Author: azeeadmin

22 Mar 2021

Box shares rise on report company is exploring sale

Shares of Box, a well-known content-and-collaboration company that went public in 2015, rose today after Reuters reported that the company is exploring a sale. TechCrunch previously discussed rising investor pressure for Box to ignite its share-price after years in the public-market wilderness.

At the close today Box’s equity was worth $23.65 per share, up around 5% from its opening value, but lower than its intraday peak of $26.47, reached after the news broke. The company went public a little over five years ago at $14 per share, only to see its share price rise to around the same level it returned today during its first day’s trading.

Box, famous during its startup phase thanks in part to its ubiquitous CEO and co-founder Aaron Levie, has continued to grow while public, albeit at a declining pace. Dropbox, a long-term rival, has also seen its growth rate decline since going public. Both have stressed rising profitability over revenue expansion in recent quarters.

But the problem that Box has encountered while public, namely hyper-scale platform companies with competing offerings, could also prove a lifeline; Google and Microsoft could be a future home for Levie’s company, after years of the duo challenging Box for deals.

As recently as last week, Box announced a deal for tighter integration with Microsoft Office 365. Given the timing of the release, it was easy to speculate the news could be landing ahead of a potential deal. The Reuters article adds fuel to the possibility.

While we can’t know for sure if the Reuters article is accurate, the possible sale of Box makes sense.

The article indicated that one of the possible acquisition options for Box could be taking it private again via private equity. Perhaps a firm like Vista or Thoma Bravo, two firms that tend to like mature SaaS companies with decent revenue and some issues, could swoop in to buy the struggling SaaS company. By taking companies off the market, reducing investor pressure and giving them room to maneuver, software companies can at times find new vigor.

Consider the case of Marketo, a company that Vista purchased in 2016 for $1.6 billion before turning it around and selling to Adobe in 2018 for $4.75 billion. The end result generated a strong profit for Vista, and a final landing for Marketo as part of a company with a broader platform of marketing tools.

If there are expenses at Box that could be trimmed, or a sales process that could be improved is not clear. But Box’s market value of $3.78 billion could put it within grasp of larger private-equity funds. Or well within the reaches of a host of larger enterprise software companies that might covet its list of business customers, technology, or both.

If the rumors are true, it could be a startling fall from grace for the company, moving from Silicon Valley startup-darling to IPO to sold entity in just six years. While it’s important to note these are just rumors, the writing could be on the wall for the company and it could just be a matter of when and not if.

22 Mar 2021

Biden will nominate big tech critic and antitrust star Lina Khan to the FTC

Biden didn’t campaign on getting tough against big tech, but his early actions are speaking louder than his words.

The White House confirmed its intentions to nominate Lina Khan to the FTC Monday, sending a clear signal that his administration will break from the Silicon Valley-friendly precedents of the Obama era. Politico first reported Biden’s planned nomination of Khan, which will be subject to Senate confirmation, earlier this month.

Lina Khan is a star of the antitrust movement, insofar as a topic like regulating big business can produce one. Khan is best-known for a paper she published as a law student in 2017 called “Amazon’s Antitrust Paradox.” The paper argues that thinking about what qualifies as monopolistic behavior hasn’t kept pace with how modern businesses operate, particularly within the tech sector.

She believes that a modernized approach to antitrust must look at market forces in a big picture way instead of only examining traditional measures like price and output:

“My argument is that gauging real competition in the twenty-first century marketplace—especially in the case of online platforms—requires analyzing the underlying structure and dynamics of markets. Rather than pegging competition to a narrow set of outcomes, this approach would examine the competitive process itself. Animating this framework is the idea that a company’s power and the potential anticompetitive nature of that power cannot be fully understood without looking to the structure of a business and the structural role it plays in markets. Applying this idea involves, for example, assessing whether a company’s structure creates certain anticompetitive conflicts of interest; whether it can cross-leverage market advantages across distinct lines of business; and whether the structure of the market incentivizes and permits predatory conduct.”

As associate law professor at Columbia, Khan also contributed to a comprehensive report from the House’s antitrust subcommittee last year that set the stage for major antitrust reform that could trim back big tech’s considerable overgrowth.

Khan isn’t the only high profile tech antitrust crusader in the Biden administration’s orbit. In early March, Biden named Columbia law’s Tim Wu to shape technology and competition policy at the National Economic Council. Wu came up with the term “net neutrality” and is well-known as an advocate for an open internet. In 2018, Wu authored “The Curse of Bigness: Antitrust in the New Gilded Age,” a treatise calling out corporate consolidation in tech as a looming political and economic threat.

Sen. Amy Klobuchar, who is leading tech-focused antitrust reform efforts through the Senate’s own antitrust subcommittee, praised Khan’s nomination. “We need all hands on deck as we work to take on some of the biggest monopolies in the world, and President Biden is making his commitment to competition policy clear,” Klobuchar said in a statement provided to TechCrunch.

“Lina’s experience working both in Congress and at the Federal Trade Commission and as an advocate for competitive markets will be vital as we advance efforts to strengthen enforcement and protect consumers.”

22 Mar 2021

Google Cloud hires Intel veteran to head its custom chip efforts

There has been a growing industry trend in recent years for large scale companies to build their own chips. As part of that, Google announced today that it has hired long-time Intel executive Uri Frank as Vice President to run its custom chip division.

“The future of cloud infrastructure is bright, and it’s changing fast. As we continue to work to meet computing demands from around the world, today we are thrilled to welcome Uri Frank as our VP of Engineering for server chip design,” Amin Vahdat, Google Fellow and VP of systems infrastructure wrote in a blog post announcing the hire.

With Frank, Google gets an experienced chip industry executive, who spent more than two decades at Intel rising from engineering roles to Corporate Vice President at the Design Engineering Group, his final role before leaving the company earlier this month.

Frank will lead the custom chip division in Israel as part of Google. As he said in his announcement on LinkedIn, this was a big step to join a company with a long history of building custom silicon.

“Google has designed and built some of the world’s largest and most efficient computing systems. For a long time, custom chips have been an important part of this strategy. I look forward to growing a team here in Israel while accelerating Google Cloud’s innovations in compute infrastructure,” Frank wrote.

Google’s history of building its own chips dates back to 2015 when it launched the first TensorFlow chips. It moved into video processing chips in 2018 and added OpenTitan , an open source chip with a security angle in 2019.

Frank’s job will be to continue to build on this previous experience to work with customers and partners to build new custom chip architectures. The company wants to move away from buying motherboard components from different vendors to building its own “system on a chip” or SoC, which it says will be drastically more efficient.

“Instead of integrating components on a motherboard where they are separated by inches of wires, we are turning to “Systems on Chip” (SoC) designs where multiple functions sit on the same chip, or on multiple chips inside one package. In other words, the SoC is the new motherboard,” Vahdat wrote.

While Google was early to the ‘Build Your Own Chip’ movement, we’ve seen other large scale companies like Amazon, Facebook, Apple and Microsoft begin building their own custom chips in recent years to meet each company’s unique needs, and give more precise control over the relationship between the hardware and software.

It will be Frank’s job to lead Google’s custom chip unit and help bring it to the next level.

22 Mar 2021

Accel’s Dan Levine and Scale’s Alexandr Wang will chat about how to create a category on Extra Crunch Live

Alexandr Wang has spent the last five years looking to accelerate the development of AI and machine learning algorithms with Scale AI. The company has raised upward of $270 million since inception and doesn’t show any signs of slowing.

That’s why we’re thrilled to hang out with Wang and Scale AI investor Dan Levine (Accel) on Wednesday, April 7 on Extra Crunch Live.

Extra Crunch Live is free to everyone and focuses on the relationships between founders and investors that have led to successful business building. We talk about what made them choose each other, hear about the initial pitch meetings and learn about how they make decisions about the future together.

ECL also features the Pitch Deck Teardown, wherein our esteemed guests give their live feedback on decks submitted by the audience. If you’d like to send us your deck to be featured on a future episode of Extra Crunch Live, hit up this link.

Dan Levine worked on the platform team at Dropbox before getting into venture, and before that was an entrepreneur himself, founding YC-backed Chartio. His current portfolio includes Gem, Mux, Numeracy (acquired by Snowflake), ReadMe, Scale, Searchlight, Sentry and Vercel.

Wang, for his part, was a technical lead at Quora before founding Scale. He also worked as an algorithm developer at Hudson River Trading and as a software engineer at Addepar after attending, and ultimately dropping out from, MIT, where he studied artificial intelligence.

Between the two of them, these speakers have plenty of wisdom to impart about how to ideate, fund and scale (ha!) businesses.

The episode goes down on April 7 at 12 p.m. PDT/3 p.m. EDT and is free to attend live. Only Extra Crunch members will have access to the episode on demand so be sure to register now and hang out with us.


Early Stage is the premier “how-to” event for startup entrepreneurs and investors. You’ll hear firsthand how some of the most successful founders and VCs build their businesses, raise money and manage their portfolios. We’ll cover every aspect of company building: Fundraising, recruiting, sales, product-market fit, PR, marketing and brand building. Each session also has audience participation built in — there’s ample time included for audience questions and discussion. Use code “TCARTICLE” at checkout to get 20% off tickets right here.

22 Mar 2021

Techstars NYC is more global than ever with its latest class of startups

Techstars NYC just announced the 10 startups participating in this year’s program, making up what Managing Director Jenny Fielding described as the accelerator’s most global class yet.

“We’ve always had applications from around the world and I was always able to take companies from anywhere,” Fielding said. “But the truth is, when you run Techstars New York, if you don’t have five companies from New York, there’s a feeling that you’re letting the ecosystem down a little bit.”

Now that the program is almost entirely virtual, Fielding said she felt free to “open up the geos.” In fact, not a single one of the startups is based in New York — instead, there are multiple San Francisco and Washington, D.C. companies, as well as others based in the France, Israel, Kenya, Portugal and the United Kingdom.

Fielding argued that even without New York startups, the accelerator still has a New York identity, because it connects global startups with the New York ecosystem.

After conducting last year’s accelerator virtually, Fielding said the hardest element to recreate has been the in-person camaraderie between the founders. So she’s hoping to have an in-person meetup here at the end of May, although the logistics of that meetup will depend on what’s safe and legal at that time (and what the entrepreneurs are comfortable with).

Other aspects of the virtual experience are likely to stick around post-pandemic. After all, Techstars hosts around 200 mentors per class, and Fielding said the virtual program marked the first time “nobody was late.” Similarly, she suggested that demo day remains an “open question,” as an extended period of investor meetings seems to be driving more fundraising for the startups.

Meanwhile, here are the startups:

  • Dash (Nairobi, Kenya) — An alternative, cross-currency payment network for African consumers.
  • Detach.ai (Lisbon, Portugal) — An AI operations platform focused on resolving issues procatively.
  • Elanza Wellness (San Francisco and London, U.K.) — A fertility platform that brings together medical, lifestyle and mental health data.
  • Gable (San Francisco and Tel Aviv, Israel) — A “workspace as a service” company helping businesses find neighborhood workspaces for their employees
  • Hiitide (Chicago) — A marketplace that turns books into virtual book clubs and courses
  • OneVillage (Washington, D.C.) — An online wishlist, planning tool and retailer for cancer patients and their supporters.
  • Paerpay (Boston) — A contactless payment platform that doesn’t require additional hardware or app downloads.
  • Phalanx (Washington, D.C.) — A company that secures AI systems using data, model validation and vulnerability scanning.
  • Phood (Boulder) — A startup digitizing university student cards so they can be used payments in various online services.
  • Prediko (London, U.K. and Paris, France) — A startup focused on e-commerce inventory planning.
22 Mar 2021

Where is the e-commerce app ecosystem headed in 2021?

The pandemic-induced growth of e-commerce is, by now, now well documented.

What is happening in the app ecosystem that supports e-commerce? Is it growing? Are we likely to see consolidations or IPOs? Are there superapps that will emerge?

This post is less about conclusions and more about taking you along while I go through the rabbit hole to satiate my own curiosity.

I see all three trends forming:

  1. Superapps are likely to emerge. I think companies like Bold Commerce will be among the earliest superapps.
  2. There will be consolidations anchored around large SaaS players and roll-ups powered by private equity funds.
  3. There are players like Tiny that acquire early-stage firms and let them run independently.

The closest match to the growing e-commerce stack is the marketing automation stack. While there are significant overlaps, it’s fascinating to compare and contrast the growth of these ecosystems and what drives consolidation.

The closest match to the growing e-commerce stack is the marketing automation stack. While there are significant overlaps, it’s fascinating to compare and contrast the growth of these ecosystems and what drives consolidation.

Between 2015 and 2021, the martech stack grew from 1,800 to 8,000, meaning it roughly doubles every three years.

The explosion of the martech stack is common knowledge and is well documented by Scott Brinker and his famous supergraphics. What’s worth noting is that the consolidation we expected to happen is happening, and yet the pace of new companies coming up in the space makes up for the consolidation — and some more.

According to Brinker, the martech landscape grew 5,233% between 2011 and 2020. The fastest-growing category within martech in 2020 is data and governance, which grew in numbers by 25%. The martech app ecosystem more than tripled between 2015 to 2018, powered by the growth of SaaS and e-commerce industries.

I am an avid tracker of this space, but I am also interested in how we can apply martech’s evolution to the e-commerce stack. The e-commerce stack also grew 3.5 times between 2017 and 2020. But much of the growth is ahead, and so is the upcoming consolidation.

22 Mar 2021

H3x rethinks the electric motor to power the next phase of mobility

It’s plain to see that electric vehicles are the future, but there’s more to making that change happen than swapping out a gas motor for a battery-powered one — especially in aircraft. H3x is a startup that aims to accelerate that future with a reimagined, completely integrated electric motor that it claims outperforms everything on the market.

The small founding team — CEO Jason Sylvestre, CTO Max Liben, and COO Eric Maciolek — met in college while participating in an electric vehicle building and racing program. After stints in the tech and automobile industry (including at Tesla), the crew came back together when they saw that the Department of Energy was offering a bounty for improved high-density electric motors.

“The problem was uniquely suited to our abilities, and passions too — we’re excited about this stuff. We care about decarbonization of the different transit sectors, and aviation is going to become a growing part of the global carbon footprint over the next few decades as electric improves ground vehicles,” said Liben. “We just kinda decided to take a leap of faith, and applied to Y Combinator.”

Electric flight isn’t so much a wild idea as one that’s in its early, awkward stages. Lightweight craft like drones can do a great deal with the batteries and motors that are available, and converted small aircraft like seaplanes are able to make short flights, but that’s about the limit with the way things are today.

The problem is primarily a simple lack of power: the energy required to propel an aircraft fast enough to generate lift grows exponentially as the size and mass of the plane increase. A handful of kilowatt-hours will serve for a drone, and a few EV-scale batteries will work for a light aircraft… but beyond that the energy required to take flight requires batteries the bulk and weight of which make flight impractical.

The H3x lab with someone working on a motor the size of a toaster.Of course, it doesn’t have to be like that. And there are two general avenues for improvement: better batteries or better motors. So either you can fit more energy in the same mass or use what energy you have more efficiently. Both are being pursued by many companies, but H3x claims to have made a huge leap forward in efficiency that could unlock new industries overnight. While even an improvement of 10 or 20 percent in power per kilogram (e.g. a 50-pound motor putting out 120 horsepower rather than 100) would be notable, H3x says its motor is performing at around 300 percent of the competition’s output.

How? It’s all about integration, Liben explained. While the pieces are similar in some ways to motors and power assemblies out there now, the team basically started from scratch with the idea of maximizing efficiency and minimizing size.

Electric motors generally have three main sections: the motor itself, a power delivery system, and a gearbox, each of which may have its own housing and be sold and mounted separately from one another. One reason why these aren’t all one big machine is temperature: the parts and coolant systems of the gearbox, for instance, might not be able to operate at the temperatures generated by the motor or the power system, or vice versa. Put them together and one may cause the other to seize up or otherwise fail. The different sections just have different requirements, which seems natural.

Animated image of an electric motor rendered to be see-through.

Image Credits: H3x

H3x challenges this paradigm with a novel integrated design, but Liben was careful to clarify what that means.

“We’re not just taking the inverter box and slapping it on top and calling it integrated,” he said. “All the components are all intimately connected to the same housing and motor. We’re making a truly integrated design that’s one of the first of its kind at this power level.”

And by “one of the first” he doesn’t mean that Airbus has one in some powertrains, but rather that there have been research projects along these lines — nothing intended for production.

The idea that no one else has gone this far in putting everything in the same box at scales that could be used commercially may sound suspicious to some. One would think that the existing players in aerospace would have been barking up this tree for years, but Liben said large companies are too slow to innovate and too invested in other methods, while smaller ones tend to avoid risk by improving incrementally on successful existing designs and competing among themselves. “No one is targeting the level of performance we’re looking at right now,” he said.

But it isn’t like H3x stumbled over a single advance that magically tripled the performance of electric motors.

“We’re not relying on one big tech or something — there’s no magic bullet,” Liben said. “There are a few improvements that have very significant gains, like 50 percent better than the state of the art, and lots of areas that add 10-20 percent. It’s good from the technical risk side.”

He went into considerable detail on a lot of those improvements, but the less technical-minded among our readers, if they’ve even read this far, might close the tab if I tried to recount the whole conversation. To be brief, it amounts to combining advances in materials, manufacturing, and electric components so that they act synergistically, each enabling the other to be used to best effect.

For instance, recently improved power switching hardware can be run at hotter temperatures and handle higher loads — this raises performance but also allows for shared cooling infrastructure. The shared infrastructure can itself be improved by using new pure-copper 3D printing techniques, which allow more cooling to fit inside the housing. Using 3D printing means custom internal geometries so that the motor, gearbox, and power delivery can all be mounted in optimal positions to one another instead of bolted on where existing methods allow.

The result is an all-in-one motor, the HPDM-250, that’s smaller than a lot of the competition, yet produces far more power. The best production motors out there are around 3-4 kilowatt-hours per kilogram of continuous power. H3x’s prototype produces 13 — coincidentally, just above the theoretical efficiency that would enable mid-range passenger aircraft.

CG render of 3D printed copper coils.

Image Credits: H3x

There is the risk that stacking cutting edge techniques like this makes the cost rise faster than the performance. Liben said that while it’s definitely more expensive in some ways, the smaller size and integrated design also lead to new savings in cost, time, or material.

“People think, ‘3D printing copper, that’s expensive!’ But when you compare it to the super high performance linings you’d need otherwise, and the different ways that you manufacture them, that can require a lot of manual steps and people involved… it can be a lot simpler printing something,” he explained. “It can be counterintuitive, but at least from my BOM [bill of materials] cost, when you’re selling something three times smaller than the other guy, even if it’s high performance materials, it’s actually not as expensive as you’d think. Based on the customers we’ve talked to so far, we think we’re in a good spot.”

Servicing a fully integrated motor is also fundamentally more complex than doing so for an off the shelf one, but Liben noted that they were careful to think about maintenance from the start — and also that, while it may be a little harder to service their motor than an ordinary electric one, it’s much, much simpler than servicing even the most reliable and well-known gas-powered motors.

Despite the huge gains H3x claims, the target market of passenger aircraft is hardly one that they, or anyone, can just jump into. Heavily regulated industries like air travel require years of work and technology proving to change a fastener style, let alone the method of propulsion.

So H3x is focusing on the numerous smaller, less regulated industries that could use vastly improved electric propulsion. Cargo drones, electric boats, and air taxis might still be rare sights on this planet, but a big bump to motor power and efficiency might be what helps tip them from niche (or vaporware) to mainstream. Certainly all three of those applications could benefit hugely from improved range or payload capacity.

Graduating to passenger flights isn’t a distant dream, exactly, suggested Liben: “We’re already on our way — this isn’t 20-years-out type stuff. In the last few years the timelines have shrunk drastically. You could have a full battery electric vehicle soon, but it isn’t going to cut it for longer flights.”

There’s still a role for motors like H3x’s in hybrid aircraft that use jet fuel, batteries, and perhaps even hydrogen fuel cells interchangeably. Like the switch to electric cars, it doesn’t happen all at once and it doesn’t need to for the purposes of their business. “That’s the great thing about motors,” Liben said. “They’re so ubiquitous.”

H3x declined to disclose any funding or partners, although it’s hard to believe that the team could have gotten as far as it has without some kind of significant capital and facilities — this sort of project outgrows the garage workbench pretty fast. But with Y Combinator’s demo day happening tomorrow, it seems likely that they’ll be receiving a lot of calls over the next few weeks, after which it may be reasonable to expect a seed round to come together.

If H3x’s prototypes perform as well in the wild as they do on the bench, they may very well enable a host of new electric transportation applications. We’ll be watching closely to see how the startup’s play affects the future of electric mobility.

22 Mar 2021

BMW and PG&E team up to prepare the electric grid for millions of EVs

BMW Group and California utility Pacific Gas & Electric are rolling out the next phase of a pilot that aims to test — and learn — how electric vehicles could support the integration of renewable energy on the electric grid.

The ChargeForward program, now entering its third phase, is open to PG&E customers who drive a BMW electric or plug-in hybrid electric vehicle. Around 3,000 drivers can sign up to voluntarily to allow their vehicle to be “smart charged” when electricity demand is low and renewable energy availability is high. Drivers will earn incentives for participating in the program, including $150 at sign-up and an additional $250 per year.

The program is one of the longest-running partnerships between an electric utility and an automaker. The first two phases had only 100 and 400 participants respectively, so this latest phase presents a marked expansion for the collaboration. It’s a sensible alliance for two industries that are preparing for the gradual decline in sales of internal combustion engines. For electric utilities, this means planning for a drastic increase in customer demand on a grid that is increasingly powered by renewable resources like solar and wind.   

bmw chargeforward electric

Image Credits: BMW

“Let’s assume someone plugs in at home on a Saturday morning at 9am and sets their departure time for 4 pm that day,” Adam Langton, BMW’s Energy Services manager who oversees the ChargeForward program, explained. “The ChargeForward software system communicates with the vehicle and determines that the vehicle is more than half full, needing 2 hours of charging to fill up the battery. The system then evaluates the person’s home electricity rate, renewable energy availability and congestion on the grid in their neighborhood. On this day, there is no congestion on the grid and solar energy will be very high in the afternoon. The ChargeForward system directs the vehicle to start charging at 1 pm and complete charging by 3 pm. This allows the driver to get a full battery prior to their departure time.” 

Electricity demand tends to follow a “duck curve” shape, peaking in the early evening as people return home from work – right as solar energy resources go off line. And people tend to charge their EVs overnight. To meet this demand, fossil fuel-emitting resources like natural gas ramp up.

The result? More greenhouse gas emissions. A study published by MIT researchers in Environmental Science and Technology found that in California overnight EV charging produces around 74% more GHGs than midday charging. (Variations in the grid mix matter here – in wind-heavy regions in the Midwest or Texas, overnight EV charging may make the most sense as lots of wind tends to be generated overnight.)  

The ChargePoint program aims to take advantage of the ample renewable resources available during the day and reduce GHG emissions in the process. Participating customers will enter their charging preferences and departure times on a BMW ChargeForward mobile app. BMW will also receive real-time information about the grid, such as the availability of renewable energy relative to the customer’s location, and it will use this data to calculate an optimal charging window and send it automatically to the vehicle. Customers will be able to opt-out of the charging shift at any point through the app.

While California is known for pursuing ambitious clean energy goals – including codifying into law a landmark target of achieving 100% renewable and zero-carbon electricity by 2045 – the state has also set a goal of getting 5 million EVs on the road by 2030. And that’s no surprise, considering that transportation is the single largest source of GHG emissions in the state. 

BMW and PG&E will also collaborate in a lab setting to explore vehicle-to-grid technologies that enable EVs to discharge electricity to the power grid. Such bi-directional functionality could allow EVs to be used as big backup generators in the case of emergencies or as distributed nano power plants to help balance the grid throughout the day.

The third phase of the ChargeForward program begins in mid-April and runs through March 2023. 

22 Mar 2021

Clubhouse says its Android launch will take ‘a couple of months’

Social audio app Clubhouse has now promised a time frame of sorts for the launch of its anticipated Android version, following its recent hire of an Android software developer last month. In its weekly Townhall event on Sunday, Clubhouse co-founder Paul Davison remarked that the company was working “really hard” to come to Android, but said it’s going to take a “couple of months” to make that happen. That seems to indicate a time frame that’s closer to late spring or summer 2021.

Clubhouse had previously said in a late January blog post that it would begin work on its Android version “soon,” but had not yet promised any sort of time frame as to when it would be able to bring that version to the public. Instead, most of its statements about Android have been vague mentions of the importance of supporting the Android user base and making its app more accessible to a wider audience.

In the meantime, Clubhouse’s biggest rival, Twitter Spaces, has been taking advantage of Clubhouse’s delay to address the sizable Android user base by rapidly rolling out support to more people across platforms. This month, for example, Twitter Spaces opened up to Android users, allowing anyone on Android to join and talk inside its live audio rooms. Shortly thereafter, Twitter said that it plans to publicly launch Twitter Spaces to the general public in April. That would be well ahead of Clubhouse, unless the latter rapidly speeds up development and drops its invite-only status in the weeks ahead.

During Sunday’s Clubhouse Townhall, co-founder Davison explained the company’s approach to scaling to a larger market — like one where Android users participate — as an effort that requires a slower pace, when it comes to opening up access to more users. He noted that when Clubhouse grows, the discovery experience inside the app can be negatively impacted as a result. Users today are seeing more foreign language groups in their feeds, for instance, and are having a harder time finding friends and some of the best content, he said.

To address these challenges, Clubhouse plans to make several changes, including tweaks to the app’s Activity feed, tools to give users more control over their push notifications, and the launch of more personalization features — like showing users a personalized list of suggested rooms that appear on screen when you first open the app. These sorts of improvements are necessary to make Clubhouse succeed even as it scales its app to a larger user base, the company believes.

That said, Davison also spoke of dropping Clubhouse’s invite-only status as something it hopes to do “in the coming months.” He noted that he wants the app to open up to everyone, because there are “so many incredible creators not yet on Clubhouse, who have an audience elsewhere.”

“It’s going to be really important that we just open up to everyone,” Davison said. “Android’s going to be really important. Localization is obviously going to be very important.” Plus, making Clubhouse more accessible was important, too, he said.

The lack of an Android version of Clubhouse has already caused some complications for the company.

A number of Android app developers have taken advantage of the hole left in the market to hawk their “Clubhouse guides,” which intentionally aim to confuse Android users looking for Clubhouse by using the same app icon. (Google apparently doesn’t bother to weed out low-value and/or infringing content like this from the Play Store.)

More recently, cybercriminals have gotten in on the action, too. They’ve created fake versions of Clubhouse that even pointed to a well-executed copy of the Clubhouse website in order to trick users into downloading their malicious app. One of these apps has been found to be spreading BlackRock malware, which steals users’ login credentials for over 450 services, including Facebook, Twitter and Amazon.

Davison addressed this issue during the Townhall, warning users that if they see anyone trying to impersonate Clubhouse on Android, not to use that app because “it could be harmful.”

“It is certainly not the real Clubhouse. Same thing with PC. There’s no PC app for Clubhouse,” he said, adding that a desktop version of Clubhouse is not a high priority for the company.

The company made a number of other announcements, as well, the most notable being its plans for more creator tools. These will be focused on helping creators grow their own audiences for their shows, and even monetize their events, if they choose, through things like direct payments, subscriptions, brand sponsorships, and even “paid events.” Clubhouse will also offer tools for managing memberships and tracking metrics around listeners and retention, but overall, details were light on what specific tools would be available or when they would roll out.

Clubhouse hasn’t responded to a request for further comment on the statements made during its Townhall event.

22 Mar 2021

Social shopping-focused Chums announces $3.5M raise ahead of YC Demo Day

With Y Combinator Demo Day kicking off tomorrow morning, startups in the current batch are hurrying to make a little news before they show off their recent growth to investors. The list includes Runway, Mono, Pangea and Flux.

Add Chums to the mix. Chums is a social shopping service that helps friends suggest products to their pals. And the startup has put together a total of $3.5 million across two pre-seed investments.

TechCrunch spoke with Noah Elion, one of Chums’ founders, about the round. He said that his company closed $1 million in December, later looking to raise another $1.5 million. Interest ran high for shares in the startup, so Chums wound up raising $1 million more than its latter target, for a combined total of $3.5 million.

The company declined to share the cap at which the funds, raised via a SAFE, were secured.

The $1.5 million target was based on the amount of capital that his company would need for the next 18 months, Elion said. The final sum came from Ludlow, Shrug, Contrary Capital and Fuel Capital, among other firms and individuals.

How did a company in the midst of Y Combinator manage to raise an old-school Series A round of capital despite launching its product just a few weeks ago? The background of its founding team helps some. Co-founder Dick Fickling was an early engineer at Honey, for example, another shopping-focused startup that had a material exit.

The startup’s service is a mobile app that allows users to follow product-types that they may want to purchase, and suggest goods to one another that might fit their friends’ needs. It made its way to market three weeks ago, or as Elion explained, right before his company went out fundraising. TechCrunch asked about early traction, to which Elion said that it was too soon to say much, though his team has seen “encouraging” levels of engagement thus far.

The startup is four people today, which its website describes as a group of friends. This is mostly true. Elion and Fickling teamed up after the former built a predecessor to Chums — called Chums Referral — becoming friends in the process. Fickling was previously colleagues and friends with the folks who comprise the rest of the team, namely Lauren Williams (director of engineering) and Lena Gasilina (product).

The team is looking for a designer and a front-end developer, but after that is done hiring. It intends to stay at six people until its next round. Why? It wants to reach product-market fit with a half-dozen staff. If it does, it should be able to raise more money at a comfortable valuation. There’s some sense in the idea, though it was slightly odd to hear a startup plan measured growth to preserve capital in 2021.

Chums makes money on commissions from recommended products, splitting the revenue with users. Elion declined to share the network, or networks, his company is working with to secure commercial ties with retailers, but did note that in time Chums will go direct to secure better deals.

With a closed round, most of its team in place and an app in the market, it’s now up to Chums to prove Elion’s view Google is overly gamed and Amazon is best when you know what you are looking for. In the co-founder’s view, people liked malls for their “diversity of content” and as a space for “spontaneous shopping.” Perhaps Chums can fit that niche, and, in the process, generate some serious coin.