Category: UNCATEGORIZED

02 Oct 2020

Blossom Capital appoints Carmen Alfonso Rico as its newest partner

Blossom Capital, the early-stage venture capital firm founded by Ophelia Brown, has recruited its latest partner: Carmen Alfonso Rico has joined from Samaipata VC, where she led the U.K. office. Before that she was at Felix Capital and is also a co-founder of the London outpost of “community-driven” VC, The Fund.

During her time at Felix Capital and Samaipata, Alfonso Rico is said to have sourced and invested in a number of promising European startups, such as virtual events platform Hopin and social networking app Peanut, along with scale-ups Goop, Deliveroo and Mirakl.

She’s also been an entrepreneur herself, having founded two companies, both with limited success but plenty of learnings. Vinpho was a Spanish crowdsourced journalism platform (you can read the early pitch deck here), and Reconnect was a U.K.-based direct-to-consumer lifestyle and fashion brand for pregnant women.

“It actually came about quite unexpectedly,” Alfonso Rico tells me on a call discussing her latest career move. “Ophelia and I like to joke now that it was almost like generating a deal and when founders are not looking to raise because I was not looking to move at all… We had breakfast and discussed Blossom and I very quickly realised that Blossom was a very, very interesting platform and that it had a lot of the kind of deal-making mindset that I was looking for”.

That’s a partial reference to the firm’s “high conviction” investing pitch, which sees the Series A and sometimes seed investor back fewer companies by writing larger cheques. Alfonso Rico says she was also attracted to the way Blossom is structured, being an all-partner firm where investments are worked on together and one that it isn’t particularly thesis-driven with regards to sectors or geography, unlike much of her previous VC experience. And, of course, there’s Brown’s own ambition.

“I think you know Ophelia [Brown], she is quite bold and very hungry and I think she projects that into Blossom,” says Alfonso Rico. “I immediately got very interested but we did take a lot of time to get to know each other, we spent weeks discussing deals, we spent some time together, actually properly together, to just make sure that there was that personal fit. And at the end, it was kind of an obvious decision”.

Although Blossom’s partner team isn’t “strictly segmented,” in terms of individual focus areas, Alfonso Rico says her investing and entrepreneurial background includes consumer, where she has an established network and some “muscle [memory]” analysing consumer companies, and digital platforms and marketplaces, both B2C and B2B. She’s also long-been obsessed with the “power of communities” and how they can be leveraged to support the success of products and brands regardless of sector.

“Following that customer love, that power of the community, has led me to my best investments, and I plan on continuing down that path,” she adds.

02 Oct 2020

Nintendo’s new RC Mario Kart looks terrific

In a year, Nintendo would have demoed, in person, Mario Kart Live: Home Circuit. The company would have invited select members of the press into some rented event space and let us experience the game first-hand, like it had with Labo and Ring Fit Adventures. It’s 2020, however, and that’s just not how we do things.

Watching someone else play an RC game over teleconference software is not ideal. But it’s nothing if not extremely of the moment. And more importantly, it’s probably a testament to what Nintendo has built here that it translates so well with a less than ideal setup. Granted, I won’t feel comfortable offering a proper review until I’ve played the game on my Switch, but I can confidently say that Mario Kart Live makes for one hell of an impressive demo.

Image Credits: Nintendo

Like the recently released Mario Lego sets, this is the kind of toy that makes me jealous of kids today. It also, frankly, bums me out that I don’t have more space at home to lay out a track. I’ve heard it was a buyer’s market, so maybe I’ll go buy a house. Whatever the case, bringing Mario to a real-world RC car is one of those no-brainer ideas, and the execution looks great.

The game also finds Nintendo embracing augmented reality in a really convincing and clever way. We’ve seen some AR from the company, most notably in the form of Pokémon GO — which, to be fair, was more of a Niantic joint and, as plenty will happily point out, not really proper AR. And like that title, Nintendo worked closely with a third party. In this case, it’s the New York-state based Velan Studios, which was started by brothers Guha and Karthik Bala who also founded Vicarious Visions, an Albany-based game developer now owned by Activision.

“It started as an experiment by a small team at Velan,” the startup said in a blog post today. “Like many prototypes, the main goal was to “find the fun”. We built an RC car by kitbashing together drone parts, cameras, and sensors to create a unique thirdperson view driving experience. It gave us the exhilaration of speed and allowed us to see the world from a totally different perspective.”

Image Credits: Nintendo

The execution of Mario Kart Live is a perfect bit of synergy in that it leverages the Switch to really bring the whole thing to life — in a manner similar to what the company has already done with Labo and Ring Fit. Of course, much or most of the real magic here comes courtesy of the racer. Currently limited to Mario and Luigi (no word yet on additional characters), the cars feature both a camera for FPV on the Switch and all of the requisite sensors.

Nintendo declined to answer specific questions about the on-board sensors and other hardware, but one assumes depth-sensing plays a big role here. There’s no calibration out of the box. You can pretty much start it up and start driving around. Once you actually unfold and set up the three gates to create the circular course, however, that will require some driving to generate the lay of the land. Nintendo’s employed a clever graphic for that, with Lakitu dropping a bucket of paint the character drives over and tracks with his wheels.

Image Credits: Nintendo

The game also employs some clever physics, with game action impacting speed and steering. There’s a range of top speeds, from 50 to 200 cc. A demo stripped of AR shows how in-game elements impact the actual kart speed. Other elements, like the sudden occasional sand storm, cause the kart to drift to the sides. The game will also react, if, say, you crash it into a table leg — sending coins flying just as it would in a Mario Kart game.

On that note, the company tells me that the karts are quite robust, with a bumper that’s essentially designed to run into stuff. That shouldn’t cause any damage, given the top speeds here. Though the company notes that if, say, a heavy book falls on top of the kart after it jostled it loose from a shelf, that could ultimately be an issue. Nintendo says there will be a way to repair the karts, but offered no specifics on warranty.

Image Credits: Nintendo

Races can be played with up to four, though a kart is required to play. In fact, the actual game will be free to download from the Nintendo store, but is essentially worthless without a kart. Until that’s set up, the only thing you’ll be able to access is a game trailer. At the moment, the in-game opponents are just the Koopalings.

Image Credits: Nintendo

Like the karts themselves, however, it seems likely — or even certain — that the company will introduce additional characters down the road. Perhaps we can look for expansions along the lines of what the company has done with Smash Bros. Also, like Mario Maker, you can customize both your character and car for the in-game FPV AR overlays (though these won’t be visible to other players).

Mario Kart Live: Home Circuit arrives October 16, priced at $100 a kart. You’ll need either a Switch or Switch Lite to play.

01 Oct 2020

A PC gaming site had to ban political troll mods for games, because nowhere is safe

NexusMods, a large platform and gathering place for modding PC games, has banned all content relating to the U.S. elections following a flood of troll content, saying “we’ve decided to wipe our hands clean of this mess.” Not exactly headline news, no, but a reminder that the toxic behavior frequently seen (and blamed) on social media is pervasive even in niches where politics would seem to be completely irrelevant.

“Modding” (as in modifying) is the practice of creating new content for games that players can then install on their own, for example adding new levels or characters, or adjusting the interface or difficulty. NexusMods is one of the larger collections of such mods and a lively community.

Unfortunately, even something as simple as a way to add decorative tapestries to Skyrim is a proxy political battleground, with numerous mods appearing to, for example, replace generic enemies in a game with Trump supporters or “rioters.” Here’s a screenshot from Reddit user Cipherx02, who noted that users were also filling the description fields with disinformation:

I blurred out one mod that used an image of a protester shot in Portland by Kyle Rittenhouse. Yes, they did!

In a post to the site’s news page, the admins of NexusMods walk a fine line in expressing their frustration without espousing any political ideology apart from, perhaps, “anti-idiot”:

Recently we have seen a spate of provocative and troll mods being uploaded based around current sociopolitical issues in the United States. As we get closer to the US election in November we expect this trend to increase as it did this time 4 years ago.

Considering the low quality of the mods being uploaded, the polarising views they express and the fact that a small but vocal contingent of our users are seemingly not intelligent or grown up enough to be able to debate the issues without resorting to name calling and baseless accusations without proof (indicative of the wider issues plaguing our world at this time) we’ve decided to wipe our hands clean of this mess and invoke an outright ban on mods relating to sociopolitical issues in the United States. We have neither the time, the care or the wish to moderate such things. This ban will apply to all mods uploaded from the 28th of September onwards. We will review this restriction sometime after the next President of the United States has been inaugurated.

No doubt all over the web there are situations of this sort as ordinarily politically-neutral spaces are infected by toxic discourse. Unlike Facebook and YouTube, however, smaller sites and communities don’t have thousands of paid moderators or sophisticated machine learning tools to nip the problems in the bud.

As such a total ban doesn’t seem so much an overreaction as the only reasonable reaction. As the election approaches (and likely well beyond that) it’s probable that many small communities will have to draw a line in the sand or risk serious incidents such as doxing, threats, and the unwelcome attentions of angry internet mobs.

01 Oct 2020

Spain’s startup ecosystem: 9 investors on remote work, green shoots and 2020 trends

As reported in the first half of our Spain-focused VC survey, the nation’s startup ecosystem continues to grow and is keeping pace with ecosystems in more developed European countries such as U.K., France, Sweden and Germany.

While main hubs Madrid and Barcelona bump heads politically, tech ecosystems in each city have been developing with local support. According to this regional investor database, Spain is home to 62 angels, 84 seed funds and 19 Series A and beyond institutional funds.

As the capital and financial center, Madrid enjoys proximity to political power and multinational companies, which is likely why it’s home to a larger proportion of fintech startups. According to Dealroom, between 2015 and 2019, Madrid’s emerging companies raised €1.5 billion. In recent years, its Arganzuela district has become known as a startup hub, but Barcelona’s Districte de la innovació is also home to a growing number of established and upcoming technology companies.

May of 2020 saw a resumption of VC activity with €70.89 million invested in startups. Wallabox, the Barcelona-based electric charger company, closed the second part of €12 million from a Series A investment. Also in May, Belvo raised €9.09 million, Accure Therapeutics €7.6 million and Cubiq Foods €4 million.

Notable companies and data points:

  • Voovio Technologies — raised €15 million from Moira Capital.
  • MOVO — €13 million from Delivery Hero, Seaya Ventures and others.
  • Lana — $12.5 million from Base10, Cathay Innovation and other investors.
  • ProntoPiso — €1.6 million from existing shareholders.
  • Colvin — raised €14 million.
  • U.S./Spanish insurtech startup CoverWallet was sold to AON for $330 million.
  • MediQuo — raised €4 million.
  • Factorial — raised a €15 million in a Series A round led by CRV.
  • Holded — €6 million Series A round in 2019 led by Lakestar.

Here are the investors who shared their thoughts with us for the conclusion of our Spain VC survey:

Lourdes Álvarez de Toledo, partner, JME Ventures

What trends are you most excited about investing in, generally?
SaaS. B2B.

What’s your latest, most exciting investment?
Kymatio.

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?
Subscription B2C app for managing kids from 0 to 18 years.

What are you looking for in your next investment, in general?
Scalability,

Which areas are either oversaturated or would be too hard to compete in at this point for a new startup? What other types of products/services are you wary or concerned about?
Too much competition: travel. Interesting areas: quantum computing.

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
More than 50% in Spain.

Which industries in your city and region seem well-positioned to thrive, or not, long term? What are companies you are excited about (your portfolio or not), which founders?
Industries: cybersecurity. Companies: Lingokids, Devo, Genially, Glovo.

How should investors in other cities think about the overall investment climate and opportunities in your city?
Spain has no Series B investors, so there are many opportunities for foreign Series B funds.

Do you expect to see a surge in more founders coming from geographies outside major cities in the years to come, with startup hubs losing people due to the pandemic and lingering concerns, plus the attraction of remote work?
At least in Spain, I think remote work will be only temporary. If you are freelance it is still important to work near the main cities.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19?
Retail, fashion, travel.

What is your advice to startups in your portfolio right now?
Don’t take debt if it is not extremely necessary, try to be cash flow positive — although you have to sacrifice faster growth.

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Yes! In Genially: awesome growth.

What is a moment that has given you hope in the last month or so? This can be professional, personal or a mix of the two.
Schools opening again (four kids already).

Any other thoughts you want to share with TechCrunch readers?
Spain will be very harmed the next year, and so will the startup ecosystem.

Javier González-Soria y Moreno de la Santa, managing partner, Top Seeds Lab

What trends are you most excited about investing in, generally?

01 Oct 2020

Digital vote-by-mail applications in most states are inaccessible to people with disabilities

The 2020 election is without a doubt going to be the biggest one in history for voting by mail, but people with disabilities may find it rather difficult to apply for their ballot, since according to an audit by Deque, most states don’t actually have an accessible digital application.

Deque, a company that helps develop accessible web applications and processes, checked each state’s process for applying to receive a mail-in or absentee ballot (they’re basically the same thing). Disappointingly, 43 of the states’ applications “had some level of digital inaccessibility.”

This could be a variety of things, but take for example an application that’s a PDF. In order to be accessible the document should be real text that can be read by a screen reader app, and the user should be able to fill in the fields necessary without printing it and grabbing a pen.

Making a single form readable and writable can probably be done in an hour or two, which is why Deque did so and offered the updated forms to each state. Georgia, Rhode Island, Ohio, Montana, Missouri, Maryland, and Kentucky all quickly accepted the offered help. Michigan and Massachusetts have accessible online processes as alternatives to the PDFs, and several states don’t require applications.

The remainder have some sort of issue. That doesn’t mean that a blind person or someone who can’t write will be totally unable to request a mail-in ballot, but it won’t be as easy as it is for many others and they may need help from another person, which isn’t always easy to get on short notice. Deque has most of the states’ forms available with accessibility updates here.

“Voting is a right. It was an easy decision for us to offer these remediated PDFs as a free public service, hopefully making it easier for all to take advantage of mail-in voting options,” said Deque CEO Preety Kumar in a press release announcing the audit.

The effort to make and keep the web — and things like ordinary government functions — accessible is a full-time one. As those in the community have noted, it’s easier and better by far to design accessibility in at the start than patch it on later.

01 Oct 2020

Daily Crunch: Google commits $1B to pay publishers

Google is paying a lot of money for its news licensing program, Microsoft announces an affordable laptop and Facebook says it won’t accept ads casting doubts on the election. This is your Daily Crunch for October 1, 2020.

The big story: Google commits $1B to pay publishers

Specifically, CEO Sundar Pichai said today that the company will be paying $1 billion to news publishers to license their content for a new format called the Google News Showcase — basically, panels highlighting stories from partner publishers in Google News.

Google outlined the broad strokes of this plan over the summer, but now it’s actually launching, and it has signed deals with 200 publications in Germany, Brazil, Argentina, Canada, the U.K. and Australia.

This announcement also comes as Google and Facebook are both facing battles in a number of countries as regulators and publishers pressure them for payments.

The tech giants

Microsoft adds the $549 Laptop Go to its growing Surface lineup — At $549, the Laptop Go is $50 more than the Surface Go tablet, but it’s still an extremely affordable take on the category.

Facebook won’t accept ads that ‘delegitimize’ US election results — Facebook said this includes ads “calling a method of voting inherently fraudulent or corrupt, or using isolated incidents of voter fraud to delegitimize the result of an election.”

Google now has three mid-range Pixel phones — Brian Heater unpacks the company’s smartphone strategy.

Startups, funding and venture capital

Working for social justice isn’t a ‘distraction’ for mission-focused companies — Passion Capital’s Eileen Burbidge weighs in on Coinbase’s controversial stance on politics.

Cazoo, the UK used car sales platform, raises another $311M, now valued at over $2.5B — The funding comes only six months after the company raised $116 million.

With $18M in new funding, Braintrust says it’s creating a fairer model for freelancers — The startup is using a cryptocurrency token that it calls Btrust to reward users who build the network.

Advice and analysis from Extra Crunch

Latin America’s digital transformation is making up for lost time — After more than a decade of gradual progress made through fits and starts, tech in Latin America finally hit its stride.

News apps in the US and China use algorithms to drive engagement, discovery — We examine various players in the field and ask how their black boxes affect people’s content consumption.

(Reminder: Extra Crunch is our subscription membership program, which aims to democratize information about startups. You can sign up here.)

Everything else

Section 230 will be on the chopping block at the next big tech hearing — It looks like we’re in for another big tech CEO hearing.

What if the kernel is corrupt? — The latest episode of Equity discusses moderation issues at Clubhouse.

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.

01 Oct 2020

There’s a way to pick the absolute best images for your content: Apply AI

Most marketers believe there’s a lot of value in having relevant, engaging images featured in content.

But selecting the “right” images for blog posts, social media posts or video thumbnails has historically been a subjective process. Social media and SEO gurus have a slew of advice on picking the right images, but this advice typically lacks real empirical data.

This got me thinking: Is there a data-driven — or even better, an AI-driven — process for gaining deeper insight into which images are more likely to perform well (aka more likely to garner human attention and sharing behavior)?

The technique for finding optimal photos

In July of 2019, a fascinating new machine learning paper called “Intrinsic Image Popularity Assessment” was published. This new model has found a reliable way to predict an image’s likely “popularity” (estimation of likelihood the image will get a like on Instagram).

It also showed an ability to outperform humans, with a 76.65% accuracy on predicting how many likes an Instagram photo would garner versus a human accuracy of 72.40%.

I used the model and source code from this paper to come up with how marketers can improve their chances of selecting images that will have the best impact on their content.

Finding the best screen caps to use for a video

One of the most important aspects of video optimization is the choice of the video’s thumbnail.

According to Google, 90% of the top performing videos on the platform use a custom selected image. Click-through rates, and ultimately view counts, can be greatly influenced by how eye-catching a video title and thumbnail are to a searcher,

In recent years, Google has applied AI to automate video thumbnail extraction, attempting to help users find thumbnails from their videos that are more likely to attract attention and click-throughs.

Unfortunately, with only three provided options to choose from, it’s unlikely the thumbnails Google currently recommends are the best thumbnails for any given video.

That’s where AI comes in.

With some simple code, it’s possible to run the “intrinsic popularity score” (as derived by a model similar to the one discussed in this article) against all of the individual frames of a video, providing a much wider range of options.

The code to do this is available here. This script downloads a YouTube video, splits it into frames as .jpg images, and runs the model on each image, providing a predicted popularity score for each frame image.
Caveat: It is important to remember that this model was trained and tested on Instagram images. Given the similarity in behavior for clicking on an Instagram photo or a YouTube thumbnail, we feel it’s likely (though never tested) that if a thumbnail is predicted to do well as an Instagram photo, it will similarly do well as a YouTube video thumbnail.

Let’s look at an example of how this works.

 

thumbnail from youtube video with housebuilding couple

Current thumbnail. Image Credits: YouTube (opens in a new window)

 

We had the intrinsic popularity model look at three frames per second of this 23-minute video. It took about 20 minutes. The following were my favorites from the 20 images that had the highest overall scores.

01 Oct 2020

Facebook sues two companies engaged in data scraping operations

Facebook today says it has filed a lawsuit in the U.S. against two companies that had engaged in an international “data scraping” operation. The operation extended across Facebook properties, including both Facebook and Instagram, as well as other large websites and services, including Twitter, Amazon, LinkedIn and YouTube. The companies, who gathered the data of Facebook users for “marketing intelligence” purposes, did so in violation of Facebook’s Terms of Service, says Facebook.

The businesses named in the lawsuits are Israeli-based BrandTotal Ltd. and Unimania Inc., a business incorporated in Delaware.

According to BrandTotal’s website, its company offers a real-time competitive intelligence platform that’s designed to give media, insights and analytics teams visibility into their competition’s social media strategy and paid campaigns. These insights would allow its customers to analyze and shift their budget allocation to target new opportunities, monitor trends and threats from emerging brands, optimize their ads and messaging, and more.

Meanwhile, Unimania operated apps claimed to offer users the ability to access social networks in different ways. For example, Unimania offered apps that let you view Facebook via a mobile-web interface or alongside other social networks like Twitter. Another app let you view Instagram Stories anonymously, it claimed.

However, Facebook’s lawsuit is largely focused on two browser extensions offered by the companies: Unimania’s “Ads Feed” and BrandTotal’s “UpVoice.”

The former allowed users to save the ads they saw on Facebook for later reference. But as the extension’s page discloses, doing so would opt users into a panel that informed the advertising decisions of Unimania’s corporate customers. UpVote, on the other hand, rewarded users with gift cards for using top social networking and shopping sites and sharing their opinions about the online campaigns run by big brands.

Facebook says these extensions operated in violation of its protections against scraping and its terms of service. When users installed the extensions and visited Facebook websites, the extensions installed automated programs to scrape their name, user ID, gender, date of birth, relationship status, location information, and other information related to their accounts. The data was then sent to a server shared by BrandTotal and Unimania.

Facebook lawsuit vs BrandTotal Ltd. and Unimania Inc. by TechCrunch on Scribd

Data scrapers exist in part to collect as much information as they can through any means possible using automated tools, like bots and scripts. Cambridge Analytica infamously scraped millions of Facebook profiles in the run-up to the 2016 presidential election in order to target undecided voters. Other data scraping operations use bots to monitor concert or event ticket prices in order to undercut competitors. Scraped data can also be used for marketing and advertising, or simply sold on to others.

In the wake of the Cambridge Analytica scandal, Facebook has begun to pursue legal action against various developers that break its terms of service.

Most cases involving data scraping are litigated under the Computer Fraud and Abuse Act, written in the 1980s to prosecute computer hacking cases. Anyone who accesses a computer “without authorization” can face hefty fines or even prison time.

But because the law doesn’t specifically define what “authorized” access is and what isn’t, tech giants have seen mixed results in their efforts to shut down data scrapers.

LinkedIn lost its high-profile case against HiQ Labs in 2019 after an appeals court ruled that the scraper was only collecting data that was publicly available from the internet. Internet rights groups like the Electronic Frontier Foundation lauded the decision, arguing that internet users should not face legal threats “simply for accessing publicly available information in a way that publishers object to.”

Facebook’s latest legal case is slightly different because the company is accusing BrandTotal of scraping Facebook profile data that wasn’t inherently public. Facebook says the accused data scraper used a browser extension installed on users’ computers to gain access to their Facebook profile data.

In March 2019, it took action against two Ukrainian developers who were harvesting data using quiz apps and browser extensions to scrape profile information and people’s friends lists, Facebook says. A court in California recently recommended a judgement in Facebook’s favor in the case. A separate case around scraping filed last year against a marketing partner Stackla  also came back in Facebook’s favor.

This year, Facebook filed lawsuits against companies and individuals engaged in both scraping and fake engagement services.

Facebook isn’t just cracking down on data scraping businesses to protect user privacy, however. It’s because failing to do so can lead to large fines. Facebook at the beginning of this year was ordered to pay out over half a billion dollars to settle a class action lawsuit that alleged systemic violation of an Illinois privacy law. Last year, it settled with the FTC over privacy lapses and had to pay a $5 billion penalty. As governments work to further regulation online privacy and data violations, fines like this could add up.

The company says legal action isn’t the only way it’s working to stop data scraping. It has also invested in technical teams and tools to monitor and detect suspicious activity and the use of of unauthorized automation for scraping, it says.

01 Oct 2020

Section 230 will be on the chopping block at the next big tech hearing

It looks like we’re in for another big tech CEO hearing.

The Senate Commerce Committee voted Thursday to move forward with subpoenas for Twitter’s Jack Dorsey, Facebook’s Mark Zuckerberg and Sundar Pichai, the CEO of Alphabet. The unusual decision to subpoena the social media chief executives adds yet another politically volatile event to the schedule in the run-up to the most contentious election in modern U.S. history.

The hearing will focus on Section 230 of the Communications Decency Act, the key law that shields online platforms from legal liability for the content their users create.

While the topic might sound dry for the unacquainted, the law is an explosive topic, both politically and in the eyes of the tech industry, which could be left reeling from even what might seem like minor changes to the legal shield.

Committee Chairman Roger Wicker called the decision to hold the hearing “imperative” in order for Americans to “receive a full accounting from the heads of these companies about their content moderation practices.”

Remarkably, the decision to subpoena the CEOs was unanimous, with ranking Democrat Maria Cantwell joining the vote to subpoena the companies after initially opposing the decision.

Cantwell previously called the idea of issuing subpoenas an “extraordinary” step intended to “chill the efforts” of companies to remove misinformation and harassment from their platforms.

Republican members of the Senate Commerce Committee include its Wicker, Ted Cruz, John Thune and Rick Scott. Democrats on the committee include Cantwell, Amy Klobuchar, Brian Schatz, and Kyrsten Sinema.

What’s going on with Section 230?

Section 230 is generally regarded as the legal infrastructure that made the social internet possible, from Facebook accounts and comments sections to Yelp and Amazon reviews. It’s a short law but in 2020 an increasingly controversial one as lawmakers scramble for levers to limit — or at least threaten to limit — the power of big tech companies.

Republicans see dismantling Section 230’s legal protections as a way to punish social media companies for perceived anti-conservative bias — a common refrain on the right that is regularly undermined by the ubiquity of right-leaning content on platforms like Facebook.

Importantly, President Trump and Attorney General William Barr have taken particular interest in attacking Section 230. Earlier this year, Trump lashed out at Twitter for moderating his false claims with an executive order threatening the law. While the order was largely toothless, Trump’s focus on Section 230 set the agenda for the Barr’s Department of Justice and for Republicans in Congress eager to follow his lead. The order also roped the FCC into getting involved.

In June, the Justice Department laid out a groundwork for “a set of concrete reform proposals” that would undermine the law, couching the proposal as an effort to rid platforms of “illicit content” like child abuse. Last month, Barr sent draft legislation to Congress incorporating those proposals.

Democrats have more recently warmed up to the idea of going after Section 230, but for different reasons. While the right mostly complains about political censorship, Democratic lawmakers see changing Section 230 as a way to hold platforms accountable for rampant misinformation and other forms of toxic content that continue to thrive on social platforms.

Legislation taking aim at Section 230

Lindsey Graham’s bill, the EARN IT Act, is probably the best known legislation targeting Section 230 so far. A toned-down version of that bill advanced out of its committee but hasn’t yet faced the full Senate.

In June, Senators John Thune and Brian Schatz, both members of the committee issuing subpoenas, introduced a bipartisan Section 230 bill known as the PACT Act that focused mostly on moderation transparency.

To make matters even more confusing, another Graham-sponsored bill focused on Section 230 emerged earlier this month hours after Trump called on his party to “repeal Section 230 immediately.” That proposal did not have bipartisan sponsorship.

Whatever happens with the next big tech hearing and with all of these Section 230 bills, it’s clear that there’s a bipartisan appetite for doing something to change tech’s critical legal shield, even if the what isn’t yet clear.

What is clear: Tinkering with such a foundational law could have a huge cascade of effects for the internet as we know it and isn’t something to be undertaken lightly — if at all.

01 Oct 2020

What if the kernel is corrupt?

Hello and welcome back to Equity, TechCrunch’s VC-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.

This week, Alex is on a much deserved vacation (but not from Twitter, it seems) so Danny Crichton and I chatted through the news and happenings of the week. Somehow we winded our way through the latest tech controversies, gave Chris Wallace a shout out, and ended with some funding rounds. I’ll be out next week so don’t miss me too much, but expect the entire Equity team to be back full-speed in mid-October. Thanks, as always, to our producer Chris Gates for his patience and diligence.

Now, onto a sneak peek of what we got into:

  •  Moderation continues to be the root of all problems. We got into the anti-semitic comments that were spewed on Clubhouse, and what that means for the future of the audio-only platform. As Danny so eloquently put it: if Clubhouse is having moderation problems even with an exclusive invite-only user base, the problem will grow.
  •  We also talked about Coinbase CEO Brian Armstrong’s blog post, which triggered a debate between us on whether tech companies can even choose to not be political. For the record, Black Lives Matter is not a political statement. It’s a human statement. Read this op-ed for more.
  •  I wrote a piece about how a new program wants to be the Y Combinator for emerging fund managers. The whole “YC for X” model usually makes me roll my eyes, but listen to hear why I’m actually optimistic and bullish on programs like these taking off within tech.
  • Silver Lake added a $2 billion ‘long-term’ hedge fund backed by Abu Dhabi to its tech finance toolkit. The strategy is a signal to privately-backed startups, and potentially a slap in the face to SoftBank.
  • For a quick edtech note, I caught up with Duolingo’s CEO this week in one of his rare press interviews. Luis Von Ahn explained the app’s surge in bookings, and there’s one key metric we pull out to noodle over.
  • Danny explained Gusto’s latest product launch with, wait for it, Gusto. In all seriousness, he brings up interesting points about the future of fin-tech feeling more full-suite, and free.
  • Funding round chatter continued when we unpacked Lee Fixel’s latest investment in India’s Inshorts
  • Finally, we ended with LiquidDeath,  which is not the name of a drinking game, but instead the name of a startup that has successfully attracted millions in venture capital for mountain water.

And with that, we will be back next week. Vote like your life depends on it, because it does.

Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.