problems we seek to address may be unique to our time, but the source of our solutions remains the same. Expanding entrepreneurial activity will identify and scale the technologies needed to move our country forward and provide for a more secure and prosperous future for all. Let’s focus on working together to leverage this strength to solve our long-term challenges.

Duolingo filed to go public yesterday, giving the world a deep look inside its business results and how the pandemic impacted the edtech unicorn’s performance. TechCrunch’s initial read of the company’s filing was generally positive, noting that its growth was impressive and its losses modest; Duolingo recently began making money on an adjusted basis.

While the company’s top-level numbers are impressive, we want to go one level deeper to grow our understanding of the company beyond our EC-1.

First, we’ll explore the growth of Duolingo’s total user base, how much money it makes per active user, and how effectively the company has managed to convert free users to paid products over time. The numbers will set us up to understand what else can be learned about Duolingo’s business beyond our original deep dive into the company’s finances — specifically underscoring the pressure cooker it finds itself in when looking for new revenue sources.

Starting with Duolingo’s growth in total active users, guess how fast they rose from 2019 to 2020. Hold that number in your head.

The actual numbers are as follows: In 2019, Duolingo closed the year with 27.3 million monthly active users (MAUs); it wrapped 2020 with 36.7 million MAUs. That’s a gain of 34%. If we narrow our gaze to Q1 2021 numbers compared to Q1 2020, we can see that Duolingo’s MAUs rose from 33.5 million to 39.9 million, or growth of around 19%.

The bulk of Duolingo’s growth, then, came in early 2020 when we consider its pandemic bump. Put more simply, the company scaled from 27.3 million MAUs at the end of 2019 to 33.5 million MAUs at the end of Q1 2020; from then, the company added 3.2 million more MAUs throughout 2020 and 6.4 million during the next four quarters.

Another lens through which to view the numbers is simply a recognition that first-quarter results at Duolingo appear to be stronger than results in the rest of the year, perhaps due to New Year’s resolutions to learn a new language or brush up on a second language learned in high school.

Next, let’s examine Duolingo’s monetization efforts regarding converting free users to paying users.

Here we can see a very different growth story. While the company’s MAUs rose 34% from 2019 to 2020, the company’s paying users rose from 900,000 at the end of 2019 to 1.6 million at the end of 2020. That is a far sharper gain of 84% on a year-over-year basis.

So, while Duolingo did see material user growth during 2020, it saw turbocharged expansion in the users it was able to shake revenue from. Improved monetization, more than acceleration in user growth, was the pandemic’s effect on Duolingo.

What can we see in the company’s more recent results? From Q1 2020 to Q1 2021, Duolingo’s paid subscribers rose from 1.1 million to 1.8 million, a gain of around 64%. That was a slower pace than the company managed more generally in 2020, which matches Duolingo’s slower revenue growth in Q1 2021 than it recorded in 2020.

The number is still strong, we think. But not as impressive as the more than 100% revenue expansion that the company put on the board last year.

In percentage terms, 3.3% of Duolingo’s MAUs were paid subscribers in 2019. That figure rose to 4.4% in 2020. And in Q1 2021, it reached 4.5%. Duolingo rounds that number to 5% in its S-1, which feels somewhat aggressive to us, given the somewhat modest pace at which the metric is improving. Here’s the wording:

As of March 31, 2021, approximately 5% of our monthly active users were paid subscribers of Duolingo Plus. Our paid subscriber penetration has increased steadily since we launched Duolingo Plus in 2017 and, combined with our user growth, has led to our revenue more than doubling every year since.

A gain of 0.1 percentage point in a quarter is growth, we suppose.

Next, let’s chat about revenue per MAU. To get consistent numbers, we’ll divide quarterly revenues by MAU figures from the same period. So, we’ll compare Q4 2019 revenue at Duolingo with its year-end MAU figure. We’ll do the same for 2020, and for Q1 2021 we’ll use both numbers from that period.

After launching its IPO last week with an expected listing price range of $26 to $29 per share, cybersecurity company SentinelOne is going tomorrow with some momentum behind it. Sources close to the  tell us that the company, which will be trading under the ticker “S” on the New York Stock Exchange, is expecting to raise over $1 billion in its IPO, putting its valuation at around $10 billion.

Last week, when the company first announced the IPO, it was projected that it would raise $928 million at the top end of its range, giving SentinelOne a valuation of around $7 billion. Coming in at a $10 billion market capitalization would make SentinelOne the most valuable cybersecurity IPO to date.

A source said that the road show has been stronger than anticipated, in part because of the strength of one of its competitors, CrowdStrike, which is publicly traded and currently sitting at a market cap of $58 billion.

The other reason for the response is a slightly grimmer one: cybersecurity continues to be a major issue for businesses of all sizes, public organizations, governments and individuals. “No one wants to see another SolarWinds, and there is no reason that there shouldn’t be more than one or two strong players,” a source said.

As is the bigger trend in cybersecurity, Israel-hatched, Mountain View-based SentinelOne‘s approach to combat that is artificial intelligence — and in its case specifically, a machine learning-based solution that it sells under the brand Singularity that focuses on endpoint security, working across the entire edge of the network to monitor and secure laptops, phones, containerised applications and the many other devices and services connected to a network.

Last year, endpoint security solutions were estimated to be around an $8 billion market, and analysts project that it could be worth as much as $18.4 billion by 2024 — another reason why SentinelOne may have moved up the timetable on its IPO (last year the company’s CEO Tomer Weingarten had told me he thought the company had one or two years left as a private company before considering an IPO, a timeline it clearly decided was worth speeding up).

SentinelOne raised $267 million on a $3.1 billion valuation led by Tiger Global as recently as last November, but it has been expanding rapidly. Growth last quarter was 116% compared to the same period a year before, and it now has more than 4,700 customers and annual recurring revenue of $161 million, according to its S-1 filing. It is also still not profitable, posting a net loss of $64 million in the last quarter.

It may be a little while longer until Starlink hits profitability. The SpaceX project, which aims to deliver global high-speed broadband via a satellite network, sells its beta kits to customers for around $500 dollars despite it costing much more to produce them, CEO Elon Musk said in an interview Tuesday.

The kit includes a user terminal, a kind of dish, that connects the customer to the satellites and enables broadband access. “To be totally frank, we are losing money on that terminal right now,” he said. That terminal costs us more than $1,000, so obviously I’m subsidizing the cost of the terminal.” He went on to add that SpaceX is working on a next-gen terminal capable of providing the same capability, but at a lower cost to make.

SpaceX’s overall investment in the project could be between $5-10 billion initially and as much as $30 billion over time, as the company continues to provide improvements and stay competitive against improvements in cellular technology, he said.

Musk, who made these comments during a virtual keynote at the Mobile World Congress event in Barcelona on Tuesday, also provided other details about the current status of Starlink. The project is on track to have over half a million users within the next twelve months, he said, and is operational in around 12 countries with more “being added every month.”

SpaceX is also getting close to launching satellite version 1.5, which will have laser inter-satellite links to provide continuous connectivity over high-latitude and polar regions. Next year the company will launch version 2, “which will be significantly more capable,” Musk noted.

Starlink satellites streak through a telescope’s observations.

The project has entered into two partnerships with major country telecommunications companies, though Musk declined to specify their names.

It is hard to imagine Starlink without the breakthrough in rocket reusability achieved by SpaceX. “But we still need to take this to another level with [. . .] the Starship development,” Musk said. That rocket will be designed for rapid reusability – so the ability to relaunch with little to no time on the ground between flights, similar to an airplane’s capabilities today.

Starship is key to Musk’s vision to build a base on the Moon or a city on Mars. He said the company is hoping to make the first orbital launch attempt with Starship in the next few months. SpaceX filed a request for approval with the Federal Communications Commission (FCC) to fly Starlink terminals on the new spacecraft in order to “demonstrate high data rate communications” between Starship’s launch system and the ground throughout the mission.

The number of startups acquiring e-commerce businesses, especially those operating on Amazon, to grow and scale is increasing as more people than ever are shopping online.

The latest such startup to raise capital is Forum Brands, which today announced it has raised $27 million in equity funding for its technology-driven e-commerce acquisition platform. 

Norwest Venture Partners led the round, which also included participation from existing backers NFX and Concrete Rose.

Brenton Howland, Ruben Amar and Alex Kopco founded New York-based Forum Brands last summer during the height of the COVID-19 pandemic. Its self-proclaimed goal was to use data to innovate through acquisition.

“We’re buying what we think are A+ high-growth e-commerce businesses that sell predominantly on Amazon and are looking to build a portfolio of standalone businesses that are category leaders, on and off Amazon,” Howland said. “A source of inspiration for us is that we saw how consumer goods and services changed fundamentally for what we think is going to be for decades and decades to come, accelerating the shift toward digital.”

Forum Brands founding team. Image Credits: Forum Brands

Forum’s technology employs “advanced” algorithms and over 60 million data points to populate brand information into a central platform in real time, instantly scoring brands and generating accurate financial metrics.

The M&A team also uses data to contact brand owners “in just three clicks.” But Forum says it already knows which brands meet its acquisition criteria before ever making contact with brand owners.

“The decision to acquire comes within 48 hours and once terms are agreed upon, entrepreneurs get paid in 30 days or less for their brand, with additional income benefits through post-acquisition partnerships,” according to the company.

Its apps leverage analytics to push recommendations to drive growth and financial performance for brands. Then, its multichannel approaches aimed at positioning the brands for “long-term category leadership.”

“We are using a lot of data science and machine learning techniques to build technology that allows us to eventually operate efficiently a large portfolio of digital brands at scale,” Kopco said.

The company is undeterred by the increasingly crowded space based on the belief that the market opportunity is so huge, there’s plenty of room for multiple players.

“We are very much in the day zero consolidation of the e-commerce space, and the market is very, very large,” Amar told TechCrunch. “And based on our data, 98% or 99% of all sellers are still operating independently. So, this is not a winner-takes-all market. There will be multiple winners, and we’ve built a strategy to be one of these winners.” 

Norwest Venture Partners’ Stew Campbell believes that the number of sellers who reach a point where they have trouble scaling either due to the lack of resources or time is only going to grow. And Forum Brands intends to capitalize on that.

“There’s a continued need for more liquidity options for the entrepreneurs behind many Amazon-first brands. Forum helps entrepreneurs recognize value, which can be significant too many,” he said. ”After acquisition, the Forum team drives operational efficiencies and scale to create better customer experiences for shoppers on Amazon.”

Campbell emphasizes that his firm was drawn to Forum Brands’ team, which the company also touts as a differentiator.

Co-founder and COO Kopco worked in a variety of product roles for several years at Amazon and John Derkits, Forum’s VP of brand growth, is also ex-Amazon. Overall, three-fourths of its operating team are former Amazonians. Co-CEO and co-founder Howland was an investor for two years at Cove Hill Partners and is a former McKinsey consultant.

Campbell says his firm has seen many other models in this market, “but the Forum team blends long-term mindsets and focus on technology, while bringing operational and M&A expertise.”

If this all sounds familiar, it’s because TechCrunch also recently covered the raise of Acquco, which has a similar business model to that of Forum Brands and also involves former Amazon employees. In May, that startup raised $160 million in debt and equity to scale its business. Thrasio is another high-profile player in the space, and has raised $850 million in funding this year. Other startups that have recently attracted venture capital include Branded, which recently launched its own roll-up business on $150 million in funding, as well as Berlin Brands Group, SellerX, Heyday, Heroes and Perch. And, Valoreo, a Mexico City-based acquirer of e-commerce businesses, raised $50 million of equity and debt financing in a seed funding round announced in February.

Also, earlier this month, Moonshot Brands announced a $160 million debt and equity raise to “acquire high-performing Amazon third-party sellers and direct-to-consumer businesses on Shopify and WooCommerce with established brand equity.” That company says that since its founding in 2020, it has achieved a $30 million revenue run rate. Among its investors are Y Combinator, Joe Montana’s Liquid 2 Ventures and the founders of Hippo, Lambda School and Shift. 

GitHub has unveiled a new product that leverages artificial intelligence to help you write code more efficiently. Named GitHub Copilot, today’s new product can suggest lines of code and even sometimes entire functions.

GitHub has partnered with OpenAI to develop this tool. It doesn’t replace developers, it’s just a tool that should improve productivity and make it easier to learn how to code. GitHub frames this new tool as an AI pair programmer.

The model behind GitHub Copilot has been trained on billions of lines of code — many of them are hosted and available publicly on GitHub itself. When you’re writing code, GitHub Copilot suggests code as you type. You can cycle through suggestions, accept or reject them.

In order to figure out what you’re currently coding, GitHub Copilot tries to parse the meaning of a comment, the name of the function you are writing, or the past couple of lines. The company shows a few demos on its website.

In particular, you can describe a function in plain English in a comment and then convert it to actual code. If you’re getting started with a new language or you’ve been using no-code or low-code tools in the past, that feature could be useful.

If you’re writing code every day, GitHub Copilot can be used to work with a new framework or library. You don’t have to read the documentation from start to finish as GitHub Copilot already knows the specific functions and features of the framework you’re working with. It could also replace many Stack Overflow queries.

GitHub Copilot integrates directly with Visual Studio Code. You can install it as an extension or use it in the cloud with GitHub Codespaces. Over time, the service should improve based on how you interact with GitHub Copilot. As you accept and reject suggestions, those suggestions should get better.

Currently available as a technical preview, GitHub plans to launch a commercial product based on GitHub Copilot. It currently works best with Python, JavaScript, TypeScript, Ruby and Go.

As companies expand worldwide, and meet online in tools like Zoom, the language barrier can be a real impediment to getting work done. Zoom announced that it intends to acquire German startup Karlsruhe Information Technology Solutions or Kites for short, to bring real-time machine learning-based translation to the platform.

The companies did not share the terms of the deal, but with Kites, the company gets a team of top researchers, who can help enhance the machine learning translation knowledge at the company. “Kites’ talented team of 12 research scientists will help Zoom’s engineering team advance the field of [machine translation] to improve meeting productivity and efficiency by providing multi-language translation capabilities for Zoom users,” the company said in a statement.

The deal appears to be an acquihire as the company adds those 12 researchers to the Zoom engineering group. It intends to leave the team in place in Germany with plans to build a machine learning translation R&D center with additional hires over time as the company puts more resources into this area.

While the Kites website reveals little about it other than an address, the company About page on LinkedIn indicates that the startup was founded in 2015 by two researchers who taught at Carnegie Mellon and Karlsruhe Institute of Technology with the goal of building machine learning translation tooling.

“The Kites mission is to break down language barriers and make seamless cross language interaction a reality of everyday life,” the LinkedIn overview stated. It claims to be among a handful of companies, that include Google and Microsoft, to have developed “leading speech recognition and translation technologies,” which would suggest that Zoom has acquired some key technologies.

It does not appear the company had a commercial product, but the site does indicate that there is a machine learning translation platform that is in use in academia and government. Regardless, the fruits of the company’s research will now belong to Zoom.

As the pandemic took hold, training staff had to ‘go virtual’. Typically, that would have meant falling back on existing corporate training solutions, which we all know and “love”. Could there be another way?

In 2018, trauma surgeon Dr. Alex Young took the training required for high-stress scenarios like surgery and applied it to a virtual reality environment, ending up with, he says, a radical and effective approach to training.

His digital training platform Virti has now raised $10 million in a Series A round led by IQ Capital, which was joined by Cedars-Sinai Medical Center and a new, UK-based learning technology VC fund, Descenture Capital. In additional news, Kurt Kratchman and Mark Ashworth join Virti from Oracle as CRO and CFO/COO respectively.

Founded in Bristol, UK, the Virti platform works across mobile or desktop devices, or VR/AR headsets and captures data across all three to analyze, measure, and give feedback on employee performance, turning a lot of subjectively assessed skills into more objective and measurable data. It’s even managed to have been named one of TIME’s Best Inventions of 2020.

Virti claims its deep learning technology is improving training outcomes by up to 230% and the startups says it has increased revenues by 978%. It also has a cloud-based, no-code simulation creation suite allowing organizations to build their own bespoke training modules.

Dr Alexander Young, CEO and founder of Virti, commented: “At Virti, our goal is to maximize human performance by making experiential learning affordable and accessible for everyone. In-person training has always been expensive with e-learning often unengaging – and research shows that employees forget upwards of 80% of episodic training.”

Max Bautin, managing Partner at IQ Capital, said: “E-learning has seen strong growth over the last 5 years, and COVID-driven shift to remote work has increased demand many times over. Virti’s deeptech experiential learning platform is by far the best in the world.”

Virti competes with normal desktop-based training solutions. But on the VR side, more so with StriVR which has raised $51 million, and Mursiun which has raised $35.1 million.

Speaking to me over a call Young told me: “Our system, which we’ve patented in terms of the analytics, can actually track what people are looking at if they’re in a virtual reality headset. So we can really pull out some deep engagement metrics, a bit like heat map data you might see on marketing platforms. Combined with how people are interacting and doing things like making decisions in these environments, we can then predict how they may perform better in real-world environments and share that on a reporting dashboard. The other aspect is if you’re not practicing things you forget about 80% of what you can learn. Our system allows people to jump back in and reminds them and because it’s accessible on mobile as well as VR, AR headsets, they get that hit of updates and learning to keep them up-skilled and remembering information for longer.”