Author: azeeadmin

IBM today made another acquisition to deepen its reach into providing enterprises with AI-based services to manage their networks and workloads. It announced that it is acquiring Turbonomic, a company that provides tools to manage application performance (specifically resource management), along with Kubernetes and network performance, part of its bigger strategy to bring more AI into IT ops, or as it calls it, AIOps.

Financial terms of the deal were not disclosed but according to data in PitchBook, Turbonomic was valued at nearly $1 billion — $963 million, to be exact — in its last funding round in September 2019. A report in Reuters rumoring the deal a little earlier today valued it at between $1.5 billion and $2 billion, and a source tells us the figure is accurate.

The Boston-based company’s investors included General Atlantic, Cisco, Bain, Highland Capital Partners, and Red Hat. The last of these, of course, is now a part of IBM (so it was theoretically also an investor), and together Red Hat and IBM have been developing a range of cloud-based tools addressing telco, edge and enterprise use cases.

This latest deal will help extend that further, and it has more generally been an area that IBM has been aggressive in recently. Last November IBM acquired another company called Instana to bring application performance management into its stable, and it pointed out today that the Turbonomic deal will complement that and the two technologies’ tools will be integrated together, IBM said.

Turbonomic’s tools are particularly useful in hybrid cloud architectures, which involve not just on-premise and cloud workloads, but workloads that typically are extended across multiple cloud environments. While this may be the architecture people apply for more resilience, reasons of cost, location or other practicalities, the fact of the matter is that it can be a challenge to manage. Turbonomic’s tools automate management, analyse performance, and suggest changes for network operations engineers to make to meet usage demands.

“Businesses are looking for AI-driven software to help them manage the scale and complexity challenges of running applications cross-cloud,” said Ben Nye, CEO, Turbonomic, in a statement. “Turbonomic not only prescribes actions, but allows customers to take them. The combination of IBM and Turbonomic will continuously assure target application response times even during peak demand.”

The bigger picture for IBM is that it’s another sign of how the company is continuing to move away from its legacy business based around servers and deeper into services, and specifically services on the infrastructure of the future, cloud-based networks.

“IBM continues to reshape its future as a hybrid cloud and AI company,” said Rob Thomas, SVP, IBM Cloud and Data Platform, in a statement. “The Turbonomic acquisition is yet another example of our commitment to making the most impactful investments to advance this strategy and ensure customers find the most innovative ways to fuel their digital transformations.”

A large part of the AI promise in the world of network operations and IT ops is how it will afford companies to rely more on automation, another area where IBM has been very active. (In a very different application of this technology — in business services — this month, it acquired MyInvenio in Italy to bring process mining technology in house.)

The promise of automation, meanwhile, is lower operation costs, a critical issue for managing network performance and availability in hybrid cloud deployments.

“We believe that AI-powered automation has become inevitable, helping to make all information-centric jobs more productive,” said Dinesh Nirmal, General Manager, IBM Automation, in a statement. “That’s why IBM continues to invest in providing our customers with a one-stop shop of AI-powered automation capabilities that spans business processes and IT. The addition of Turbonomic now takes our portfolio another major step forward by ensuring customers will have full visibility into what is going on throughout their hybrid cloud infrastructure, and across their entire enterprise.”

Even as signs of hope for life after the pandemic have begun to emerge here in the U.S., increases in video game spending continue. There’s no doubt that much of last year’s big numbers were driven by stay-at-home requirements in much of the country and the world. All said, U.S. spending on the industry increased 27% for 2020.

There remains a broader question, however, around whether this momentum can maintain, as people start to, you know, leave the house more. For now, at least, things are continuing to look rosy for the industry. NPD noted this morning that U.S. spending on the category jumped 30% y-o-y for Q1 2021 to $14.92 billion.

When we break the number down a bit, however, it becomes clear that the driver goes beyond mere pandemic entertainment. Content was up 25% for the quarter, accessories jumped 42% and hardware went up 82%.

The motivator behind that last figure should be immediately obvious to anyone who follows the industry with any among of interest. Where Nintendo’s Switch dominated the conversation for most of 2020, Sony and Microsoft both launched their next gen consoles late-last year.

“While we are still seeing elevated rates of both engagement and spending resulting from changes in consumer behavior driven by the pandemic, we are also seeing cyclical gains from the November launches of both the PlayStation 5 and Xbox Series consoles,” analyst Mat Piscatella said in a release The growth driven by these new platforms, combined with gains experienced in mobile, PC and VR content spending, as well as the continued strength of Nintendo Switch, have pushed the market to new highs.”

While waiting for full first-quarter venture capital results for fintech startups to drop, we knew that they were going to be outsized. The Exchange previously explored the pace at which huge venture rounds were invested into the startup niche, noting that by mid-March the fintech market had already recorded a record number of $100 million rounds.

But the largest venture capital rounds are only part of the fintech investing picture, so we were looking forward to getting a deeper look into what happened in the critical startup sector more generally. We’ve now got the data, so today we’re digging in with both hands.

The Exchange explores startups, markets and money. Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.

Per a CB Insights compilation of Q1 2021 fintech venture capital data from around the world, the first three months of the year were the most valuable period for fintech investing, ever. Somewhat shockingly, the first quarter beat the infamous second quarter of 2018, when Ant Group raised a $14 billion round, so skewing the category’s longitudinal data that some analyst groups simply discount it for analytical purposes.

It wasn’t necessary this time: The 614 tracked fintech deals in Q1 were worth a total of $22.8 billion, per the report, enough to set an all-time high, Ant Group be damned. Per CB Insights, the quarter’s fintech VC deal volume rose a modest 15% compared to the year-ago quarter, while VC dollar volume in the sector shot 98% higher over the same interval.

The boom in funding was a global affair, as we’ll get into shortly. We’re also going to chat sub-sectors in the fintech world, parsing where there’s the most venture activity to track, and, critically, where VCs are pushing — or pulling back — their attention and capital.

So, where did the fintech venture capital market push the most money in the first quarter, and why? We’ll be chatting data as we go, but The Exchange also enlisted VCs from three continents who have made fintech investments to help provide context: We’ll hear from Jesse Wedler, a partner at CapitalG based in North America; Kola Aina, a general partner at Ventures Platform based in Africa; and Shiyan Koh, a general partner at Hustle Fund based in Asia.

Let’s talk a few key fintech numbers, and then rip into venture results by geography and focus.

Huge checks, myriad exits

While we’re looking beyond the largest checks today to get a more holistic perspective on the state of the fintech venture capital world, we cannot discount them. So, briefly, what matters from the mega-round space, or the funding category of rounds worth nine figures and more? Some 57 were raised by fintech startups around the world in the first quarter, or about 4.5 per week. That number was 30 in Q4 2020, and just 21 in Q1 2020.

The first quarter’s 57 mega-deals were worth a huge 69% of total venture capital in the fintech space during the quarter. Don’t be shocked by that figure; a single mega-round can add up to the value of 50 seed deals pretty easily.

The huge results should also not be a complete surprise, CapitalG’s Wedler told TechCrunch in an email, as “the reality is that fintech has been a hot category for years.” What could be driving the recent acceleration in capital disbursement into financial technology startups? Wedler mused it’s a combination of “the ubiquity of smartphones and the modern internet, the development of modern cloud technology, and advancements in APIs and modular services.”

Following November’s overhaul of Google Pay, which saw the service expanding into personal finance, the company today is rolling out a new set of features aimed at making Google Pay more a part of its users’ everyday lives. With an update, Google Pay will now include new options for grocery savings, paying for public transit, and categorizing their spending.

Through partnerships with Safeway and Target, Google Pay users will now be able to browse their store’s weekly circulars that showcase the latest deals. Safeway is bringing over 500 stores to the Google Pay platform, and Target stores nationwide will offer a similar feature. Google Pay users will be able to favorite the recommended deals for later access. And soon, Google Pay will notify you of the weekly deals when you’re near a participating store, if location is enabled.

Image Credits: Google

Another update expands Google Pay’s transit features, which already today support buying and using transit tickets across over 80 cities in the U.S. New additions arriving soon now include major markets, Chicago and the San Francisco Bay Area. This follows Apple Pay’s recently added and much welcomed support for the Bay Area’s Clipper card. The company is also integrating with Token Transit to expand transit support to smaller towns across the U.S.

Soon, the Google Pay app will also allow Android users to access transit tickets from the app’s homescreen through a “Ride Transit” shortcut. They can then purchase, add, or top up the balance on transit cards. Once purchased, you’ll be able to hold up your transit card to a reader — or show a visual ticket in the case there’s no reader.

The final feature is designed for those using Google Pay for managing their finances. With last year’s revamp, Google partnered with 11 banks to launch a new kind of bank account it called Plex. A competitor to the growing number of mobile-only digital banks, Google’s app serves as the front-end to the accounts which are actually hosted by the partner banks, like Citi and Stanford Federal Credit Union.

As a part of that experience, Google Pay users will now gain better access into their spending behavior, balances, bills, and more via an “Insights” tab. Here, you’ll be able to see what your balance is, what bills are coming due, get alerts about larger transactions, and tracking spending by either category or business. As Google is now automatically categorizing transactions, that means you’ll be able to search for general terms (like “food”) as well as by specific business names (like “Burger King”), Google explains.

Image Credits: Google

These features are a part of Google’s plan to use the payments app to gain access more data on users, who can then be targeted with offers from Google Pay partners.

When the redesigned app launched, users were asked to opt in to personalization features which could help the app show users better, more relevant deals. While Google says it’s not providing your data directly to these third-party brands and retailers, the app provides a conduit for those businesses to reach potential customers at a time when the tracking industry is in upheaval over Apple’s privacy changes. Google ability to help brands reach consumers through Google Pay could prove to be a valuable service, if the is able to grow its user base, and encourage more to opt in to the personalization features.

To make that happen, you can expect Google Pay to roll out more useful or “must have” features in the weeks to come.

The chance that I am ever willing to commute on a regular basis again in the future is zero. It’s too inefficient. And while workers and employers are somewhat split on where they stand on the question of remote toil, the COVID-19 pandemic has permanently shaken up the working world; we’re not going back to the pre-COVID normal.

To support what could be droves of workers sticking to distance-labor instead of returning to offices, Firstbase is building a software-and-hardware solution to quickly get remote workers the tools and support they need. And today the company announced that it closed a $13 million Series A led by Andreessen Horowitz. B Capital Group and Alpaca VC also put capital into the round; TechCrunch first caught wind of Firstbase when it took part in an Acceleprise accelerator cohort in mid-2020.

Notably Firstbase didn’t start with its current product focus. As is common amongst startups, it was born as something else entirely. With an original fintech bent, the company went remote back in 2018. But the experience wasn’t stellar, Firstbase co-founder and CEO Chris Herd told TechCrunch. It was hard to get workers the technology they needed, and hard to get it back if they left the company, he explained.

Later, with the fintech effort low on capital and time, the company realized that some internal tech it had built to help support remote staff’s hardware and software needs might have broader application. Firstbase pivoted in late 2019, and by March of 2020 Herd told TechCrunch that his company had 600 companies on its waitlist. That number has since multiplied.

The company’s product is two-fold. It’s a software service that help companies track, and manage their hardware assets that remote workers use. And it’s a hardware service that can pre-install software on hardware and ship it to employees, and provide remote IT support. Notably customers can either use Firstbase’s software alone, which they pay for on a SaaS basis, or both its software and hardware offerings.

Firstbase has two sources of gross margin. Its software business will generate obvious software incomes, and the company can extract gross profit from its hardware business, Herd explained. The hardware part of the startup’s model appears more nascent than the software component. Firstbase only began onboarding customers last November, making it a yet-nascent startup that is allowed to still be figuring things out.

TechCrunch asked Herd what it costs to kit out a remote worker today. He said that it varied, but could land between $2,000 and $5,000, though he added that Firstbase will allow customers to pay those costs over time as a series of flat payments.

What’s ahead for the company? Per its CEO, the merely ten-person company, three of whom are part time, would like to grow its staff by four or five-fold this year. And unsurprisingly, Firstbase intends to hew to its remote roots, meaning that it won’t be looking for workers in a single geographic region. Some of the staff it intends on hiring will be in its sales org, a focus that Herd mentioned during our interview. The company will also build out more enterprise-friendly software features with its new capital, allowing it to target larger customers.

Let’s see how far Firstbase can scale with its Series A. And if it gets pre-empted before the year ends.

PreShow Interactive is giving gamers a new way to earn in-game currency in exchange for watching ads — a concept that’s become familiar in mobile games but hasn’t really made much headway on PCs or consoles.

The startup is led by MoviePass’ founding CEO Stacy Spikes. When I spoke to Spikes about PreShow two years ago, he was beta testing an app that provided users with free movie tickets in exchange for watching ads. But obviously, theatrical moviegoing has taken a big hit in the past year.

Spikes told me yesterday that he’d always hoped to bring the PreShow concept to four categories — theatrical movies, gaming, subscription streaming and video on demand — but the pandemic forced the startup to shift focus more quickly than expected and explore what a gaming experience might look like.

The current plans is to launch a new PreShow Interactive app this summer, where viewers can connect their in-game accounts and identify how much virtual currency they want to earn. Then they watch a package of ads and PreShow will automatically transfer the currency to their account — in other words, it’s buying the currency for them.

Users will have to download a separate app to watch the ads and get the benefits, but Spikes said this is actually better than trying to integrate advertising or branded content into the game itself, which can be a slow process for the developer and the advertiser, while also being distracting for the players. And this means PreShow Interactive should able to support 20,000 games at launch, across PCs, consoles and virtual reality.

Image Credits: PreShow Interactive

“We just didn’t see the purpose of spending the time on integrations when it’s not really necessary,” he added. “Our deal is only with the consumer for their time. We’re saying, ‘This is your time. It has value.'”

One of the key elements to Preshow’s approach is technology that can detect when the viewer is actually looking at their phone screen — the ads will stop playing if you turn away. Critics have described this as “creepy surveillance tech,” but Spikes claimed that early PreShow users have embraced the approach. He also argued that it’s more transparent than the data collection and targeting currently driving online advertising.

“We used to think data was the new oil, but now our feeling is that permission and engagement and attention is the new oil,” he said.

In addition to revealing its new strategy, PreShow is announcing that it has raised $3 million in seed funding led by Harlem Capital, with participation Canaan Partners, Wavemaker Ventures, Front Row Fund, ROC Fund, BK Fulton and Monroe Harris.

And to be clear, Spikes said PreShow isn’t abandoning theatrical movies. He said that the PreShow app will eventually offer both movie and gaming deals “under one roof,” but brands aren’t currently eager to advertise to moviegoers.

“We’re ready to go when the marketplace is ready to go,” he said.

Some fun ones this week, so let’s get all of those pesky business transactions out of the way first, shall we? I mean, not that tens of millions of dollars changing hands for future robotics technology is boring, he said, tugging at his collar for comedic effect.

Image Credits: Plus One Robotics

Big raise this week for Plus One Robotics. The San Antonio-based company raised a healthy $33 million Series B, bringing its total funding above $40 million. The company mostly traffics in the warehouse and logistics space — obviously a category with a lot of excitement around it after last year’s massive shut down. As many companies have told me, most clients are simply looking for a way to help their footing in the competition against Amazon.

In addition to its massive headcount and seemingly bottomless resources, the e-commerce giant has deployed a huge army of robots in its warehouse. Plus One, for its part, doesn’t make the robots, but rather the vision software that works with them. The company’s product is designed to work across a broad range of robotic arms and grippers, allowing workers to control up to 50 systems at once.

Image Credits: Roam Robotics

We’ve talked about exoskeletons quite a bit on these pages, but Roam offers an interesting alternative to a number of bigger, bulkier and harder products on the market. The company’s latest device I liken to a standard knee brace, with AI and robotic capabilities that assist with movement. Specifically it helps with things like walking up stairs and standing up from a seated position.

And here we have a tiny tree man. Project Kiwi is kind of like Pinocchio if he really leaned into the whole wooden thing in the process of becoming a real boy. Obviously Disney’s going for the (sometimes) littlest Guardian of the Galaxy, Groot, for its latest extremely impressive animatronic.

Matthew was extremely impressed seeing the beautiful little tree guy in action and, living vicariously through some YouTube videos, I definitely have to confirm.

A fun bit of research out of Carnegie Mellon this week. The latest bit of biomimicry is a bit surprising. Obviously Cheetah has been a big inspiration for a number of quadrupedal robots (MIT in particular has a whole lot going in the Cheetah department). Specifically, though, the CMU researchers are looking at the big cat’s tail. Per CMU:

The cheetah’s lightweight furry tail is known as an aerodynamic drag tail; that is, it acts sort of like a parachute. Most robotic tails have high inertia, but the cheetah manages to retain low inertia. Inertia is a physical quality that describes an object’s resistance to changes in motion — high tail inertia means the tail can apply high forces. Aerodynamic tails instead use a different principle — aerodynamic drag — to achieve high forces without a large inertia.

Every developer relies on environments like testing, staging and production as they build software, but building them can be a time-consuming operation. ReleaseHub, an early stage startup that was part of the Y Combinator Winter 2020 cohort, wants to change that by providing a service to make environments available on demand.

Today, the company announced a $2.7 million seed, and also announced that service is generally available while they were at it. Sequoia led the round with participation from Y Combinator, Rogue VC, Liquid Capital and unnamed angel investors.

Company co-founder and CEO Tommy McClung says that every developer in the world has to use environments in their development workflow, but it remains for the most part a manual process.

“All of those environments are incredibly difficult to build. So the problem we’re solving is the ability to create those on demand. Instead of having to have a DevOps team that is responsible for managing, creating and maintaining them, the software does that and you can instantaneously create them,” McClung told me.

The service is integrated into GitHub and BitBucket, so you can build the environments on the fly as you need them based on templates for the various type. “The real value that we’re bringing to the table here is that we’re bringing that together in an almost virtualized way so that you can reproduce these environments on demand,” he said.

McClung who has been working in technology for over 20 years says this is a problem he’s seen over and over again at the various companies he’s worked at over the years. After running engineering at TrueCar, his most recent company, he decided to build a startup to solve the problem once and for all.

He notes that this is the second time he’s been a YC company and while the size and scope of the operation has changed since he last participated in 2009, the process remains much the same. For starters, there were 20 companies involved back then and over 200 this time around, but he says by breaking it down into smaller groups, it helped create the same feel.

The company launched at the beginning of last year, and spent last year building the product and working with design partners and beta customers ahead of today’s release. The plan is to offer a subscription service where companies pay by the number of environments they create.

ReleaseHub currently has 10 employees including the three founders with plans to add more, especially engineers to help continue building out the solution and adding more layers of functionality. As he does this, McClung says bringing in a diverse group of employees is a priority for the founding team.

“I mean I’ve been building companies for a long time and it has to be embedded into the DNA of the company at the very earliest stages, so making sure that you have diverse talent [from the start],” he said.

He says the plan is to stay 100% remote even after offices open again. “We were forced into being remote and actually we made it work really well for us. You know in a lot of ways it’s advantageous for work-life balance,” he said.

More good news from a smartphone market currently rebounding from the far reaching impacts of the pandemic. New numbers from Canalys put global shipments for Q1 2021 at 27% above where they were the same time last year.

The industry was hit early and hit hard by Covid-19. The first quarter saw company running into serious supply chain issues as the pandemic first hit China and parts of Asia where most manufacturing occurs. Following that, demand began to slow, as fewer people were interested in buying mobile devices, coupled with broader economic and job impacts.

Image Credits: Canalys

Samsung continued to lead the way globally, with 76.5 million, up from 59.6 million, representing a 28% jump, year-over-year. In all, the company controls around 22% of global shipments (same as a year prior).

In second place, Apple represented the biggest jump of the quarter, with a 41% increase from 37.1 million to 52.4 million. That no doubt owes substantially to the big upgrades that arrived toward to the end of last year. Huawei’s struggles, meanwhile, have knocked the company out of the top five.

“Xiaomi is in pole position to be the new Huawei,” said Canalys’ Ben Stanton said in a release. “Its competitors offer superior channel margin, but Xiaomi’s sheer volume actually gives distributors a better opportunity to make money than rival brands. But the race is not over. Oppo and Vivo are hot on its heels, and are positioning in the mid-range in many regions to box Xiaomi in at the low end.”

The study also notes that LG’s exit from the category should mix things up a bit, as well, particularly in the Americas region, which accounted for 80% of the company’s sales last year.

Blue Origin seems very close to flying paying customers on its New Shepard sub-orbital rocket, having conducted a dress rehearsal of astronaut loading and unloading on its latest mission. Today, it also revealed that it will be selling the first ticket (tickets?) on board its inaugural commercial flight starting next week, on Wednesday, May 5.

The ‘when, and how much’ are the two burning questions that remain around the Jeff Bezos-backed space company’s first commercial passenger flights. Blue Origin has been in the process of testing, developing and flight-certifying its spacecraft for human use for the past few years, and in its most recent missions the focus has squarely been on what are essentially finishing touches, like the aforementioned dress rehearsal, and a test of cabin comfort, communication and control features on a flight before that earlier this year.

We’ve tried asking Blue Origin CEO Bob Smith about the cost of flights a number of times before, but he declined to provide specifics, beyond saying that it’ll be in the “hundreds of thousands” of dollars range. That’s not a surprising ticket price given the ride, which includes a trip to space in the reusable New Shepard capsule stage that allows passengers to spend multiple minutes totally weightless in zero gravity, with ample window real estate to take in the space-based perspective of Earth.

Blue Origin isn’t share much more right now about what we’ll see next week when it starts selling its first passenger capacity, but did say we can expect more details come Wednesday, so stay tuned.