The Roblox final fantasy

Hello friends, and welcome to Week in Review.

Last week, I talked a bit about NFTs and their impact on artists. If you’re inundated with NFT talk just take one quick look at this story I wrote this week about the $69 million sale of Beeple’s photo collage. This hype cycle is probably all the result of crypto folks talking each other up and buying each other’s stuff, but that doesn’t mean there won’t be lasting impacts. That said, I would imagine we’re pretty close to the peak of this wave, with a larger one down the road after things cool off a bit. I’ve been wrong before though…

This week, I’m interested in a quick look at what your kids have been talking about all these years. Yes, Roblox.

If you’re reading this on the TechCrunch site, you can get this in your inbox from the newsletter page, and follow my tweets @lucasmtny.


David Baszucki, founder and CEO of Roblox - Roblox Developer Conference 2019

(Photo by Ian Tuttle/Getty Images for Roblox)

The big thing

Roblox went public on the New York Stock Exchange this week, scoring a $38 billion market cap after its first couple days of trading.

Investors rallied around the idea that Roblox is one of the most valuable gaming companies in existence. More than Unity, Zynga, Take-Two, even gaming giant Electronic Arts. It’s still got a ways to go to take down Microsoft, Sony or Apple though… The now-public company is so freaking huge because investors believe the company has tapped into something that none of the others have, a true interconnected creative marketplace where gamers can evolve alongside an evolving library of experiences that all share the same DNA (and in-game currency).

The gaming industry has entered a very democratic stride as cross-play tears down some of the walls of gaming’s platform dynamics. Each hardware platform that operates an app store of their own still has the keys to a kingdom, but it’s a shifting world with uncertainty ahead. While massive publishers have tapped cloud gaming as the trend that will string their blockbuster franchises together, they all wish they were in Roblox’s position. The gaming industry has seen plenty of Goliath’s in its day, but for every major MMO to strike it rich, it’s still just another winner in a field of disparate hits with no connective tissue.

Roblox is different, and while many of us still have the aged vision of the image above: a bunch of rudimentary Minecraft/Playmobile-looking mini-games, Roblox’s game creation tools are advancing quickly and developers are building photorealistic games that are wider in ambition and scope than before. As the company levels-up the age range it appeals to — both by holding its grasp on aging gamers on its platform and using souped-up titles to appeal to a new-generation — there’s a wholly unique platform opportunity here: the chance to have the longevity of an app store but with the social base layer that today’s cacophony of titles have never shared.

Whether or not Roblox is the “metaverse” that folks in the gaming world have been hyping, it certainly looks more like it than any other modern gaming company does.


SHENYANG, CHINA – MARCH 08: Customers try out iPhone 12 smartphones at an Apple store on March 8, 2021 in Shenyang, Liaoning Province of China. (Photo by VCG/VCG via Getty Images)

Other things

Apple releases some important security patches
It was honestly a pretty low-key week of tech news, I’ll admit, but folks in the security world might not totally buy that characterization. This week, Apple released some critical updates for its devices, fixing a Safari vulnerability that could allow attackers to run malicious code on a user’s unpatched devices. Update your stuff, y’all.

TikTok gets proactive on online bullying
New social media platforms have had the benefit of seeing the easy L’s that Facebook teed itself up for. For TikTok, its China connection means that there’s less room for error when it comes to easily avoidable losses. The team announced some new anti-bullying features aimed at cutting down on toxicity in comment feeds.

Dropbox buys DocSend
Cloud storage giants are probably in need of a little reinvention, the enterprise software boom of the pandemic has seemed to create mind-blowing amounts of value for every SaaS company except these players. This week, Dropbox made a relatively big bet on document sharing startup DocSend. It’s seemingly a pretty natural fit for them, but can they turn in into a bigger opportunity?

Epic Games buys photogrammetry studio
As graphics cards and consoles have hit new levels of power, games have had to satisfy desired for more details and complexity. It takes a wild amount of time to create 3D assets with that complexity so plenty of game developers have leaned on photogrammetry which turns a series of photos or scans of a real world object or environment into a 3D model. This week, Epic Games bought one of the better known software makers in this space, called Capturing Reality, with the aim of integrating the tech into future versions of their game engine.

Twitter Spaces launches publicly next month
I’ve spent some more time with Twitter Spaces this week and am growing convinced that it has a substantial chance to kneecap Clubhouse’s growth. Twitter is notoriously slow to roll out products, but it seems they’ve been hitting the gas on Spaces, announcing this week that it will be available widely by next month.

Seth Rogen starts a weed company
There’s a lot of money in startups, there’s really never been a better time to get capital for a project… if you know the right people and have the right kind of expertise. Seth Rogen and weed are a pretty solid mental combo and him starting a weed company shouldn’t be a big shock.


A Coupang Corp. delivery truck drives past a company's fulfillment center in Bucheon, South Korea, on Friday, Feb. 19, 2021. South Korean e-commerce giant Coupang filed for an initial public offering in the U.S. and that could raise billions of dollars to battle rivals and kick off a record year for IPOs in the Asian country. Photographer: SeongJoon Cho/Bloomberg via Getty Images

SeongJoon Cho/Bloomberg via Getty Images

Extra things

Some of my favorite reads from our Extra Crunch subscription service this week:

Coupang follows Roblox to a strong first day of trading
“Another day brings another public debut of a multibillion-dollar company that performed well out of the gate.This time it’s Coupang, whose shares are currently up just over 46% to more than $51 after pricing at $35, $1 above the South Korean e-commerce giant’s IPO price range. Raising one’s range and then pricing above it only to see the public markets take the new equity higher is somewhat par for the course when it comes to the most successful recent debuts, to which we can add Coupang.” More

How nontechnical talent can break into deep tech
“Startup hiring processes can be opaque, and breaking into the deep tech world as a nontechnical person seems daunting. As someone with no initial research background wanting to work in biotech, I felt this challenge personally. In the past year, I landed several opportunities working for and with deep tech companies. More

Does your VC have an investment thesis or a hypothesis?
“Venture capitalists love to talk investment theses: on Twitter, Medium, Clubhouse, at conferences. And yet, when you take a closer look, theses are often meaningless and/or misleading…” More


Once more, if you liked reading this, you can get it in your inbox from the newsletter page, and follow my tweets @lucasmtny.

#apple, #apple-inc, #china, #cloud-gaming, #computing, #coupang, #docsend, #dropbox, #electronic-arts, #epic-games, #extra-crunch, #facebook, #gamer, #getty, #getty-images, #iphone, #microsoft, #online-games, #roblox, #smartphones, #software, #sony, #tc, #technology, #twitter, #week-in-review, #zynga

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Extra Crunch roundup: Coupang and Roblox debut, driving GPT-3 adoption, startup how-tos, more

Extra Crunch publishes a variety of article types, but how-tos are my favorite category.

For many entrepreneurs, the startup they are trying to get off the ground might be only the second entry on their resume. As a result, they don’t have much experience to draw from when it comes to basics like hiring, fundraising and growth marketing.

Last week, Natasha Mascarenhas interviewed experts who had some strategic advice for finding the right time to bring a product manager on board. This afternoon, we published a guest post by growth marketer Jessica Li with tips for “how nontechnical talent can build relationships with deep tech companies.”

We’ve also received great feedback on a recent guest post about bootstrapping options for SaaS founders written by a founder who’s actually done it.


Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.


If you have some startup-related “how” and “why” questions, please browse our Extra Crunch How To stories. They’re aimed squarely at early-stage founders and workers trying to solve long-term problems.

Thanks very much for reading Extra Crunch this week! I hope you have a relaxing weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

Welcome to Bloxburg, public investors

SAN FRANCISCO, CA - SEPTEMBER 05: Roblox Corporation Founder and CEO David Baszucki speaks onstage during Day 1 of TechCrunch Disrupt SF 2018 at Moscone Center on September 5, 2018 in San Francisco, California.

Image Credits: Steve Jennings / Getty Images

As Roblox began to trade Wednesday, the company’s shares shot above its reference price of $45 per share. Roblox, a gaming company aimed at children, has had a tumultuous if exciting path to the public markets.

Seeing Roblox trade so very far above its direct listing reference price and final private valuation appears to undercut the argument that this sort of debut can sort out pricing issues inherent in more traditional IPOs.

4 ways startups will drive GPT-3 adoption in 2021

Robot paper holding pen, space for text

Image Credits: Zastrozhnov (opens in a new window) / Getty Images

Trained on trillions of words, GPT-3 is a 175-billion parameter transformer model — the third of such models released by OpenAI.

GPT-3 is remarkable in its ability to generate human-like text and responses, able to return coherent and topical emails, tweets, trivia and much more. In 2021, this technology will power the launch of a thousand new startups and applications.

There have never been more $100M+ fintech rounds than right now

We are in a period of all-time record investment for so-called mega-rounds, or investments of $100 million or more inside the fintech realm.

To date, Q1 2021 is ahead and is thus guaranteed to set a new record, having already bested the preceding all-time high. What’s going on?

Global-e files to go public as e-commerce startups enjoy a renaissance

Global-e, an e-commerce platform that helps online sellers reach global consumers, filed to go public on Tuesday. Global-e’s business exploded amid the pandemic in 2020, and the company expects that the COVID-fueled shift to e-commerce will only lead to future growth.

 

Passive collaboration is essential to remote work’s long-term success

Afro-caribbean woman working from home during the Covid lockdown

Image Credits: Alistair Berg (opens in a new window) / Getty Images

Have you ever popped into a meeting because you overheard a snippet of a conversation and wanted to share your perspective?

That’s passive collaboration — low-friction ways to invite new ideas. But it’s only when we’re able to fully realize passive collaboration virtually that we’ll have unlocked the full potential of remote and hybrid work situations.

 

Dear Sophie: What are the pros and cons of the H-1B, O-1A and EB-1A?

lone figure at entrance to maze hedge that has an American flag at the center

Image Credits: Bryce Durbin/TechCrunch

Dear Sophie:

I’m an entrepreneur who wants to expand my startup to the U.S. What are the benefits and drawbacks of various types of visas and green cards?

The ones I’ve heard the most about are the H-1B, O-1 and EB-1A.

— Intelligent in India

 

Proactive CEOs should prioritize European expansion

Map of Europe in blue with light shining through

Image Credits: Sean Gladwell (opens in a new window) / Getty Images

Many investors will encourage CEOs to remain U.S.-centric this year and perhaps expand their product offering or move into new market segments. But 95% of the world’s population lives outside the U.S., making an expansion into Europe your best growth lever.

 

Coupang follows Roblox to a strong first day of trading

A Coupang Corp. delivery truck drives past a company's fulfillment center in Bucheon, South Korea, on Friday, Feb. 19, 2021. South Korean e-commerce giant Coupang filed for an initial public offering in the U.S. and that could raise billions of dollars to battle rivals and kick off a record year for IPOs in the Asian country. Photographer: SeongJoon Cho/Bloomberg via Getty Images

Image Credits: Bloomberg (opens in a new window)/ Getty Images

After Roblox debuted on Wednesday, Coupang followed, with shares shooting above the South Korean e-commerce giant’s IPO price range. Quick math shows Coupang is worth around $92 billion at the moment, a huge number that nearly zero companies will ever reach.

 

How and when to hire your first product manager

Because product managers and founders often have overlapping skill sets, it can be tricky to find the right candidate.

While it’s different for every company, hiring a PM ensures companies aren’t “chasing the shiny object” but rather building the things that create enduring value for customers.

 

Deep Science: AI adventures in arts and letters

Robotic arm carrying a mechanical part

Image Credits: Alashi / Getty Images (Image has been modified)

AI isn’t confined to the tech sphere; machine learning is applicable across disciplines, from music and the “computational unfolding” of ancient letters to figuring out where EV charging stations need to be built.

 

A first look at Coursera’s S-1 filing

Image Credits: Bryce Durbin / TechCrunch

The SEC filing offers a glimpse into the finances of how an edtech company, accelerated by the pandemic, performed over the past year.

It paints a picture of growth, albeit one that came at steep expense.

 

Olo’s IPO could value the company north of $3B as Toast waits in the wings

Olo has a history of growth and profitability, making its impending pricing all the more interesting.

But are investors willing to pay more for profits? And, if so, how much?

 

From electric charging to supply chain management, InMotion Ventures preps Jaguar for a sustainable future

Image Credits: Andrew Ferraro — Handout/Jaguar Racing / Getty Images

InMotion’s investment in Circulor, a company that monitors supply chains from raw material inputs to finished outputs with an eye toward sustainable sourcing, shows the firm’s dedication to backing companies across the mobility space broadly.

 

White-label voice assistants will win the battle for podcast discovery

3D headphones with sound waves on dark background. Concept of electronic music listening and digital audio. Abstract visualization of digital sound waves and modern art. Vector illustration. (3D headphones with sound waves on dark background. Concept

Image Credits: maxkabakov (opens in a new window) / Getty Images

Americans are bored, housebound and screened out, driving roughly 128 million Americans to use a voice assistant at least once a month.

This has created a golden opportunity for audio as consumers turn to podcasts, voice assistants and smart speakers.

 

Why I’m hitting pause on ARR-focused coverage

One of the first recurring features Alex Wilhelm established at Extra Crunch was the “$100M ARR Club,” ongoing coverage of startups that have reached scale.

“Forget a $1 billion valuation — $100 million in annual recurring revenue is the cool kids’ club,” he wrote in December 2019. Since then, he expanded it to cover companies that attained $50M ARR.

The concept is a useful lens for studying the market. I can say this with confidence because it’s been widely copied by other tech news outlets. But this morning, Alex surprised me — he’s shelving the ARR Club, at least for now.

“In the end it became a pre-IPO list that was fun but not entirely educational, by my reckoning,” he told me. “The $50M ARR club evolution was supposed to help shake loose more interesting operational details, but just didn’t.”

Before putting the format on hiatus, Alex’s last ARR Club roundup looks at in-office display and kiosk startup AppSpace, data backup unicorn Druva, and Synack, which makes security software.


TC Early Stage: The premier how-to event for startup entrepreneurs and investors

From April 1-2, some of the most successful founders and VCs will explain how they build their businesses, raise money and manage their portfolios.

At TC Early Stage, we’ll cover topics like recruiting, sales, legal, PR, marketing and brand building. Each session includes ample time for audience questions and discussion.

Use discount code ECNEWSLETTER to take 20% off the cost of your TC Early Stage ticket!

#alex-wilhelm, #appspace, #artificial-intelligence, #coupang, #coursera, #ec-how-to, #ecommerce, #entrepreneurship, #extra-crunch-roundup, #gaming, #how-to, #inmotion-ventures, #roblox, #saas, #startups, #venture-capital

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Can you beat Google with Google’s brains?

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

Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. Like every week, we had to leave a lot of great stuff on the cutting-room floor. But, we did get to touch on a bunch of news that we feel really matters.

Also we do wind up talking about a few Extra Crunch pieces, which is where our deeper analysis on news items lives. If the paywall is a bother, you can get access while saving 50% with the code “EQUITY.”

Here’s what we got into:

  • Crypto-art and the NFT boom continue. Check out what Beeple just did. Danny has an opinion on the matter.
  • The Roblox direct-listing does very little actually solve the IPO pricing issue. That said, well done Bloxburg.
  • We talked about the Coursera S-1, which gave us the first financial peek into an education company revitalized by the pandemic.
  • The numbers needed context, so our follow up coverage gives readers 5 takeaways from the Coursera IPO.
  • Language learning has a market, and it’s big. We talked about Preply’s $35 million raise and why tutoring marketplaces make sense.
  • Dropbox is buying DocSend, which makes pretty good sense. Even if the exit price won’t matter much for bigger funds. We’re still witnessing Dropbox and Box add more features to their product via acquisitions. Let’s see how it impacts their revenue growth.
  • Zapier buys Makerpad. We struggled to pronounce Zapier, but did have some notes on the deal and what it might mean for the no-code space.
  • Sticking the acquisition theme, PayPal bought Curv. If you were looking for more evidence that big companies are taking crypto seriously, well, here it is.
  • And to close we nerded out about Neeva. Can a Google-competitor take on Google if it was founded by ex-Googlers?

The show is back Monday morning. Stay cool!

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

#beeple, #coupang, #coursera, #crypto, #curv, #docsend, #dropbox, #equity, #equity-podcast, #fundings-exits, #google, #makerpad, #neeva, #nft, #paypal, #preply, #roblox, #startups, #tc, #zapier

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Coupang follows Roblox to a strong first day of trading

Another day brings another pubic debut of a multibillion dollar company that performed well out of the gate.

This time it’s Coupang, whose shares are currently up just over 46% to more than $51 after pricing at $35, $1 above the South Korean e-commerce giant’s IPO price range. Raising one’s range and then pricing above it only to see the public markets take the new equity higher is somewhat par for the course when it comes to the most successful recent debuts, to which we can add Coupang.

The company’s mix of rapid growth and slimming deficits appear to have found an audience among public money types, so let’s quickly explore the price they paid. What was the company worth at its IPO price, and what is worth now? And, of course, we’ll want to calculate revenue run rates for each figure.

Oh — we’ll also need to calculate how much money SoftBank made. Inverted J-Curve indeed!

Coupang’s IPO and current value

As Renaissance Capital notes, Coupang boosted its share allocation to 130 million shares from 120 million. This made the value of both primary and secondary shares in its public offering worth a total of $4.55 billion. That’s a lot of damn money.

At its IPO price of $35, the same source pegged the company’s fully diluted IPO valuation at $62.9 billion. By our accounting, the company’s simple valuation at its IPO price came to $60.4 billion. Those numbers are close enough that we’ll just stick with the diluted number out of kindness to the company’s fans.

Doing some quick math, Coupang is worth around $92 billion at the moment. That’s a huge number that nearly zero companies will ever reach. Some do, of course, but as a percentage of startups that start it’s an outlier figure.

#coupang, #ec-ecommerce-and-d2c, #ecommerce, #fundings-exits, #gaming, #softbank, #startups, #tc, #vision-fund

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Coupang, South Korea’s Answer to Amazon, Debuts in I.P.O.

Coupang, a start-up founded by a Harvard Business School dropout, helped transform e-commerce in South Korea, one of the world’s fastest-growing markets for online shopping.

#amazon-com-inc, #coupang, #delivery-services, #e-commerce, #initial-public-offerings, #labor-and-jobs, #naver-com, #shopping-and-retail, #south-korea, #start-ups, #stocks-and-bonds, #workplace-hazards-and-violations

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SoftBank makes mountains of cash off of human laziness

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

Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. It was yet another crazy week, but did our best to get through as much of it as we could. Here’s the rundown, in case you are reading along with us!

  • Square is buying Tidal in a deal that some are skeptical of, but one about which we found quite a lot to like.
  • How capital-as-a-service can get you your first check in 2021, and a nod to Indie.VC, a pioneer in alternative financing for startups that announced it is shutting down net new investments this year.
  • Oscar Health priced its IPO above its raised range, which was good for it in terms of fundraising. However, since its debut the company has lost pricing altitude. Its declines mimic those of other public neo-insurance proivders in what could be a new trend.
  • And sticking to the insurtech beat, Hippo is going public via a SPAC. Because everyone else is?
  • Compass filed its S-1, which triggered a debate on how its different than OpenDoor.
  • Coupang’s IPO is also coming, replete with huge growth, an improving profitability picture, and a massive valuation. This is one to watch.
  • There was also a whole global news circuit around grocery delivery startups, with Instacart raising at a $39 billion valuation.
  • And we wrapped with the Surreal seed round that we found to be more than a little spicy. As it turns out, commercialized deepfakes are not merely on the way; they are here.

And with that we are back on Monday. Have a rocking weekend!

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

#clearbanc, #compass, #coupang, #equity, #equity-podcast, #fundings-exits, #grocery-delivery, #hippo, #indie-vc, #instacart, #insurtech, #opendoor, #oscar, #oscar-health, #square, #startups, #surreal, #tidal

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Coupang may raise up to $3.6 billion in its IPO, at a potential valuation of $51 billion

According to an amended S-1 filing, South Korean e-commerce leader Coupang expects to price its initial public offering between $27 to $30 per share, potentially raising up to $3.6 billion. After the IPO, Coupang will have a total of 1.7 billion shares outstanding, including Class A and Class B. This means the means the pricing would give Coupang a potential market capitalization between $46 billion to $51 billion, a huge increase over the $9 billion valuation it reached after its last funding round in 2018, led by SoftBank Vision Fund.

Coupang and some of its existing shareholders will offer a total of 120 million shares during the IPO.

If Coupang’s IPO is successful, it would be a huge win for SoftBank Vision Fund, which will own 36.8% of its Class A shares after the listing.

Founded in 2010 by Bom Kim, Coupang is known for its ultra-speedy deliveries and is now the largest e-commerce company in South Korea, according to Euromonitor. According to the filing, Kim will hold 76.7% of voting power after the listing, while SoftBank Vision Fund will hold about 8.6%. Other investors that currently own 5% or more of Coupang’s shares include Greenoaks Capital Partners, Maverick Holdings, Rose Park Advisors, BlackRock and Ridd Investments.

Coupang filed to go public on the New York Stock Exchange last month, under the symbol CPNG. Based on Bloomberg data, Coupang’s listing will be the fourth-biggest by an Asian company on a U.S. exchange, and the largest since Alibaba’s $25 billion IPO in 2014.

#asia, #coupang, #ecommerce, #fundings-exits, #ipo, #south-korea, #startups, #tc

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Former Uber CTO Thuan Pham joins South Korean e-commerce leader Coupang

Thuan Pham, who stepped down as Uber’s chief technology officer and longest-serving top executive in May, has a new job in South Korea. Coupang, the country’s largest e-commerce company by market share, announced today it has hired Pham as its new CTO.

For Pham, joining Coupang, a SoftBank-backed unicorn that holds a 24.6% market share in South Korea, the fifth-largest e-commerce in the world, is a departure from his original post-Uber plans. In an interview with Bloomberg after leaving Uber, which Pham joined in 2013, he expressed relief about his decision, describing leading the ride-hailing giant’s technology division as “a very heavy burden.” After leaving, Pham intended to spend his time teaching university students and mentoring entrepreneurs instead of joining another large tech company.

“I thought that there was a slim opportunity that I would take on another operational role again, but the bar for that would have been super high,” Pham told TechCrunch. “It had to be even more interesting than what I did at Uber for me to jump in.”

After meeting Coupang chief executive officer Bom Kim, who founded the company in 2010, however, Pham said he was intrigued by the opportunity to apply his experience at Uber to a company in a different sector.

Coupang is known for its very fast delivery services. These include Dawn Delivery, which drops off packages, including fresh groceries, ordered by midnight at customers’ doors before 7 AM. It is currently available in Seoul, where Coupang is headquartered, and several other cities. Pham said Coupang’s ability to guarantee early morning deliveries was a major hook.

“I thought, holy smokes, this is actually really innovative. Maybe it’s not a technology innovation, but it’s a business innovation, and of course technology has to enable that at scale,” he said.

Pham said he wasn’t interested in working at another ride-sharing company, but “a lot of the concepts are similar” in on-demand e-commerce. For example, both have to route drivers to pick up passengers (or, in Coupang’s case, packages) and drop them off as efficiently as possible, and both need to use dynamic pricing to respond to demand and supply, which Pham said is especially relevant to deliveries of fresh groceries.

“There a lot of challenges that you have to worry about, from the talent perspective, technology perspective, logistics process perspective and so on,” he said. “I figured a lot of things I learned at my previous company could really be applied to help, even though it’s a different domain.”

Despite Coupang’s position as the largest e-commerce player in one of the world’s largest e-commerce markets, Pham said he thinks the company is “still in the very early days.” For example, there are opportunities for building out its logistics infrastructure, inventory and verticals, including its third-party marketplace, which includes warehouse and fulfillment capability for sellers.

Pham, who recently spent five weeks in Seoul before returning home to California, rode along on a night delivery shift to get a feel for how Coupang’s logistics chain works. One thing that impressed him was the density of Seoul, which creates unique challenges and opportunities for on-demand e-commerce companies there.

“We have a few hundred items on the truck and the truck was in a very small radius area. Sometimes we enter an apartment building and we deliver to two or three homes in that building,” he said. “That kind of density is a huge advantage for a logistics company, compared to where I live in the U.S.”

Using tech to address working conditions

After it launched ten years ago, Coupang initially relied on third-party carriers before building a network of in-house fulfillment centers. This included in-house trucks and drivers referred to as “Coupang men” who also served as customer service representatives.

As the company scaled up, however, it began relying more on third-party logistics providers again. Pham said Coupang currently employs tens of thousands of full-time employees for delivery, but also relies on flex workers in order to meet spikes in demand, for example during holidays. This one of the areas where Pham said his experience at Uber can benefit Coupang.

“A bunch of the stuff I worked on and the problem I solved at the previous company is really applicable because everything there was flex,’ said Pham. “But here you have a set of workers who are on-demand, if you will, and how do you make sure that the proper incentives are there? If you have huge demand and not enough capacity, then you have to pay a higher price for people to take those jobs, those routes and those time blocks.”

But for many companies whose business models are built around on-demand services, the convenience for customers can come at a cost for workers. Like Uber and Amazon, Coupang’s working conditions have also come under attack, especially as the COVID-19 pandemic dramatically increased demand for deliveries.

During the pandemic, Coupang has been criticized for not doing enough to prevent infections at two of its logistics centers. Working conditions at it and other logistics companies, including CJ Logistics, came under scrutiny after worker deaths, which labor groups attributed to overwork (in response, a Coupang official told the Korea Times its delivery and distribution center personnel are all limited to working 52-hour weeks).

Pham said that Coupang has spent heavily on COVID-19 safety precautions, including disinfectants, increasing the spacing of goods in its warehouses and using automated systems to track, pick up and pack inventory in order to maintain social distancing.

To improve working conditions for delivery workers, Pham said the company is continuing to hone the algorithms that direct drivers to customers’ addresses.

“I know this firsthand from Uber, that the clearer the routing instruction, the less stress it puts on drivers mentally,” Pham said.

While riding on an overnight route with a delivery driver, for example, he realized there is room for improvement in Coupang’s packet sorting system, so drivers spend less time looking in bins for small packets when they reach their destination.

Pham said that ultimately, he believes Coupang’s technology can give drivers more control over what they do during their shifts, either decreasing their workload or allowing them to perform more deliveries to make more money.

#asia, #coupang, #e-commerce, #on-demand, #south-korea, #startups, #tc, #thuan-pham, #uber

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