Author: azeeadmin

If you’ve ever had to file a claim with your insurance company, you know that it’s not exactly fun. Often, you’re on hold indefinitely waiting to speak to a live person. And if you’ve ever had to file an auto or home insurance claim, you know that all the back and forth with your carrier and the various vendors can take up so much time.

Hi Marley is a Boston startup that has set out to modernize communications in the insurance space by giving carriers a way to “seamlessly” communicate with their policyholders via text. The company just closed on a $25 million Series B funding round to help scale its SMS platform.

Hi Marley also includes other vendors in that communicatiofns channel, such as car repair or rental companies. The goal is to keep policyholders happier and less likely to churn to another carrier, in addition to helping carriers resolve claims faster.

On the back end, Hi Marley is a platform of apps, APIs and a layer of intelligence that integrates with other core systems such as Guidewire and Duck Creek “to deliver critical insights” to the carriers, according to CEO and co-founder Mike Greene. Per its website, Hi Marley’s messaging solution aims to streamline communication around claims, underwriting and policyholder service interactions “while simultaneously connecting everyone who touches that insurance experience into a singular, real-time conversation.”

Demand is there, and no doubt the COVID-19 pandemic forcing more people to go digital has led to still more consumer demand for new ways to communicate. Last year, the number of carriers using Hi Marley’s platform doubled, and the company saw a 4x increase in its user base, Greene said. Currently, the startup has over 40 customers live in production — including American Family, MetLife, Auto-Owners, Erie and MAPFRE.

“Unlike horizontal chat solutions, we are tackling the entire communication layer across the insurance enterprise for our carriers and their ecosystem partners,” Greene told TechCrunch.

Greene is no stranger to the space, having worked in the insurance sector for years. He previously co-founded and led Futurity Group, which was acquired by AON, a software and services company focused on monitoring and improving performance in P&C insurance.

Emergence Capital led the Series B round, which brings Hi Marley’s total raised since its 2017 inception to $41.7 million. Existing backers Underscore, True Ventures, Bain Capital Ventures, and Greenspring also participated in the financing, along with additional investors including Brewer Lane.

Emergence Capital Founder & General Partner Gordon Ritter — who took a seat on Hi Marley’s board — said his firm has been focused on finding the next iconic industry cloud company within the vertical for “quite some time.” 

“In the same way Veeva [a company Ritter chaired to a successful IPO in 2013] expanded from CRM to additional software solutions that power the pharma industry, we continue to be bullish on startups building vertically-focused solutions that can power an entire industry,” Ritter said.

Historically, he added, insurance has been viewed as a necessary evil, a purchase made purely for the sake of safety and security. And in today’s environment, carriers using “old” communication strategies will likely see a negative impact on performance, Ritter believes.

“Most of us can likely agree that our experiences dealing with insurers during times of need have been less than ideal, if not unpleasant altogether,” said Ritter, who actually has family with roots in the insurance industry. “But Mike wants to reverse the indifference or negative reputation; he is on a mission to make insurance lovable… A new communication fabric between carriers and their ecosystem to benefit end customers is needed.”

Looking ahead, Hi Marley plans to use its new capital to create new features, ensure the platform scales across the enterprise and (naturally) do some hiring.

People returning from a period of incarceration face innumerable challenges, among them entering a high-tech workforce that requires a new set of skills. Jason Jones leads remote instruction at The Last Mile, a code training program for inmates; Deepti Rohatgi is head of Slack for Good, a social-good office within the company running Next Chapter, which helps place recently incarcerated find employment at tech partners; Aly Tamboura advises the new $350 million (and counting) Justice Accelerator Fund at the Chan-Zuckerberg Initiative. These three, whose stories are intertwined, discussed the possibility for change and how to effect it within the context of tech and returning citizens.

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On the shift in attitudes that makes it possible

Not many years ago the idea of in-facility tech training and mentoring might not even have been a possibility. But the increasingly visible shortcomings and flaws of the justice system have made it clear how much such programs are needed.

Tamboura: When we think of mass incarceration, as a whole, the nation is really starting to get it, is saying this was a failed experiment, it’s not working, our communities are no safer, we have all these people in prison.

And a lot of Departments of Corrections across across the United States, they’re not equipped to get people ready to come home and to thrive. They really weren’t set up for that. So when you think of the role of tech in this, when you ask what has changed, a lot of Department of Corrections, have changed that mantra, a lot of Governors, to change that mantra, and projects, like The Last Mile and Next Chapter, these public-private partnerships are showing states what is possible, if we all collaborate and and put our heads together. (Timestamp: 5:36)

• Uptrust raises new money to fight mass incarceration with technology
• Commissary Club wants to help formerly incarcerated people find community

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On tailoring the lesson to the learner

Teaching people serving prison terms means catering to their strengths and expectations, just like teaching any other group. In this case it also means wearing away the dehumanization and stigma that comes with spending years in a cell.

Jones: From the very first time that they come in, we really try to embed this culture, to humanize them, right? I think when it starts with the language, we don’t call none of our learners inmates convicts parolees or anything like that, because the narratives that have been attached to those to those labels have always been negative and dehumanized.

Then we challenge them in healthy ways and try to relate a lot of their lived experience to the coding concepts. For example, this week, I just did a lesson about scoping. And I related into like, how their cells or their living quarters is set up in – like the scope that they live in, only them or their celly have access to that, to what’s in the cell, as opposed to like the global scope where the day room or yard everyone has access to. So just finding these ways where you can relate the lived experience of the current situation, or current condition to some of these coding concepts that’s a little bit abstract and new for someone learning technology.

(Timestamp: 8:08)

• Ameelio wants to take on for-profit, prison-calling rackets after starting with free letters to inmates

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On getting people close to the work

Showing future coworkers and stakeholders about the real nature of the justice and incarcerative systems firsthand helps break down barriers. Silicon Valley may be famously progressive but even so people have internalized decades of misinformation about how things actually work.

Rohatgi: Most people in tech have no exposure to people who have been impacted by a criminal justice system, even though there are over 2 million people who are incarcerated. We need to first make sure the company has shifted their culture to make sure that the apprentices and future software engineers can thrive… so they don’t use terms like felon or ex-con, right? And frankly, people need to understand why this country has gotten into the place it is with our criminal justice system. So there’s a lot of education that happens within the companies.

For us, it’s involved taking over 200 Slack employees to San Quentin, to help shift their perceptions of what somebody who is incarcerated is capable of, explaining to them all the obstacles that you have to go through once you are released, right? Just really getting an education on this issue that nobody has, or very few people within the tech community have exposure to… Then we’ve seen massive shifts from fear to love. (Timestamp: 10:01)

• Salesforce buys Slack in a $27.7B megadeal

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On getting system-impacted people a place at the table

Of course it’s advised to ask people who have been in prison for their input on programs that may affect others there, but how often are such returned citizens given positions of weight at 9-figure funds? Yet as Tamboura explains it’s exactly what’s needed.

Tamboura: You know, CZI is a baby. It’s a new organization. And when our team got involved with this work, it just it took off like a rocket ship. And it’s time for it’s time for us to, like, graduate from grade school and move into college with this fund.

This is one of the few times in history where a fund I think it is the only time in history where a fund has been advised by someone — and I mean a fund this significant as this — advised by people who are system impacted. There’s this old mantra people that are closest to the problems are closest to solutions. And I really believe that people who have been through the system people or are system impacted, really need to not only have a seat at the table, but have a compelling voice in this work. (Timestamp: 13:29)

• UCLA is building a digital archive of mass incarceration with a new $3.6M grant

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On the impact

The prison system is notoriously fractured, with regulations and opportunities varying wildly between different facilities and states. It takes research, clout, and direct work with the people in charge to move the ball — but when it hits, it can change a lot of lives. Programs like The Last Mile are just part of a broader effort.

Jones: We have a sort of like a franchise model when we go into expanding into any state. For instance, Ali with CZI, they helped with us expanding to Oklahoma, helped with the funding. It was a partnership. And when we launched, it was, at the time, the highest incarcerated state for women in the world. And I remember one of our board members, MC Hammer, talking to Governor Stitt and raising that statistic. In a matter of months, they did the biggest commutation still to this day. It was like 500 people got commuted, and a lot of our learners was part of that commutation, and got out. (Timestamp: 17:08)

• Build products that improve the lives of inmates

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On proving the impossible possible

Inertia is one of the biggest obstacles to overcome in any social movement, and part of that is the assumption that if it could be done, someone would have already done it; no one has done it, so it can’t be done.

Rohatgi: One thing that’s really important is proving the model. If Slack can do it, why can’t Zoom, Square, or Dropbox? It turns out, they can. And if Zoom, Square, and Dropbox can do it, why can’t other companies, right? So the idea that it’s impossible, you can’t say that anymore. You can’t say it’s not possible to do it — you can, and for very big, not massive, but for big tech companies. So I feel like the impossibility of making the significant change and making systemic change within the tech sector seems completely doable to me. (Timestamp: 22:37)

• A beginner’s guide to diversity, equity and inclusion

Watch the full session below:

Some well-known VC firms have spent the last few months crunching data while working to chart, graph, and map the world of venture investing. Happily for you and I, they’ve been pretty free with their time and data, helping us better understand today’s market for high-growth, software startups.

Last week The Exchange dug into data from Battery Ventures, which worked to explain some of the gains software companies have made in recent years in terms of their valuation multiples. The short gist is that multiples expansion — the repricing of software companies higher for each dollar of revenue they command — could be explained in part by segmenting the companies into various growth cohorts. Once accomplished, it’s easy to see that the fastest-growing software startups are enjoying the most price appreciation.

And as one Battery investor explained, growth rates de-risk valuation multiples.

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

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The logic is sound enough. I can doodle on it in a future column if you’d like. But today, instead of retreading familiar ground, we’re diving into new data from Bessemer, a VC group that should be familiar to Exchange readers thanks to its cloud index that we refer to quite often. Regardless, Bessemer’s 2021 cloud report is out, and it assists some of the work we did with Battery’s charts.

What we can do with Bessemer’s dataset is extend the argument from Battery’s report: Sure, strong growth rates de-risk multiples, but what the new report indicates is that growth rates themselves amongst cloud companies (modern software, SaaS, call it what you will) should prove more durable than nearly anyone historically expected.

You can quickly see the synthesis. If growth rates de-risk rising multiples, we can infer some logic to higher-growth companies being valued more richly than their slower-growing peers. But that doesn’t get us to understanding why multiples themselves might be rising, provided we wanted to find some argument for why they are sane. More durable growth rates, however, provide a possible answer.

Why? The longer a company can keep up its growth rate from year to year, the larger it will be in the future. Modern software companies do have a history of growth-rate-retardation over time, but nearly never negative growth rates.

More durable growth today implies more cash generation in the future. Up go valuations, and, for the fastest-growing today, the bump in worth comes with the valuation downside protection inherent in quick growth.

Got all that? If not, don’t worry — I have charts. Let’s keep going.

A theory for why software valuations aren’t irrational (maybe)

The key reason that startup and public-company software valuations are so high is because investors are willing to pay those prices. Hungry for yield on their capital, buying growth via software has been a trade for some time. It was even accelerated last summer as the pandemic gripped the global economy.

Suddenly software was not just a possible place to bet on growth, it was also a durable place to stash cash, because without software the world would stop. And that couldn’t happen, so most folks kept paying their software bills.

You might think that the valuation gains companies saw as other stocks fell out of favor would fade. After all, if they got a bump and the bump faded, surely they would lose some air from their balloon. Kinda? But mostly it appears that software valuations have stayed pretty damn aloft. And this brings us to the future.

Check out the following chart, via the Bessemer report (and shared with permission), that I will explain immediately afterwards:

Bessemer partner Mary D’Onofrio, one of the report’s lead authors and part of the growth team, told us that the x-axis is a public software company’s last-year’s growth rate, while the y-axis is what it is managing in the current year. And that 0.8x? That’s the correlation.

Los-Angeles based startup Canoo revealed its newest — and now third — electric vehicle, a pickup truck that does away with the sharp corners and huge engine housing of both comparable EV trucks and legacy diesel pickups and is aimed at both commercial customers and weekend warrior-minded consumers.

The truck, which Canoo says is the most space efficient on the market, was leaked Wednesday evening in advance of an official reveal set for Thursday afternoon.

The three Canoo vehicles all share a design language. But the important part, and the cornerstone of Canoo, is the foundation. Canoo uses the same platform architecture on all of its vehicles, only altering the cabins, or top hats, with each new model. Canoo’s proprietary platform is like a thin, flat skateboard that houses the critical components of the EV powertrain. The company said this type of design gives its truck a similar flatbed size as a best-selling traditional pickup.

The truck will open for preorders in the second quarter of 2021, with deliveries set to begin as early as 2023.

The truck clocks in at 184 inches in length (in comparison, Tesla’s Cybertruck is 231 inches long and the Rivian R1T is 218 inches). But where Canoo’s model stands out is in its pull-out bed extension, which stretches the truck bed from six feet to a fully enclosed eight feet, and extends the length to a more competitive 213 inches. It also boasts up to 600 horsepower and has a battery range of more than 200 miles. 

Like Canoo’s other vehicles, the pickup has all kinds of options to change it. There are dividers for the truck bed, for instance as well as a camper shell that can turn it the vehicle into a van. There’s even a rooftop tent — at least in its photos — which suggested that Canoo is thinking about an accessories business to go along with its vehicles.

There’s also cargo storage area that has a fold down work table and additional electrical outlets, side tables that can flip down, a hidden step to the truck bed that contains even more storage, and a roof rack.

“Our pickup truck is as strong as the toughest trucks out there and is designed to be exponentially more productive,” Canoo executive chairman Tony Aquila said in a statement. “This truck works for you. We made accessories for people who use trucks – on the job, weekends, adventure. You name it, we did it because it’s your platform and she’s bad to the bone.”

Last December, Canoo went public through a merger agreement with special acquisition company Hennessy Capital Acquisition Corp., with a market valuation of $2.4 billion. It joined a string of EV automakers and charging infrastructure companies that Fisker Inc., Nikola Corp. and Lordstown Motors in forgoing a traditional IPO on the road to a NASDAQ listing.

 

Twitter Spaces, the social network’s Clubhouse rival, is working towards a public launch in April, the company announced in comments made in a public Twitter Space audio room on Wednesday. According to the Space’s host, Alex aka @akkhosh on Twitter, the company intends to make it possible for anyone to host a Twitter Spaces room of their own sometime in April.

“So, very soon,” the Twitter employee noted. “That’s where we’re headed.”

TechCrunch immediately reached out to Twitter to fact check his statements on Wednesday. Given that, in the context a broader conversation about a beta product that just rolled out to testers on Android a week ago — and for joining Spaces only — his comments could have been interpreted to mean that Android beta testers would also gain the ability to host their own Spaces by April.

That would still be a fairly quick pace of development for a product that only launched into public testing late last year.

However, a Twitter spokesperson confirmed that we can take Alex at his word.

“Can absolutely confirm that he meant everyone on Android and iOS, not just beta testers,” the spokesperson told TechCrunch. In other words, the company is making Twitter Spaces available to the public user base in a matter of weeks.

The speed of development now taking place at Twitter has been notable. In just a few months, Twitter has launched its audio chat room feature to public testing and has quickly iterated on the product to tweak elements like it titles and descriptions, scheduling options, support for co-hosts and moderators, guest lists, and more. When forthcoming changes are announced — like Android support, co-hosts, or scheduling options, for example — they’re promised to roll out in a matter of weeks, not months.

A few other ideas were also discussed during yesterday’s Twitter Spaces session. The company said it’s considering support for using music in Spaces and thinking about better ways of integrating tweets.

For the former, the goal would be to offer Spaces’ hosts some sort of welcoming music they could play for their listeners. The company has also discussed the idea of offering users the way to tweet inside the Space directly, where tweets would not be displayed on your public timeline. There are various ways this could be accomplished — for example, by offering an ephemeral, fleeting chat room inside the Space, similar to Twitter’s older live video app Periscope, or by offering a dedicated timeline just for the Space itself, which could be more complex to build.

Of course, there are some concerns with rushing a product like Twitter Spaces to launch. In Spaces’ competitor, Clubhouse, users are still regularly reporting dealing with verbal abuse and bad actors who are looking to take advantage of the platform as a place to hustle or scam people.

It’s less clear to what extent Twitter Spaces has been impacted by similar issues, as its product is still non-public. But one Twitter Spaces user who joined during yesterday’s session talked about how their recent Twitter Space was hijacked by a fan group who attempted to take over the discussion. While these particular hijackers would be placated by having the ability to run their own Spaces session, it’s easy to imagine how a coordinated effort to derail a Twitter Space could still be a problem in the weeks to come.

Twitter, in the early days of Spaces, had spoken publicly about how it would first ensure that “women and those from marginalized backgrounds” — a group of people who “are disproportionately impacted by abuse and harm on the platform,” a product designer had said — would be the first testers of the product to ensure it’s built with safety in mind. But in the weeks that have followed, there has not been as much said about Twitter Space’s anti-abuse measures or policies, as the team’s focus has been directed more on the product itself, and its various bells and whistles.

Even when taking the time to speak to analysts and investors or sit down for interviews, Twitter execs and product leaders have tended to gloss over why it keeps building new tools — like its Stories feature Fleets and now, Spaces — to encourage conversations from those who are too afraid to tweet.

The fact is that many are afraid because Twitter has not yet successfully made its platform a place where users aren’t trolled, abused, or attacked — for sometimes even the most benign statements or missteps.

One feature that could potentially help protect users by holding abusers accountable is recording Spaces.  Twitter earlier said it aims to build in a way to natively record Spaces conversations. When on the record, fewer people may be willing to speak abusively, perhaps. That could encourage more thoughtful conversations but could still potentially scare other users off from trying the product.

Meanwhile, the jury is still out on Twitter Spaces and Clubhouse’s long-term potential. There’s a question as to whether some of these platforms will see dwindling usage when the world re-opens as the pandemic ends and the conference and networking circuits heat back up. In that light, Twitter Spaces may end up having more long-term staying power as it’s connected to Twitter’s broader product and plans to make its platform a place for creators to organize, and eventually monetize their fan bases.

Given the deluge of climate focused companies flooding public markets, it’s getting hard to keep track of who’s doing what, where they’re traded and how they’re performing. That’s why the folks at Energy Impact Partners have set up an index tracking tech companies that are focused on sustainability, energy efficiency and reducing greenhouse gas emissions.

For the past few months the firm, whose investors include some of the largest energy consumers and utilities in the world, has been working on setting up the index of representative climate tech offerings that are available on public markets and discovered one thing — these companies are crushing returns compared to the overall market.

Since the beginning of 2020, EIP Climate Index has outperformed NASDAQ by approximately 2.8 times — it’s up 127% compared to 45% for the NASDAQ. Of the companies on the list, about 20 out of the 27 companies are new offerings that have been public less than a year and have outperformed NASDAQ during that period. About16 of them are up over 100% during that time. That’s true even with the overall index down about 20 percent from its January peaks.

The index isn’t actually available for public investment, it’s an educational tool more than anything else, but it does show the breadth of companies working on climate-related solutions and reveals the overwhelming appetite of public market investors to back these companies.

“There’s been a really incredibly positive run in the climate tech run in the public markets and not just from SPACs,” said Shayle Kann, a partner at Energy Impact Partners. “Part of our motivation for creating this climate tech index let’s see if we can put together as diverse a group of companies as possible.”

Included in the EIP index are companies like Beyond Meat, which is a sustainability darling, and businesses that are a bit longer in the tooth like hydrogen fuel cell companies Ballard Power and Bloom Energy. The companies run the gamut from electric storage to renewable energy production, to vehicle charging and infrastructure to alternative protein providers.

“The idea was, how was the sector, if you include all this stuff, performing as a whole. We created this index and tried to be inclusive. It has been dramatically outperforming the market.”

While the EIP list is intended to be informative, there’s no reason someone couldn’t take this index and turn it into an exchange traded fund for the industry. Most of the ETFs that are currently on the market are focused narrowly on energy production, or infrastructure, this index is potentially the first to track the broadly diversified world of companies focused on mitigating the impacts of climate change and reducing greenhouse gas emissions.

There are even additive manufacturers in the mix like Desktop Metal, which Kann said had a huge climate component to its technology.

“Additive manufacturing has a fairly strong climate case in reduced waste, reduced transportation, electrification of the manufacturing process,” Kann said. 

It’s also a signal that early stage private investors can take note of too, said Kann.

“It provides a broader pathway to public markets. The companies that see their share prices run up here. What it suggests for us and for everybody else in this venture capital world is the exit pathways are improved when this index does well,” he said. 

 

As we’ve made our way through this pandemic, it has forced businesses to rethink and accelerate trends. One such trend is the movement to no-code tools to allow line-of-business users to create apps and workflows without engineering help. To help answer that demand, ServiceNow released a couple of new tools today as part of their latest release.

Dave Wright, the chief innovation officer at ServiceNow, says that COVID has forced more teams to work in a distributed fashion, and that has in turn has advanced the idea of putting software building into the hands of every employee.

“So because people haven’t had the same support networks and are distributed, you need to be able to produce software that has a consumer grade feel to it. And if you could get that in place, then you can get people to use the system. If you get people to use the system, then you start to get better employee productivity and employee engagement,” Wright explained.

This has typically revolved around the three main areas of focus on the ServiceNow platform — customer service, IT and HR — but in order to step outside those three categories, the company has decided to develop a new area called Creator Workflows, which are designed to help workers build new workflows suited to their needs.

The company has come up with a couple of new tools to help these Creators: AppEngine Studio and AppEngine Templates, which work together to help these folks build these no-code workflows wherever they work across an organization.

AppEngine studio provides the main development environment where users can drag and drop the components they need to build workflows that make sense for them. The templates take that ease of use a step further by providing a framework for some common tasks.

The new release also incorporates a couple of recent acquisitions: Loom Systems and Attivio. The company has taken the latter and repurposed it to be a platform-wide search tool called AI Search.

“It allows you to deliver contextualized consumer grade results. So it means that we can personalize the results that you get from a search back to you so that it’s more relevant to you and more focused on giving you that context that you really need to make sure you get actionable information,” he said.

Another company that they purchased was Loom Systems, which gave the company an AIOps component and the ability to inject that AI across the platform. Gab Menachem, who was CEO and co-founder at Loom prior to the acquisition, says the process of becoming part of ServiceNow has been smooth.

“Vendors in this space find themselves kind of giving customers a science project. In ServiceNow the whole focus of this year has been to incorporate [Loom] into the workflow and make work flow naturally, so that employee productivity would be boosted, and the engagement will be high. And that’s what we focus on, and I think it was a really easy transition into a big company because it just made all of our customers a lot happier,” Menachem said.

This new tooling is available starting today.

Roblox went public yesterday after seeing tremendous growth in 2020, and that’s not just good news for the company’s employees and investors — there are also startups like Gamefam hoping to take advantage of the platform’s success.

Roblox has a whole ecosystem of millions of developers and creators building on its game platform, and some are banding together to create their own teams and studios. (We profiled several of those teams earlier this year in an article about the company’s creator accelerator.) But Gamefam founder and CEO Joe Ferencz said his startup is “the first and only fully-dedicated, professional game publishing company on Roblox.”

Founded in 2019, Gamefan currently has 37 full-time employees and eight live games, including Ultimate Driving and Hot Wheels Open World, and Ferencz said there are another 10 in development. Collectively, those games are seeing 48 million monthly visitors and generating six figures in monthly revenue.

Ferencz described the team as “gaming industry professionals working hand-in-hand with the top up-and-coming Roblox creators.” For example, Ultimate Driving creator TwentyTwoPilots also serves as Gamefam’s creative director.

Ferencz himself has worked as a manager Ubisoft and Mattel, where he worked on franchises including Hot Wheels, and where he recalled seeing the emergence free-to-play mobile gaming: “I said to myself, ‘The next time there’s this big platform shift, I want to be a part of this.'” The rise of Roblox and user-created games provided him with that opportunity.

At the same time, Ferencz said he was excited about the opportunities that Roblox provides to escape from the “orthodoxies” of free-to-play gaming, where the economics often drive game design decisions.

“Roblox truly is the metaverse for this younger generation,” he argued. “What they are finding here is something that transcends gaming, it’s human co-experience. What that means is that each game needs to have a very distinctive and attractive immersion to it in way that mobile free-to-play doesn’t.”

Of course, part of Roblox’s appeal is the fact that individual creators don’t need to work with large teams or publishers, but Ferencz said, “Superstar developers and creators are thinking about bigger and bigger games, the sophistication is really evolving at a rapid pace.” That, in turn, means bigger teams, and “when you have bigger teams, you have more process, you need to know how to structure high-performing teams and drive positive teamwork between people.”

“As the business gets bigger, you need people focused on the business opportunities, dedicated marketing functions, a dedicated live operations team,” he continued. “That’s what we offer.”

Ferencz and Gamefan’s business team have been involved in the Roblox platform for several years now, but he admitted, “Although we get it, we don’t get it exactly the way people who have been playing on it since they were 10 and developing for it since 15 get it … We respect that and lean into that.”

So one of the key elements to the Gamefam approach, he said, is to make sure the creators are driving the game development process.

“We believe that there needs to be a visionary or a team of visionaries on each project, and that they need to decide what is right,” Ferencz said. “There will then be a team around them that is part of a consensus process, that the visionaries are responsible for bringing along for a ride.”

And as he thinks about Gamefam’s future, Ferencz said the company could eventually publish games on other platforms. Don’t expect it to happen anytime soon, though.

“Our focus is UGC gaming, and Roblox is the only place that matters in UGC gaming today,” he said. “We plan to build a huge brand and media business hand-in-hand with the Roblox platform. In the long term, if other platforms become relevant, then course we will be looking to evaluate and expand on those platforms —but the truth is, right now we couldn’t be more all about Roblox.”

 

Hugging Face has raised a $40 million Series B funding round — Addition is leading the round. The company has been building an open source library for natural language processing (NLP) technologies. You can find the Transformers library on GitHub — it has 42,000 stars and 10,000 forks.

Existing investors Lux Capital, A.Capital and Betaworks also participated in today’s funding round. Other investors include Dev Ittycheria, Olivier Pomel, Alex Wang, Aghi Marietti, Florian Douetteau, Richard Socher, Paul St. John, Kevin Durant and Rich Kleiman.

With Transformers, you can leverage popular NLP models, such as BERT, GPT, XLNet, T5 or DistilBERT and use those models to manipulate text in one way or another. For instance, you can classify text, extract information, automatically answer questions, summarize text, generate text, etc.

There are many different use cases for NLP. A popular one has been support chatbot. For instance, challenger bank Monzo has been using Hugging Face behind the scenes to answer questions from its customers. Overall, around 5,000 companies are using Hugging Face in one way or another, including Microsoft with its search engine Bing.

When it comes to business model, the startup has recently launched a way to get prioritized support, manage private models and host the inference API for you. Clients include Bloomberg, Typeform and Grammarly.

With the new funding round, the company plans to triple its headcount in New York and Paris — there will be remote positions too. Interestingly, the company is also sharing some details about its bank account.

Hugging Face has been cash-flow positive in January and February 2021. The company raised a $15 million round a little over a year ago — 90% of the previous round is still available on the bank account. And the company’s valuation saw a fivefold increase. This shouldn’t come as a surprise as you can negotiate better terms if you don’t actually need to raise.

And it looks like Hugging Face is on the right path as the company is hosting a vibrant community of NLP developers. You can browse models and datasets, take advantage of them and contribute as Hugging Face is becoming the central brick of NLP enthusiasts.

A weekend statement from the Taiwanese government over its ability to provide water to the nation’s chip manufacturers in the face of an unprecedented drought make it clear that climate change is a direct threat to the foundations of the tech industry.

As reported by Bloomberg, Taiwanese president Tsai Ing-wen took to Facebook on Sunday to post about the nation’s capacity to provide water to its citizens and businesses in the face of the worst drought the nation has faced in 56 years.

The nation said that it would have sufficient water reserves to ensure manufacturing of semiconductors by companies like Taiwan Semiconductor Manufacturing wouldn’t stop.

These chips sit at the foundation of the tech industry and any disruption in production could have disastrous consequences for the global economy. Already, supply constraints have caused stoppages at automakers like General Motors and Volkswagen, and chip manufacturing facilities are running close to capacity.

The Biden administration has emphasized the need for the U.S. to strengthen its semiconductor manufacturing supply when it issued an executive order last month to address ongoing chip shortages that have idled manufacturing plants around the country.

“Taiwan’s water shortage and its effect on semis is a wake up call for every technology investor, every founder and the entire venture ecosystem. It is complexity theory made manifest and only serves to show that scalable, data-driven solutions rapidly deployed across large industrial markets are our only hope in correcting the course,” wrote Vaughn Blake, a partner at the energy-focused investment firm Blue Bear Capital.

Taiwan’s water woes and their ability to severely impact the semiconductor industry aren’t new. They were even flagged in a 2016 Harvard Business School case study analysis. And TSMC is already working to address its water consumption.

By 2016, TSMC had already worked to improve its water purification and recycling efforts — necessary for an industry that consumes between 2-9 million gallons of water per day. (Intel alone used 9 billion gallons of water in 2015). At least some of TSMC’s fabrication facilities have managed to achieve recycling rates of 90% on industrial wastewater, according to the Harvard case study.

But as Moore’s Law drives down the size and increases the demand for even more precision and fewer impurities in the manufacturing process, water use at fabs is going up. Next generation chips may be consuming as much as 1.5 times more water, which means better recycling is needed to compensate.

For startups, we need to be looking at ways to lower the cost and improve the performance of wastewater recycling and desalination, both increasingly energy-intensive propositions.

Some companies are doing just that. These are businesses like Blue Boson out of the UK, which purports to have developed a quantum-based water treatment technology. Its claims sound more like science fiction, but its website touts some of the best research universities in the world. Fido, a leak detection company also out of the UK tracks potential spots where water is wasted, and both Pontic Technology and Micronic are American companies developing water and fluid sterilization systems.

Numix, another purification startup, seems designed to remove the heavy metals that are part and parcel of industrial manufacturing. And Divining Labs out of Los Angeles is using artificial intelligence to better predict and manage stormwater runoff to collect more resources for water use.

“Upton Sinclair said, ‘It is difficult to get a man to understand something, when his salary depends on him not understanding it,'” Blake of Blue Bear Capital wrote. “Well, to all the founders and investors out there, it looks like all tech is climate tech for the foreseeable future, lest there be no tech at all.”