Category: UNCATEGORIZED

Town Sports International, the parent company of New York Sports Clubs and Christi’s Fitness gyms, is mopping up after a security lapse exposed customer data.

Security researcher Bob Diachenko received a tip from a contact, Sami Toivonen, about an unprotected server containing almost a terabyte of spreadsheets representing years of internal company data, including financial records and personal customer records. But because there was no password on the server, anyone could access the files inside.

The server was exposed for almost a year, Diachenko told TechCrunch.

Town Sports pulled the server offline a short time after Diachenko contacted the company. He shared his findings exclusively with TechCrunch, which independently verified the authenticity of the data by confirming details found in the spreadsheets with customers.

Spreadsheets found on the server contained customer names, postal addresses, email addresses, and phone numbers. The data also contained when a customer checks-in and at which gym location. Some also had notes on customer accounts, such as complaints and when customers were past due on a missed membership payment.

Chief executive Patrick Walsh did not respond to several requests for comment, which also asked if the company planned to inform customers of the security lapse.

Town Sports was forced to shutter its 185 gyms on the U.S. east coast after COVID-19 was declared a pandemic in mid-March. By the end of March, the company told financial regulators it had about 588,000 members.

One of the spreadsheets found on the exposed server showed that Town Sports had just 7,100 paying customers by mid-May, while 566,000 customers had their gym memberships frozen.

Town Sports began freezing accounts and refunding membership fees after the company continued to charge customers even after the lockdown began, a move that drew a threat of legal action from New York attorney general Letitia James, who accused the gym chain of “ripping off” its members.

The same spreadsheet still had customer data on some 665,000 cancelled accounts.

Earlier this month the gym chain filed for bankruptcy, just as states began allowing gyms to reopen, albeit with reduced capacity and safety measures in place.

Last night Robinhood, the American fintech unicorn that provides free securities trading services to consumers via an app, announced that it raised an additional $460 million in its previously-known Series G. That round is now worth $660 million at an $11.7 billion post-money valuation.

A little over a month ago Robinhood announced that it had raised a $200 million Series G, bringing its valuation to $11.2 billion at the time.

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

The company previously raised a two-part Series F this year, worth $600 million, bringing its total capital raised to well north of the $1 billion mark for the year.

But Robinhood is not alone in posting such epic fundraising numbers.

American neobank Chime rode the pandemic-induced general savings-and-investing boom, raising a $485 million Series F a few days ago. That round came less than a year after Chime had raised a mammoth Series E last December.

Two different American fintech giants each raised more than $1 billion in under a year. That’s quite the feat. This morning as a refresher for us both, we’re going over what we know about recent growth from each company, as those metrics should help us understand why the two former startups are worth so damn much money.

Growth

We begin with Chime, which raised back in December of 2019. Around that time there were a grip of stories written about the company that included estimates of its revenue scale in the year:

• CNBC said Chime’s revenue would come in around $300 million in 2019. Forbes had the number at $200 million.
• Business Insider reported that Chime anticipated revenues of $200 million for the year.

The CNBC number was the last to be reported, meaning that was probably the most accurate. But each included lots of growth. The $200 million revenue figure was still a quadrupling compared to Chime’s 2018 result, according to the same Forbes story.

Last night Robinhood, the American fintech unicorn that provides free securities trading services to consumers via an app, announced that it raised an additional $460 million in its previously-known Series G. That round is now worth $660 million at an $11.7 billion post-money valuation.

A little over a month ago Robinhood announced that it had raised a $200 million Series G, bringing its valuation to $11.2 billion at the time.

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

The company previously raised a two-part Series F this year, worth $600 million, bringing its total capital raised to well north of the $1 billion mark for the year.

But Robinhood is not alone in posting such epic fundraising numbers.

American neobank Chime rode the pandemic-induced general savings-and-investing boom, raising a $485 million Series F a few days ago. That round came less than a year after Chime had raised a mammoth Series E last December.

Two different American fintech giants each raised more than $1 billion in under a year. That’s quite the feat. This morning as a refresher for us both, we’re going over what we know about recent growth from each company, as those metrics should help us understand why the two former startups are worth so damn much money.

Growth

We begin with Chime, which raised back in December of 2019. Around that time there were a grip of stories written about the company that included estimates of its revenue scale in the year:

• CNBC said Chime’s revenue would come in around $300 million in 2019. Forbes had the number at $200 million.
• Business Insider reported that Chime anticipated revenues of $200 million for the year.

The CNBC number was the last to be reported, meaning that was probably the most accurate. But each included lots of growth. The $200 million revenue figure was still a quadrupling compared to Chime’s 2018 result, according to the same Forbes story.

WhyLabs, a new machine learning startup that was spun out of the Allen Institute, is coming out of stealth today. Founded by a group of former Amazon machine learning engineers, Alessya Visnjic, Sam Gracie and Andy Dang, together with Madrona Venture Group principal Maria Karaivanova, WhyLabs’ focus is on ML operations after models have been trained — not on building those models from the ground up.

The team also today announced that it has raised a $4 million seed funding round from Madrona Venture Group, Bezos Expeditions, Defy Partners and Ascend VC.

Visnjic, the company’s CEO, used to work on Amazon’s demand forecasting model.

“The team was all research scientists, and I was the only engineer who had kind of tier-one operating experience,” she told me. “So it was like, ”Okay, how bad could it be?’ I carried the pager for the retail website before it can be bad. But it was one of the first AI deployments that we’d done at Amazon at scale. The pager duty was extra fun because there were no real tools. So when things would go wrong — like we’d order way too many black socks out of the blue — it was a lot of manual effort to figure out why was this happening.”

Image Credits: WhyLabs

But while large companies like Amazon have built their own internal tools to help their data scientists and AI practitioners operate their AI systems, most enterprises continue to struggle with this — and a lot of AI projects simply fail and never make it into production. “We believe that one of the big reasons that happens is because of the operating process that remains super manual,” Visnjic said. “So at WhyLabs, we’re building the tools to address that — specifically to monitor and track data quality and alert — you can think of it as Datadog for AI applications.”

The team has brought ambitions, but to get started, it is focusing on observability. The team is building — and open-sourcing — a new tool for continuously logging what’s happening in the AI system, using a low-overhead agent. That platform-agnostic system, dubbed WhyLogs, is meant to help practitioners understand the data that moves through the AI/ML pipeline.

For a lot of businesses, Visnjic noted, the amount of data that flows through these systems is so large that it doesn’t make sense for them to keep “lots of big haystacks with possibly some needles in there for some investigation to come in the future.” So what they do instead is just discard all of this. With its data logging solution, WhyLabs aims to give these companies the tools to investigate their data and find issues right at the start of the pipeline.

Image Credits: WhyLabs

According to Karaivanova, the company doesn’t have paying customers yet, but it is working on a number of proofs of concepts. Among those users is Zulily, which is also a design partner for the company. The company is going after mid-size enterprises for the time being, but as Karaivanova noted, to hit the sweet spot for the company, a customer needs to have an established data science team with 10 to 15 ML practitioners. While the team is still figuring out its pricing model, it’ll likely be a volume-based approach, Karaivanova said.

“We love to invest in great founding teams who have built solutions at scale inside cutting-edge companies, who can then bring products to the broader market at the right time. The WhyLabs team are practitioners building for practitioners. They have intimate, first-hand knowledge of the challenges facing AI builders from their years at Amazon and are putting that experience and insight to work for their customers,” said Tim Porter, managing director at Madrona. “We couldn’t be more excited to invest in WhyLabs and partner with them to bring cross-platform model reliability and observability to this exploding category of MLOps.”

WhyLabs, a new machine learning startup that was spun out of the Allen Institute, is coming out of stealth today. Founded by a group of former Amazon machine learning engineers, Alessya Visnjic, Sam Gracie and Andy Dang, together with Madrona Venture Group principal Maria Karaivanova, WhyLabs’ focus is on ML operations after models have been trained — not on building those models from the ground up.

The team also today announced that it has raised a $4 million seed funding round from Madrona Venture Group, Bezos Expeditions, Defy Partners and Ascend VC.

Visnjic, the company’s CEO, used to work on Amazon’s demand forecasting model.

“The team was all research scientists, and I was the only engineer who had kind of tier-one operating experience,” she told me. “So it was like, ”Okay, how bad could it be?’ I carried the pager for the retail website before it can be bad. But it was one of the first AI deployments that we’d done at Amazon at scale. The pager duty was extra fun because there were no real tools. So when things would go wrong — like we’d order way too many black socks out of the blue — it was a lot of manual effort to figure out why was this happening.”

Image Credits: WhyLabs

But while large companies like Amazon have built their own internal tools to help their data scientists and AI practitioners operate their AI systems, most enterprises continue to struggle with this — and a lot of AI projects simply fail and never make it into production. “We believe that one of the big reasons that happens is because of the operating process that remains super manual,” Visnjic said. “So at WhyLabs, we’re building the tools to address that — specifically to monitor and track data quality and alert — you can think of it as Datadog for AI applications.”

The team has brought ambitions, but to get started, it is focusing on observability. The team is building — and open-sourcing — a new tool for continuously logging what’s happening in the AI system, using a low-overhead agent. That platform-agnostic system, dubbed WhyLogs, is meant to help practitioners understand the data that moves through the AI/ML pipeline.

For a lot of businesses, Visnjic noted, the amount of data that flows through these systems is so large that it doesn’t make sense for them to keep “lots of big haystacks with possibly some needles in there for some investigation to come in the future.” So what they do instead is just discard all of this. With its data logging solution, WhyLabs aims to give these companies the tools to investigate their data and find issues right at the start of the pipeline.

Image Credits: WhyLabs

According to Karaivanova, the company doesn’t have paying customers yet, but it is working on a number of proofs of concepts. Among those users is Zulily, which is also a design partner for the company. The company is going after mid-size enterprises for the time being, but as Karaivanova noted, to hit the sweet spot for the company, a customer needs to have an established data science team with 10 to 15 ML practitioners. While the team is still figuring out its pricing model, it’ll likely be a volume-based approach, Karaivanova said.

“We love to invest in great founding teams who have built solutions at scale inside cutting-edge companies, who can then bring products to the broader market at the right time. The WhyLabs team are practitioners building for practitioners. They have intimate, first-hand knowledge of the challenges facing AI builders from their years at Amazon and are putting that experience and insight to work for their customers,” said Tim Porter, managing director at Madrona. “We couldn’t be more excited to invest in WhyLabs and partner with them to bring cross-platform model reliability and observability to this exploding category of MLOps.”

European antitrust regulators now have until almost the end of the year to take a decision on whether to green light Google’s planned acquisition of Fitbit.

The tech giant announced its intention to buy the fitness tracking wearable maker in November 2019, saying it would shell out $2.1 billion in cash to make off with Fitbit and the health data it holds on some 28M+ users.

EU regulators were quick to sound the alarm about letting the tech giant go shopping for such a major cache of sensitive personal data, with the European Data Protection Board warned in February that the proposed purchase poses a huge risk to privacy.

There is also a parallel concern that Fitbit’s fitness data could further consolidate Google’s regional dominance in the ad market. And last month EU competition regulators announced a full antitrust probe — saying then they would take a decision within 90 working days. That deadline has now been extended by a further two weeks.

A Commission spokeswoman confirmed the earlier provisional December 9 deadline has been pushed on “in agreement with the parties” — citing Article 10(3) of the EU’s Merger Regulation.

“The provisional legal deadline for a final decision in this case is now December 23, 2020,” she added.

The Commission has not offered any detail on the reason for allocating more time to take a decision.

When EU regulators announced the in-depth probe, the Commission said it was concerned data gathered by Fitbit could lead to a distortion of competition if Google was allowed to assimilate the wearable maker and “further entrench” its dominance in online ad markets.

Other concerns include the impact on the nascent digital healthcare sector, and whether Google might be incentivised to degrade the interoperability of rival wearables with its Android OS once it has its own hardware skin in the game.

The tech giant, meanwhile, has offered assurances around the deal in an attempt to get it cleared — claiming ahead of the Commission’s probe announcement it would not use Fitbit health data for ad targeting, and suggesting that it would create a ‘data silo’ for Fitbit data to keep it separate from other data holdings.

However regulators have expressed scepticism — with the Commission writing last month that the “data silo commitment proposed by Google is insufficient to clearly dismiss the serious doubts identified at this stage as to the effects of the transaction”.

It remains to be seen what the bloc’s competition regulators conclude after taking a longer and harder look at the deal — and it’s worth noting they are simultaneously consulting on whether to give themselves new powers to be able to intervene faster to regulate digital markets — but Google’s hopes of friction-free regulatory clearance and being able to hit the ground running in 2020 with Fitbit’s data in its pocket have certainly not come to pass. 

Spotify today is introducing a new feature designed to make podcasts more interactive. The company says it’s beginning to test “Polls,” a tool that will allow listeners to engage with podcasts by answering questions posed by the podcast hosts during the show. The polls will appear in the Spotify app, and can be found either on the Now Playing screen or on the podcast episode’s page.

The user can then answer the question and view how their answer stacks up with the rest of the listener base in real-time. They won’t, however, be able to view the results of the poll without first participating themselves.

Participation in polls is entirely optional, Spotify says, and the votes will remain anonymous.

In other words, the goal is not to accumulate individualized data on listeners, but rather give the podcast host a way to better understand their audience. For example, a host could ask the audience to vote on who the next guest should be, or they could ask them to settle a debate that cropped up on the show. Polls will also be able to support either a “choose one” or “choose multiple” option for the answers, to give them some flexibility.

Image Credits: Spotify

Podcasts that support polls will only be able to feature one per episode, and each poll can only pose one question. But there’s no limit to how many total polls the podcast, overall, could include — the creator could offer a poll with every episode, if they preferred.

At launch, the polls feature is only being made available to a small group of beta testers, including The Rewatchables, Incredible Feats with Dan Cummins, and Crime Countdown. Spotify tells TechCrunch it plans to onboard other Spotify Originals and Exclusives over time, as the test progresses. But there’s no specific ETA or timeline for that expansion, at present.

The test will roll out to most Spotify listeners beginning today, September 23. The full Spotify user base will be able to see the polls later on, the company says. This is being considered the start of the beta because no other podcasts have tested the feature ahead of today’s announcement.

This is not the first feature Spotify has introduced to make its app the prefered podcast player.

The company has in the past also rolled out support for podcast playlists, personalized daily podcast recommendations, editorially curated podcast suggestions, and, more recently, video podcasts and podcast top charts. But where many of its other features were designed to attract users to the Spotify app, the addition of Polls is also meant to cater to podcast creators, not just fans.

Spotify today has one of the largest podcast catalogs, now topping 1.5 million podcasts, thanks to its investments in acquiring podcast companies, like Gimlet Media and the Ringer, as well as podcasting tools, like Anchor.

The company, however, just lost one of its biggest exclusive podcast stars, Joe Budden, when it failed to come to terms on a new deal, even after offering the creator a significant raise.

Image Credits: Spotify

Spotify has also been facing the downside of its aggressive podcast acquisition strategy in recent days, as it dealt with the backlash over its $100 million exclusive deal with Joe Rogan. The podcast host had been spreading misinformation about the Oregon forest fires, which he later apologized for. But Spotify faced abuse from listeners and bad PR as people became aware of the problem.

That incident highlighted the difficulties with Spotify’s “exclusives” strategy, where it’s not just buying access to a large star and their audience, but also the headaches they bring with them.

In the meantime, it’s continues to try and woo more podcasters to join its platform by offering creative tools and features, like these new Polls.

During the test, Polls will be available for 90% of of users across all markets, on both iOS and Android devices.

Spotify today is introducing a new feature designed to make podcasts more interactive. The company says it’s beginning to test “Polls,” a tool that will allow listeners to engage with podcasts by answering questions posed by the podcast hosts during the show. The polls will appear in the Spotify app, and can be found either on the Now Playing screen or on the podcast episode’s page.

The user can then answer the question and view how their answer stacks up with the rest of the listener base in real-time. They won’t, however, be able to view the results of the poll without first participating themselves.

Participation in polls is entirely optional, Spotify says, and the votes will remain anonymous.

In other words, the goal is not to accumulate individualized data on listeners, but rather give the podcast host a way to better understand their audience. For example, a host could ask the audience to vote on who the next guest should be, or they could ask them to settle a debate that cropped up on the show. Polls will also be able to support either a “choose one” or “choose multiple” option for the answers, to give them some flexibility.

Image Credits: Spotify

Podcasts that support polls will only be able to feature one per episode, and each poll can only pose one question. But there’s no limit to how many total polls the podcast, overall, could include — the creator could offer a poll with every episode, if they preferred.

At launch, the polls feature is only being made available to a small group of beta testers, including The Rewatchables, Incredible Feats with Dan Cummins, and Crime Countdown. Spotify tells TechCrunch it plans to onboard other Spotify Originals and Exclusives over time, as the test progresses. But there’s no specific ETA or timeline for that expansion, at present.

The test will roll out to most Spotify listeners beginning today, September 23. The full Spotify user base will be able to see the polls later on, the company says. This is being considered the start of the beta because no other podcasts have tested the feature ahead of today’s announcement.

This is not the first feature Spotify has introduced to make its app the prefered podcast player.

The company has in the past also rolled out support for podcast playlists, personalized daily podcast recommendations, editorially curated podcast suggestions, and, more recently, video podcasts and podcast top charts. But where many of its other features were designed to attract users to the Spotify app, the addition of Polls is also meant to cater to podcast creators, not just fans.

Spotify today has one of the largest podcast catalogs, now topping 1.5 million podcasts, thanks to its investments in acquiring podcast companies, like Gimlet Media and the Ringer, as well as podcasting tools, like Anchor.

The company, however, just lost one of its biggest exclusive podcast stars, Joe Budden, when it failed to come to terms on a new deal, even after offering the creator a significant raise.

Image Credits: Spotify

Spotify has also been facing the downside of its aggressive podcast acquisition strategy in recent days, as it dealt with the backlash over its $100 million exclusive deal with Joe Rogan. The podcast host had been spreading misinformation about the Oregon forest fires, which he later apologized for. But Spotify faced abuse from listeners and bad PR as people became aware of the problem.

That incident highlighted the difficulties with Spotify’s “exclusives” strategy, where it’s not just buying access to a large star and their audience, but also the headaches they bring with them.

In the meantime, it’s continues to try and woo more podcasters to join its platform by offering creative tools and features, like these new Polls.

During the test, Polls will be available for 90% of of users across all markets, on both iOS and Android devices.

One thing Samsung knows for certain: it’s interested in budget flagships. The category makes sense these days, as users are increasingly unwilling to spend north of $1,000 on new phones. That’s doubly the case during the COVID-19 pandemic, with people leaving the house far less often and simply not possessing the same sort of disposable income they once had, amid economic slowdowns and widespread unemployment.

What’s less certain is how to position such a device. Samsung’s been through a lot of different names, including, most recently, the “Lite” line. That name made sense from a utility perspective. The S10 Lite was simply a lower-spec’d version of the flagship of similar name. Ultimately, however, I suspect that Samsung decided that pointing to the device’s shortcomings wasn’t ideal from a branding perspective, which is why we’re currently looking at the Samsung Galaxy S20 FE — or “Fan Edition.”

Image Credits: Samsung

The name implies that the product is an update to the S20 aimed firmly at Samsung’s fans. Here’s what Mobile head TM Roh had to say about the new device: “We are constantly speaking to our fans and taking feedback, and we heard what they loved about our Galaxy S20 series, what features they used most often and what they would want new smartphone. The S20 FE is an extension of the Galaxy S20 family and is the start of a new way to bring meaningful innovation to even more people to let them do the things they love with the best of Galaxy.”

That’s true from a certain perspective. Samsung says it did some focus grouping to come up with the right combination for the FE, which I believe. It’s also probably true that “cheaper” was a big feature many folks have been looking for in their handsets in recent years, so from that standpoint, Samsung’s got fans’ numbers here — $699 for something approaching a flagship isn’t that bad, these days.

And Samsung’s made a point to be mindful of the comprises it made here in the name of keeping the prices down. The biggest changes from the rest of the S20 series are a downgrade in materials, from a glass and metal to plastic (polycarbonate) design, display and camera specs. At 6.5 inches, the screen size actually falls between the S20 and S20+, but it’s been reduced from a QuadHD+ resolution to FHD+ — similar to what you’ll find on the Galaxy A71. The refresh rate stays at 120Hz, though the curved screen is gone.

Image Credits: Samsung

The S20’s 8GB of RAM has been reduced to 6GB, though the 128GB of standard storage remains the same. You’ll find the same Snapdragon 865 on board and, interestingly, the battery has actually been upgraded from 4,000mAh to 4,500mAh, owing to a larger device footprint. There are three rear-facing cameras, with the telephoto dropping from 64-megapixels down to eight — though the front-facing selfie cam has been upgraded from 10 megapixels to 32.

Not the latest and greatest, but in all, pretty reasonable compromises made in the name of shaving $300 off the device’s starting price. Pre-orders start today. The device starts shipping October 2.

One thing Samsung knows for certain: it’s interested in budget flagships. The category makes sense these days, as users are increasingly unwilling to spend north of $1,000 on new phones. That’s doubly the case during the COVID-19 pandemic, with people leaving the house far less often and simply not possessing the same sort of disposable income they once had, amid economic slowdowns and widespread unemployment.

What’s less certain is how to position such a device. Samsung’s been through a lot of different names, including, most recently, the “Lite” line. That name made sense from a utility perspective. The S10 Lite was simply a lower-spec’d version of the flagship of similar name. Ultimately, however, I suspect that Samsung decided that pointing to the device’s shortcomings wasn’t ideal from a branding perspective, which is why we’re currently looking at the Samsung Galaxy S20 FE — or “Fan Edition.”

Image Credits: Samsung

The name implies that the product is an update to the S20 aimed firmly at Samsung’s fans. Here’s what Mobile head TM Roh had to say about the new device: “We are constantly speaking to our fans and taking feedback, and we heard what they loved about our Galaxy S20 series, what features they used most often and what they would want new smartphone. The S20 FE is an extension of the Galaxy S20 family and is the start of a new way to bring meaningful innovation to even more people to let them do the things they love with the best of Galaxy.”

That’s true from a certain perspective. Samsung says it did some focus grouping to come up with the right combination for the FE, which I believe. It’s also probably true that “cheaper” was a big feature many folks have been looking for in their handsets in recent years, so from that standpoint, Samsung’s got fans’ numbers here — $699 for something approaching a flagship isn’t that bad, these days.

And Samsung’s made a point to be mindful of the comprises it made here in the name of keeping the prices down. The biggest changes from the rest of the S20 series are a downgrade in materials, from a glass and metal to plastic (polycarbonate) design, display and camera specs. At 6.5 inches, the screen size actually falls between the S20 and S20+, but it’s been reduced from a QuadHD+ resolution to FHD+ — similar to what you’ll find on the Galaxy A71. The refresh rate stays at 120Hz, though the curved screen is gone.

Image Credits: Samsung

The S20’s 8GB of RAM has been reduced to 6GB, though the 128GB of standard storage remains the same. You’ll find the same Snapdragon 865 on board and, interestingly, the battery has actually been upgraded from 4,000mAh to 4,500mAh, owing to a larger device footprint. There are three rear-facing cameras, with the telephoto dropping from 64-megapixels down to eight — though the front-facing selfie cam has been upgraded from 10 megapixels to 32.

Not the latest and greatest, but in all, pretty reasonable compromises made in the name of shaving $300 off the device’s starting price. Pre-orders start today. The device starts shipping October 2.