Buzzy live voice chat app Clubhouse has confirmed that it has raised new funding – without revealing how much – in a Series B round led by Andreessen Horowitz through the firm’s partner Andrew Chen. The app was reported to be raising at a $1 billion valuation in a report from The Information that landed just before this confirmation. While we try to track down the actual value of this round and the subsequent valuation of the company, what we do know is that Clubhouse has confirmed it will be introducing products to help creators on the platform get played, including subscriptions, tipping and ticket sales.

This funding round will also support a ‘Creator Grant Program’ being set up by Clubhouse, which will be used to “support emerging Clubhouse creators” according to the startup’s blog post. While the app has done a remarkable job attracting creator talent, including high-profile celebrity and political users, directing revenue towards creators will definitely help spur sustained interest, as well as more time and investment from new creators who are potentially looking to make a name for themselves on the platform, similar to YouTube and TikTok influencers before them.

Of course, adding monetization for users also introduces a method for Clubhouse itself to monetize. The platform is free to all users, and doesn’t yet offer any kind of premium plan or method of charging users, nor is it ad-supported. Adding ways for users to pay other users provides an opportunity for Clubhouse to retain a cut for its services.

The plans around monetization routes for creators appear to be relatively open-ended at this point, with Clubhouse saying it’ll be launching “first tests” around each of the three areas it mentions (tipping, tickets and subscriptions) over the “next few months.” It sounds like these could be similar to something like a Patreon built right into the platform. Tickets are a unique option that would go well with Clubhouse’s more formal roundtable discussions, and could also be a way that more organizations make use of the platform for hosting virtual events.

The startup also announced that it will be starting work on its Android app (it’s been iOS only for now) and that it will also invest in more backend scaling to keep up with demand, as well as support team growth and tools for detecting and prevuing abuse. Clubhouse has come under fire for its failure in regards to moderation and prevention of abuse in the past, so this aspect of its product development will likely be closely watched. The platform will also see changes to discovery aimed at surfacing relevant users, groups (‘clubs’ in the app’s parlance) and rooms.

During a regular virtual town hall the app’s founders host on the platform, CEO Paul Davison revealed that Clubhouse now has 2 million weekly active users.

Buzzy live voice chat app Clubhouse has confirmed that it has raised new funding – without revealing how much – in a Series B round led by Andreessen Horowitz through the firm’s partner Andrew Chen. The app was reported to be raising at a $1 billion valuation in a report from The Information that landed just before this confirmation. While we try to track down the actual value of this round and the subsequent valuation of the company, what we do know is that Clubhouse has confirmed it will be introducing products to help creators on the platform get played, including subscriptions, tipping and ticket sales.

This funding round will also support a ‘Creator Grant Program’ being set up by Clubhouse, which will be used to “support emerging Clubhouse creators” according to the startup’s blog post. While the app has done a remarkable job attracting creator talent, including high-profile celebrity and political users, directing revenue towards creators will definitely help spur sustained interest, as well as more time and investment from new creators who are potentially looking to make a name for themselves on the platform, similar to YouTube and TikTok influencers before them.

Of course, adding monetization for users also introduces a method for Clubhouse itself to monetize. The platform is free to all users, and doesn’t yet offer any kind of premium plan or method of charging users, nor is it ad-supported. Adding ways for users to pay other users provides an opportunity for Clubhouse to retain a cut for its services.

The plans around monetization routes for creators appear to be relatively open-ended at this point, with Clubhouse saying it’ll be launching “first tests” around each of the three areas it mentions (tipping, tickets and subscriptions) over the “next few months.” It sounds like these could be similar to something like a Patreon built right into the platform. Tickets are a unique option that would go well with Clubhouse’s more formal roundtable discussions, and could also be a way that more organizations make use of the platform for hosting virtual events.

The startup also announced that it will be starting work on its Android app (it’s been iOS only for now) and that it will also invest in more backend scaling to keep up with demand, as well as support team growth and tools for detecting and prevuing abuse. Clubhouse has come under fire for its failure in regards to moderation and prevention of abuse in the past, so this aspect of its product development will likely be closely watched. The platform will also see changes to discovery aimed at surfacing relevant users, groups (‘clubs’ in the app’s parlance) and rooms.

During a regular virtual town hall the app’s founders host on the platform, CEO Paul Davison revealed that Clubhouse now has 2 million weekly active users.

SpaceX has set a new all-time record for the most satellites launched and deployed on a single mission, with its Transporter-1 flight on Sunday. The launch was the first of SpaceX’s dedicated rideshare missions, in which it splits up the payload capacity of its rocket among multiple customers, resulting in a reduced cost for each but still providing SpaceX with a full launch and all the revenue it requires to justify lauding one of its vehicles.

The launch today included 143 satellites, 133 of which were from other companies who booked rides. SpaceX also launched 10 of its own Starlink satellites, adding to the already more than 1,000 already sent to orbit to power SpaceX’s own broadband communication network. During a launch broadcast last week, SpaceX revealed that it has begun serving beta customers in Canada and is expanding to the UK with its private pre-launch test of that service.

Customers on today’s launch included Planet Labs, which sent up 48 SuperDove Earth imaging satellites; Swarm, which sent up 36 of its own tiny IoT communications satellites, and Kepler, which added to its constellation with eight more of its own communication spacecraft. The rideshare model that SpaceX now has in place should help smaller new space companies and startups like these build out their operational on-orbit constellations faster, complementing other small payload launchers like Rocket Lab, and new entrant Virgin Orbit, to name a few.

This SpaceX launch was also the first to deliver Starlink satellites to a polar orbit, which is a key part of the company’s continued expansion of its broadband service. The mission also included a successful landing and recovery of the Falcon 9 rocket’s first-stage booster, the fifth for this particular booster, and a dual recovery of the fairing halves used to protect the cargo during launch, which were fished out of the Atlantic ocean using its recovery vessels and will be refurbished and reused.

From Brazil to Nigeria, people turn to Bitcoin for different reasons than most of their speculating counterparts in North America. Namely, because it’s the most advantageous way for them to conduct international transactions. 

Such is the case with a 28-year-old poker player in Brazil who simply goes by Felipe, for safety. Poker is a legal form of gambling in Brazil, so Felipe can use Brazilian banks and regulated exchanges to earn income from home. He dropped out of law school because playing poker against foreigners with Bitcoin to spend was more profitable than becoming a partner at a local law firm. Felipe said he now outearns his brother, a middle-tier executive at one of Brazil’s top corporations. 

“Bitcoin is the best medium of money exchange in the poker community,” Felipe said. “I withdraw earnings as Bitcoin, or as Tether, to a Brazilian crypto exchange and sell it there.”

Felipe said he is wary of his government because he believes the Brazilian economy will experience a catastrophic shock in the next few years. Back in 1992, President Fernando Collor de Mello was impeached after confiscating millions of civilian savings accounts to offset national debts. Felipe doesn’t want his bank account forcibly emptied when the next crisis hits. This inspires him to accumulate Bitcoin, avoiding more traditional options stocks. 

“The pension funds system is completely broken,” Felipe added. “The thing with Bitcoin is, you don’t need it until you do.” 

Manuel Folgueiras is one of many Cuban users who joined the Bitcoin ecosystem over the past year. This 33-year-old economist, who lost his tourism industry job in 2020, now supports himself using various cryptocurrency projects.

“It’s very difficult to get Bitcoin, because we don’t have access to any exchanges and there are a lot of scams. Cuban banks don’t have relationships with crypto exchanges,” Folgueiras said. “Now I use Bitcoin for both savings and income, through trading arbitrage. We have to use a VPN and it’s very risky. If the exchange detects that you’re from Cuba, your account will get blocked.”

Global demand for Bitcoin has been surging since the pandemic began in 2020, pushing dollar-denominated prices briefly past $34,000 during the first week of January, 2021. For residents in many emerging markets, demand for Bitcoin is driven by concerns about the overall health of their national economies, not pure speculation. Some of these countries where Bitcoin markets are spiking, especially in Latin America and the Middle East, are seeing their domestic economies tailspin and are worried political controls could further threaten economic stability.

For example, since Western Union stopped operating in Cuba, more Cubans are using Bitcoin than ever before. For people in a variety of countries, pandemic policy changes reduced access to the dollar-centric financial system.

Folgueiras estimated he is one of roughly 80,000 people on the island involved in an unofficial brokerage business called Trust Investing, often called a Ponzi scheme by local technologists. In short, the business promises to trade cryptocurrency on behalf of “investors,” to whom they deposit lucrative returns. The project promises 200% returns, which seems impossible, and references questionable “partners” on the Trust Investing website. 

Those partner companies are registered to people associated with a variety of court cases across Latin America and, in June 2020, Panama’s National Securities Market Commission (CNMV) published a warning not to trust the Trust Investing company itself. Even Folgueiras acknowledged that many people call this business a scam. But he said returns from the Trust Investing program are helping him survive the abysmal job market. It’s a gamble whether the company will give him returns or run away with his money, a risk he’s willing to take. 

Plus, Folgueiras added, any form of Bitcoin business in Cuba is already “very risky.” There aren’t many regulated, trustworthy exchanges openly serving Cubans today, due to U.S. sanctions. Aside from the remittance startup, BitRemesas, the last compliance-oriented startup that tried serving this market shut down in 2019. As such, many Cubans turn to questionable schemes, or WhatsApp, instead. 

“Cubans get Bitcoin via WhatsApp groups, peer-to-peer trading. The most popular mobile wallets are Coinomi, Enjin Wallet and Trust Wallet, because most people in Cuba only use a cell phone. It’s a mobile-only market,” Folgueiras said. “Bitcoin changed my life in a positive way and became an important source of income. Cryptocurrencies are also an interesting way for Cubans to shop online and send international payments or remittances.” 

This grassroots, mobile-only environment is common across many small countries with underdeveloped economics. Likewise, Fodé Diop, founder of the Dakar Bitcoin Developers meetup in Senegal, told CoinDesk last year that Senegal was not just a mobile-first market; it’s a mobile-only Bitcoin scene. Unlike North America and Europe, many emerging-market crypto communities only use cell phones for everything from research and trading to storage. 

On the other hand, it would be a mistake to assume most emerging-market Bitcoin users are marginalized by the global banking system. To the contrary, in countries like Nigeria and Brazil, many upper-middle-class entrepreneurs and gamers use Bitcoin to conduct perfectly legal business. According to data from the global peer-to-peer (P2P) markets LocalBitcoins and Paxful, there were more than $25.3 million worth of P2P Bitcoin trades last year in Brazil alone. 

Meanwhile, in Africa, Nigerian P2P Bitcoin volumes dwarf those numbers with a cool $357 million. Likewise, BuyCoins co-founder Tomiwa Lasebikan said his Nigerian cryptocurrency exchange ballooned from an average of $5 million in monthly volume in December 2019 to $21 million by December 2020. 

He said several factors spurred local growth, including anti-police brutality activists like the Nigerian Feminist Coalition, which collected bitcoin donations after being denied banking access, and stricter banking limitations on Nigerians paying for international services.

“A lot of people in Nigeria are running into a problem that they couldn’t renew subscriptions, like Spotify or Amazon, with their Nigerian accounts,” Lasebikan said. “Then, in October, there was a whole lot of interest in cryptocurrency, not just Bitcoin, for aggregating donations for people protesting police brutality. A lot of activists had their bank accounts shut down. Continued fundraising like this, both inside and outside the country, would not have been possible two decades ago.” 

He added his exchange startup now serves roughly 12,000 active users a month. Nearby, Binance communications lead in Nigeria, Damilola Odufuwa, said her global exchange company facilitated hundreds of virtual events for 17,000 Nigerian crypto beginners in 2020. These educational programs covered basic terminology, trading strategies and guides to opening exchange accounts. 

“During the pandemic, it was hard to get things into the country, including remittances,” Odufuwa said. “Now there’s also this need to use cryptocurrency to donate [to activists]…we plan to at least quadruple educational programming this year.”

Depending on the user’s socioeconomic background, people use Bitcoin to earn income from online games like poker, trading cryptocurrencies or offering freelance services to international clients. Odufuwa said thousands of the new users she’s seen during the pandemic want to profit from their developer skills, not just trades. So her company will offer more developer training related to the open-source Binance Smart Chain project. Although it’s impossible to accurately quantify, it seems as though at least hundreds of freelancers around the globe now depend on Bitcoin for income. 

One such LocalBitcoins user in Latin American, Venezuelan journalist José Rafael Peña, has been earning the majority of his income in Bitcoin since late 2016. He estimated that cryptocurrency writing gigs account for 90% of his income. 

“Bitcoin, in some circumstances, is a very helpful tool, especially when you live in a country with a chaotic economy and limited financial tools,” Peña said. “I began using Bitcoin because it let me protect against the bolivar’s devaluation, even without a dollar bank account.”

All things considered, Odufuwa said emerging markets saw “tremendous” growth since the pandemic began. But Peña warned not to confuse that growth with a mainstream “solution” to local government woes. 

“Most people try to survive the crisis in any way,” he said. “Even here, crypto is a niche.”

From Brazil to Nigeria, people turn to Bitcoin for different reasons than most of their speculating counterparts in North America. Namely, because it’s the most advantageous way for them to conduct international transactions. 

Such is the case with a 28-year-old poker player in Brazil who simply goes by Felipe, for safety. Poker is a legal form of gambling in Brazil, so Felipe can use Brazilian banks and regulated exchanges to earn income from home. He dropped out of law school because playing poker against foreigners with Bitcoin to spend was more profitable than becoming a partner at a local law firm. Felipe said he now outearns his brother, a middle-tier executive at one of Brazil’s top corporations. 

“Bitcoin is the best medium of money exchange in the poker community,” Felipe said. “I withdraw earnings as Bitcoin, or as Tether, to a Brazilian crypto exchange and sell it there.”

Felipe said he is wary of his government because he believes the Brazilian economy will experience a catastrophic shock in the next few years. Back in 1992, President Fernando Collor de Mello was impeached after confiscating millions of civilian savings accounts to offset national debts. Felipe doesn’t want his bank account forcibly emptied when the next crisis hits. This inspires him to accumulate Bitcoin, avoiding more traditional options stocks. 

“The pension funds system is completely broken,” Felipe added. “The thing with Bitcoin is, you don’t need it until you do.” 

Manuel Folgueiras is one of many Cuban users who joined the Bitcoin ecosystem over the past year. This 33-year-old economist, who lost his tourism industry job in 2020, now supports himself using various cryptocurrency projects.

“It’s very difficult to get Bitcoin, because we don’t have access to any exchanges and there are a lot of scams. Cuban banks don’t have relationships with crypto exchanges,” Folgueiras said. “Now I use Bitcoin for both savings and income, through trading arbitrage. We have to use a VPN and it’s very risky. If the exchange detects that you’re from Cuba, your account will get blocked.”

Global demand for Bitcoin has been surging since the pandemic began in 2020, pushing dollar-denominated prices briefly past $34,000 during the first week of January, 2021. For residents in many emerging markets, demand for Bitcoin is driven by concerns about the overall health of their national economies, not pure speculation. Some of these countries where Bitcoin markets are spiking, especially in Latin America and the Middle East, are seeing their domestic economies tailspin and are worried political controls could further threaten economic stability.

For example, since Western Union stopped operating in Cuba, more Cubans are using Bitcoin than ever before. For people in a variety of countries, pandemic policy changes reduced access to the dollar-centric financial system.

Folgueiras estimated he is one of roughly 80,000 people on the island involved in an unofficial brokerage business called Trust Investing, often called a Ponzi scheme by local technologists. In short, the business promises to trade cryptocurrency on behalf of “investors,” to whom they deposit lucrative returns. The project promises 200% returns, which seems impossible, and references questionable “partners” on the Trust Investing website. 

Those partner companies are registered to people associated with a variety of court cases across Latin America and, in June 2020, Panama’s National Securities Market Commission (CNMV) published a warning not to trust the Trust Investing company itself. Even Folgueiras acknowledged that many people call this business a scam. But he said returns from the Trust Investing program are helping him survive the abysmal job market. It’s a gamble whether the company will give him returns or run away with his money, a risk he’s willing to take. 

Plus, Folgueiras added, any form of Bitcoin business in Cuba is already “very risky.” There aren’t many regulated, trustworthy exchanges openly serving Cubans today, due to U.S. sanctions. Aside from the remittance startup, BitRemesas, the last compliance-oriented startup that tried serving this market shut down in 2019. As such, many Cubans turn to questionable schemes, or WhatsApp, instead. 

“Cubans get Bitcoin via WhatsApp groups, peer-to-peer trading. The most popular mobile wallets are Coinomi, Enjin Wallet and Trust Wallet, because most people in Cuba only use a cell phone. It’s a mobile-only market,” Folgueiras said. “Bitcoin changed my life in a positive way and became an important source of income. Cryptocurrencies are also an interesting way for Cubans to shop online and send international payments or remittances.” 

This grassroots, mobile-only environment is common across many small countries with underdeveloped economics. Likewise, Fodé Diop, founder of the Dakar Bitcoin Developers meetup in Senegal, told CoinDesk last year that Senegal was not just a mobile-first market; it’s a mobile-only Bitcoin scene. Unlike North America and Europe, many emerging-market crypto communities only use cell phones for everything from research and trading to storage. 

On the other hand, it would be a mistake to assume most emerging-market Bitcoin users are marginalized by the global banking system. To the contrary, in countries like Nigeria and Brazil, many upper-middle-class entrepreneurs and gamers use Bitcoin to conduct perfectly legal business. According to data from the global peer-to-peer (P2P) markets LocalBitcoins and Paxful, there were more than $25.3 million worth of P2P Bitcoin trades last year in Brazil alone. 

Meanwhile, in Africa, Nigerian P2P Bitcoin volumes dwarf those numbers with a cool $357 million. Likewise, BuyCoins co-founder Tomiwa Lasebikan said his Nigerian cryptocurrency exchange ballooned from an average of $5 million in monthly volume in December 2019 to $21 million by December 2020. 

He said several factors spurred local growth, including anti-police brutality activists like the Nigerian Feminist Coalition, which collected bitcoin donations after being denied banking access, and stricter banking limitations on Nigerians paying for international services.

“A lot of people in Nigeria are running into a problem that they couldn’t renew subscriptions, like Spotify or Amazon, with their Nigerian accounts,” Lasebikan said. “Then, in October, there was a whole lot of interest in cryptocurrency, not just Bitcoin, for aggregating donations for people protesting police brutality. A lot of activists had their bank accounts shut down. Continued fundraising like this, both inside and outside the country, would not have been possible two decades ago.” 

He added his exchange startup now serves roughly 12,000 active users a month. Nearby, Binance communications lead in Nigeria, Damilola Odufuwa, said her global exchange company facilitated hundreds of virtual events for 17,000 Nigerian crypto beginners in 2020. These educational programs covered basic terminology, trading strategies and guides to opening exchange accounts. 

“During the pandemic, it was hard to get things into the country, including remittances,” Odufuwa said. “Now there’s also this need to use cryptocurrency to donate [to activists]…we plan to at least quadruple educational programming this year.”

Depending on the user’s socioeconomic background, people use Bitcoin to earn income from online games like poker, trading cryptocurrencies or offering freelance services to international clients. Odufuwa said thousands of the new users she’s seen during the pandemic want to profit from their developer skills, not just trades. So her company will offer more developer training related to the open-source Binance Smart Chain project. Although it’s impossible to accurately quantify, it seems as though at least hundreds of freelancers around the globe now depend on Bitcoin for income. 

One such LocalBitcoins user in Latin American, Venezuelan journalist José Rafael Peña, has been earning the majority of his income in Bitcoin since late 2016. He estimated that cryptocurrency writing gigs account for 90% of his income. 

“Bitcoin, in some circumstances, is a very helpful tool, especially when you live in a country with a chaotic economy and limited financial tools,” Peña said. “I began using Bitcoin because it let me protect against the bolivar’s devaluation, even without a dollar bank account.”

All things considered, Odufuwa said emerging markets saw “tremendous” growth since the pandemic began. But Peña warned not to confuse that growth with a mainstream “solution” to local government woes. 

“Most people try to survive the crisis in any way,” he said. “Even here, crypto is a niche.”

SpaceX is set to launch the very first of its dedicated rideshare missions – an offering it introduced in 2019 that allows small satellite operators to book a portion of a payload on a Falcon 9 launch. SpaceX’s rocket has a relatively high payload capacity compared to the size of many of the small satellites produced today, so a rideshare mission like this offers smaller companies and startups a chance to get their spacecraft in orbit without breaking the bank. Today’s attempt is scheduled for 10 AM EST (7 AM PST) after a first try yesterday was cancelled due to weather. So far, weather looks much better for today.

The cargo capsule atop the Falcon 9 flying today holds a total of 133 satellites according to SpaceX, which is a new record for the highest number of satellites being launched on a single rocket – beating out a payload of 104 spacecraft delivered by Indian Space Research Organization’s PSLV-C37 launch back in February 2017. It’ll be a key demonstration not only of SpaceX’s rideshare capabilities, but also of the complex coordination involved in a launch that includes deployment of multiple payloads into different target orbits in relatively quick succession.

This launch will be closely watched in particular for its handling of orbital traffic management, since it definitely heralds what the future of private space launches could look like in terms of volume of activity. Some of the satellites flying on this mission are not much larger than an iPad, so industry experts will be paying close attention to how they’re deployed and tracked to avoid any potential conflicts.

Some of the payloads being launched today include significant volumes of startup spacecraft, including 36 of Swarm’s tiny IoT network satellites, and eight of Kepler’s GEN-1 communications satellites. There are also 10 of SpaceX’s own Starlink satellites on board, and 48 of Planet Labs’ Earth-imaging spacecraft.

The launch stream above should begin around 15 minutes prior to the mission start, which is set for 10 AM EST (7 AM PST) today.

With record funding levels and three unicorns to show, local investors are buoyant about Romania’s prospects heading into 2021. We caught up with eight of them recently, and heard how the country’s technical talent pool, broadband access and low cost of living have positioned it for the era of remote-first global companies across industries.

The momentum from last year includes 58 startups that raised total funding of €30.39 million, according to a new report just out from long-time Romanian conference How To Web. This represents a 6% increase in the volume of investments overall, and a 51% increase of investments year on year overall. A significant part of these numbers came from companies raising money for the first time.

Key industries include cybersecurity, enterprise software and fintech, with many “super-geeky teams, with deep expertise in the field” as one investor put it. “We are very focused on Romanian founders,” said another. But because of significant emigration in recent years, “they can reside and launch anywhere in the world.”

Here are the investors in their own words, for any TechCrunch reader who is interested in hiring, investing or founding a company in the country:

• Cristian Negrutiu, Founding Partner, Sparking Capital
• Cristian Munteanu, Managing partner, Early Game Ventures
• Andrei Pitis, Founding Partner, Simple Capital
• Bogdan Axinia, Managing Partner, eMAG Ventures
• Dan Mihaescu, Founding Partner, GapMinder Ventures
• Alexandru Popescu, Managing Partner, Cleverage Venture Capital
• Theodor Genoiu, Associate, Roca X
• Matei Dumitrescu, Founding Partner, Impact Capital

Oh, and one more thing. We just launched Extra Crunch in Romania. Subscribe to access all of our investor surveys, company profiles and other inside tech coverage for startups everywhere. Save 25% off a one- or two-year Extra Crunch membership by entering this discount code: ECROMANIA 

Cristian Negrutiu, Sparking Capital, Founding Partner

What trends are you most excited about investing in, generally?
Given the incipient stage of Romanian ecosystem, our fund is industry agnostic. On a personal note, I’m interested in verticals like supply chain, mobility, proptech, circular/sharing economy.

What’s your latest, most exciting investment?
Our latest investment is a start-up in the digital fitness industry.

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?
I would like to see more solutions in supply chain, as I believed that this industry needs a paradigm shift.

What are you looking for in your next investment, in general?
1. Relevant market 2. Good product 3. Excellent team 4. Fit with us

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?
I believe that in marketing and finance is difficult to enter or you need something really different. In terms of products/services, marketplaces need to evolve in order to be competitive

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

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?
Romanian ecosystem is still in infancy, but with a high velocity and very good prospects for the future. I believe that we will see soon more Romanian unicorns, including from our portfolio

How should investors in other cities think about the overall investment climate and opportunities in your city?
As said above – still in early stages, but full of opportunities and going full speed

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?
Not for Romania. The ecosystem is still based on few cities like Bucharest, Cluj, Iasi and the hubs within those 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? What are the opportunities startups may be able to tap into during these unprecedented times?
Apart from traditional HoReCa (Hotel/Restaurant/Café) businesses and overall trends, we didn’t see much impact. Actually, any start-up that promotes digitization in a specific industry (e.g. proptech) gained momentum in this period.

How has COVID-19 impacted your investment strategy?
We tried to be as normal as possible and maintain a steady flow of business. We advise founders to look after their teams and customers and be careful with cash

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Yes, as mentioned above.

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.
We always need to be positive and not exaggerate about the pandemic. It will pass.

Cristian Munteanu, Managing partner, Early Game Ventures

What trends are you most excited about investing in, generally?
Given our limited geographical scope (we invest only in Romania), we have to have a generic approach and consider many verticals and trends. Just as an example, we are looking at startups applying technologies that reached mass adoption to niche fields: computer vision applied to specific crops (agritech) or applied to in-store customer behaviour (martech); biometric data (collected through wearable devices) applied to group interactions as opposed to single individuals; ultra-light blockchain ledgers applied to smart buildings… From another investment perspective, we are looking to invest in what we call “the infrastructure for innovation” such as startups building APIs — we believe that Romania is not yet API-fied enough.

What’s your latest, most exciting investment?
The last term sheet we signed was with a startup that is building technology to help enterprise-level companies to better manage their software licenses. Super-geeky team, with deep expertise in the field, creating a lot of value to their customers.

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?
I would like to find great teams trying to make in-game payments easier (building at the intersection of payments and gaming), or working on Irrigation-as-a-Service (agritech), or building a NASDAQ for energy.

What are you looking for in your next investment, in general?
I am looking for founders that are both super competent and brave. Such people will dare tackle big problems and will have a chance to succeed at solving it.

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?
I’ve seen too many startups building apps to help people find parking spots, too many marketplaces that no one need, too much off the shelf technology for marketing, too many CRMs and ERPs.

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
We are investing only in Romania — 100% committed to the local ecosystem.

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?
I think that, given the natural potential of Romania, agritech has a big chance; still this space is not fully serviced yet. Otherwise, cybersecurity, enterprise software, and fintech are quite well represented. From our portfolio of almost 20 startups, CODA is enabling managed service providers with cybersecurity skills; Humans is building a hub for synthetic media technologies; Mechine is making agricultural equipment speak to each other; Tokinomo is collecting and analyzing data from the shelf (in-store marketing); BunnyShell is building next-gen cloud tech and making it easy for anyone to set up servers in three clicks.

How should investors in other cities think about the overall investment climate and opportunities in your city?
The startup ecosystem in Romania is very young, with the first local VC funds established three years ago with support from the European Investment Fund. And yet, Romania is home to three unicorns and many other promising startups. The large technical talent pool, the widely spread broadband access and the low costs of doing business and living turn Romania into a market to keep an eye on.

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?
I expect founders from the big cities to stay in the big cities as setting up and working for a startup does not mean writing code on the laptop from a remote beach. In the tormenting search for product-market fit, founders need to talk business, visit partners, sign contracts, attend events, meet peers, do surveys, prototype and one thousand other things that cannot be done on Zoom to their full extent. The tech industry and the startupland took a hit from the pandemic as the rest of the world. And just as the rest of the world, they will survive, adapt, and mostly return to the normal interactions from before March 2020.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
Unfortunately, I saw urban mobility apps suffer from the restrictions imposed by the pandemic. Also, anything related to restaurants, hotels and conventional events was badly affected. We are invested in startups in these verticals and made everything we could to help them during the worst days of the pandemic.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
Our fund registered a 20% decrease in the numbers of investments in 2020 compared to 2019 and a 40% decrease in the total value of deals; so the impact of COVID was significant. At the same time, in terms of fund performance, 2020 was a good year, with companies in our portfolio raising new investment rounds with outside investors, increasing their valuation, and showing good returns. The first half of 2020 was dedicated to damage control measures and supporting the portfolio companies, but the situation changed towards the end of the year, with high new deals activity in the last quarter (higher than in Q4 2019). VC-backed startups had investors to turn to in harsh times and benefited from support and additional funds when needed; things were much more difficult for the rest of the startups though.

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Probably the first thing we noticed the moment the pandemic started was a peak in productivity. During the months of mandatory shelter at home, the early-stage startups working on their prototypes put in extra-hours and gained speed. Personnel retention was good, people were focused, there was a positive spirit and a general desire to make things happen. Indeed, some startups reported an immediate boost of sales, such as Tokinomo whose robots replace the human promoters in supermarkets.

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.
The highlight of 2020 was the week I spent on a magnificent yacht sailing with friends through the islands in Greece. It was a recharging moment that gave me a boost for the rest of the year. The next elating moment came in December with the Series A investments that increased our fund’s performance.

Andrei Pitis, Founding partner, Simple Capital

What trends are you most excited about investing in, generally?
Startups creating world leading Intellectual Property with Romanian and broader Eastern European founders

What’s your latest, most exciting investment?
Uniapply.com

What are you looking for in your next investment, in general?
Strong committed founders with deep understanding of the domain they are planning to disrupt on a global scale through innovative intellectual property.

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?
I think too many people are trying to launch platforms without much understanding of how hard it is to launch it in the absence of a major differentiator. Customer acquisition through other digital marketing platforms is very expensive if there is no other unfair advantage to launch such a platform.

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
We are very focused on Romanian founders — but they can reside and launch anywhere in the world. We have investments in many US-based companies started by Romanian founders.

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?
I think Romania is very well positioned to win in cybersecurity and enterprise software as well as AI-based engines. I am very excited about pentest-tools.com, deepstash.com, uniapply.com from our portfolio as well as Fintech OS and TypingDNA that are not in our portfolio.

How should investors in other cities think about the overall investment climate and opportunities in your city?
Bucharest is a thriving ecosystem with plenty of opportunities ripe for global expansion.

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?
Indeed we have seen a surge in founders from smaller cities in Romania. We are founding partners of the Innovation Labs pre-accelerator that has a nationwide footprint and we are seeing more and more students interested in becoming founders all over Romania.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
Mobility solutions are impacted, local players are losing to bigger players like Lime.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
The pandemics delayed a lot of the investments, but we closed them toward the end of the year. Biggest worries for founders is that they have less and less leverage as a startup to attract tech talent. The problem is that the tech people can now work for any company in the world and this skyrocketed their salaries/rates.

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Yes we have seen — some of them benefited from people staying at home and having more time.

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.
The introduction of the vaccine and the pace at which people are vaccinated in Romania, that is not the fastest but also not the slowest either. An online platform for appointments is up and running and people are using it!

Bogdan Axinia, Managing partner, eMAG Ventures

What trends are you most excited about investing in, generally?
Health & wellbeing are areas that “helped” by the pandemic crisis are on brink of transformation and growth. A blend of software and hardware readiness is developing fast together with the openness of clients and regulatory authorities.

What’s your latest, most exciting investment?
Food delivery services. It is still day 0 with great opportunities ahead in terms of consumer services and business growth: food, ready to cook meals, convenience items, grocery, etc.

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?
It is still room to grow on B2C and B2B2C fintech space despite relatively high numbers of startups.

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
Bucharest and Romania in general have great potential when we look at talent pool from tech perspective and are a great place to start to scale regional and globally.

How should investors in other cities think about the overall investment climate and opportunities in your city?
Great place to come: great infrastructure (internet cost & speed, number of hubs), talent pool and increased number of investments transactions in last 3 years.

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?
I expect to see a growth but not a surge of founders from other geographies. And I believe thats a good thing for the ecosystem.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
Travel is both exposed and in the same time with great potential for new startups to come. There will be a “revenge travel” period from consumers but they will look for something different and in the same time business travel will not be the same and this will generate new practices and behaviour.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
We see opportunities to grow and we are allocating more capital for investments and we are advising our startups to invest more and grow faster.

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.
The start of the vaccine campaign across the globe and the initial results.

Dan Mihaescu, Founding partner, GapMinder Ventures

What trends are you most excited about investing in, generally?
B2B platforms enabled by ML/automation/AI in fintech, SaaS enterprise software, cybersecurity, healthcare IT, low-code development environments, conversational technologies, automation in logistics

What’s your latest, most exciting investment?
– Latest investment was DruidAI, announced on January 12th, 2021. GapMinder led a $2.5M round.
– Other 2020 exciting new investments or follow-ons: TypingDNA, FintechOS, DeepStash, Soleadify, Machinations, Innoship, Frisbo, Cartloop, XVision

What are you looking for in your next investment, in general?
– Stage: Seed or Series A
– Technology: Automation or conversational technology assisted by ML or AI
– Team: Mature with track-record for International expansion;
– Product: B2B scalable international, with B2B platforms as main focus

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?
Copies of B2C models (from US) that are borne in CEE tend to be limited to small local markets, and evolve into highly crowded environments. Shared economy companies borne in Romania are such examples. Unit economics were simply not attractive for us as VC investor.

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 70%

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?
– Models we consider will continue to thrive: B2B platforms enabled by automation/conversational technologies (assisted by ML/AI) have a higher potential for internationalisation vs B2C models.
– Reg verticals with higher potential, we mentioned above a few.
– GapMinder portfolio exciting companies: FintechOS, TypingDNA, DeepStash, DruidAI, Soleadify, Machinations, Innoship, Frisbo, Cartloop, SmartDreamers, XVision, among others

How should investors in other cities think about the overall investment climate and opportunities in your city?
Romania (in cities such as Bucharest, Cluj, Timisoara, Brasov, Oradea and Iasi) is a high-opportunity market, with excellent teams, startups borne with international vision, excellent environment for automation and ML enabled projects.

The ecosystem becomes more mature, from coverage of pre-seed rounds towards Series A, while not overcrowded yet.
Overall, a high opportunity environment for Series B and late Series A investors from US or rest of Europe.

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?
The hubs are concentrated in terms of education pool, potential customers (B2B or more sophisticated B2C) to test new products, potential investors on the pre-seed phase that are crucial for the initial steps of start-up developments.

For more advanced start-ups, hyper-growth is important, therefore the capability to scale up and go international might be helped by the presence in certain hubs.
In other words, there is a complex mix that the hubs are offering. So, at Romanian level, we do not expect a diminishing role of the hubs.

At European or US level, it is debatable if main hubs are too overcrowded or over-expensive for the teams. However, the business growth potential for the more advanced start-ups is important.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
The behaviour of users, both internal and external, has migrated towards a need for autonomy, which drives the need for:
– Tools that allow conversational interactions (including in natural language) with evolved human like feeling
– Remote collaborative low code development tools
– A general need for all companies (from the smallest ones to enterprise) to move yesterday to digital interactions

In 2020 a lot of consumers and companies were forced to focus on core priorities, and move to secondary focus the “nice-to-have” services or products. The VCs have seen even a sharper delimitation between high-tech and tech-enabled companies, not to mention some “interesting” proofs of Fake Tech. This shift has impacted lots of verticals, and such shift might be here to stay.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
GapMinder’s strategy described above is focussed on companies that actually have been benefiting from the tide of urgency in accelerating digital transformations of companies. And we seen it in the 2x-3x growth of most of our portfolio companies in 2020.
Our advices to our portfolio companies have been simple:
1. Cash is king. Make sure you have an 18 months minimum runway. If an opportunity to raise, seriously consider it.
2. Customers are the most important partners you have. Listen to them
3. The team is your most important asset. Keep it close and take care of it in these daring times.
4. Act fast

Of course, on top of the above, we had very specific conversations with each team.

To be candid, this all looks good at the end of 2020, but the first half of 2020 has been intense for founders in our portfolio and filled with doubts about decisional freeze in some verticals, stress on implementation in international markets wherever travel was needed, alignment between teams inside larger companies. Looking back, this was just normal. We feel fortunate to be part of the life of such great teams and start-ups, that proved so good during tough times.

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Yes, we already felt signs of recovery in second half of 2020, especially Q4.

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.
Starting at scale the vaccination against COVID-19 in last 6 weeks is definitely the most important positive sign at human level, society level, but also from a pure business perspective.
In our team, GapMinder, we feel optimistic!

Alexandru Popescu, Managing Partner, Cleverage Investment

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

What’s your latest, most exciting investment?
Oncochain

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?

What are you looking for in your next investment, in general?
Team, idea, traction

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

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?
Sanopass; Oncochain ( our portfolio); Fintech ( Fintech OS – Teodeor Blidarus; Sergiu Negut)

How should investors in other cities think about the overall investment climate and opportunities in your city?
Very dynamic yet at an early stage

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?
No.

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
Telemedicine – advantage; dentistry – exposed;

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
No impact due COVID; biggest worries are related to teams maturity & to market capacity to absorb new ideas fast enough; my advice is to look for know-how and try to grow as fast as possible

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Definitely I see “green shoots”

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.
Much better evaluation of one of our investments after only few months

Theodor Genoiu, Associate, Roca X

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

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?
eCommerce marketplaces, some service areas, mobility

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
Our thesis has a goal of a 40% distribution of the AuM in Romania

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?
Positive industry outlook – edutech, medtech, fintech, logistics;

Exciting companies – Fintech OS, Medicai, Kinderpedia, iFactor and a few others.

Negative industry outlook – marketplaces, Deeptech, gaming (in terms of funding, not talent), advertising

How should investors in other cities think about the overall investment climate and opportunities in your city?
Growing ecosystem with a large technical talent pool but in need of true entrepreneurial education, experience and mentality.

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?

Yes and no, in more established ecosystems a surge in founders coming from geographies outside major cities might be an outcome, the onset of remote work will bring a major boost to startups, although talented technical employees will become more and more difficult to onboard.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
Our investment strategy remains unchanged, the most commons worries of founders in our portfolio are linked to attracting new funding partners, lack of foresight in some target markets and difficulty in finding employees in certain verticals. We don’t have a general advice for all our startups, it’s case by case, we advise some to pivot, others to start conversion efforts on their large customer base and others to launch in new geographies.

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

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.
The openness to adopt new technologies and try new things from well-known conservative verticals such as education.

Matei Dumitrescu, Founding Partner, Smart Impact Capital

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

What’s your latest, most exciting investment?
iFactor, Ringhel, Sanopass

Are there startups that you wish you would see in the industry but don’t? What are some overlooked opportunities right now?
Yes, there are: impact startups

What are you looking for in your next investment, in general?
Impact, innovation, 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?
Marcom, ecomm, marketplaces

How much are you focused on investing in your local ecosystem versus other startup hubs (or everywhere) in general? More than 50%? Less?
Almost 100% focused on local startups with a global view

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?
Tech, ehealth. Medicai and its founder Mircea Popa are examples of great potential.

How should investors in other cities think about the overall investment climate and opportunities in your city?
Bucharest is booming, the market in getting bigger, the VCs are growing, the number of new initiatives is dramatically increased.

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?
No, but remote work is possible

Which industry segments that you invest in look weaker or more exposed to potential shifts in consumer and business behavior because of COVID-19? What are the opportunities startups may be able to tap into during these unprecedented times?
We had an opportunity with e-education and e-health. However, sharing economy was exposed to problems.

How has COVID-19 impacted your investment strategy? What are the biggest worries of the founders in your portfolio? What is your advice to startups in your portfolio right now?
Our startups were already agile, working remote and selling through digital channels digital products or services.

Are you seeing “green shoots” regarding revenue growth, retention or other momentum in your portfolio as they adapt to the pandemic?
Yes, we do.

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.
There wasn’t such moment.

Any other thoughts you want to share with TechCrunch readers?
We invest in IMPACT, because the impact creates VALUE, and that is what people pay for!

Hey y’all. You’ve just landed on Human Capital, the weekly newsletter that details the latest in labor, and diversity and inclusion in tech. The week kicked off with GitHub making a public apology to the person the company terminated for cautioning his employees about Nazis in D.C. on the day of the insurrection at the U.S. Capitol.

Later in the week, Google revoked corporate access from AI ethicist Margaret Mitchell in what some are saying is reminiscent of the company’s treatment of Dr. Timnit Gebru. Meanwhile, Instacart is making some changes to its platform that will result in job loss. 

Sign up below to get this in your email every Friday at 1 p.m. PT.

GitHub’s head of HR resigns; company offers fired Jewish employee his job back

A GitHub internal investigation revealed the company made “significant errors of judgment and procedure” in the firing of the Jewish employee who cautioned his coworkers about the presence of Nazis in the D.C. area on the day of insurrection at the U.S. Capitol.

In a blog post, GitHub COO Erica Brescia said the company’s head of HR took full responsibility for what happened and resigned from the company yesterday. GitHub did not disclose the name of the person who resigned, but it’s widely known that Carrie Olesen was the chief human resources officer at GitHub.

GitHub said it has “reversed the decision to separate with the employee” and is talking to his representative.

“To the employee we wish to say publicly: We sincerely apologize,” Brescia said in the blog post. However, the terminated employee previously told me that he did not want his job back but instead some other form of reconciliation.

Google AI ethicist under investigation 

Google is investigating AI ethicist Margaret Mitchell for reportedly using automated scripts to find examples of mistreatment of Dr. Timnit Gebru, according to Axios. Gebru says she was fired from Google while Google has maintained that she resigned. In a statement to Axios, Google said the company had locked Mitchell’s account:

Our security systems automatically lock an employee’s corporate account when they detect that the account is at risk of compromise due to credential problems or when an automated rule involving the handling of sensitive data has been triggered. In this instance, yesterday our systems detected that an account had exfiltrated thousands of files and shared them with multiple external accounts. We explained this to the employee earlier today.

The recently-formed Alphabet Workers Union made a statement saying it was concerned by Mitchell’s suspension of corporate access:

“Regardless of the outcome of the company’s investigation, the ongoing targeting of leaders in this organization calls into question Google’s commitment to ethics—in AI and in their business practices. Many members of the Ethical AI team are AWU members and the membership of our union recognizes the crucial work that they do and stands in solidarity with them in this moment.”

Google’s Sundar Pichai to meet with HBCU leaders

At least five HBCU presidents are scheduled to meet with Google CEO Sundar Pichai and Chief Diversity Officer Melonie Parker later this month to discuss recent allegations of racism and discrimination at the company, according to CNN. Additionally, the goal of the meeting is to ensure HBCUs have a good relationship with Google and that the company offers a good environment for its students and graduates.

Context:

Amazon launches anti-union website

Ahead of Amazon warehouse workers in Alabama gearing up to vote on whether to form a union, Amazon launched an anti-union website. Called Do It Without Dues, the site aims to dissuade workers from voting to unionize.

Instacart plans to terminate nearly 2,000 jobs 

Instacart plans to lay off nearly 2,000 of its workers, including the 10 workers from the Kroger-owned Mariano’s who unionized early last year, Vice reports. These workers are responsible for in-store shopping and packing of groceries.

According to Vice, 10 of the workers affected unionized with the United Food and Commercial Workers Local 1546 in Skokie, Illinois. However, they have yet to negotiate a contract with Instacart, according to Vice. Instacart notified the union of the planned changes earlier this week. In the letter, Instacart said it planned to stop using in-store shoppers at Kroger-owned stores, which includes the Mariano’s store in Skokie, in Q1 and Q2 of this year, but no earlier than mid-March.

Welcome back to The TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s broadly based on the daily column that appears on Extra Crunch, but free, and made for your weekend reading. Click here if you want it in your inbox every Saturday morning.

Ready? Let’s talk money, startups and spicy IPO rumors.

We’re shaking things up this weekend in the newsletter, focusing on a series of larger themes and news items instead of having a few discrete sections. Why? Because there was too much to fit into our usual format. If you were a fan of the original layout, we’ll be back to it next week.

Today we’re talking Coinbase’s growth, how Juked.gg tapped the equity crowdfunding market, a noodle or two on the a16z media game, Talkspace’s SPAC, VC and founder predictions for 2021, and where’s the right place to found a company.

Sound good? Let’s get into it!

Coinbase’s deposits scale ahead of IPO

Thanks to Kazim Rizvi of Drop, parent company to Cardify which provides data on consumer spending, we have a look into how quickly deposits have scaled at American cryptocurrency platform Coinbase. As Coinbase has filed to go public, and we’re eagerly anticipating its eventual S-1 filing, we were stoked to get a directional look at how quickly consumer interest was growing for the assets it helps folks buy.

They are scaling rapidly. Using the first week of January 2019 as a baseline, by the last week of December 2020 deposits and withdrawals from Coinbase had grown by more than 12x apiece. That’s staggering growth, and while the data is somewhat volatile — and we’d treat it as directional instead of exact — on a week-to-week basis, it underscores how well companies like Coinbase may be performing as Bitcoin booms once again, bringing in more trading interest and consumer demand.

Via Cardify, Cardify data.

The Cardify data also indicates a multiplying of new customer acquisition at Coinbase over the same time period, and deposits scaling alongside the price of Bitcoin. As Bitcoin has topped the $30,000 mark recently, sharply higher than in recent quarters, the price gains may have helped Coinbase not only a solid Q4 2020, but perhaps put it on a path for a bonkers Q1 2021 as well.

If we were 10/10 excited about the Coinbase S-1 before this dataset, we’re now a heckin’ 12/10.

Equity crowdfunding seven-figures for esports content

Esports is super cool and if you don’t agree, you are incorrect. But it doesn’t matter if you or I are right or not on the question, as the market has largely decided that competitive gaming is worth time, attention and investors’ money.

The proliferation of esports leagues and games and the like has led to a decidedly fragmented universe, however, lacking a central hub akin to what ESPN provides the world of traditional sports.

But not to worry, Juked.gg just raised capital to build a content hub for esports. This means that old folks like myself can still find out when tournaments are happening, and enjoy a dabble of League of Legends or Starcraft 2 pro play when we can, sans hunting around the internet for dates and times.

Juked.gg went through 500 Startups (more on its class here), catching our eye at the time as a neat nexus for esports-related content. Now flush with a little over $1 million that it raised on the Republic platform, it has big plans.

The Exchange spoke with Juked.gg’s co-founder and CEO Ben Goldhaber about his company’s performance to date. Per Goldhaber, Juked has scaled from 500 users when it launched in late 2019, to 50,000 in December of 2020. Ahead, Juked may invest more in journalism, more into social features, and more into user-generated content. We’ll have more on Juked as it gets its vision built, now powered by over a million dollars from 2,524 investors, each betting that the startup is building the right product to help unify a growing, if distributed, entertainment category.

The a16z media push

To preserve our collective sanity, I’m not going to bang on at length here, but building out content at a VC firm is not new. Hell, how long ago did the First Round Review launch? What a16z appears to have in mind is different in scale, not substance. We chatted about it on Equity this week, in case you need more on the matter.

Talkspace’s maybe-not-stupid SPAC

While it is enjoyable to mock SPACs, featuring as many do companies that are nascent to say the least, not all SPAC-led debuts are as silly as the rest. This is the case with the impending Talkspace deal, the deck for which you can read here.

What matters is this set of charts:

Look at that! Historical revenue growth! Improving gross margins! Rising gross profit!

You may argue that the company is not really worth an enterprise value of $1.4 billion that it will sport after its combination with Hudson Executive Investment Corp., but, hey, at least it’s a real business.

How VCs and founders see 2021 differently

Seed VC NFX dropped a VC and founder survey the other day that I’ve been meaning to share with you. You can read the whole thing here, if you’d like.

I have two pull-outs for you this morning:

1. VCs are more bullish on the economy than founders, with around 30% of founders expecting consumer spending to stay flat or decline, positions that only around 17% of VCs agreed with.
2. And when it comes to leaving the Bay Area — yes, that chestnut again — 35% of founders have itchy feet, while just 20% of investors are similarly inclined. I think this is because the latter have houses in the Bay Area while most founders do not. But it should temper the view that all the money and talent are leaving. They aren’t.

There’s no place like no place

Initialized Capital put together some data on where founders think it is best to found a company. In 2020, nearly 42% of surveyed founders said the Bay Area. By 2021 that number had slipped to a little over 28%, with a plurality of 42% indicating that a distributed company is the best way to go.

I hear about this a lot from early-stage founders. They are often building what I call micro-multinationals, small companies that have a few employees in one country, and then a handful in others. Making that setup work is going to be a hotspot for HR software I reckon.

Regardless, the requirement of founding companies in the Bay Area is kaput. The advantages of founding there will linger much longer.

Coming up!

Coming up on The Exchange next week: The first entries of our new $50 million ARR series, featuring interviews with Assembly, SimpleNexus, Picsart, OwnBackup and others. And we have some $100 million ARR interviews in the can, as well.

Finally, to keep the The Powers That Be happy, The Exchange covered some neat stuff this week, including American VC results, fintech and unicorn venture capital, European and Asian venture capital results, how the IPO market is even more bonkers than you thought, and notes on what Qualtrics may be worth when it goes public.

Hugs, and let’s all get a nap in,

Alex

Howdy friends, this is the web version of my Week in Review newsletter, it’s here to entice you to sign up and get it in your inbox every week.

Last week, I showcased how Twitter was looking at the future of the web with a decentralized approach so that they wouldn’t be stuck unilaterally de-platforming the next world leader. This week, I scribbled some thoughts on another aspect of the future web, the ongoing battle between Facebook and Apple to own augmented reality. Releasing the hardware will only be the start of a very messy transition from smartphone-first to glasses-first mobile computing.

Again, if you so desire you can get this in your inbox from the newsletter page, and follow my tweets @lucasmtny

The Big Thing

If the last few years of new “reality” tech has telegraphed anything, it’s that tech companies won’t be able to skip past augmented reality’s awkward phase, they’re going to have to barrel through it and it’s probably going to take a long-ass time.

The clearest reality is that in 2021 everyday users still don’t seem quite as interested in AR as the next generation of platform owners stand to benefit from a massive transition. There’s some element of skating to where the puck is going among the soothsayers that believe AR is the inevitable platform heir etc. etc., but the battle to reinvent mobile is at its core a battle to kill the smartphone before its time has come.

A war to remake mobile in the winner’s image

It’s fitting that the primary backers of this AR future are Apple and Facebook, ambitious companies that are deeply in touch with the opportunities they could’ve capitalized on if they could do it all over again.

While Apple and Facebook both have thousands of employees toiling quietly in the background building out their AR tech moats, we’ve seen and heard much more on Facebook’s efforts. The company has already served up several iterations of their VR hardware through Oculus and has discussed publicly over the years how they view virtual reality and augmented reality hardware converging. 

Facebook’s hardware and software experiments have been experimentations in plain sight, an advantage afforded to a company that didn’t sell any hardware before they started selling VR headsets. Meanwhile Apple has offered up a developer platform and a few well-timed keynote slots for developers harnessing their tools, but the most ambitious first-party AR project they’ve launched publicly on iOS has been a measuring tape app. Everything else has taken place behind closed doors.

That secrecy tends to make any reporting on Apple’s plans particularly juicy. This week, a story from Bloomberg’s Mark Gurman highlights some of Apple’s next steps towards a long-rumored AR glasses product, reporting that Apple plans to release a high-end niche VR device with some AR capabilities as early as next year. It’s not the most surprising but showcases how desperate today’s mobile kingpins are to ease the introduction of a technology that has the potential to turn existing tech stacks and the broader web on their heads.

Both Facebook and Apple have a handful of problems getting AR products out into the world, and they’re not exactly low-key issues:

1. hardware isn’t ready
2. platforms aren’t ready
3. developers aren’t ready
4. users don’t want it yet

This is a daunting wall, but isn’t uncommon among hardware moonshots. Facebook has already worked its way through this cycle once with virtual reality over several generations of hardware, though there were some key difference and few would call VR a mainstream success quite yet.

Nevertheless, there’s a distinct advantage to tackling VR before AR for both Facebook and Apple, they can invest in hardware that’s adjacent to the technologies their AR products will need to capitalize on, they can entice developers to build for a platform that’s more similar to what’s coming and they can set base line expectations for consumers for a more immersive platform. At least this would all be the case for Apple with a mass market VR device closer to Facebook’s $300 Quest 2, but a pricey niche device as Gurman’s report details doesn’t seem to fit that bill quite so cleanly.

The AR/VR content problem 

The scenario I’d imagine both Facebook and Apple are losing sleep over is that they release serviceable AR hardware into a world where they are wholly responsible for coming up with all the primary use cases.

The AR/VR world already has a hefty backlog of burnt developers who might be long-term bullish on the tech but are also tired of getting whipped around by companies that seem to view the development of content ecosystems simply as a means to ship their next device. If Apple is truly expecting the sales numbers of this device that Bloomberg suggests — similar to Valve’s early Index headset sales — then color me doubtful that there will be much developer interest at all in building for a stopgap device, I’d expect ports of Quest 2 content and a few shining stars from Apple-funded partners.

I don’t think this will me much of a shortcut for them.

True AR hardware is likely going to have different standards of input, different standards of interaction and a much different approach to use cases compared to a device built for the home or smartphone. Apple has already taken every available chance to entice mobile developers to embrace phone-based AR on iPhones through ARKit, a push they have seemed to back off from at recent developer-centric events. As someone who has kept a close eye on early projects, I’d say that most players in the space have been very underwhelmed by what existing platforms enable and what has been produced widely.

That’s really not great for Apple or Facebook and suggests that both of these companies are going to have to guide users and developers through use cases they design. I think there’s a convincing argument that early AR glasses applications will be dominated by first-party tech and may eschew full third-party native apps in favor of tightly controlled data integrations more similar to how Apple has approached developer integrations inside Siri.

But giving developers a platform built with Apple or Facebook’s own dominance in mind is going to be tough to sell, underscoring the fact that mobile and mobile AR are going to be platforms that will have to live alongside each other for quite a bit. There will be rich opportunities for developers to create experiences that play with 3D and space, but there are also plenty of reasons to expect they’ll be more resistant to move off of a mutually enriching mobile platform onto one where Facebook or Apple will have the pioneer’s pick of platform advantages. What’s in it for them?

Mobile’s OS-level winners captured plenty of value from top-of-funnel apps marketplaces, but the down-stream opportunities found mobile’s true prize, a vastly expanded market for digital ads. With the opportunity of a mobile do-over, expect to find pioneering tech giants pitching proprietary digital ad infrastructure for their devices. Advertising will likely be augmented reality’s greatest opportunity allowing the digital ads market to create an infinite global canvas for geo-targeted customized ad content. A boring future, yes, but a predictable one.

For Facebook, being a platform owner in the 2020s means getting to set their own limitations on use cases, not being confined by App Store regulations and designing hardware with social integrations closer to the silicon. For Apple, reinventing the mobile OS in the 2020s likely means an opportunity to more meaningfully dominate mobile advertising.

It’s a do-over to the tune of trillions in potential revenues.

What comes next

The AR/VR industry has been stuck in a cycle of seeking out saviors. Facebook has been the dearest friend to proponents after startup after startup has failed to find a speedy win. Apple’s long-awaited AR glasses are probably where most die-hards are currently placing their faith.

I don’t think there are any misgivings from Apple or Facebook in terms of what a wild opportunity this to win, it’s why they each have more people working on this than any other future-minded project. AR will probably be massive and change the web in a fundamental way, a true Web 3.0 that’s the biggest shift of the internet to date.

That’s doesn’t sound like something that will happen particularly smoothly.

I’m sure that these early devices will arrive later than we expect, do less than we expect and that things will be more and less different from the smartphone era’s mobile paradigms in ways we don’t anticipate. I’m also sure that it’s going to be tough for these companies to strong-arm themselves into a more seamless transition. This is going to be a very messy for tech platforms and is a transition that won’t happen overnight, not by a long shot.

Other things

The Loon is dead
One of tech’s stranger moonshots is dead, as Google announced this week that Loon, it’s internet balloon project is being shut down. It was an ambitious attempt to bring high-speed internet to remote corners of the world, but the team says it wasn’t sustainable to provide a high-cost service at a low price. More

Facebook Oversight Board tasked with Trump removal
I talked a couple weeks ago — what feels like a lifetime ago — about how Facebook’s temporary ban of Trump was going to be a nightmare for the company. I wasn’t sure how they’d stall for more time of a banned Trump before he made Facebook and Instagram his central platform, but they made a brilliant move, purposefully tying the case up in PR-favorable bureaucracy, tossing the case to their independent Oversight Board for their biggest case to date. More

Jack is Back
Alibaba’s head honcho is back in action. Alibaba shares jumped this week when the Chinese e-commerce giant’s billionaire CEO Jack Ma reappeared in public after more than three months after his last public appearance, something that stoked plenty of conspiracies. Where he was during all this time isn’t clear, but I sort of doubt we’ll be finding out. More

Trump pardons Anthony Levandowski
Trump is no longer President, but in one of his final acts, he surprisingly opted to grant a full pardon to one Anthony Levandowski, the former Google engineer convicted of stealing trade secrets regarding their self-driving car program. It was a surprising end to one of the more dramatic big tech lawsuits in recent years. More

Xbox raises Live prices
I’m not sure how this stacks in importance relative to what else is listed here, but I’m personally pissed that Microsoft is hiking the price of their streaming subscription Xbox Live Gold. It’s no secret that the gaming industry is embracing a subscription economy, it will be interesting to see what the divide looks like in terms of gamer dollars going towards platform owners versus studios. More

Musk offers up $100M donation to carbon capture tech
Elon Musk, who is currently the world’s richest person, tweeted out this week that he will be donating $100 million towards a contest to build the best technology for carbon capture. TechCrunch learned that this is connected to the Xprize organization. More details

Extra Things

I’m adding a section going forward to highlight some of our Extra Crunch coverage from the week, which dives a bit deeper into the money and minds of the moneymakers.

Hot IPOs hang onto gains as investors keep betting on tech
“After setting a $35 to $39 per-share IPO price range, Poshmark sold shares in its IPO at $42 apiece. Then it opened at $97.50. Such was the exuberance of the stock market regarding the used goods marketplace’s debut.
But today it’s worth a more modest $76.30 — for this piece we’re using all Yahoo Finance data, and all current prices are those from yesterday’s close ahead of the start of today’s trading — which sparked a question: How many recent tech IPOs are also down from their opening price?” More

How VCs invested in Asia and Europe in 2020
“Wrapping our look at how the venture capital asset class invested in 2020, today we’re taking a peek at Europe’s impressive year, and Asia’s slightly less invigorating set of results. (We’re speaking soon with folks who may have data on African VC activity in 2020; if those bear out, we’ll do a final entry in our series concerning the continent.)” More

Hello, Extra Crunch Community!
“We’re going to be trying out some new things around here with the Extra Crunch staff front and center, as well as turning your feedback into action more than ever. We quite literally work for you, the subscriber, and want to make sure you’re getting your money’s worth, as it were.” More

Until next week,
Lucas Matney