Author: azeeadmin

Twitter has banned right-wing provocateur James O’Keefe, creator of political gotcha video producer Project Veritas, for violating its “platform manipulation and spam policy,” suggesting he was operating multiple accounts in an unsanctioned way. O’Keefe has already announced that he will sue the company for defamation.

The ban, or “permanent suspension” as Twitter calls it, occurred Thursday afternoon. A Twitter representative the action followed the violation of rules prohibiting “operating fake accounts” and attempting to “artificially amplify or disrupt conversations through the use of multiple accounts,” as noted here.

This suggests O’Keefe was banned for operating multiple accounts, outside the laissez-faire policy that lets people have a professional and a personal account, and that sort of thing.

But sharp-eyed users noticed that O’Keefe’s last tweet unironically accused reporter Jesse Hicks of impersonation, including an image showing an unredacted phone number supposedly belonging to Hicks. This too may have run afoul of Twitter’s rules about posting personal information, but Twitter declined to comment on this when I asked.

Supporters of O’Keefe say that the company removed his account as retribution for his most recent “exposé” involving surreptitious recordings of a CNN employee admitting the news organization has a political bias. (The person he was talking to had, impersonating an nurse, matched with him on Tinder.)

For his part O’Keefe said he would be suing Twitter for defamation over the allegation that he operated fake accounts. I’ve contacted Project Veritas for more information.

Google Earth gives users a new look at a changing planet, Facebook tests new business discovery features and Autodesk acquires Upchain. This is your Daily Crunch for April 15, 2021.

The big story: Google Earth gets an update

Google is describing this as Google Earth’s biggest update since 2017, though there’s really just one major addition: A time-lapse mode bringing together satellite photos from the past 37 years, in 3D.

Beyond just being a novel new feature, this mode can reveal how climate change has reshaped our planet. In fact, Google Earth now offers guided tours focused on forest change, urban growth, warming temperatures and more.

The tech giants

Facebook to test new business discovery features in US News Feed — Users will be able to tap on topics they’re interested in underneath posts and ads in their News Feed, allowing them to explore related content from businesses.

Autodesk acquires Upchain — Upchain is a Toronto-based startup that offers a cloud-based product life cycle management service.

Consumer groups and child development experts petition Facebook to drop ‘Instagram for kids’ plan — The letter was written by the Campaign for a Commercial-Free Childhood, an advocacy group that often leads campaigns against big tech and its targeting of children.

Startups, funding and venture capital

Polestar raises $500M from outside investors as EV market grows — This is the first external round for Volvo Car Group’s standalone electric performance brand.

Goldman Sachs leads $23M in funding for Brazilian e-commerce startup Olist — Olist connects small businesses to larger product marketplaces, helping entrepreneurs sell their products to a larger customer base.

Substack announces a $1M initiative to fund local journalists — The newsletter startup will fund independent writers creating local news publications.

Advice and analysis from Extra Crunch

Coinbase’s direct listing alters the landscape for fintech and crypto startups — In Alex Wilhelm’s view, Coinbase reaching a valuation north of $100 billion during its first day of trading was the biggest startup event of the year.

Billion-dollar B2B: cloud-first enterprise tech behemoths have massive potential — Dharmesh Thakker of Battery Ventures writes that a new class of cloud-first, enterprise-tech behemoths have the potential to reach $1 billion in ARR.

How startups can ensure CCPA and GDPR compliance in 2021 — It’s important to enact best data management practices before a legal situation arises.

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

Everything else

Detroit’s native son, billionaire Dan Gilbert, makes the case for his town — The Quicken Loans founder has poured at least $2.5 billion into rehabilitating buildings in the heart of the city.

Can the tech trade show return in 2021? — IFA promises “full-scale, real-life event” for Berlin in September, while MWC reels from the loss of marquee names.

Garry Kasparov launches a community-first chess platform — Kasparovchess will be a platform in which legendary chess players have free reign to share tips and tricks with players from various levels.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

When Dell announced it was spinning out VMware yesterday, the move itself wasn’t surprising: there had been public speculation for some time. But Dell could have gone a number of ways in this deal, despite its choice to spin VMware out as a separate company with a constituent dividend instead of an outright sale.

The dividend route, which involves a payment to shareholders between $11.5 and $12 billion, has the advantage of being tax-free (or at least that’s what Dell hopes as it petitions the IRS). For Dell, which owns 81% of VMware, the dividend translates to somewhere between $9.3 and $9.7 billion in cash, which the company plans to use to pay down a portion of the huge debt it still holds from its $58 billion EMC purchase in 2016.

VMware was the crown jewel in that transaction, giving Dell an inroad to the cloud it had lacked prior to the deal. For context, VMware popularized the notion of the virtual machine, a concept that led to the development of cloud computing as we know it today. It has since expanded much more broadly beyond that, giving Dell a solid foothold in cloud native computing.

Dell hopes to have its cake and eat it too with this deal: it generates a large slug of cash to use for personal debt relief while securing a five-year commercial deal that should keep the two companies closely aligned. Dell CEO Michael Dell will remain chairman of the VMware board, which should help smooth the post-spinout relationship.

But could Dell have extracted more cash out of the deal?

Doing what’s best for everyone

Patrick Moorhead, principal analyst at Moor Insights and Strategies, says that beyond the cash transaction, the deal provides a way for the companies to continue working closely together with the least amount of disruption.

“In the end, this move is more about maximizing the Dell and VMware stock price [in a way that] doesn’t impact customers, ISVs or the channel. Wall Street wasn’t valuing the two companies together nearly as [strongly] as I believe it will as separate entities,” Moorhead said.

It might be strange to hear this from a firm that just raised a $55 million equity fund, but the team at Upper90 would like to remind you that equity isn’t the only funding that’s available.

Upper90 is led by CEO Billy Libby (former head of quantitative education sales at Goldman Sachs) and Chairman Jason Finger (co-founder of Seamless), and it was the first investor in both Thrasio and Clearbanc. The firm offers debt and equity funding, and it just closed a $195 million fund in December — but the fund announced today is Upper90’s first to be devoted purely to equity financing.

Finger said he and Libby have taken this combined approach because there are often predictable parts of an online business, where (for example) “if I’m doing some marketing, I know that $1 on Facebook will generate $8 of revenue.” In those cases, “equity is the most expensive way you can finance growth,” and he said it “really fundamentally bothered me that the founders and early investors who took a lot of the risks, dedicating their life on a 24/7 basis” would often end up owning a small percentage of the company.

That doesn’t mean debt is the only solution, but in Finger’s words, founders should stop seeing big equity rounds as “a badge of honor.” Instead, they can work with Upper90 to find the “optimal capital structure” combining both elements.

“Life isn’t binary,” he added. “Part of the reason we launched an equity fund in the [e-commerce] rollup sector is that equity is an important piece for you to get the highest quality lender — they’re going to want to know that there’s equity protection underneath their credit facility.”

He also suggested that making an equity investment turns Upper90 into a “long-term partner” for the companies it backs, freeing the team from being “purely focused on the returns related to our credit.”

As alluded to earlier, Libby and Finger see the e-commerce aggregation market as one that’s particularly well-suited to their approach. (Thrasio is perhaps the best-known startup rolling up Amazon sellers, while Clearbanc offers its own revenue-based financing to e-commerce and SaaS companies.)

“I always say: What’s new is old,” Libby told me. “If we had this conversation 15 years ago, we’d be talking about rolling up gyms and dry cleaners and smoothie shops […] The infrastructure that Amazon has developed allows people to be entrepreneurs in a week, so I think that we’re still extremely early in this trend. There are going to be so many more people starting their own store on Amazon.”

And eventually, he suggested Upper90 could take a similar approach in other industries: “A content creator who starts a YouTube channel is not that different than the Amazon store owner. Five years from now, we could be talk about, what’s the value of a subscriber on YouTube, what’s the value of an influencer’s following on Instagram, how can we bring some of that revenue forward?”

Good news, Bay Area! Apple Pay now works with Clipper cards.

That means you can now use an iPhone or Apple Watch to pay for BART. Or Muni. Or Caltrain. Or the Ferry! Or (almost) any other transit-related thing you’d otherwise use the plastic Clipper card for.

Clipper has a page outlining the Apple Pay setup process right here.

A few quick but important things to note:

• Adding an existing Clipper card to an Apple Wallet apparently transfers the funds off that card. At that point, says Clipper, “your plastic card has been deactivated” — so it sounds like it won’t work as a physical backup card.
• Some people will want to hang on to the plastic cards, regardless: Clipper notes that Bay Area bike share users and anyone using an RTC Discount Card will need to keep the plastic card, even after its deactivated for transit use.
• Clipper has previously confirmed that support is coming for Google Pay (Android) “this spring”, but today’s rollout seems to support Apple Pay only.

As noted back in February when this was first confirmed as on-the-way, Clipper works with Apple’s “Express Transit” feature. That’s just a fancy way to say that you can tap-to-pay with the digital Clipper card without first needing to punch in your phone’s PIN or using FaceID. On certain newer iPhones, it also lets you keep using the Clipper card for a few hours after your battery has died; a wonderful thing in a pinch, but probably not something you want to rely on regularly.

A cross-party group of 40 MEPs in the European parliament has called on the Commission to strengthen an incoming legislative proposal on artificial intelligence to include an outright ban on the use of facial recognition and other forms of biometric surveillance in public places.

They have also urged EU lawmakers to outlaw automated recognition of people’s sensitive characteristics (such as gender, sexuality, race/ethnicity, health status and disability) — warning that such AI-fuelled practices pose too great a rights risk and can fuel discrimination.

The Commission is expected to presented its proposal for a framework to regulate ‘high risk’ applications of AI next week — but a copy of the draft leaked this week (via Politico). And, as we reported earlier, this leaked draft does not include a ban on the use of facial recognition or similar biometric remote identification technologies in public places, despite acknowledging the strength of public concern over the issue.

“Biometric mass surveillance technology in publicly accessible spaces is widely being criticised for wrongfully reporting large numbers of innocent citizens, systematically discriminating against under-represented groups and having a chilling effect on a free and diverse society. This is why a ban is needed,” the MEPs write now in a letter to the Commission which they’ve also made public.

They go on to warn over the risks of discrimination through automated inference of people’s sensitive characteristics — such as in applications like predictive policing or the indiscriminate monitoring and tracking of populations via their biometric characteristics.

“This can lead to harms including violating rights to privacy and data protection; suppressing free speech; making it harder to expose corruption; and have a chilling effect on everyone’s autonomy, dignity and self-expression – which in particular can seriously harm LGBTQI+ communities, people of colour, and other discriminated-against groups,” the MEPs write, calling on the Commission to amend the AI proposal to outlaw the practice in order to protect EU citizens’ rights and the rights of communities who faced a heightened risk of discrimination (and therefore heightened risk from discriminatory tools supercharged with AI).

“The AI proposal offers a welcome opportunity to prohibit the automated recognition of gender, sexuality, race/ethnicity, disability and any other sensitive and protected characteristics,” they add.

The leaked draft of the Commission’s proposal does tackle indiscriminate mass surveillance — proposing to prohibit this practice, as well as outlawing general purpose social credit scoring systems.

However the MEPs want lawmakers to go further — warning over weaknesses in the wording of the leaked draft and suggesting changes to ensure that the proposed ban covers “all untargeted and indiscriminate mass surveillance, no matter how many people are exposed to the system”.

They also express alarm at the proposal having an exemption on the prohibition on mass surveillance for public authorities (or commercial entities working for them) — warning that this risks deviating from existing EU legislation and from interpretations by the bloc’s top court in this area.

“We strongly protest the proposed second paragraph of this Article 4 which would exempt public authorities and even private actors acting on their behalf ‘in order to safeguard public security’,” they write. “Public security is precisely what mass surveillance is being justified with, it is where it is practically relevant, and it is where the courts have consistently annulled legislation on indiscriminate bulk processing of personal data (e.g. the Data Retention Directive). This carve-out needs to be deleted.”

“This second paragraph could even be interpreted to deviate from other secondary legislation which the Court of Justice has so far interpreted to ban mass surveillance,” they continue. “The proposed AI regulation needs to make it very clear that its requirements apply in addition to those resulting from the data protection acquis and do not replace it. There is no such clarity in the leaked draft.”

The Commission has been contacted for comment on the MEPs’ calls but is unlikely to do so ahead of the official reveal of the draft AI regulation — which is expected around the middle of next week.

It remains to be seen whether the AI proposal will undergo any significant amendments between now and then. But MEPs have fired a swift warning shot that fundamental rights must and will be a key feature of the co-legislative debate — and that lawmakers’ claims of a framework to ensure ‘trustworthy’ AI won’t look credible if the rules don’t tackle unethical technologies head on.

Data is the most valuable asset for any business in 2021. If your business is online and collecting customer personal information, your business is dealing in data, which means data privacy compliance regulations will apply to everyone — no matter the company’s size.

Small startups might not think the world’s strictest data privacy laws — the California Consumer Privacy Act (CCPA) and Europe’s General Data Protection Regulation (GDPR) — apply to them, but it’s important to enact best data management practices before a legal situation arises.

For example, failing to comply with the GDPR can result in legal fines of €20 million or 4% of annual revenue. Under the CCPA, fines can also escalate quickly, to the tune of $2,500 to $7,500 per person whose data is exposed during a data breach.

If the data of 1,000 customers is compromised in a cybersecurity incident, that would add up to $7.5 million. The company can also be sued in class action claims or suffer reputational damage, resulting in lost business costs.

It is also important to recognize some benefits of good data management. If a company takes a proactive approach to data privacy, it may mitigate the impact of a data breach, which the government can take into consideration when assessing legal fines. In addition, companies can benefit from business insights, reduced storage costs and increased employee productivity, which can all make a big impact on the company’s bottom line.

Challenges of data compliance for startups

Data compliance is not only critical to a company’s daily functions; if done wrong or not done at all, it can be quite costly for companies of all sizes. For example, Vodafone Spain was recently fined $9.72 million under GDPR data protection failures, and enforcement trackers show schools, associations, municipalities, homeowners associations and more are also receiving fines.

GDPR regulators have issued $332.4 million in fines since the law was enacted almost two years ago and are being more aggressive with enforcement. While California’s attorney general started CCPA enforcement on July 1, 2020, the newly passed California Privacy Rights Act (CPRA) only recently created a state agency to more effectively enforce compliance for any company storing information of residents in California, a major hub of U.S. startups.

That is why in this age, data privacy compliance is key to a successful business. Unfortunately, many startups are at a disadvantage for many reasons, including:

• Fewer resources and smaller teams — This means there are no designated data privacy officers, privacy attorneys or legal counsel dedicated to data privacy issues.
• Lack of planning — This might be characterized by being unable to handle data privacy information requests (DSARs, or “data subject access requests”) to help fulfill the customer’s data rights or not having an overall program in place to deal with major data breaches, forcing a reactive instead of a proactive response, which can be time-consuming, slow and expensive.
  
  

Electric truck startup Rivian released Thursday details of its in-house Rivian Insurance program, which it says will be integrated into its digital ordering process.

The insurance will initially be available in 40 states. Keeping in line with the company’s marketing as an “adventure vehicle” company, customers will also have the option to cover their home and recreational equipment, such as boats, dirt bikes, and campers. Rivian’s plans to start an insurance program first leaked more than a year ago after a job posting was spotted.

What makes the insurance offering stand out, however, is its integration with the Rivian vehicle platform and Driver+ safety suite, which the company said in a blog post will help deliver “tailored, data-driven coverage.” Customers who choose Rivian Insurance will get Driver+ rate reductions, with more details to come. Drivers can additionally opt in to a separate program that offers savings for using Rivian’s Active Driver Assistance software.

It’s a clever move for the company, which plans to bring its first electric pickup to market later this year. Like Tesla, Rivian intends to have Rivian Collision Centers and Service Centers performing the work – and by keeping everything in-house, the company is likely thinking customers will be attracted to a seamless insurance program. Rivian Insurance is another instance of the newer entrant following in the veteran’s lead, but with one big advantage: Tesla Insurance is only available to owners in California.

Have you ever dreamed about the opportunity to find yourself in, say, an elevator with an investor who is open to hearing your pitch? Well, then the next episode of Extra Crunch Live is for you.

If you’ve hung out with us on an ECL before, you know we start with a bit of top news, chat with our speakers about how to successfully fundraise and finish with the Pitch Deck Teardown, where we take a look at decks submitted by you, the audience members, and give live feedback.

On Wednesday, with the help of Fifth Wall’s Brendan Wallace and Hippo’s Assaf Wand, we’re going to shake things up a bit.

Folks who attend the live event will be able to virtually “raise their hand,” come on screen, and give a 60-second pitch of their startup. No demoes. No videos. No visual aids of any kind. It’s the ultimate elevator pitch, and it’ll be done before a live audience.

Wallace and Wand (that’s catchy, eh?) will give their feedback and ask questions at the end of every pitch.

The only way you can participate in the ECL Pitch-off is to show up. Luckily, the events are free to anyone. However, accessing any of this content on demand is reserved strictly for Extra Crunch members.

We’re super excited to introduce the pitch-off as a feature of ECL and hope you are too! See you on Wednesday!

Register here.

Subscription pricing is landing on Facebook’s Oculus Store, giving VR developers another way to monetize content on Facebook’s Oculus Quest headset.

Developers will be allowed to add premium subscriptions to paid or free apps, with Facebook assumedly dragging in their standard percentage fee at the same time. Oculus and the developers on its platform have been riding the success of the company’s recent Quest 2 headset, which Facebook hasn’t detailed sales numbers on but has noted that the months-old $299 headset has already outsold every other Oculus headset sold to date.

Subscription pricing is an unsurprising development but signals that some developers believe they have a loyal enough group of subscribers to bring in sizable bits of recurring revenue. Facebook shipped the first Oculus Rift just over five years ago, and it’s been a zig-zagging path to finding early consumer success during that time. A big challenge for them has been building a dynamic developer ecosystem that offer something engaging to users while ensuring that VR devs can operate sustainably.

At launch, there are already a few developers debuting subscriptions for a number of different app types, spanning exercise, meditation, social, productivity and DJing. In addition to subscriptions, the new monetization path also allows developers to let users try out paid apps on a free trial basis.

The central question is how many Quest users there are that utilize their devices enough to justify a number of monthly subscriptions, but for developers looking to monetize their hardcore users, this is another utility that they likely felt was missing from the Oculus Store.