Online retailers are offering rare, endangered bugs

Image of a website that has a specific category for selling rare insects.

When a rare species is a product.

Alive or dead, rare or mundane, bugs are weirdly easy to find for sale online. However, in some cases, the insects or spiders sold through the various e-commerce sites, both niche and large-scale, may be of dubious provenance. Some may be bred and reared in sustainable programs. Others might be taken from wild populations that are at risk, according to new research out of Cornell University that was published last week.

“It’s not always clear… if they’re sustainable or not,” John Losey, a Cornell entomology professor and one of the paper’s authors, told Ars. “There are sites out there that are definitely not providing documentation that what they’re selling is being done sustainably.”

According to Losey, some websites will provide no documentation or proof showing that a rare pinned butterfly specimen or pet tarantula was collected in a way that doesn’t pose a risk for wild populations. Some of them could very well have been reared in a sustainable program, Losey said—there’s just no way to tell.

Read 12 remaining paragraphs | Comments

#amazon, #bugs, #conservation, #e-commerce, #entomology, #etsy, #insects, #internet, #science

Tech leaders can be the secret weapon for supercharging ESG goals

Environmental, social and governance (ESG) factors should be key considerations for CTOs and technology leaders scaling next generation companies from day one. Investors are increasingly prioritizing startups that focus on ESG, with the growth of sustainable investing skyrocketing.

What’s driving this shift in mentality across every industry? It’s simple: Consumers are no longer willing to support companies that don’t prioritize sustainability. According to a survey conducted by IBM, the COVID-19 pandemic has elevated consumers’ focus on sustainability and their willingness to pay out of their own pockets for a sustainable future. In tandem, federal action on climate change is increasing, with the U.S. rejoining the Paris Climate Agreement and a recent executive order on climate commitments.

Over the past few years, we have seen an uptick in organizations setting long-term sustainability goals. However, CEOs and chief sustainability officers typically forecast these goals, and they are often long term and aspirational — leaving the near and midterm implementation of ESG programs to operations and technology teams.

Until recently, choosing cloud regions meant considering factors like cost and latency to end users. But carbon is another factor worth considering.

CTOs are a crucial part of the planning process, and in fact, can be the secret weapon to help their organization supercharge their ESG targets. Below are a few immediate steps that CTOs and technology leaders can take to achieve sustainability and make an ethical impact.

Reducing environmental impact

As more businesses digitize and more consumers use devices and cloud services, the energy needed by data centers continues to rise. In fact, data centers account for an estimated 1% of worldwide electricity usage. However, a forecast from IDC shows that the continued adoption of cloud computing could prevent the emission of more than 1 billion metric tons of carbon dioxide from 2021 through 2024.

Make compute workloads more efficient: First, it’s important to understand the links between computing, power consumption and greenhouse gas emissions from fossil fuels. Making your app and compute workloads more efficient will reduce costs and energy requirements, thus reducing the carbon footprint of those workloads. In the cloud, tools like compute instance auto scaling and sizing recommendations make sure you’re not running too many or overprovisioned cloud VMs based on demand. You can also move to serverless computing, which does much of this scaling work automatically.

Deploy compute workloads in regions with lower carbon intensity: Until recently, choosing cloud regions meant considering factors like cost and latency to end users. But carbon is another factor worth considering. While the compute capabilities of regions are similar, their carbon intensities typically vary. Some regions have access to more carbon-free energy production than others, and consequently the carbon intensity for each region is different.

So, choosing a cloud region with lower carbon intensity is often the simplest and most impactful step you can take. Alistair Scott, co-founder and CTO of cloud infrastructure startup Infracost, underscores this sentiment: “Engineers want to do the right thing and reduce waste, and I think cloud providers can help with that. The key is to provide information in workflow, so the people who are responsible for infraprovisioning can weigh the CO2 impact versus other factors such as cost and data residency before they deploy.”

Another step is to estimate your specific workload’s carbon footprint using open-source software like Cloud Carbon Footprint, a project sponsored by ThoughtWorks. Etsy has open-sourced a similar tool called Cloud Jewels that estimates energy consumption based on cloud usage information. This is helping them track progress toward their target of reducing their energy intensity by 25% by 2025.

Make social impact

Beyond reducing environmental impact, CTOs and technology leaders can have significant, direct and meaningful social impact.

Include societal benefits in the design of your products: As a CTO or technology founder, you can help ensure that societal benefits are prioritized in your product roadmaps. For example, if you’re a fintech CTO, you can add product features to expand access to credit in underserved populations. Startups like LoanWell are on a mission to increase access to capital for those typically left out of the financial system and make the loan origination process more efficient and equitable.

When thinking about product design, a product needs to be as useful and effective as it is sustainable. By thinking about sustainability and societal impact as a core element of product innovation, there is an opportunity to differentiate yourself in socially beneficial ways. For example, Lush has been a pioneer of package-free solutions, and launched Lush Lens — a virtual package app leveraging cameras on mobile phones and AI to overlay product information. The company hit 2 million scans in its efforts to tackle the beauty industry’s excessive use of (plastic) packaging.

Responsible AI practices should be ingrained in the culture to avoid social harms: Machine learning and artificial intelligence have become central to the advanced, personalized digital experiences everyone is accustomed to — from product and content recommendations to spam filtering, trend forecasting and other “smart” behaviors.

It is therefore critical to incorporate responsible AI practices, so benefits from AI and ML can be realized by your entire user base and that inadvertent harm can be avoided. Start by establishing clear principles for working with AI responsibly, and translate those principles into processes and procedures. Think about AI responsibility reviews the same way you think about code reviews, automated testing and UX design. As a technical leader or founder, you get to establish what the process is.

Impact governance

Promoting governance does not stop with the board and CEO; CTOs play an important role, too.

Create a diverse and inclusive technology team: Compared to individual decision-makers, diverse teams make better decisions 87% of the time. Additionally, Gartner research found that in a diverse workforce, performance improves by 12% and intent to stay by 20%.

It is important to reinforce and demonstrate why diversity, equity and inclusion is important within a technology team. One way you can do this is by using data to inform your DEI efforts. You can establish a voluntary internal program to collect demographics, including gender, race and ethnicity, and this data will provide a baseline for identifying diversity gaps and measuring improvements. Consider going further by baking these improvements into your employee performance process, such as objectives and key results (OKRs). Make everyone accountable from the start, not just HR.

These are just a few of the ways CTOs and technology leaders can contribute to ESG progress in their companies. The first step, however, is to recognize the many ways you as a technology leader can make an impact from day one.

#artificial-intelligence, #carbon-footprint, #cloud, #cloud-computing, #cloud-infrastructure, #cloud-services, #column, #energy, #environmentalism, #esg, #etsy, #greenhouse-gas-emissions, #greentech, #machine-learning, #open-source-software, #opinion, #sustainability, #tc, #thoughtworks

Hear top VCs Albert Wegner, Jenny Rooke, and Shilpi Kumar talk green bets at the Extreme Tech Challenge finals

This year, TechCrunch is proudly hosting the Extreme Tech Challenge Global Finals on July 22. The event is among the world’s largest purpose-driven startup competitions that are aiming to solve global challenges based on the United Nations’ 17 sustainability goals.

If you want to catch an array of innovative startups across a range of categories, all of them showcasing what they’re building, you won’t want to miss our must-see pitch-off competition.

You can also catch feature panels hosted by TechCrunch editors, including one of the most highly anticipated discussions of the event, a talk on “going green” with guest speakers Shilpi Kumar, Jenny Rooke, and Albert Wenger, all of whom are actively investing in climate startups that are targeting big opportunities

Shilpi Kumar is a partner with Urban Us, an investment platform focused on urban tech and climate solutions. She previously led go-to-market and early sales efforts at Filament, a startup focused on deploying secure wireless networks for connected physical assets. As an investor, Shilpi has also focused on hardware, mobility, energy, IoT, and robotics, having worked previously for VTF Capital, First Round Capital, and Village Global.

Jenny Rooke is the founder and managing director of Genoa Ventures, but Rooke has been deploying capital into innovative life sciences opportunities for years, including at Fidelity Biosciences and later the Gates Foundation, where she helped managed more than $250 million in funding, funneling some of that capital into genetic engineering, diagnostics, and synthetic biology startups. Rooke began independently investing under the brand 5 Prime Ventures, ultimately establishing among the largest life sciences syndicates on AngelList before launching Genoa.

Last but not least, Albert Wenger, has been a managing partner at Union Square Ventures for more than 13 years. Before joining USV, Albert was the president of del.icio.us through the company’s sale to Yahoo and an angel investor, including writing early checks to Etsy and Tumblr. He previously founded or co-founded several companies, including a management consulting firm and an early hosted data analytics company. Among his investments today is goTenna, a company trying to advance universal access to connectivity by building a scalable mobile mesh network.

Sustainability is the key to our planet’s future and our survival, but it’s also going to be incredibly lucrative and a major piece of our world economy. Hear from these seasoned investors about how VCs and startups alike are thinking about Greentech and how that will evolve in the coming years.

Join us on July 22 to find out how the most innovative startups are working to solve some of the world’s biggest problems. And best of all, tickets are free — book yours today!

#albert-wenger, #angel-investor, #angellist, #energy, #etsy, #fidelity-biosciences, #filament, #finance, #first-round-capital, #gates-foundation, #genetic-engineering, #gotenna, #investment, #managing-partner, #money, #president, #prime-ventures, #startup-company, #tc, #techcrunch, #tumblr, #union-square-ventures, #united-nations, #village-global, #yahoo

Etsy acquires Elo7, known as the ‘Etsy of Brazil’, for $217M

On the heels of Etsy’s huge deal to acquire Depop to open the door to more social selling, targeting younger users, and deeply expand in Europe, the crafty marketplace has announced another significant deal to build out its reach, this time in Latin America. Etsy has announced that it will acquire Elo7 — commonly referred to as the “Etsy of Brazil” for its popular marketplace for crafty creators — for $217 million.

Etsy was already active in Brazil, but Elo7, one of the 10 biggest e-commerce sites in the region with 1.9 million active buyers, 56,000 active sellers and some 8 million items for sale, will give Etsy a significantly bigger presence in the market.

As with Depop (which was a $1.6 billion acquisition for Etsy) and Reverb (a musical instruments market Etsy acquired in 2019), Elo7 will remain a standalone brand and continue to be operated by its current management team out of its HQ in Sao Paulo, Brazil.

The deal underscores an interesting playbook under Etsy CEO Josh Silverman, who has a long history in the world of e-commerce, including years with eBay during that company’s more acquisitive heydays.

“Elo7 is the ‘Etsy of Brazil,’ with a purpose and business model similar to our own,” Silverman said in a statement. “Following our recent agreement to purchase Depop, we’re excited to bring another unique marketplace into the Etsy family. This transaction will establish a foothold for us in Latin America, an underpenetrated ecommerce region where Etsy currently does not have a meaningful customer base. We look forward to welcoming Elo7’s talented leadership team and employees to the Etsy family.”

It’s an interesting turn also for Etsy as it goes into a more aggressive growth mode. A lot of the earlier days in the world of e-commerce were marked by companies expanding inorganically — specifically, by picking up market share through acquisitions of similar players in their own or new geographies the acquirer wants to enter. This was the playbook followed at times by eBay, Amazon, Groupon and more.

These days, maybe because e-commerce has matured and, well, Amazon is such a behemoth that the barrier to entry becomes harder, you see a lot less of that, and there has even been something of a stigma attached to companies that you could call “clones” of models already started and scaled elsewhere, just not in your patch of the world.

So it’s interesting to see Etsy buying into that quite specifically in this case, with its announcement pointing out all the synergies of the two companies’ business models making it an easy one to bring into the fold. It’s something also highlighted by Elo7 — which in its time had raised about $18 million in funding from investors that included Accel, Monashes, and Insight Partners.

“Etsy has always been an inspiration and a reference for us, and we’re excited to continue our growth journey as part of Etsy – a company whose mission and culture so closely match our own,” said Carlos Curioni, Elo7’s longtime CEO. “We’re looking forward to leveraging Etsy’s product and marketing expertise to help the Elo7 marketplace, community and team achieve our full potential in Brazil.”

Brazil is really a prime market to follow the inorganic acquisition strategy. The country is one of the biggest e-commerce markets in the world in terms of both population, buying power and digital device penetration (particularly smartphones). At a time when many mature markets are seeing e-commerce growth slow — excepting the 44% bump in Covid-19 spending in 2020, typically US consumers were seeing e-commerce growth of around 15% and slowing year-on-year pre-pandemic — Brazil has been booming, since penetration is still pretty low but all the right factors for growth are there. Etsy cites figures that project it will grow 26% by 2024.

“We’re excited to announce this purchase of Elo7 following our recent announcement of the Depop transaction – two exciting businesses that meet Etsy’s very high bar for use of capital,” said Rachel Glaser, Etsy, Inc. CFO, in. statement. “In addition to job one, which is continuing to drive growth in our core Etsy.com marketplace, we will now focus on integrating Depop and Elo7 into the Etsy family. Reverb, Depop and Elo7 will each continue to be run by their talented and empowered management teams, and we’ll connect key functions across the brands in a way designed to accelerate value creation and make the whole worth more than the sum of its parts.”

#crafts, #creators, #ecommerce, #elo7, #etsy, #ma, #marketplace, #tc

Android announces six new features, emphasizing safety and accessibility

Android shared information today about six features that will roll out this summer. Some of these are just quality of life upgrades, like starring text messages to easily find them later, or getting contextual Emoji Kitchen suggestions depending on what you’re typing. But other aspects of this update emphasize security, safety, and accessibility.

Last summer, Google added a feature on Android that basically uses your phone as a seismometer to create “the world’s largest earthquake detection network.” The system is free, and since testing in California, it’s also launched in New Zealand and Greece. Now, Google will introduce this feature in Turkey, the Philippines, Kazakhstan, Kyrgyz Republic, Tajikistan, Turkmenistan and Uzbekistan. The company says that they’ll continue expanding the feature this year, prioritizing countries with the highest earthquake risk.

Image Credits: Google

Google is also expanding on another feature released last year, which made Google Assistant compatible with Android apps. In the initial update, apps were supported like Spotify, Snapchat, Twitter, Walmart, Discord, Etsy, MyFitnessPal, Mint, Nike Adapt, Nike Run Club, eBay, Kroger, Postmates, and Wayfair. Today’s update mentioned apps like eBay, Yahoo! Finance, Strava, and Capital One. These features are comparable to Apple’s support of Siri with iOS apps, which includes the ability to open apps, perform tasks, and record a custom command.

When it comes to accessibility, Google is ramping up its gaze detection feature, which is now in beta. Gaze detection allows people to ask Voice Access to only respond when they’re looking at their screen, allowing people to naturally move between talking with friends and using their phone. Now, Voice Access will also have enhanced password input — when it detects a password field, it will allow you to input letters, numbers, and symbols by saying “capital P” or “dollar sign,” for example, making it easier for users to more quickly enter this sensitive information. In October, Google Assistant became available on gaze-powered accessible devices, and in the same month, Google researchers debuted a demo that made it so people using sign language could be identified as the “active speaker” in video calls. Apple doesn’t have a comparable gaze detection feature yet that’s widely available, though they acquired SensoMotoric Instruments (SMI), an eye-tracking firm, in 2017. So, hopefully similar accessibility features will be in the works at Apple, especially as Google continues to build out theirs.

Today’s Android update also lets Android Auto users customize more of their experience. Now, you can set your launcher screen from your phone, set dark mode manually, and more easily browse content on media apps with an A-Z scroll bar and “back to top” button. Messaging apps like WhatsApp and Messages will now be compatible on the launch screen – proceed with caution and don’t drive distracted – and EV charging, parking, and navigation apps will now be available for use.

#android, #apps, #assistant, #california, #computing, #ebay, #etsy, #google, #google-assistant, #google-now, #google-play, #greece, #kazakhstan, #kroger, #mobile-linux, #myfitnesspal, #new-zealand, #nike, #operating-systems, #philippines, #postmates, #siri, #smartphones, #snapchat, #software, #spotify, #turkey, #walmart, #wayfair, #whatsapp, #yahoo

Extra Crunch roundup: Guest posts wanted, ‘mango’ seed rounds, Expensify’s tech stack

Prospective contributors regularly ask us about which topics Extra Crunch subscribers would like to hear more about, and the answer is always the same:

  • Actionable advice that is backed up by data and/or experience.
  • Strategic insights that go beyond best practices and offer specific recommendations readers can try out for themselves.
  • Industry analysis that paints a clear picture of the companies, products and services that characterize individual tech sectors.

Our submission guidelines haven’t changed, but Managing Editor Eric Eldon and I wrote a short post that identifies the topics we’re prioritizing at the moment:

  • How-to articles for early-stage founders.
  • Market analysis of different tech sectors.
  • Growth marketing strategies.
  • Alternative fundraising.
  • Quality of life (personal health, sustainability, proptech, transportation).

If you’re a skillful entrepreneur, founder or investor who’s interested in helping someone else build their business, please read our latest guidelines, then send your ideas to guestcolumns@techcrunch.com.

Thanks for reading; I hope you have a great weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist


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


Opting for a debt round can take you from Series A startup to Series B unicorn

Image of a tree in a field, with half barren to represent debt and half flush with cash to represent success.

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

Debt is a tool, and like any other — be it a hammer or handsaw — it’s extremely valuable when used skillfully but can cause a lot of pain when mismanaged. This is a story about how it can go right.

Mario Ciabarra, the founder and CEO of Quantum Metric, breaks down how his company was on a “tremendous growth curve” — and then the pandemic hit.

“As the weeks following the initial shelter-in-place orders ticked by, the rush toward digital grew exponentially, and opportunities to secure new customers started piling up,” Ciabarra writes. “A solution to our money problems, perhaps? Not so fast — it was a classic case of needing to spend in order to make.”

If companies want to preserve equity, debt can be an advantageous choice. Here’s how Quantum Metric did it.

4 proven approaches to CX strategy that make customers feel loved

CX is the hottest acronym in business

Image Credits: mucahiddin / Getty Images

People have been working to optimize customer experiences (CX) since we began selling things to each other.

A famous San Francisco bakery has an exhaust fan at street level; each morning, its neighbors awake to the scent of orange-cinnamon morning buns wafting down the block. Similarly, savvy hairstylists know to greet returning customers by asking if they want a repeat or something new.

Online, CX may encompass anything from recommending the right shoes to AI that knows when to send a frustrated traveler an upgrade for a delayed flight.

In light of Qualtrics’ spinout and IPO and Sprinklr’s recent S-1, Rebecca Liu-Doyle, principal at Insight Partners, describes four key attributes shared by “companies that have upped their CX game.”

Twitter’s acquisition strategy: Eat the public conversation

woman talking with megaphone

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

What is a microblogging service doing buying a social podcasting company and a newsletter tool while also building a live broadcasting sub-app? Is there even a strategy at all?

Yes. Twitter is trying to revitalize itself by adding more contexts for discourse to its repertoire. The result, if everything goes right, will be an influence superapp that hasn’t existed anywhere before. The alternative is nothing less than the destruction of Twitter into a link-forwarding service.

Let’s talk about how Twitter is trying to eat the public conversation.

Reading the IPO market’s tea leaves

Although it was a truncated holiday week here in the United States, there was a bushel of IPO news. We sorted through the updates and came up with a series of sentiment calls regarding these public offerings.

Earlier this week, we took a look at:

  • Marqeta‘s first IPO price range (fintech).
  • 1st Dibs‘ first IPO price range (e-commerce).
  • Zeta Global‘s IPO pricing (martech).
  • The start of SoFi trading post-SPAC (fintech).
  • The latest from BarkBox (e-commerce).

How Expensify hacked its way to a robust, scalable tech stack

Image Credits: Nigel Sussman

Part 4 of Expensify’s EC-1 digs into the company’s engineering and technology, with Anna Heim noting that the group of P2P pirates/hackers set out to build an expense management app by sticking to their gut and making their own rules.

They asked questions few considered, like: Why have lots of employees when you can find a way to get work done and reach impressive profitability with a few? Why work from an office in San Francisco when the internet lets you work from anywhere, even a sailboat in the Caribbean?

It makes sense in a way: If you’re a pirate, to hell with the rules, right?

With that in mind, one could assume Expensify decided to ask itself: Why not build our own totally custom tech stack?

Indeed, Expensify has made several tech decisions that were met with disbelief, but its belief in its own choices has paid off over the years, and the company is ready to IPO any day now.

How much of a tech advantage Expensify enjoys owing to such choices is an open question, but one thing is clear: These choices are key to understanding Expensify and its roadmap. Let’s take a look.

Etsy asks, ‘How do you do, fellow kids?’ with $1.6B Depop purchase

GettyImages 969952548

Image Credits: Getty Images

The news this week that e-commerce marketplace Etsy will buy Depop, a startup that provides a secondhand e-commerce marketplace, for more than $1.6 billion may not have made a large impact on the acquiring company’s share price thus far, but it provides a fascinating look into what brands may be willing to pay for access to the Gen Z market.

Etsy is buying Gen Z love. Think about it — Gen Z is probably not the first demographic that comes to mind when you consider Etsy, so you can see why the deal may pencil out in the larger company’s mind.

But it isn’t cheap. The lesson from the Etsy-Depop deal appears to be that large e-commerce players are willing to splash out for youth-approved marketplaces. That’s good news for yet-private companies that are popular with the budding generation.

Confluent’s IPO brings a high-growth, high-burn SaaS model to the public markets

Image Credits: Andriy Onufriyenko / Getty Images

Confluent became the latest company to announce its intent to take the IPO route, officially filing its S-1 paperwork this week.

The company, which has raised over $455 million since it launched in 2014, was most recently valued at just over $4.5 billion when it raised $250 million last April.

What does Confluent do? It built a streaming data platform on top of the open-source Apache Kafka project. In addition to its open-source roots, Confluent has a free tier of its commercial cloud offering to complement its paid products, helping generate top-of-funnel inflows that it converts to sales.

What we can see in Confluent is nearly an old-school, high-burn SaaS business. It has taken on oodles of capital and used it in an increasingly expensive sales model.

How to win consulting, board and deal roles with PE and VC funds

Jumping to the highest level - goldfish jumping in a bigger bowl - aspiration and achievement concept. This is a 3d render illustration

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

Would you like to work with private equity and venture capital funds?

There are relatively few jobs directly inside private equity and venture capital funds, and those jobs are highly competitive.

However, there are many other ways you can work and earn money within the industry — as a consultant, an interim executive, a board member, a deal executive partnering to buy a company, an executive in residence or as an entrepreneur in residence.

Let’s take a look at the different ways you can work with the investment community.

The existential cost of decelerated growth

Even among the most valuable tech shops, shareholder return is concentrated in share price appreciation, and buybacks, which is the same thing to a degree.

Slowly growing tech companies worth single-digit billions can’t play the buyback game to the same degree as the majors. And they are growing more slowly, so even a similar buyback program in relative scale would excite less.

Grow or die, in other words. Or at least grow or come under heavy fire from external investors who want to oust the founder-CEO and “reform” the company. But if you can grow quickly, welcome to the land of milk and honey.

Even among the most valuable tech shops, shareholder return is concentrated in share price appreciation, and buybacks, which is the same thing to a degree.

Slowly growing tech companies worth single-digit billions can’t play the buyback game to the same degree as the majors. And they are growing more slowly, so even a similar buyback program in relative scale would excite less.

Grow or die, in other words. Or at least grow or come under heavy fire from external investors who want to oust the founder-CEO and “reform” the company. But if you can grow quickly, welcome to the land of milk and honey.

Hormonal health is a massive opportunity: Where are the unicorns?

uterus un paper work.Pink backgroundArt concept of female reproductive health

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

There is a growing group of entrepreneurs who are betting that hormonal health is the key wedge into the digital health boom.

Hormones are fluctuating, ever-evolving, and diverse — but these founders say they’re also key to solving many health conditions that disproportionately impact women, from diabetes to infertility to mental health challenges.

Many believe it’s that complexity that underscores the opportunity. Hormonal health sits at the center of conversations around personalized medicine and women’s health: By 2025, women’s health could be a $50 billion industry, and by 2026, digital health more broadly is estimated to hit $221 billion.

Still, as funding for women’s health startups drops and stigma continues to impact where venture dollars go, it’s unclear whether the sector will remain in its infancy or hit a true inflection point.

3 lessons we learned after raising $6.3M from 50 investors

Image of businesspeople climbing ladders up an arrow toward three increasingly tall piles of cash.

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

Two years ago, founders of calendar assistant platform Reclaim were looking for a “mango” seed round — a boodle of cash large enough to help them transition from the prototype phase to staffing up for a public launch.

Although the team received offers, co-founder Henry Shapiro says the few that materialized were poor options, partially because Reclaim was still pre-product.

“So one summer morning, my co-founder and I sat down in his garage — where we’d been prototyping, pitching and iterating for the past year — and realized that as hard as it was, we would have to walk away entirely and do a full reset on our fundraising strategy,” he writes.

Shapiro shares what he learned from embracing failure and offers three conclusions “every founder should consider before they decide to go out and pitch investors.”

For SaaS startups, differentiation is an iterative process

For SaaS success, differentiation is crucial

Image Credits: Kevin Schafer / Getty Images

Although software as a service has been thriving as a sector for years, it has gone into overdrive in the past year as businesses responded to the pandemic by speeding up the migration of important functions to the cloud, ActiveCampaign founder and CEO Jason VandeBoom writes in a guest column.

“We’ve all seen the news of SaaS startups raising large funding rounds, with deal sizes and valuations steadily climbing. But as tech industry watchers know only too well, large funding rounds and valuations are not foolproof indicators of sustainable growth and longevity.”

VandeBoom notes that to scale sustainably, SaaS startups need to “stand apart from the herd at every phase of development. Failure to do so means a poor outcome for founders and investors.”

“As a founder who pivoted from on-premise to SaaS back in 2016, I have focused on scaling my company (most recently crossing 145,000 customers) and in the process, learned quite a bit about making a mark,” VandeBoom writes. “Here is some advice on differentiation at the various stages in the life of a SaaS startup.”

#confluent, #depop, #ecommerce, #etsy, #expensify, #extra-crunch-roundup, #marqeta, #qualtrics, #quantum-metric, #saas, #social, #sprinklr, #startups, #tc, #venture-capital, #zeta-global

Amazon is now open to getting sued

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

Despite it being a short week, as always, it was a busy busy time. Our regular Friday producer Grace was under the weather today, so Chris stepped in to help out.

And as noted at the top of the episode, we’re running a survey. The survey is here, dear Equity family. Please fill it out so that we can keep making the show better.

That aside, here’s what Danny and Natasha and Alex got into:

That’s all we got! If you have heard Equity before, take the survey. Thank you!

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

#chipper-cash, #depop, #equity, #equity-podcast, #etsy, #fundings-exits, #startups, #unit

Etsy asks, ‘how do you do, fellow kids?’ with $1.6B Depop purchase

The news this morning that e-commerce marketplace Etsy will buy Depop, a startup that provides a second-hand e-commerce marketplace, for more than $1.6 billion may not have made a large impact on the acquiring company’s share price thus far, but it provides a fascinating look into what brands may be willing to pay for access to the Gen Z market.

First, a few details: Per Etsy, the Depop deal is worth “$1.625 billion consisting primarily of cash, subject to certain adjustments for Depop’s working capital, transaction expenses, cash and indebtedness, and certain deferred and unvested equity for Depop management and employees.” So, $1.625 billion, plus or minus. We’ll use that number this morning.

Because Etsy is a public company and the transaction is material, it provided a good deal of information on the acquisition. The key facts that relate to the scale of Depop’s business are as follows:

  • 2020 gross platform spend, revenue: “Depop’s 2020 gross merchandise sales (GMS) and revenue were approximately $650 million and $70 million, respectively, each increasing over 100% year-over-year.”
  • Historical gross platform spend trend: “Depop’s GMS grew at a compounded annual growth rate of nearly 80% from 2017-2020.”

At $70 million in 2020 revenue, Depop is being valued at a multiple of 23.2x of the previous year’s top line. That’s rich, but not impossibly high for a company that just had a huge pandemic year. (Though it is somewhat notable that Etsy is valuing Depop as if it was a high-growth SaaS business and not a consumer marketplace.)

The category of e-commerce performed well during the pandemic, implying that Depop’s non-pandemic growth rate would have been lower than what it ultimately recorded. How can we tell? The company’s historical GMS spend figure of “nearly 80%” from 2017 to 2020 is inclusive of the 100%+ GMS growth it recorded last year. We can infer, then, that in 2017, 2018 and 2019, GMS at Depop grew at a slower pace, namely one that is under the 80% mark.

#depop, #ec-ecommerce-and-d2c, #etsy, #fashion, #fundings-exits, #poshmark, #startups, #tc, #thredup

LA gets a big SAAS exit as Fastly nabs the Culver City-based Signal Sciences for $775M

Los Angeles was always more than a one industry town, even when it comes to technology startups, but media and entertainment (and social networking) were always the big draws in tinseltown.

Now the city’s enterprise tech scene can claim a really big winner with Signal Sciences, the security monitoring and management company that is getting bought by Fastly, a provider of content delivery networking services, for $775 million.

“Our team couldn’t be more excited about the opportunity to join Fastly to continue to drive forward security protections that empower developers. But we also believe this is a great moment to showcase the diversity of the LA technology scene,” wrote Signal Sciences chief executive, Andrew Peterson, in a direct message. “Being the largest enterprise tech outcome ever here, we’re just one of so many great deep technology companies who are paving the way for the next generation of SoCal based start ups. We’re thrilled to help lead the way for the broader tech community in Los Angeles.”

Content delivery and security go hand-in-hand and some of the biggest companies online use businesses like Fastly and its competitor, Cloudflare, to ensure that their online presence doesn’t go offline — and that browsers can quickly download and deliver websites.

Fastly said that the acquisition of Signal Sciences’ business will boost its ability to provide better security for applications and APIs — the connective fabric between different services that knit different technologies together behind the scenes.

With the acquisition, Fastly is planting a flag as a new competitor in the cybersecurity market, even as companies like Amazon, Microsoft, and Google offer a wider array of services under their Internet as a service business lines.

Application security is a higher value piece of the services stack and it takes advantage of the natural position that a company like Fastly has as a content distribution network.

“Fastly was founded to meet developers’ need for greater visibility and control. Now, as the digital transformation movement continues to accelerate, DevOps teams are struggling with inadequate and inflexible security tools,” said Joshua Bixby, Chief Executive Officer of Fastly, in a statement. “Together with Signal Sciences, we will give developers modern security tools designed for the way they work.”

Los Angeles, California, USA – March 23, 2016: Aerial view of the Hollywood sign at dusk in Los Angeles. The image has been taken from an helicopter flying over LA. Image Credit: Getty Images/franckreporter

Under the terms of the agreement Fastly is buying Signal Sciences for $200 million in cash and approximately $575 million worth of stock, subject to customary adjustments for transactions, according to a statement.

Fastly is also setting up a $50 million retention pool of restricted stock units to give out to Signal Sciences employees.

Signal Sciences employees aren’t the only winners in the deal. The company raised $63 million in venture financing from investors including CRV, Harrison Metal, Index Ventures, Oreilly Alphatech Ventures, Lead Edge Capital, and individual investors including former Facebook security officer Alex Stamos, and Etsy chief executive Chad Dickerson.

The company’s last round was a $35 million investment raised about two years ago, and one investor with knowledge of the company’s cap table called it a “pretty efficient exit” for its backers.

Morgan Stanley & Co. and Union Square Advisors are acting as financial advisors to Fastly, and Cooley LLP is acting as its legal advisor with regard to the transaction, according to a statement. Qatalyst Partners is acting as financial advisor to Signal Sciences, while Goodwin Procter was the company’s lawyer.

#alex-stamos, #amazon, #chad-dickerson, #chief-executive-officer, #cloudflare, #computing, #cooley-llp, #etsy, #facebook, #fastly, #financial-advisor, #financial-advisors, #google, #harrison-metal, #internet, #internet-security, #joshua-bixby, #lawyer, #lead-edge-capital, #los-angeles, #microsoft, #oreilly-alphatech-ventures, #qatalyst-partners, #signal-sciences, #social-networking, #tc, #union-square-advisors

Affirming the position of tech advocates, Supreme Court overturns Trump’s termination of DACA

The U.S. Supreme Court ruled today that President Donald Trump’s administration unlawfully ended the federal policy providing temporary legal status for immigrants who came to the country as children.

The decision, issued Thursday, called the termination of the Obama-era policy known as the Deferred Action for Childhood Arrivals “arbitrary and capricious.” As a result of its ruling, nearly 640,000 people living in the United States are now temporarily protected from deportation.

While a blow to the Trump Administration, the ruling is sure to be hailed nearly unanimously by the tech industry and its leaders, who had come out strongly in favor of the policy in the days leading up to its termination by the current President and his advisors.

At the beginning of 2018, many of tech’s most prominent executives, including the CEOs of Apple, Facebook, Amazon and Google, joined more than 100 American business leaders in signing an open letter asking Congress to take action on the Deferred Action for Childhood Arrivals (DACA) program before it expired in March.

Tim Cook, Mark Zuckerberg, Jeff Bezos and Sundar Pichai who made a full throated defense of the policy and pleaded with Congress to pass legislation ensuring that Dreamers, or undocumented immigrants who arrived in the United States as children and were granted approval by the program, can continue to live and work in the country without risk of deportation.

At the time, those executives said the decision to end the program could potentially cost the U.S. economy as much as $215 billion.

In a 2017 tweet, Tim Cook noted that Apple employed roughly 250 of the company’s employees were “Dreamers”.

The list of tech executives who came out to support the DACA initiative is long. It included: IBM CEO Ginni Rometty; Brad Smith, the president and chief legal officer of Microsoft; Hewlett-Packard Enterprise CEO Meg Whitman; and CEOs or other leading executives of AT&T, Dropbox, Upwork, Cisco Systems, Salesforce.com, LinkedIn, Intel, Warby Parker, Uber, Airbnb, Slack, Box, Twitter, PayPal, Code.org, Lyft, Etsy, AdRoll, eBay, StitchCrew, SurveyMonkey, DoorDash, Verizon (the parent company of Verizon Media Group, which owns TechCrunch).

At the heart of the court’s ruling is the majority view that Department of Homeland Security officials didn’t provide a strong enough reason to terminate the program in September 2017. Now, the issue of immigration status gets punted back to the White House and Congress to address.

As the Boston Globe noted in a recent article, the majority decision written by Chief Justice John Roberts did not determine whether the Obama-era policy or its revocation were correct, just that the DHS didn’t make a strong enough case to end the policy.

“We address only whether the agency complied with the procedural requirement that it provide a reasoned explanation for its action,” Roberts wrote. 

While the ruling from the Supreme Court is some good news for the population of “dreamers,” the question of their citizenship status in the country is far from settled. And the U.S. government’s response to the COVID-19 pandemic has basically consisted of freezing as much of the nation’s immigration apparatus as possible.

An Executive Order in late April froze the green card process for would-be immigrants, and the administration was rumored to be considering a ban on temporary workers under H1-B visas as well.

The President has, indeed, ramped up the crackdown with strict border control policies and other measures to curb both legal and illegal immigration. 

More than 800,000 people joined the workforce as a result of the 2012 program crafted by the Obama administration. DACA allows anyone under 30 to apply for protection from deportation or legal action on their immigration cases if they were younger than 16 when they were brought to the US, had not committed a crime, and were either working or in school.

In response to the Supreme Court decision, the President tweeted “Do you get the impression that the Supreme Court doesn’t like me?”

 

 

#adroll, #advisors, #airbnb, #amazon, #apple, #att, #brad-smith, #cisco-systems, #congress, #donald-trump, #doordash, #ebay, #etsy, #facebook, #ginni-rometty, #google, #hewlett-packard-enterprise, #ibm, #immigration, #intel, #jeff-bezos, #linkedin, #lyft, #mark-zuckerberg, #meg-whitman, #microsoft, #obama, #paypal, #president, #salesforce-com, #sundar-pichai, #supreme-court, #tc, #techcrunch, #tim-cook, #trump-administration, #twitter, #u-s-government, #uber, #united-states, #upwork, #verizon-media-group, #white-house

Etsy adds an AR shopping feature on iOS designed for use with wall art

Retailers like Target, Home Depot, Wayfair, IKEA, and others have embraced augmented reality to help shoppers make decisions about products they’re interested in by visualizing the items in their own homes. Today, Etsy is hopping on the AR bandwagon as well, with the launch of an updated iOS app that uses augmented reality features to help consumers shopping for wall art, specifically.

The company says it’s seen an increase in customers shopping for home decor since the start of the COVID-19 pandemic. In the last three months, for example, Etsy claims searches for wall decor or art have jumped 94% compared to the same time last year. Similarly, there’s been a 63% increase in searches for paintings and a 54% increase in searches for prints or illustrations.

As with many home decor items, it can be difficult to imagine how wall art will look in your space, next to your own furnishings, and whether it will agree with your room’s color scheme. Shoppers may also wonder if the item is the right size for their space or if they have even have a good spot to display the art.

Etsy’s AR feature aims to help answer those questions. In the iOS app, Etsy shoppers can now select any item categorized as Paintings, Photography, or Prints then tap the new augmented reality icon in the top right corner of the item image to see it appear in your own space. The company says its Art and Collectibles category offers over 5 million items, but doesn’t clarify how many of those are considered wall art.

Etsy says it began the development of the AR feature in early 2019, well before the COVID crisis. Unlike a typical e-commerce site, Etsy’s AR implementation is more difficult because it doesn’t work from a catalog of standard sizes and imagery. Instead, Etsy’s independent sellers add their own titles, tags, and photos, creating a massive amount of unstructured data.

To build the feature, Etsy engineers used the Vision framework in iOS to pull out the artwork to be placed in 3D, followed by Core Image to crop the image if needed. It also implemented an on-device machine learning image classification process to detect and classify whether a listing includes a frame and needs to be cropped. To place the artwork in the user’s environment, the AR feature leverages iOS’SceneKit and ARKit.

Once the AR item is loaded, you can then move your iPhone or iPad around your space to find an empty space on the wall, then tap on the AR item to place your item in the desired spot. If the item is available in multiple sizes, you’ll also be able to test that, too, by zooming in on the item. The feature works best with rectangular and square artworks, notes Etsy.

Much of Etsy’s business now flows through mobile as more consumers grow comfortable with shopping from their smartphones. The company reported its total revenue in Q1 2020 was $228.1 million, up 34.7% year-over-year. Gross profit reached $145.6 million, up 24.8%. These figures don’t reflect the full impact of the pandemic, given the quarter ended March 31, 2020. In Q1, Etsy says 58% of its gross merchandise sales came from mobile devices.

The AR feature is still in beta on the Etsy app for iOS. An Android version is in the works, Etsy says

#apps, #ar, #art, #augmented-reality, #etsy, #mobile, #shopping