Bzaar bags $4M to enable US retailers to source home, lifestyle products from India

Small businesses in the U.S. now have a new way to source home and lifestyle goods from new manufacturers. Bzaar, a business-to-business cross-border marketplace, is connecting retailers with over 50 export-ready manufacturers in India.

The U.S.-based company announced Monday that it raised $4 million in seed funding, led by Canaan Partners, and including angel investors Flipkart co-founder Binny Bansal, PhonePe founders Sameer Nigam and Rahul Chari, Addition founder Lee Fixel and Helion Ventures co-founder Ashish Gupta.

Nishant Verman and Prasanth Nair co-founded Bzaar in 2020 and consider their company to be like a “fair without borders,” Verman put it. Prior to founding Bzaar, Verman was at Bangalore-based Flipkart until it was acquired by Walmart in 2018. He then was at Canaan Partners in the U.S.

“We think the next 10 years of global trade will be different from the last 100 years,” he added. “That’s why we think this business needs to exist.”

Traditionally, small U.S. buyers did not have feet on the ground in manufacturing hubs, like China, to manage shipments of goods in the same way that large retailers did. Then Alibaba came along in the late 1990s and began acting as a gatekeeper for cross-border purchases, Verman said. U.S. goods imports from China totaled $451.7 billion in 2019, while U.S. goods imports from India in 2019 were $87.4 billion.

Bzaar screenshot. Image Credits: Bzaar

Small buyers could buy home and lifestyle goods, but it was typically through the same sellers, and there was not often a unique selection, nor were goods available handmade or using organic materials, he added.

With Bzaar, small buyers can purchase over 10,000 wholesale goods on its marketplace from other countries like India and Southeast Asia. The company guarantees products arrive within two weeks and manage all of the packaging logistics and buyer protection.

Verman and Nair launched the marketplace in April and had thousands users in three continents purchasing from the platform within six months. Meanwhile, products on Bzaar are up to 50% cheaper than domestic U.S. platforms, while SKU selection is growing doubling every month, Verman said.

The new funding will enable the company to invest in marketing to get in front of buyers and invest on its technology to advance its cataloging feature so that goods pass through customs seamlessly. Wanting to provide new features for its small business customers, Verman also intends to create a credit feature to enable buyers to pay in installments or up to 90 days later.

“We feel this is a once-in-a-lifetime shift in how global trade works,” he added. “You need the right team in place to do this because the problem is quite complex to take products from a small town in Vietnam to Nashville. With our infrastructure in place, the good news is there are already shops and buyers, and we are stitching them together to give buyers a seamless experience.”

 

#alibaba, #bzaar, #canaan-partners, #china, #ecommerce, #enterprise, #flipkart, #funding, #import, #market, #nishant-verman, #prasanth-nair, #recent-funding, #saas, #startups, #tc

China Roundup: Beijing is tearing down the digital ‘walled gardens’

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

This week, China gets serious about breaking down the walled gardens that its internet giants have formed for decades. Two major funding rounds were announced, from the newly established autonomous driving unicorn Deeproute.ai and fast-growing, cross-border financial service provider XTransfer.

Tear down the walls

The Chinese internet is infamously siloed, with a handful of “super apps” each occupying a cushy, protective territory that tries to lock users in and keep rivals out. On Tencent’s WeChat messenger, for instance, links to Alibaba’s Taobao marketplace and ByteDance’s Douyin short video service can’t be viewed or even redirected. That’s unlike WhatsApp, Telegram or Signal that offer friendly URL previews within chats.

E-commerce platforms fend off competition in different ways. Taobao uses Alibaba’s affiliate Alipay as a default payments option, omitting its arch rival WeChat Pay. Tencent-backed JD.com, a rival to Alibaba, encourages its users to pay through its own payments system or WeChat Pay.

But changes are underway. “Ensuring normal access to legal URLs is the basic requirement for developing the internet,” a senior official from China’s Ministry of Industry and Information Technology said at a press conference this week. He added that unjustified blockages of web links “affect users’ experience, undermine users’ rights, and disrupt market orders.”

There is some merit in filtering third-party links when it comes to keeping out the likes of pornography, misinformation and violent content. Content distributors in China also strictly abide by censorship rules, silencing politically sensitive discussions. These principles will stay in place, and MIIT’s new order is really to crack anticompetitive practices and wane the power of the bloated internet giants.

The call to end digital walled gardens is part of MIIT’s campaign, started in July, to restore “orders” to the Chinese internet. While crackdowns on internet firms are routine, the spate of new policies announced in recent months — from new data security rules to heightened gaming restrictions — signify Beijing’s resolution to curb the influence of Chinese internet firms of all kinds.

The deadline for online platforms to unblock URLs is September 17, the MIIT said earlier. Virtually all the major internet companies have swiftly issued statements saying they will firmly carry out MIIT’s requirements and help promote the healthy development of the Chinese internet.

Internet users are bound to benefit from the dismantling of the walled gardens. They will be able to browse third-party content smoothly on WeChat without having to switch between apps. They can share product links from Taobao right within the messenger instead of having their friends copy-paste a string of cryptic codes that Taobao automatically generates for WeChat sharing.

Robotaxi dream

Autonomous driving startup Deeproute.ai said this week it has closed a $300 million Series B round from investors including Alibaba, Jeneration Capital, and Chinese automaker Geely. The valuation of this round was undisclosed.

We’ve seen a lot of publicity from Pony.ai, WeRide, Momenta and AutoX but not so much Deeproute.ai. That in part is because the company is relatively young, founded only in 2019 by Zhou Guang after he was “fired” by his co-founders at the once-promising Roadstar.ai amid company infighting.

Investors in Roadstar.ai reportedly saw the dismissal of Zhou as detrimental to the startup, which had raised at least $140 million up to that point, and subsequently sought to dissolve the business. It appears that Zhou, formerly the chief scientist at Roadstar, still commands the trust of some investors to support his reborn autonomous driving venture.

Like Pony.ai and WeRide, Deeproute is trying to operate its own robotaxi fleets. While the business model gives it control over reams of driving data, it’s research- and cash-intensive. As such, major Chinese robotaxi startups are all looking at faster commercial deployments, like self-driving buses and trucks, to ease their financial stress.

Cross-border trade boom

The other major funding news this week comes from Shanghai-based XTransfer, which helps small-and-medium Chinese exporters collect payments from overseas. The Series C round, led by D1 Partners, pulled in $138 million and catapulted Xtransfer’s valuation to over $1 billion. The proceeds will go towards product development, hiring and global expansion.

Founded by former executives from Ant Group, XTransfer tries to solve a pain point faced by small and medium exporters: opening and maintaining bank accounts in different countries can be difficult and costly. As such, XTransfer works as a payments gateway between its SME customer, the party that pays it, and their respective banks.

As of July, XTransfer’s customers had surpassed 150,000, most of which are in mainland China. The company of over 1,000 employees is also expanding into Southeast Asia.

While business-to-business export is booming in China, more and more products are also being directly sold from Chinese brands to consumers around the world. Some of the most successful examples, like Shein and Anker, use a different set of payments processors for their direct-to-consumer sales, which tend to be in bigger volume but smaller in average ticket value.

#alibaba, #alibaba-group, #alipay, #ant-group, #asia, #beijing, #bytedance, #china, #china-roundup, #geely, #jack-ma, #jd-com, #momenta, #online-payments, #robotaxi, #shanghai, #shein, #southeast-asia, #taobao, #tc, #tencent, #wechat, #xtransfer

Equity Monday: Market pessimism, new iPhones, and IPOs

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast where we unpack the numbers behind the headlines.

This is Equity Monday, our weekly kickoff that tracks the latest private market news, talks about the coming week, digs into some recent funding rounds and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here. I also tweet.

Vacation was good, and a big thanks to Mary Ann and Natasha — not to mention Grace and Chris! — for keeping things flowing while I mostly sat around reading books and playing video games. But enough being maudlin! To the news!

  • Investors are kinda thinking that the run-up in stocks needs to take a breather. And that the reset could land between 5% and 10%, with another 10% of respondents expecting a correction of more than 10%. Yowza.
  • China may break up Ant, keeping the pace of its regulatory deluge going as this week starts. And the Chinese government thinks that its country has too many EV companies. If the market or central planning will wind up taking point on solving the “problem” is not clear.
  • The Apple v. Epic decision is still driving conversation. Here’s TechCrunch’s coverage, and here’s the MG piece I mentioned.
  • Toast and Freshworks have new filings up. Which is good news if you want to dig into new S-1/A reports. Forge is going public via a SPAC.
  • And Babyscripts and Commercetools raised rounds, while Jungle Ventures raised a fund.

Got all that? Ok good. Chat you Wednesday!

Equity drops every Monday at 7:00 a.m. PST, Wednesday, and Friday at 6:00 a.m. PST, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts!

#alibaba, #ant, #babyscripts, #china, #commercetools, #equity, #equity-monday, #ev, #freshworks, #fundings-exits, #jungle-ventures, #startups, #toast

Investors are doubling down on Southeast Asia’s digital economy

Southeast Asian tech companies are drawing the attention of investors around the world. In 2020, startups in the region raised over $8.2 billion, about four times more than they did in 2015. This trend continued in 2021, with regional M&A hitting a record high of $124.8 billion in the first half of 2021, up 83% from a year earlier.

This begs the question: Who exactly is investing in Southeast Asia?

Let’s explore the three key types of investors pouring money into and driving the growth of Southeast Asia’s tech ecosystem.

Over 229 family offices have been registered in Singapore since 2020, with total assets under management of an estimated $20 billion.

Big tech

Southeast Asia has become an attractive market for U.S. and Chinese tech firms. Internet penetration here stands at 70%, higher than the global average, and digital adoption in the region remains nascent — it wasn’t until the pandemic that adoption of digital services such as e-wallets and online shopping took off.

China’s tech giants Tencent and Alibaba were among the first to support early e-commerce growth in Southeast Asia with investments in Sea Limited and Lazada, and have since expanded their footprint into other internet verticals. Alibaba has backed Akulaku, M-Pay (eMonkey), DANA, Wave Money and Mynt (GCash), while Tencent has invested in Voyager Innovations (PayMaya), SHAREit, iflix, Ookbee and Sanook.

U.S. tech firms have also recently entered the scene. In June 2020, Gojek closed a $3 billion Series F round from Google, Facebook, Tencent and Visa. Google, together with Singapore’s Temasek Holdings, invested some $350 million in Tokopedia in October. Meanwhile, Microsoft invested an undisclosed amount in Grab in 2018 and has invested $100 million in Indonesian e-commerce firm Bukalapak.

Venture capitalists

In Q1 2021, Southeast Asian startups raised $6 billion, according to DealStreetAsia, positioning 2021 as another record year for VC investment in the region.

The region is also rising in prominence as a destination for investment capital relative to the rest of Asia. Regional VC investment grew 5.2 times to $8.2 billion in 2020 from $1.6 billion in 2015, as we can see in the table below.

Venture capital investment by region 2015-2020

Image Credits: Jungle VC

Southeast Asia also has many opportunities for VC investment relative to its market size. From 2015 to 2020, China saw VC investment of nearly $300 per person; for Southeast Asia — despite a recent investment boom — this metric sits at just $47.50 per person, or just a sixth of that in China. This implies a substantial opportunity for investments to develop the region’s digital economy.

The region’s rising population and growth prospects are higher due to China’s population growth challenges, alongside the latter’s higher digital economy market saturation and maturity.

#alibaba, #asia, #asia-pacific, #bridgewater-associates, #china, #column, #e-commerce, #ec-column, #ec-southeast-asia-oceania, #facebook, #ggv-capital, #google, #internet-penetration, #james-dyson, #joseph-phua, #lazada, #lazada-group, #microsoft, #online-shopping, #paul-allen, #private-equity, #ray-dalio, #sergey-brin, #singapore, #southeast-asia, #startups, #temasek-holdings, #tencent, #tokopedia, #united-states, #venture-capital

China roundup: Beijing wants tech giants to shoulder more social responsibilities

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

This week, the gaming industry again became a target of Beijing, which imposed arguably the world’s strictest limits on underage players. On the other hand, China’s tech titans are hastily answering Beijing’s call for them to take on more social responsibilities and take a break from unfettered expansion.

Gaming curfew

China dropped a bombshell on the country’s young gamers. As of September 1, users under the age of 18 are limited to only one hour of online gaming time: on Fridays, Saturdays and Sundays between 8-9 p.m.

The stringent rule adds to already tightening gaming policies for minors, as the government blames video games for causing myopia, as well as deteriorating mental and physical health. Remember China recently announced a suite of restrictions on after-school tutoring? The joke going around is that working parents will have an even harder time keeping their kids occupied.

A few aspects of the new regulation are worth unpacking. For one, the new rule was instituted by the National Press and Publication Administration (NPPA), the regulatory body that approves gaming titles in China and that in 2019 froze the approval process for nine months, which led to plunges in gaming stocks like Tencent.

It’s curious that the directive on playtime came from the NPPA, which reviews gaming content and issues publishing licenses. Like other industries in China, video games are subject to regulations by multiple authorities: NPPA; the Cyberspace Administration of China (CAC), the country’s top internet watchdog; and the Ministry of Industry and Information Technology, which oversees the country’s industrial standards and telecommunications infrastructure.

As analysts long observe, the mighty CAC, which sits under the Central Cyberspace Affairs Commission chaired by President Xi Jinping, has run into “bureaucratic struggles” with other ministries unwilling to relinquish power. This may well be the case for regulating the lucrative gaming industry.

For Tencent and other major gaming companies, the impact of the new rule on their balance sheet may be trifling. Following the news, several listed Chinese gaming firms, including NetEase and 37 Games, hurried to announce that underage players made up less than 1% of their gaming revenues.

Tencent saw the change coming and disclosed in its Q2 earnings that “under-16-year-olds accounted for only 2.6% of its China-based grossing receipts for games and under-12-year-olds accounted for just 0.3%.”

These numbers may not reflect the reality, as minors have long found ways around gaming restrictions, such as using an adult’s ID for user registration (just as the previous generation borrowed IDs from adult friends to sneak into internet cafes). Tencent and other gaming firms have vowed to clamp down on these workarounds, forcing kids to seek even more sophisticated tricks, including using VPNs to access foreign versions of gaming titles. The cat and mouse game continues. 

Prosper together

While China curtails the power of its tech behemoths, it has also pressured them to take on more social responsibilities, which include respecting the worker’s rights in the gig economy.

Last week, the Supreme People’s Court of China declared the “996” schedule, working 9 a.m. to 9 p.m. six days a week, illegal. The declaration followed years of worker resistance against the tech industry’s burnout culture, which has manifested in actions like a GitHub project listing companies practicing “996.”

Meanwhile, hardworking and compliant employees have often been cited as a competitive advantage of China’s tech industry. It’s in part why some Silicon Valley companies, especially those run by people familiar with China, often set up branches in the country to tap its pool of tech talent.

The days when overworking is glorified and tolerated seem to be drawing to an end. Both ByteDance and its short video rival Kuaishou recently scrapped their weekend overtime policies.

Similarly, Meituan announced that it will introduce compulsory break time for its food delivery riders. The on-demand services giant has been slammed for “inhumane” algorithms that force riders into brutal hours or dangerous driving.

In groundbreaking moves, ride-hailing giant Didi and Alibaba’s e-commerce rival JD.com have set up unions for their staff, though it’s still unclear what tangible impact the organizations will have on safeguarding employee rights.

Tencent and Alibaba have also acted. On August 17, President Xi Jinping delivered a speech calling for “common prosperity,” which caught widespread attention from the country’s ultra-rich.

“As China marches towards its second centenary goal, the focus of promoting people’s well-being should be put on boosting common prosperity to strengthen the foundation for the Party’s long-term governance.”

This week, both Tencent and Alibaba pledged to invest 100 billion yuan ($15.5 billion) in support of “common prosperity.” The purposes of their funds are similar and align neatly with Beijing’s national development goals, from growing the rural economy to improving the healthcare system.

#alibaba, #asia, #beijing, #bytedance, #china, #china-roundup, #didi, #gaming, #github, #government, #jd-com, #kuaishou, #ministry-of-industry-and-information-technology, #netease, #tc, #tencent, #xi-jinping

China proposes strict control of algorithms

China is not done with curbing the influence local internet services have assumed in the world’s largest populous market. Following a widening series of regulatory crackdowns in recent months, the nation on Friday issued draft guidelines on regulating the algorithms firms run to make recommendations to users.

In a 30-point draft guidelines published on Friday, the Cyberspace Administration of China (CAC) proposed forbidding companies from deploying algorithms that “encourage addiction or high consumption” and endanger national security or disrupt the public order.

The services must abide by business ethics and principles of fairness and their algorithms must not be used to create fake user accounts or create other false impressions, said the guidelines from the internet watchdog, which reports to a central leadership group chaired by President Xi Jinping. The watchdog said it will be taking public feedback on the new guidelines for a month (until September 26).

The guidelines also propose that users should be provided with the ability to easily turn off algorithm recommendations. Algorithm providers who have the power to influence public opinion or mobilize the citizens need to get an approval from the CAC.

Friday’s proposal comes at a time when Beijing is increasingly targeting companies for the way they have handled consumer data and the monopolistic positions they have assumed in the nation.

Earlier this year, Beijing-backed China Consumers Association said local internet companies had been “bullying” users into purchases and promotions and undermining their privacy rights.

Beijing’s recent data-security crackdown and tightening regulations around tutor services have spooked investors and wiped hundreds of billions of dollars.

Friday’s guidelines appear to target ByteDance, Alibaba Group, Tencent, and Didi and other companies whose services are built on top of proprietary algorithms. Shares of Alibaba and Tencent fell slightly on the news.

In recent years, several governments including those in the U.S. and India have attempted — to little to no success — to get better clarity on how these big tech companies’ algorithms work and put checks in place to prevent misuse.

#alibaba, #asia, #bytedance, #china, #didi, #government, #tencent

Europe’s quick-commerce startups are overhyped: Lessons from China

More than 10 companies currently compete across Europe with an instant grocery delivery business model. Half of them were established in 2020, the year of the pandemic. These companies have raised more than $2 billion to date.

Existing and well-funded online food-delivery service players like Delivery Hero are also joining the race by launching dedicated grocery offerings. However, if lessons from the world’s largest online grocery market, China ($400 billion), matter, then it’s clear that instant delivery is not the magic bullet to crack the dominance of Europe’s incumbent supermarket chains in the overall $2 trillion-plus flat market.

Instead, China’s quick-commerce equivalents (like Dingdong Maicai, Miss Fresh and Meituan Maicai) compete alongside a wealth of other online grocery models (such as Pinduoduo, JD’s Super and Alibaba’s Taoxianda), which have helped bring total market penetration to 20% and beyond.

Quick commerce suffers from narrower profit margins compared to competing models and is addressing lower consumer demand in China than anyone in the West is expecting it to achieve in Europe and the U.S. If the performance of online grocery platforms in China (a market five to seven years ahead of Europe in terms of online retail) is anything to go by, a range of B2C business models would be more likely to displace the traditional grocery retailers.

Third-time luck for quick commerce?

The idea of ordering groceries online and having them delivered to consumers in less than an hour is nothing new. Back in the heyday of the dot-com bubble, a company attempted to do just that: Kozmo.com. Founded in 1998, it raised more than $250 million (around $400 million in today’s dollars) from investors, promising to deliver food, among other items, to consumers within an hour, while charging no delivery fees.

In 1999, it had revenues of $3.5 million and a loss of $1.8 million. However, in 2001, the business was shut down by its board after the company could not make the business model work at scale.

Some 15 years later, another company had a go. Gopuff was established in Philadelphia in 2013 and originally targeted students. What started out as a hookah delivery service soon expanded into a much broader convenience store offering and delivered to customers in approximately 30 minutes.

Gopuff was most recently valued at $15 billion after raising a total of $3.4 billion — 75% of which occurred in the past 12 months. Last year, Gopuff grew revenues from around $100 million to $340 million.

Kozmo.com went out of business after just three years. Meanwhile, Gopuff was turned down by several VCs in its early days, and it wasn’t until the pandemic that it saw a rapid acceleration in fundraising. Little did teams at either company know that they would later become the inspiration for a whole generation of founders in Europe.

Europe’s $2B instant-grocery gamble

Has anything fundamentally changed in the 20 years since Kozmo.com? Indeed, we’ve seen little technological progress that would hugely affect the operations of an instant commerce business. However, there have been much larger shifts in consumer habits.

Firstly, the number of global internet users has skyrocketed (from below 500 million to beyond 4 billion), and mobile internet has taken over. Secondly, demand for online grocery delivery has grown significantly due to the COVID-19 pandemic, as consumers have preferred to make retail purchases from home for safety reasons. Thirdly, consumers are now accustomed to paying fees for delivery services, typically around $2 per order, which Kozmo notoriously did not do.

While many online grocery business models exist, the instant grocery, quick-commerce approach has been the favorite of European entrepreneurs and VCs over the past 18 months. The model itself, also referred to as q-commerce, is not that hard to understand.

Companies maintain a small product offering of around 1,000–2,000 SKUs that consumers would otherwise find in convenience or drug stores. These products are purchased directly from brands or through distributors and are stored in self-operated microwarehouses close to customers’ locations.

Marketing tactics are aggressive, often employing vouchers for first-time users of up to $12 (50% of an average shopping basket), and many startups offer their products at supermarket price or even at a discount of 10%–15%. Delivery usually happens by bicycle, e-bike or scooter, within 10-30 minutes of an order being placed, for a fee of around $2 with no minimum order value.

Companies like Getir from Istanbul (total funding: $1 billion, last valuation: $7.5 billion) and Gorillas from Berlin (total funding: $335 million, last valuation: $1 billion) are leading the way. When Gorillas announced its $290 million Series B in March 2021, it became the fastest European startup to achieve unicorn status (nine months after launch). The company is already rumored to be seeking Series C financing at a $2.5 billion valuation.

There are more than 10 companies across Europe with more or less the same business model. Those include the 2020-established Flink (Germany-based, $300 million raised), Zapp (U.K.-based, $100 million raised), Dija (U.K.-based, $20 million raised and just acquired by Gopuff), Jiffy (U.K.-based, $7 million raised) and Cajoo (France-based, $6 million raised).

There is also JOKR, which was started by the founder of Foodpanda. JOKR was only established in Q1 2021, but right after incorporation raised one of the largest ever initial seed rounds (rumored to be $100 million) and subsequently a $170 million Series A in July to bring the model to Europe, Latin America and the U.S.

Likewise, companies coming from food delivery have pushed further into this space and received additional funding in recent months, notably Delivery Hero through Dmart and Glovo through SuperGlovo, following role models in the U.S., such as DoorDash.

Does instant grocery stand a chance of becoming profitable?

As these companies approach later-stage financing sometime in the future, questions will be asked about the path to profitability in an industry of notoriously thin margins. Indeed, this is an uncomfortable truth that hasn’t changed since the early days of Kozmo.com.

The available figures show that old patterns are repeating. Gopuff recently reported an EBITDA of negative $150 million on $340 million in revenue (EBITDA margin: -45%). Furthermore, an analysis by the German business monthly Manager Magazine concluded that Gorillas was operating at negative unit economics of -6%. Additional costs, such as overhead and technology, might push this number up significantly further.

#alibaba, #amazon, #asia, #carrefour, #china, #column, #covid-19, #delivery-hero, #e-commerce, #ec-china, #ec-ecommerce-and-d2c, #ec-europe, #ecommerce, #europe, #food-delivery, #gopuff, #meituan, #ocado, #online-food-ordering, #online-grocery, #pinduoduo, #tc

This Week in Apps: OnlyFans bans sexual content, SharePlay delayed, TikTok questioned over biometric data collection

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Top Stories

OnlyFans to ban sexually explicit content

OnlyFans logo displayed on a phone screen and a website

(Photo Illustration by Jakub Porzycki/NurPhoto via Getty Images)

Creator platform OnlyFans is getting out of the porn business. The company announced this week it will begin to prohibit any “sexually explicit” content starting on October 1, 2021 — a decision it claimed would ensure the long-term sustainability of the platform. The news angered a number of impacted creators who weren’t notified ahead of time and who’ve come to rely on OnlyFans as their main source of income.

However, word is that OnlyFans was struggling to find outside investors, despite its sizable user base, due to the adult content it hosts. Some VC firms are prohibited from investing in adult content businesses, while others may be concerned over other matters — like how NSFW content could have limited interest from advertisers and brand partners. They may have also worried about OnlyFans’ ability to successfully restrict minors from using the app, in light of what appears to be soon-to-come increased regulations for online businesses. Plus, porn companies face a number of other issues, too. They have to continually ensure they’re not hosting illegal content like child sex abuse material, revenge porn or content from sex trafficking victims — the latter which has led to lawsuits at other large porn companies.

The news followed a big marketing push for OnlyFans’ porn-free (SFW) app, OFTV, which circulated alongside reports that the company was looking to raise funds at a $1 billion+ valuation. OnlyFans may not have technically needed the funding to operate its current business — it handled more than $2 billion in sales in 2020 and keeps 20%. Rather, the company may have seen there’s more opportunity to cater to the “SFW” creator community, now that it has big names like Bella Thorne, Cardi B, Tyga, Tyler Posey, Blac Chyna, Bhad Bhabie and others on board.

U.S. lawmakers demand info on TikTok’s plans for biometric data collection

The TikTok logo is seen on an iPhone 11 Pro max

The TikTok logo is seen on an iPhone 11 Pro max. Image Credits: Nur Photo/Getty Images

U.S. lawmakers are challenging TikTok on its plans to collect biometric data from its users. TechCrunch first reported on TikTok’s updated privacy policy in June, where the company gave itself permission to collect biometric data in the U.S., including users’ “faceprints and voiceprints.” When reached for comment, TikTok could not confirm what product developments necessitated the addition of biometric data to its list of disclosures about the information it automatically collects from users, but said it would ask for consent in the case such data collection practices began.

Earlier this month, Senators Amy Klobuchar (D-MN) and John Thune (R-SD) sent a letter to TikTok CEO Shou Zi Chew, which said they were “alarmed” by the change, and demanded to know what information TikTok will be collecting and what it plans to do with the data. This wouldn’t be the first time TikTok got in trouble for excessive data collection. Earlier this year, the company paid out $92 million to settle a class-action lawsuit that claimed TikTok had unlawfully collected users’ biometric data and shared it with third parties.

Weekly News

Platforms: Apple

Image Credits: Apple

  • ⭐ Apple told developers that some of the features it announced as coming in iOS 15 won’t be available at launch. This includes one of the highlights of the new OS, SharePlay, a feature that lets people share music, videos and their screen over FaceTime calls. Other features that will come in later releases include Wallet’s support for ID cards, the App Privacy report and others that have yet to make it to beta releases.
  • Apple walked back its controversial Safari changes with the iOS 15 beta 6 update. Apple’s original redesign had shown the address bar at the bottom of the screen, floating atop the page’s content. Now the tab bar will appear below the page’s content, offering access to its usual set of buttons as when it was at the top. Users can also turn off the bottom tab bar now and revert to the old, Single Tab option that puts the address bar back at the top as before.
  • In response to criticism over its new CSAM detection technology, Apple said the version of NeuralHash that was reverse-engineered by a developer, Asuhariet Ygvar, was a generic version, and not the complete version that will roll out later this year.
  • The Verge dug through over 800 documents from the Apple-Epic trial to find the best emails, which included dirt on a number of other companies like Netflix, Hulu, Sony, Google, Nintendo, Valve, Microsoft, Amazon and more. These offered details on things like Netflix’s secret arrangement to pay only 15% of revenue, how Microsoft also quietly offers a way for some companies to bypass its full cut, how Apple initially saw the Amazon Appstore as a threat and more.

Platforms: Google

  • A beta version of the Android Accessibility Suite app (12.0.0) which rolled out with the fourth Android beta release added something called “Camera Switches” to Switch Access, a toolset that lets you interact with your device without using the touchscreen. Camera Switches allows users to navigate their phone and use its features by making face gestures, like a smile, open mouth, raised eyebrows and more.
  • Google announced its Pixel 5a with 5G, the latest A-series Pixel phone, will arrive on August 27, offering IP67 water resistance, long-lasting Adaptive Battery, Pixel’s dual-camera system and more, for $449. The phone makes Google’s default Android experience available at a lower price point than the soon to arrive Pixel 6.
  • An unredacted complaint from the Apple-Epic trial revealed that Google had quietly paid developers hundreds of millions of dollars via a program known as “Project Hug,” (later “Apps and Games Velocity Program”) to keep their games on the Play Store. Epic alleges Google launched the program to keep developers from following its lead by moving their games outside the store.

Augmented Reality

  • Snap on Thursday announced it hired its first VP of Platform Partnerships to lead AR, Konstantinos Papamiltiadis (“KP”). The new exec will lead Snap’s efforts to onboard partners, including individual AR creators building via Lens Studio as well as large companies that incorporate Snapchat’s camera and AR technology (Camera Kit) into their apps. KP will join in September, and report to Ben Schwerin, SVP of Content and Partnerships.

Fintech

  • Crypto exchange Coinbase will enter the Japanese market through a new partnership with Japanese financial giant Mitsubishi UFJ Financial Group (MUFG). The company said it plans to launch other localized versions of its existing global services in the future.

Social

Image Credits: Facebook

  • Facebook launched a “test” of Facebook Reels in the U.S. on iOS and Android. The new feature brings the Reels experience to Facebook, allowing users to create and share short-form video content directly within the News Feed or within Facebook Groups. Instagram Reels creators can also now opt in to have their Reels featured on users’ News Feed. The company is heavily investing its its battle with TikTok, even pledging that some portion of its $1 billion creator fund will go toward Facebook Reels.
  • Twitter’s redesign of its website and app was met with a lot of backlash from users and accessibility experts alike. The company choices add more visual contrast between various elements and may have helped those with low vision. But for others, the contrast is causing strain and headaches. Experts believe accessibility isn’t a one-size fits all situation, and Twitter should have introduced tools that allowed people to adjust their settings to their own needs.
  • The pro-Trump Twitter alternative Gettr’s lack of moderation has allowed users to share child exploitation images, according to research from the Stanford Internet Observatory’s Cyber Policy Center.
  • Pinterest rolled out a new set of more inclusive search filters that allow people to find styles for different types of hair textures — like coily, curly, wavy, straight, as well as shaved or bald and protective styles. 

Photos

  • Photoshop for iPad gained new image correction tools, including the Healing Brush and Magic Wand, and added support for connecting an iPad to external monitors via HDMI or USB-C. The company also launched a Photoshop Beta program on the desktop.

Messaging

  • WhatsApp is being adopted by the Taliban to spread its message across Afghanistan, despite being on Facebook’s list of banned organizations. The company says it’s proactively removing Taliban content — but that may be difficult to do since WhatsApp’s E2E encryption means it can’t read people’s texts. This week, Facebook shut down a Taliban helpline in Kabul, which allowed civilians to report violence and looting, but some critics said this wasn’t actually helping local Afghans, as the group was now in effect governing the region.
  • WhatsApp is also testing a new feature that will show a large preview when sharing links, which some suspect may launch around the time when the app adds the ability to have the same account running on multiple devices.

Streaming & Entertainment

  • Netflix announced it’s adding spatial audio support on iPhone and iPad on iOS 14, joining other streamers like HBO Max, Disney+ and Peacock that have already pledged to support the new technology. The feature will be available to toggle on and off in the Control Center, when it arrives.
  • Blockchain-powered streaming music service Audius partnered with TikTok to allow artists to upload their songs using TikTok’s new SoundKit in just one click.
  • YouTube’s mobile app added new functionality that allows users to browse a video’s chapters, and jump into the chapter they want directly from the search page.
  • Spotify’s Anchor app now allows users in global markets to record “Music + Talk” podcasts, where users can combine spoken word recordings with any track from Spotify’s library of 70 million songs for a radio DJ-like experience.
  • Podcasters are complaining that Apple’s revamped Podcasts platform is not working well, reports The Verge. Podcasts Connect has been buggy, and sports a confusing interface that has led to serious user errors (like entire shows being archived). And listeners have complained about syncing problems and podcasts they already heard flooding their libraries.

Dating

  • Tinder announced a new feature that will allow users to voluntarily verify their identity on the platform, which will allow the company to cross-reference sex offender registry data. Previously, Tinder would only check this database when a user signed up for a paid subscription with a credit card.

Gaming

Image Source: The Pokémon Company

  • Pokémon Unite will come to iOS and Android on September 22, The Pokémon Company announced during a livestream this week. The strategic battle game first launched on Nintendo Switch in late July.
  • Developer Konami announced a new game, Castlevania: Grimoire of Souls, which will come exclusively to Apple Arcade. The game is described as a “full-fledged side-scrolling action game,” featuring a roster of iconic characters from the classic game series. The company last year released another version of Castelvania on the App Store and Google Play.
  • Dragon Ball Z: Dokkan Battle has now surpassed $3 billion in player spending since its 2015 debut, reported Sensor Tower. The game from Bandai Namco took 20 months to reach the figure after hitting the $2 billion milestone in 2019. The new landmark sees the game joining other top-grossers, including Clash Royale, Lineage M and others.
  • Sensor Tower’s mobile gaming advertising report revealed data on top ad networks in the mobile gaming market, and their market share. It also found puzzle games were among the top advertisers on gaming-focused networks like Chartboost, Unity, IronSource and Vungle. On less game-focused networks, mid-core games were top titles, like Call of Duty: Mobile and Top War. 

Image Credits: Sensor Tower

Health & Fitness

  • Apple is reportedly scaling back HealthHabit, an internal app for Apple employees that allowed them to track fitness goals, talk to clinicians and coaches at AC Wellness (a doctors’ group Apple works with) and manage hypertension. According to Insider, 50 employees had been tasked to work on the project.
  • Samsung launched a new product for Galaxy smartphones in partnership with healthcare nonprofit The Commons Project, that allows U.S. users to save a verifiable copy of their vaccination card in the Samsung Pay digital wallet.

Image Credits: Samsung

Adtech

Government & Policy

  • China cited 43 apps, including Tencent’s WeChat and an e-reader from Alibaba, for illegally transferring user data. The regulator said the apps had transferred users location data and contact list and harassed them with pop-up windows. The apps have until August 25 to make changes before being punished.

Security & Privacy

  • A VICE report reveals a fascinating story about a jailbreaking community member who had served as a double agent by spying for Apple’s security team. Andrey Shumeyko, whose online handles included JVHResearch and YRH04E, would advertise leaked apps, manuals and stolen devices on Twitter and Discord. He would then tell Apple things like which Apple employees were leaking confidential info, which reporters would talk to leakers, who sold stolen iPhone prototypes and more. Shumeyko decided to share his story because he felt Apple took advantage of him and didn’t compensate him for the work.

Funding and M&A

? South Korea’s GS Retail Co. Ltd will buy Delivery Hero’s food delivery app Yogiyo in a deal valued at 800 billion won ($685 million USD). Yogiyo is the second-largest food delivery app in South Korea, with a 25% market share.

? Gaming platform Roblox acquired a Discord rival, Guilded, which allows users to have text and voice conversations, organize communities around events and calendars and more. Deal terms were not disclosed. Guilded raised $10.2 million in venture funding. Roblox’s stock fell by 7% after the company reported earnings this week, after failing to meet Wall Street expectations.

? Travel app Hopper raised $175 million in a Series G round of funding led by GPI Capital, valuing the business at over $3.5 billion. The company raised a similar amount just last year, but is now benefiting from renewed growth in travel following COVID-19 vaccinations and lifting restrictions.

? Indian quiz app maker Zupee raised $30 million in a Series B round of funding led by Silicon Valley-based WestCap Group and Tomales Bay Capital. The round values the company at $500 million, up 5x from last year.

? Danggeun Market, the publisher of South Korea’s hyperlocal community app Karrot, raised $162 million in a Series D round of funding led by DST Global. The round values the business at $2.7 billion and will be used to help the company launch its own payments platform, Karrot Pay.

? Bangalore-based fintech app Smallcase raised $40 million in Series C funding round led by Faering Capital and Premji Invest, with participation from existing investors, as well as Amazon. The Robinhood-like app has over 3 million users who are transacting about $2.5 billion per year.

? Social listening app Earbuds raised $3 million in Series A funding led by Ecliptic Capital. Founded by NFL star Jason Fox, the app lets anyone share their favorite playlists, livestream music like a DJ or comment on others’ music picks.

? U.S. neobank app One raised $40 million in Series B funding led by Progressive Investment Company (the insurance giant’s investment arm), bringing its total raise to date to $66 million. The app offers all-in-one banking services and budgeting tools aimed at middle-income households who manage their finances on a weekly basis.

Public Markets

?Indian travel booking app ixigo is looking to raise Rs 1,600 crore in its initial public offering, The Economic Times reported this week.

?Trading app Robinhood disappointed in its first quarterly earnings as a publicly traded company, when it posted a net loss of $502 million, or $2.16 per share, larger than Wall Street forecasts. This overshadowed its beat on revenue ($565 million versus $521.8 million expected) and its more than doubling of MAUs to 21.3 million in Q2.  Also of note, the company said dogecoin made up 62% of its crypto revenue in Q2.

Downloads

Polycam (update)

Image Credits: Polycam

3D scanning software maker Polycam launched a new 3D capture tool, Photo Mode, that allows iPhone and iPad users to capture professional-quality 3D models with just an iPhone. While the app’s scanner before had required the use of the lidar sensor built into newer devices like the iPhone 12 Pro and iPad Pro models, the new Photo Mode feature uses just an iPhone’s camera. The resulting 3D assets are ready to use in a variety of applications, including 3D art, gaming, AR/VR and e-commerce. Data export is available in over a dozen file formats, including .obj, .gtlf, .usdz and others. The app is a free download on the App Store, with in-app purchases available.

Jiobit (update)

Jiobit, the tracking dongle acquired by family safety and communication app Life360, this week partnered with emergency response service Noonlight to offer Jiobit Protect, a premium add-on that offers Jiobit users access to an SOS Mode and Alert Button that work with the Jiobit mobile app. SOS Mode can be triggered by a child’s caregiver when they detect — through notifications from the Jiobit app — that a loved one may be in danger. They can then reach Noonlight’s dispatcher who can facilitate a call to 911 and provide the exact location of the person wearing the Jiobit device, as well as share other details, like allergies or special needs, for example.

Tweets

When your app redesign goes wrong…

Image Credits: Twitter.com

Prominent App Store critic Kosta Eleftheriou shut down his FlickType iOS app this week after too many frustrations with App Review. He cited rejections that incorrectly argued that his app required more access than it did — something he had successfully appealed and overturned years ago. Attempted follow-ups with Apple were ignored, he said. 

Image Credits: Twitter.com

Anyone have app ideas?

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China roundup: Alibaba’s sexual assault scandal and more delayed IPOs

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

A sexual assault case at Alibaba has sparked a new round of #MeToo reckoning in China. Industry observers believe this is a watershed moment for the fight against China’s allegedly misogynist tech industry. Meanwhile, social media operators are still undecided on how to deal with the unprecedented public uproar against the powerful internet giant.

In other news, more Chinese tech companies have delayed plans to go public overseas after Didi’s fallout with Chinese regulators over its rushed IPO, including Tencent’s music streaming empire and one of China’s highest-valued autonomous driving startups.

Call for justice

Just past midnight last Sunday, an Alibaba employee posted on the company’s internal forum a detailed account saying her manager and a client had sexually assaulted her on a business trip. She took the case public after failing to obtain support from her superiors and human resources.

The post quickly made its rounds through China’s social media platforms. People stayed up blasting Alibaba’s ignorance, toxic business drinking, and the pervasive objectification of women in the Chinese “tech industry,” which has grown so far-reaching that it’s just the contemporary corporate world.

A day later, on August 9, Alibaba swiftly fired the alleged perpetrator. Two managers resigned and the firm’s head of HR was given a “disciplinary warning.” Alibaba’s CEO Daniel Zhang said he felt “shocked, angry and ashamed” about the incident and called on the company to work with the police to investigate the case.

This is arguably the most high-profile #MeToo case embroiling a major Chinese tech company by far and one that seems to have beckoned the toughest response from the company involved. Alibaba is formulating company policies to prevent sexual assaults, which surprises many that the global tech behemoth didn’t already have those in place.

The case managed to garner widespread public attention in China thanks to social media. Within the first few hours, it seemed as though discussion around the incident was propagating organically and uncensored on microblogging platform Weibo, in which Alibaba owns a majority stake.

But people soon noticed that despite the severity of the event, it took days before the case climbed to the top of Weibo’s trending chart, a bellwether for the most talked about topic on the Chinese internet. The perceived delay recalls Weibo’s censorship of an extramarital affair involving Alibaba executive Jiang Fan last year.

Talang Qingnian, roughly “Surfing Youth,” a social media column under state paper People’s Daily, blasted in an article:

The slow buildup of discussion again raised suspicion over whether Alibaba has manipulated public discourse.

Ever since the Jiang Fan case, the country’s attitude has been very clear that capital must not control the media.

As the basic infrastructure for truthful news in China, Weibo should not be a tool for any stakeholder to manipulate public opinion.

The article fanned up more public outrage but was soon taken down, likely because its wording was too strong. The Chinese state media apparatus is vast and only a few outlets, such as Xinhua, consistently convey top-level leaders’ official opinions. It’s not uncommon to see the less authoritative state-affiliated publications back down on reports that have cause backlashes. Last week, an article from a state-affiliated economic paper removed a piece calling video games “spiritual opium,” a loaded description that had earlier tanked the stocks of Tencent and NetEase, and republished the article with a softer tone.

Smaller war chests

Regulatory uncertainties have always been flagged as a risk by Chinese companies seeking overseas listings, but it was largely up to foreign investors to decide whether they were worthwhile investments. China’s recent regulatory onslaught on its tech darlings, however, has become a real deterrent for Chinese firms’ IPO dream.

This week, reports arrived that NetEase Music, a popular music streaming service, and Pony.ai, an autonomous vehicle startup last valued at $5.3 billion, have respectively postponed their plans to list in Hong Kong and New York.

Beijing has become warier of its data-rich companies getting scrutinized by U.S. regulators. Last month, the U.S. securities regulator said Chinese companies that want to raise capital in the U.S. must provide information about their legal structure and disclose the risk of Beijing’s interference in their business.

Many Chinese tech firms have learned from Didi’s fallout with the government, which had reportedly told the ride-sharing company to hold off on its listing until it sorted out a data protection framework. Didi went ahead regardless, triggering a government probe into its data practice and tanking its shares, which now stand at $8 apiece compared to $16 around its debut in early July.

Beijing’s crackdown has affected every major player in China’s consumer tech sector, wiping as much as $87 billion off the net worth of the country’s tech billionaires, including Pony Ma of Tencent and Colin Huang of Pinduoduo, according to Financial Times. The government wants “hard tech” like semiconductors and clean energy, so it has made it clear to future entrepreneurs where they should allocate their energy. The new generation of startups is listening now.

#alibaba, #alibaba-group, #asia, #beijing, #china, #daniel-zhang, #netease, #sexual-assault, #sina-weibo, #tc, #tencent, #weibo

A close look at Singapore’s thriving startup ecosystem

Singapore is home to fewer than six million people, making it one of the smallest ASEAN countries, in terms of population. It is a young country as well — having gained independence in 1963 — and resides in a neighborhood with far larger economies, including China, Indonesia, and Vietnam. When the country first became independent, its mandate was to simply survive rather than thrive.

So how does a country evolve from a position of relative uncertainty, with comparatively few resources, to one that leads the ASEAN region in venture capital investment and has been home to 10 unicorns?

Countries around the world examine Singapore’s ecosystem from a distance, hoping to learn from, and emulate, its story. The World Bank Group recently published a report, The Evolution and State of Singapore’s Start-up Ecosystem, documenting the country’s experience in building its startup ecosystem and the challenges facing it.

This article presents an overview of the report’s key findings and offers a few key recommendations on what other countries can learn from Singapore’s experience, as well as what Singapore itself can do to maintain progress.

A glimpse into Singapore’s current startup ecosystem

As of 2019, Singapore had over $19 billion in PE and VC assets under management, more than twice that of neighboring Indonesia, Philippines, Vietnam, Malaysia, and Thailand combined. In that same year, the country was home to an estimated 3,600 tech startups and nearly 200 different intermediary and supporting organizations (accelerators, co-working spaces, coding academies, etc.) – some which have a multinational presence, such as Blk71, whose Singapore headquarters has been referred to as “the world’s most tightly packed entrepreneurial ecosystem.”

While assessing the size and strength of startup ecosystems is an evolving method, Start-up Genome priced Singapore’s ecosystem at over $25 billion, five times the global median.

Arguably, the most eye-catching hallmark of this ecosystem is its population of current and former unicorns. Collectively, Singapore has been home to ten unicorns, three of which have offered an IPO (Nanofilm, Razer and Sea) and two of which have been acquired – one by giant Alibaba (Lazada) and one by Chinese streaming powerhouse YY (Bigo Live). The remaining five are Trax, Acronis, JustCo, PatSnap, and Grab – the ASEAN region’s largest unicorn to date.

 

The education sector is also prominent in Singapore’s ecosystem. Universities like the National University of Singapore (NUS) and Nanyang Technological University (NTU) are deeply embedded into this ecosystem, helping with R&D commercialization linkages, incubation, talent/knowledge transfer, and other areas.

So, how did Singapore’s startup ecosystem come to be?

Numerous factors have contributed to building Singapore’s startup ecosystem, with government intervention and leadership being the dominant driving forces. The government has spent more than USD60 billion over the past several decades to enhance the country’s R&D infrastructure, create VC funds, and launch accelerators and other support organizations.

#alibaba, #asia, #china, #column, #coworking, #ec-column, #ec-southeast-asia-oceania, #funding, #government, #indonesia, #malaysia, #philippines, #razer, #singapore, #startup-ecosystem, #startups, #tc, #thailand, #unicorn, #vc, #venture-capital, #venture-capital-investment, #vietnam, #world-bank

Turkey’s first decacorn: Trendyol raises $1.5B at a $16.5B valuation

Trendyol, an e-commerce platform based in Turkey, has raised $1.5 billion in a massive funding round that values the company at $16.5 billion. General Atlantic, SoftBank Vision Fund 2, Princeville Capital and sovereign wealth funds, ADQ (UAE) and Qatar Investment Authority co-led the round. 

The deal marks SoftBank’s first in the country.

The new financing also makes Trendyol Turkey’s first decacorn, and among the highest-valued private tech companies in Europe. It comes just months after strategic — and majority — backer Alibaba invested $350 million in the company at a $9.4 billion valuation.

Founded in 2010, Trendyol ranks as Turkey’s largest e-commerce company, serving more than 30 million shoppers and delivering more than 1 million packages per day. It claims to have evolved from marketplace to “superapp” by combining its marketplace platform (which is powered by Trendyol Express, its own last-mile delivery solution) with instant grocery and food delivery through its own courier network (Trendyol Go), its digital wallet (Trendyol Pay), consumer-to-consumer channel (Dolap) and other services.

Trendyol founder Demet Suzan Mutlu said the new capital will go toward expansion within Turkey and globally. Specifically, the company plans to continue investing in nationwide infrastructure, technology and logistics and toward accelerating digitalization of Turkish SMEs. She said the company was founded to create positive impact and that it intends to continue on that mission.

Evren Ucok, Trendyol’s chairman,  added that part of the company’s goal is to create new export channels for Turkish merchants and manufacturers.

Melis Kahya Akar, managing director and head of consumer for EMEA at General Atlantic, said that Trendyol’s marketplace model — ranging from grocery delivery to mobile wallets — “brings convenience and ease to consumers” in Turkey and internationally.

“Turkey is one of the fastest growing economies in the world and benefits from attractive demographics, with a young population that is very active online,” wrote General Atlantic’s Kahya Akar via e-mail. “We expect its already sizable e-commerce market –$17 billion in 2020 – to continue to grow meaningfully on the back of growing online penetration. We think Trendyol is ideally positioned to meet the needs of consumers in Turkey and around the world as the company expands.”

A 2020 report by JPMorgan found that e-commerce represented only 5.3% of the overall Turkish retail market at the time but that Turkish e-commerce had notched impressive leaps in revenues in recent years: 2018 alone saw the market jump by 42%, followed by 31% in 2019. As of 2020, 67% of the Turkish population were making purchases online.

#alibaba, #apps, #demet-suzan-mutlu, #e-commerce, #ecommerce, #europe, #food-delivery, #funding, #fundings-exits, #general-atlantic, #qatar-investment-authority, #recent-funding, #softbank, #softbank-vision-fund, #startups, #trendyol, #turkey, #venture-capital

This Week in Apps: In-app events hit the App Store, TikTok tries Stories, Apple reveals new child safety plan

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place, with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Top Stories

Apple to scan for CSAM imagery

Apple announced a major initiative to scan devices for CSAM imagery. The company on Thursday announced a new set of features, arriving later this year, that will detect child sexual abuse material (CSAM) in its cloud and report it to law enforcement. Companies like Dropbox, Google and Microsoft already scan for CSAM in their cloud services, but Apple had allowed users to encrypt their data before it reached iCloud. Now, Apple’s new technology, NeuralHash, will run on users’ devices, tatformso detect when a users upload known CSAM imagery — without having to first decrypt the images. It even can detect the imagery if it’s been cropped or edited in an attempt to avoid detection.

Meanwhile, on iPhone and iPad, the company will roll out protections to Messages app users that will filter images and alert children and parents if sexually explicit photos are sent to or from a child’s account. Children will not be shown the images but will instead see a grayed-out image instead. If they try to view the image anyway through the link, they’ll be shown interruptive screens that explain why the material may be harmful and are warned that their parents will be notified.

Some privacy advocates pushed back at the idea of such a system, believing it could expand to end-to-end encrypted photos, lead to false positives, or set the stage for more on-device government surveillance in the future. But many cryptology experts believe the system Apple developed provides a good balance between privacy and utility, and have offered their endorsement of the technology. In addition, Apple said reports are manually reviewed before being sent to the National Center for Missing and Exploited Children (NCMEC).

The changes may also benefit iOS developers who deal in user photos and uploads, as predators will no longer store CSAM imagery on iOS devices in the first place, given the new risk of detection.

In-App Events appear on the App Store

Image Credits: Apple

Though not yet publicly available to all users, those testing the new iOS 15 mobile operating system got their first glimpse of a new App Store discovery feature this week: “in-app events.” First announced at this year’s WWDC, the feature will allow developers and Apple editors alike to showcase directly on the App Store upcoming events taking place inside apps.

The events can appear on the App Store homepage, on the app’s product pages or can be discovered through personalized recommendations and search. In some cases, editors will curate events to feature on the App Store. But developers will also be provided tools to submit their own in-app events. TikTok’s “Summer Camp” for creators was one of the first in-app events to be featured, where it received a top spot on the iPadOS 15 App Store.

Weekly News

Platforms: Apple

Apple expands support for student IDs on iPhone and Apple Watch ahead of the fall semester. Tens of thousands more U.S. and Canadian colleges will now support mobile student IDs in the Apple Wallet app, including Auburn University, Northern Arizona University, University of Maine, New Mexico State University and others.

Apple was accused of promoting scam apps in the App Store’s featured section. The company’s failure to properly police its store is one thing, but to curate an editorial list that actually includes the scams is quite another. One of the games rounded up under “Slime Relaxations,” an already iffy category to say the least, was a subscription-based slime simulator that locked users into a $13 AUD per week subscription for its slime simulator. One of the apps on the curated list didn’t even function, implying that Apple’s editors hadn’t even tested the apps they recommend.

Tax changes hit the App Store. Apple announced tax and price changes for apps and IAPs in South Africa, the U.K. and all territories using the Euro currency, all of which will see decreases. Increases will occur in Georgia and Tajikistan, due to new tax changes. Proceeds on the App Store in Italy will be increased to reflect a change to the Digital Services Tax effective rate.

Game Center changes, too. Apple said that on August 4, a new certificate for server-based Game Center verification will be available via the publicKeyUrl.

Fintech

Robinhood stock jumped more than 24% to $46.80 on Tuesday after initially falling 8% on its first day of trading last week, after which it had continued to trade below its opening price of $38.

Square’s Cash app nearly doubled its gross profit to $546 million in Q2, but also reported a $45 million impairment loss on its bitcoin holdings.

Coinbase’s app now lets you buy your cryptocurrency using Apple Pay. The company previously made its Coinbase Card compatible with Apple Pay in June.

Social

An anonymous app called Sendit, which relies on Snap Kit to function, is climbing the charts of the U.S. App Store after Snap suspended similar apps, YOLO and LMK. Snap was sued by the parent of child who was bullied through those apps, which led to his suicide. Sendit also allows for anonymity, and reviews compare it to YOLO. But some reviews also complained about bullying. This isn’t the first time Snap has been involved in a lawsuit related to a young person’s death related to its app. The company was also sued for its irresponsible “speed filter” that critics said encouraged unsafe driving. Three young men died using the filter, which captured them doing 123 mph.

TikTok is testing Stories. As Twitter’s own Stories integrations, Fleets, shuts down, TikTok confirmed it’s testing its own Stories product. The TikTok Stories appear in a left-hand sidebar and allow users to post ephemeral images or video that disappear in 24 hours. Users can also comment on Stories, which are public to their mutual friends and the creator. Stories on TikTok may make more sense than they did on Twitter, as TikTok is already known as a creative platform and it gives the app a more familiar place to integrate its effects toolset and, eventually, advertisements.

Facebook has again re-arranged its privacy settings. The company continually moves around where its privacy features are located, ostensibly to make them easier to find. But users then have to re-learn where to go to find the tools they need, after they had finally memorized the location. This time, the settings have been grouped into six top-level categories, but “privacy” settings have been unbundled from one location to be scattered among the other categories.

A VICE report details ban-as-a-service operations that allow anyone to harass or censor online creators on Instagram. Assuming you can find it, one operation charged $60 per ban, the listing says.

TikTok merged personal accounts with creator accounts. The change means now all non-business accounts on TikTok will have access to the creator tools under Settings, including Analytics, Creator Portal, Promote and Q&A. TikTok shared the news directly with subscribers of its TikTok Creators newsletter in August, and all users will get a push notification alerting them to the change, the company told us.

Discord now lets users customize their profile on its apps. The company added new features to its iOS and Android apps that let you add a description, links and emojis and select a profile color. Paid subscribers can also choose an image or GIF as their banner.

Twitter Spaces added a co-hosting option that allows up to two co-hosts to be added to the live audio chat rooms. Now Spaces can have one main host, two co-hosts and up to 10 speakers. Co-hosts have all the moderation abilities as hosts, but can’t add or remove others as co-hosts.

Messaging

Tencent reopened new user sign-ups for its WeChat messaging app, after having suspended registrations last week for unspecified “technical upgrades.” The company, like many other Chinese tech giants, had to address new regulations from Beijing impacting the tech industry. New rules address how companies handle user data collection and storage, antitrust behavior and other checks on capitalist “excess.” The gaming industry is now worried it’s next to be impacted, with regulations that would restrict gaming for minors to fight addiction.

WhatsApp is adding a new feature that will allow users to send photos and videos that disappear after a single viewing. The Snapchat-inspired feature, however, doesn’t alert you if the other person takes a screenshot — as Snap’s app does. So it may not be ideal for sharing your most sensitive content.

Telegram’s update expands group video calls to support up to 1,000 viewers. It also announced video messages can be recorded in higher quality and can be expanded, regular videos can be watched at 0.5 or 2x speed, screen sharing with sound is available for all video calls, including 1-on-1 calls, and more.

Streaming & Entertainment

American Airlines added free access to TikTok aboard its Viasat-equipped aircraft. Passengers will be able to watch the app’s videos for up to 30 minutes for free and can even download the app if it’s not already installed. After the free time, they can opt to pay for Wi-Fi to keep watching. Considering how easy it is to fall into multi-hour TikTok viewing sessions without knowing it, the addition of the addictive app could make long plane rides feel shorter. Or at least less painful.

Chinese TikTok rival Kuaishou saw stocks fall by more than 15% in Hong Kong, the most since its February IPO. The company is another victim of an ongoing market selloff triggered by increasing investor uncertainty related to China’s recent crackdown on tech companies. Beijing’s campaign to rein in tech has also impacted Tencent, Alibaba, Jack Ma’s Ant Group, food delivery company Meituan and ride-hailing company Didi. Also related, Kuaishou shut down its controversial app Zynn, which had been paying users to watch its short-form videos, including those stolen from other apps.

Twitch overtook YouTube in consumer spending per user in April 2021, and now sees $6.20 per download as of June compared with YouTube’s $5.60, Sensor Tower found.

Image Credits: Sensor Tower

Spotify confirmed tests of a new ad-supported tier called Spotify Plus, which is only $0.99 per month and offers unlimited skips (like free users get on the desktop) and the ability to play the songs you want, instead of only being forced to use shuffle mode.

The company also noted in a forum posting that it’s no longer working on AirPlay2 support, due to “audio driver compatibility” issues.

Mark Cuban-backed audio app Fireside asked its users to invest in the company via an email sent to creators which didn’t share deal terms. The app has yet to launch.

YouTube kicks off its $100 million Shorts Fund aimed at taking on TikTok by providing creators with cash incentives for top videos. Creators will get bonuses of $100 to $10,000 based on their videos’ performance.

Dating

Match Group announced during its Q2 earnings it plans to add to several of the company’s brands over the next 12 to 24 months audio and video chat, including group live video, and other livestreaming technologies. The developments will be powered by innovations from Hyperconnect, the social networking company that this year became Match’s biggest acquisition to date when it bought the Korean app maker for a sizable $1.73 billion. Since then, Match was spotted testing group live video on Tinder, but says that particular product is not launching in the near-term. At least two brands will see Hyperconnect-powered integrations in 2021.

Photos

The Photo & Video category on U.S. app stores saw strong growth in the first half of the year, a Sensor Tower report found. Consumer spend among the top 100 apps grew 34% YoY to $457 million in Q2 2021, with the majority of the revenue (83%) taking place on iOS.

Image Credits: Sensor Tower

Gaming

Epic Games revealed the host of its in-app Rift Tour event is Ariana Grande, in the event that runs August 6-8.

Pokémon GO influencers threatened to boycott the game after Niantic removed the COVID safety measures that had allowed people to more easily play while social distancing. Niantic’s move seemed ill-timed, given the Delta variant is causing a new wave of COVID cases globally.

Health & Fitness

Apple kicked out an app called Unjected from the App Store. The new social app billed itself as a community for the unvaccinated, allowing like-minded users to connect for dating and friendships. Apple said the app violated its policies for COVID-19 content.

Google Pay expanded support for vaccine cards. In Australia, Google’s payments app now allows users to add their COVID-19 digital certification to their device for easy access. The option is available through Google’s newly updated Passes API which lets government agencies distribute digital versions of vaccine cards.

COVID Tech Connect, a U.S. nonprofit initially dedicated to collecting devices like phones and tablets for COVID ICU patients, has now launched its own app. The app, TeleHome, is a device-agnostic, HIPAA-compliant way for patients to place a video call for free at a time when the Delta variant is again filling ICU wards, this time with the unvaccinated — a condition that sometimes overlaps with being low-income. Some among the working poor have been hesitant to get the shot because they can’t miss a day of work, and are worried about side effects. Which is why the Biden administration offered a tax credit to SMBs who offered paid time off to staff to get vaccinated and recover.

Popular journaling app Day One, which was recently acquired by WordPress.com owner Automattic, rolled out a new “Concealed Journals” feature that lets users hide content from others’ viewing. By tapping the eye icon, the content can be easily concealed on a journal by journal basis, which can be useful for those who write to their journal in public, like coffee shops or public transportation.

Edtech

Recently IPO’d language learning app Duolingo is developing a math app for kids. The company says it’s still “very early” in the development process, but will announce more details at its annual conference, Duocon, later this month.

Educational publisher Pearson launched an app that offers U.S. students access to its 1,500 titles for a monthly subscription of $14.99. the Pearson+ mobile app (ack, another +), also offers the option of paying $9.99 per month for access to a single textbook for a minimum of four months.

News & Reading

Quora jumps into the subscription economy. Still not profitable from ads alone, Quora announced two new products that allow its expert creators to monetize their content on its service. With Quora+ ($5/mo or $50/yr), subscribers can pay for any content that a creator paywalls. Creators can choose to enable a adaptive paywall that will use an algorithm to determine when to show the paywall. Another product, Spaces, lets creators write paywalled publications on Quora, similar to Substack. But only a 5% cut goes to Quora, instead of 10% on Substack.

Utilities

Google Maps on iOS added a new live location-sharing feature for iMessage users, allowing them to more easily show your ETA with friends and even how much battery life you have left. The feature competes with iMessage’s built-in location-sharing feature, and offers location sharing of 1 hour up to 3 days. The app also gained a dark mode.

Security & Privacy

Controversial crime app Citizen launched a $20 per month “Protect” service that includes live agent support (who can refer calls to 911 if need be). The agents can gather your precise location, alert your designated emergency contacts, help you navigate to a safe location and monitor the situation until you feel safe. The system of live agent support is similar to in-car or in-home security and safety systems, like those from ADT or OnStar, but works with users out in the real world. The controversial part, however, is the company behind the product: Citizen has been making headlines for launching private security fleets outside law enforcement, and recently offered a reward in a manhunt for an innocent person based on unsubstantiated tips.

Funding and M&A

? Square announced its acquisition of the “buy now, pay later” giant AfterPay in a $29 billion deal that values the Australian firm at more than 30% higher than the stock’s last closing price of AUS$96.66. AfterPay has served over 16 million customers and nearly 100,000 merchants globally, to date, and comes at a time when the BNPL space is heating up. Apple has also gotten into the market recently with an Affirm partnership in Canada.

? Gaming giant Zynga acquired Chinese game developer StarLark, the team behind the mobile golf game Golf Rival, from Betta Games for $525 million in both cash and stock. Golf Rival is the second-largest mobile golf game behind Playdemic’s Golf Clash, and EA is in the process of buying that studio for $1.4 billion.

?  U.K.-based Humanity raised an additional $2.5 million for its app that claims to help slow down aging, bringing the total raise to date to $5 million. Backers include Calm’s co-founders, MyFitness Pal’s co-founder and others in the health space. The app works by benchmarking health advice against real-world data, to help users put better health practices into action.

? YELA, a Cameo-like app for the Middle East and South Asia, raised $2 million led by U.S. investors that include Tinder co-founder Justin Mateen and Sean Rad, general partner of RAD Fund. The app is focusing on signing celebrities in the regions it serves, where smartphone penetration is high and over 6% of the population is under 35.

? London-based health and wellness app maker Palta raised a $100 million Series B led by VNV Global. The company’s products include Flo.Health, Simple Fasting, Zing Fitness Coach and others, which reach a combined 2.4 million active, paid subscribers. The funds will be used to create more mobile subscription products.

? Emoji database and Wikipedia-like site Emojipedia was acquired by Zedge, the makers of a phone personalization app offering wallpapers, ringtones and more to 35 million MAUs. Deal terms weren’t disclosed. Emojipedia says the deal provides it with more stability and the opportunity for future growth. For Zedge, the deal provides?….um, a popular web resource it thinks it can better monetize, we suspect.

? Mental health app Revery raised $2 million led by Sequoia Capital India’s Surge program for its app that combines cognitive behavioral therapy for insomnia with mobile gaming concepts. The company will focus on other mental health issues in the future.

? London-based Nigerian-operating fintech startup Kuda raised a $55 million Series B, valuing its mobile-first challenger bank at $500 million. The inside round was co-led by Valar Ventures and Target Global.

? Vietnamese payments provider VNLife raised $250 million in a round led by U.S.-based General Atlantic and Dragoneer Investment Group. PayPal Ventures and others also participated. The round values the business at over $1 billion.

Downloads

Mastodon for iPhone

Fans of decentralized social media efforts now have a new app. The nonprofit behind the open source decentralized social network Mastodon released an official iPhone app, aimed at making the network more accessible to newcomers. The app allows you to find and follow people and topics; post text, images, GIFs, polls, and videos; and get notified of new replies and reblogs, much like Twitter.

Xingtu

@_666eveITS SO COOL FRFR do u guys want a tutorial? #fypシ #醒图 #醒图app♬ original sound – Ian Asher

TikTok users are teaching each other how to switch over to the Chinese App Store in order to get ahold of the Xingtu app for iOS. (An Android version is also available.) The app offers advanced editing tools that let users edit their face and body, like FaceTune, apply makeup, add filters and more. While image-editing apps can be controversial for how they can impact body acceptance, Xingtu offers a variety of artistic filters which is what’s primarily driving the demand. It’s interesting to see the lengths people will go to just to get a few new filters for their photos — perhaps making a case for Instagram to finally update its Post filters instead of pretending no one cares about their static photos anymore.

Tweets

Facebook still dominating top charts, but not the No. 1 spot:  

Not cool, Apple: 

This user acquisition strategy: 

Maybe Stories don’t work everywhere: 

#adt, #afterpay, #alibaba, #android, #ant-group, #api, #app-maker, #app-store, #apple, #apps, #australia, #automattic, #beijing, #biden-administration, #canada, #china, #cloud-services, #coinbase, #coinbase-card, #computing, #day-one, #dragoneer-investment-group, #driver, #dropbox, #duolingo, #emojipedia, #eta, #facebook, #fintech-startup, #food-delivery, #game-center, #game-developer, #general-atlantic, #general-partner, #georgia, #gif, #google, #hyperconnect, #instagram, #ios, #ios-devices, #ipad, #iphone, #italy, #itunes, #jam-fund, #justin-mateen, #kuaishou, #kuda, #law-enforcement, #london, #ma, #maine, #meituan, #microsoft, #middle-east, #mobile, #mobile-app, #mobile-applications, #mobile-devices, #online-creators, #onstar, #operating-system, #palta, #playdemic, #quora, #sean-rad, #sensor-tower, #sequoia-capital, #smartphone, #snap, #snapchat, #social-network, #social-networking, #software, #south-africa, #south-asia, #spotify, #stories, #target-global, #tc, #this-week-in-apps, #tiktok, #twitch, #united-kingdom, #united-states, #valar-ventures, #viasat, #vnv-global, #wi-fi, #wordpress-com, #zedge, #zynga

China roundup: Games are opium, algorithms need scrutiny

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

The question for the tech news cycle in China these days has become: Who is Beijing’s next target? Regulatory clampdowns are common in China’s tech industry but the breadth of the recent moves has been unprecedented. No major tech giant is exempted and everyone is being attacked from a slightly different angle, but Beijing’s message is clear: Tech businesses are to align themselves with the interests and objectives of Beijing.

Education curbs hit tech giants

The government’s motivation isn’t always ideological. It could lead to policies that rein in the unruly private tutoring sector in the hope of easing pressure on students and parents. Recent orders from Beijing have strictly limited after-school tutoring, though they also sparked a wave of sympathy for public school teachers who work at lucrative tutoring centers to compensate for their meager salaries.

The effects of the education crackdown are also trickling down to internet companies. For the past few years, ByteDance had been aggressively building an online education business through a hiring and acquisition spree in part to diversify an ad-based video business. Its plan seems to be in shambles as it reportedly plans to lay off staff in its education department following recent the clampdown.

The restraints are also hitting American companies. Duolingo, the language learning app, was removed from several app stores in China. While it’s not immediately clear whether the action was the result of any policy change, the government recently, along with its restraints on extra-curriculum, barred foreign curricula in schools from K-9.

Games are opium

It could be tricky to read the top leaders’ minds because their messages could come through various government departments or state-affiliated media outlets, carrying different weights.

This week, Tencent is in the authorities’ crosshairs. About $60 billion of its market cap was wiped after the Economic Information Daily, an economic paper supervised by China’s major state news agency Xinhua, published an article (which was taken down shortly) describing video games as “spiritual opium” and cited the major role Tencent plays in the industry. Shares of Tencent’s smaller rival NetEase were also battered.

This certainly isn’t the first time Tencent and the gaming industry overall were slammed by the government for their impact on underage players. Tencent has been working to appease the authorities by introducing protections for young players, for instance, by tightening age checks several times.

Tencent, which has a sprawling online empire of social networks, payments and music on top of games, has also promised to “do [more social] good” through its products. And following the recent op-ed from the state paper, Tencent further restricted the amount of time and money children can spend inside games. But after all, the company still depends largely on addictive game mechanics that lure players to open loot boxes.

Tencent share prices over the past six months. Image Credits: Google Finance

Fix the algorithms

The other camp of tech companies feeling the heat is those dependent on machine learning algorithms to distribute content. The Propaganda Department of the Chinese Communist Party, the country’s watchdog of public expressions, along with several other government organs, issued an advisory to “strengthen the study and guidance of online algorithms and carry out oversight over algorithmic recommendations.”

The government’s goal is to assert more control over how algorithmic black boxes affect what information people receive. Shares of Kuaishou, TikTok’s archrival in China, tanked on the news. Since its blockbuster initial public offering in February, Kuaishou’s stock price has tumbled as much as 70%. Meanwhile, the Beijing-based short video firm is shuttering one of its overseas apps called Zynn, which has caused controversy over plagiarism. But its overseas user base is also rapidly growing, crystalizing in one billion monthly users worldwide recently.

End of “two-choose-one”

The week hasn’t ended. On Friday morning, The Wall Street Journal reported that the country’s antitrust regulator is preparing to fine Meituan, China’s major food delivery platform, $1 billion for allegedly abusing its market dominance. In 2020, Meituan earned 114.8 billion yuan or $17.7 billion in revenue.

Until recently, forcing suppliers to pick sides had been a common practice in China’s e-commerce world. Alibaba did so by forbidding sellers to list on rivaling platforms, a practice that resulted in a $2.75 billion antitrust penalty in April. We will see where the government will act next as it continues to curb the power of its tech darlings.

#alibaba, #asia, #beijing, #china, #china-roundup, #chinese-communist-party, #department-of-education, #duolingo, #gaming, #government, #kuaishou, #netease, #online-education, #tc, #tencent

China Roundup: What’s going on with China’s data security clampdown?

Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

A tectonic shift is underway in how Beijing regulates and accesses the troves of citizen data collected by its tech giants. More details of China’s new cybersecurity rules have recently come to light as Didi, the SoftBank-backed ride-sharing dominator in China, became the target of the Chinese government’s latest effort to heighten data protection. This week, we look at what this changing landscape means to Chinese tech firms wooing investors in the United States.

Data sovereignty

The new wave of discussion around China’s cybersecurity rules started with the bombshell dropped on Didi. Just two days after its $4 billion IPO in New York, the ride-hailing giant was hit with a probe by China’s Cybersecurity Review Office on July 2. Two days later, the same government agency ordered the Didi app, which has amassed nearly 500 million annual users, to be yanked because it was “illegally collecting user data.”

The Cybersecurity Review Office is an agency within the Cyberspace Administration of China, the country’s top internet regulator. It has existed for a few years but its roles were only made clear in April 2020 when China put forward its rules on internet security reviews.

Didi appears to be the first target of the department’s enforcement actions. A memo of an “expert meeting” shared among Didi’s investors, which TechCrunch reviewed, said the ride-hailing firm had failed to assure Beijing its data practices were secure before going public in New York. A major concern was that Didi’s data, if unguarded by Chinese laws, could be subject to scrutiny by U.S. regulators. But a Didi executive claimed that the firm stored all its China data locally and it is “absolutely not possible” that it passed data to the U.S.

Before long, the Cybersecurity Review Office was onto other players that could similarly compromise the data security of Chinese users. On July 5, it put SoftBank-backed truck-sharing platform Full Truck Alliance and recruiting site Boss Zhipin — both of which recently IPO’ed in the U.S. — under the same review process as it did with Didi.

The probes were just the beginning. On July 10, the Cybersecurity Review Office unveiled the draft of a revised version of the data security review rules passed last year. One of the major changes is that any business commanding over one million users is subject to security checks if it is seeking an overseas IPO.

Just as the U.S. government frets over Chinese companies commanding Americans’ data, as in the case of TikTok, China is now making sure that its citizen data stays onshore and protected from U.S. authorities. Foreign players operating in China have to comply, too. Giants like Apple and Tesla have pledged and moved to store their Chinese user data within the country.

The new data rule is no doubt a stumbling block for Chinese companies that want to list abroad. TikTok owner ByteDance indefinitely put on hold its plans of a U.S. listing after Chinese officials told it to address data security risks, according to a report by The Wall Street Journal. But how about incumbents like Alibaba that have traded their stocks on Wall Street for years? And do the revised rules apply to companies listing in Hong Kong, which is being increasingly integrated with mainland China?

Also in the news

  • Tencent and Alibaba may tear down their “walled gardens.” According to The Wall Street Journal, the archrivals are considering opening their services to each other. This means users may be able to pay via Alipay on the WeChat app, which currently excludes Alibaba-affiliated Alipay. China has recently been working to rein in its tech darlings and already slapped anticompetition penalties on a cohort of tech firms. Jack Ma’s fintech behemoth Ant Group has been put on the spot and forced to restructure into a financial holding company that would potentially curb its profitability and subject it to more regulatory oversight.
  • TikTok tops 3 billion downloads from the App Store and Google Play, according to Sensor Tower. This makes the hit video platform the only app not owned by Facebook to cross the milestone across the two app stores, said the research firm, and it’s only the fifth one after WhatsApp, Messenger, Facebook and Instagram to achieve that. TikTok is also generating big bucks for ByteDance. Globally, it has made more than $2.5 billion in consumer spending since its launch.
  • Tencent ups its stake in food delivery giant Meituan to 17.2%The deal cost Tencent, a longtime patron of Meituan, $400 million. The proceeds will allow Meituan to invest further in “cutting edge tech” such as unmanned delivery cars and drones, an area where other tech firms have also made similar promises to automate parcel and food deliveries.
  • The smart vehicle craze continues. These days, hardly a week goes by without a major announcement by an autonomous driving or smart car company in China. The news last week came from Banma, which was set up by Alibaba and state-owned carmaker SAIC Motor to make internet-connected cars. It just raised $460 million from Alibaba and SAIC Motor, among others and claimed its technology now serves three million users. It raised its first round in 2018 with 1.6 billion yuan (around $250 million) and was already valued at over $1 billion at the time.

#alibaba, #alibaba-group, #alipay, #ant-group, #asia, #beijing, #bytedance, #china, #didi, #food-delivery, #jack-ma, #meituan, #saic-motor, #smart-car, #tc, #tencent, #the-wall-street-journal, #tiktok