HumanForest suspends London e-bike sharing service, cuts jobs after customer accident

UK-based startup HumanForest has suspended its nascent ‘free’ e-bike service in London this week, after experiencing “mechanical” issues and after a user had an accident on one of its bikes, TechCrunch has learned. The suspension has also seen the company make a number of layoffs with plans to re-launch next spring using a different e-bike.

The service suspension comes only a few months after HumanForest started the trial in North London — and just a couple of weeks after announcing a $2.3M seed round of funding backed by the founders of Cabify and others.

We were tipped to the closure by an anonymous source who said they were employed by the startup. They told us the company’s e-bike had been found to have a defect and there had been an accident involving a user, after which the service was suspended. They also told us HumanForest fired a bunch of staff this week with little warning and minimal severance.

Asked about the source’s allegations, HumanForest confirmed it had suspended its service in London following a “minor accident” on Sunday, saying also that it had identified “problems of a similar nature” prior to the accident but had put down those down to “tampering or minor mechanical issues”.

Here’s its statement in full: “We were not aware that the bike was defective. There had been problems of a similar nature which were suspected to be tampering or minor mechanical issues. We undertook extra mechanical checks which we believed had resolved the issue and informed the supplier. We immediately suspended operations following the minor accident on Sunday. The supplier is now investigating whether there is a more serious problem with the e-bike.”

In an earlier statement the startup also told us: “There was an accident last week. Fortunately, the customer was not hurt. We immediately withdrew all e-bikes from the street and we have informed the supplier who is investigating. Our customers’ safety is our priority. We have, therefore, decided to re-launch with a new e-bike in Spring 2021.”

HumanForest declined to offer any details about the nature of the defect that caused it to suspend service but a spokeswoman confirmed all its e-bikes were withdrawn from London streets the same day as the accident, raising questions as to why it did not do so sooner — having, by its own admission, already identified “similar problems”.

The spokeswoman also confirmed HumanForest made a number of job cuts in the wake of the service suspension.

“We are very sorry that we had to let people go at this difficult time but, with operations suspended, we could only continue as a business with a significantly reduced team,” she said. “We tried very hard to find a way to keep people on board and we looked at the possibility of alternative contractual arrangements or employment but unfortunately, there are no guarantees of when we can re-launch.”

“Employees who had been with the company for less than three months were on their probation period which, as outlined in their contract, had one week’s notice. We will be paying their salaries until the end of the month,” she said, reiterating that it’s a difficult time for the startup.

The e-bikes HumanForest was using for the service appear to be manufactured by the Chinese firm Hongji — but are supplied by a German startup, called Wunder Mobility, which offers both b2c and b2b mobility services.

We contacted both companies to ask about the e-bike defect reported by HumanForest.

At the time of writing only Wunder Mobility had responded — confirming it acts as “an intermediary” for HumanForest but not offering any details about the nature of the technical problem.

Instead, it sent us this statement, attributed to its CCO Lukas Loers: “HumanForest stands for reliable quality and works continuously to improve its services. In order to offer its customers the best possible range of services in the sharing business, HumanForest will use the winter break to evaluate its findings from the pilot project in order to provide the best and most sustainable solution for its customers together with Wunder Mobility in the spring.”

“Unfortunately, we cannot provide any information about specific defects on the vehicles, as we have only acted as an intermediary. Only the manufacturer or the operator HumanForest can comment on this,” it added.

In a further development this week, which points to the competitive and highly dynamic nature of the nascent micromobility market, another e-bike sharing startup, Bolt — which industry sources suggest uses the same model of e-bike as HumanForest (its e-bike is visually identical, just painted a more lurid shade of green) — closed its e-bike sharing service in Paris this week, a few months after launch.

When we contacted Bolt to ask whether it had withdrawn any e-bikes because of technical issues it flat denied doing so — saying the Paris closure was a business decision, and was not related to problems with its e-bike hardware.

“We understand some other companies have had issues with their providers. Bolt hasn’t withdrawn any electric bikes from suppliers due to defects,” a spokesperson told us, going on to note it has “recently” launched in Barcelona and trailing “more announcements about future expansion soon”.

In follow up emails the spokesperson further confirmed it hasn’t identified any defects with any e-bikes it’s tested, nor withdrawn any bikes from its supplier.

Bolt’s UK country manager, Matt Barrie, had a little more to say in a response to chatter about the various micromobility market moves on Twitter — tweeting the claim that: “Hardware at Bolt is fine, all good, the issues that HumanForest have had are with their bespoke components.”

“The Paris-Prague move is a commercial decision to support our wider business in Prague. Paris a good market and we hope to be back soon,” he added.

We asked HumanForest about Barrie’s claim that the technical issues with its hardware are related to “bespoke components” — but its spokeswoman declined to comment.

HumanForest’s twist on the e-bike sharing model is the idea of offering free trips with in-app ads subsidizing the rides. Its marketing has also been geared towards pushing a ‘greener commute’ message — touting that the e-bike batteries and service vehicles are charged with certified renewable energy sources.

#bolt, #e-bike-sharing, #europe, #hongji, #humanforest, #micromobility, #startups, #tc, #transportation, #wunder-mobility

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Calling Helsinki VCs: Be featured in The Great TechCrunch Survey of European VC

TechCrunch is embarking on a major new project to survey the venture capital investors of Europe, and their cities.

Our <a href=”https://forms.gle/k4Ji2Ch7zdrn7o2p6”>survey of VCs in Helsinki will capture how the city is faring, and what changes are being wrought amongst investors by the coronavirus pandemic. (Please note, if you have filled the survey out already, there is no need to do it again).

We’d like to know how Helsinki’s startup scene is evolving, how the tech sector is being impacted by COVID-19, and, generally, how your thinking will evolve from here.

Our survey will only be about investors, and only the contributions of VC investors will be included. More than one partner is welcome to fill out the survey.

The shortlist of questions will require only brief responses, but the more you can add, the better.

You can fill out the survey here.

Obviously, investors who contribute will be featured in the final surveys, with links to their companies and profiles.

What kinds of things do we want to know? Questions include: Which trends are you most excited by? What startup do you wish someone would create? Where are the overlooked opportunities? What are you looking for in your next investment, in general? How is your local ecosystem going? And how has COVID-19 impacted your investment strategy?

This survey is part of a broader series of surveys we’re doing to help founders find the right investors.

For example, here is the recent survey of London.

You are not in Helsinki, but would like to take part? European VC investors can STILL fill out the survey, as we will be putting a call out to your city next anyway!

The survey is covering almost every European country on the continent of Europe (not just EU members, btw), so just look for your country and city on the survey and please participate (if you’re a venture capital investor).

Thank you for participating. If you have questions you can email mike@techcrunch.com

#articles, #business, #corporate-finance, #economy, #entrepreneurship, #europe, #european-union, #helsinki, #london, #private-equity, #startup-company, #tc, #venture-capital

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Cambridge Analytica’s former boss gets 7-year ban on being a business director

The former CEO of Cambridge Analytica, the disgraced data company that worked for the 2016 Trump campaign and shut down in 2018 over a voter manipulation scandal involving masses of Facebook data — has been banned from running limited companies for seven years.

Alexander Nix signed a disqualification undertaking earlier this month which the UK government said yesterday it had accepted. The ban commences on October 5.

“Within the undertaking, Alexander Nix did not dispute that he caused or permitted SCL Elections Ltd or associated companies to market themselves as offering potentially unethical services to prospective clients; demonstrating a lack of commercial probity,” the UK insolvency service wrote in a press release.

Nix was suspended as CEO of Cambridge Analytica at the peak of the Facebook data scandal after footage emerged of him, filmed by undercover reporters, boasting of spreading disinformation and entrapping politicians to meet clients’ needs.

Cambridge Analytica was a subsidiary of the SCL Group, which included the division SCL Elections, while Nix was one of the key people in the group — being a director for SCL Group Ltd, SCL Social Ltd, SCL Analytics Ltd, SCL Commercial Ltd, SCL Elections and Cambridge Analytica (UK) Ltd. All six companies entered into administration in May 2018, going into compulsory liquidation in April 2019.

The “potentially unethical” activities that Nix does not dispute the companies offered, per the undertaking, are:

  • bribery stings and honey trap stings designed to uncover corruption
  • voter disengagement campaigns
  • the obtaining of information to discredit political opponents
  • the anonymous spreading of information

Last year the FTC also settled with Nix over the data misuse scandal — with the former Cambridge Analytica boss agreeing to an administrative order restricting how he conducts business in the future. The order also required the deletion/destruction of any personal information collected via the business.

Back in 2018 Nix was also grilled by the UK parliament’s DCMS committee — and in a second hearing he claimed Cambridge Analytica had licensed “millions of data points on American individuals from very large reputable data aggregators and data vendors such as Acxiom, Experian, Infogroup”, arguing the Facebook data had not been its “foundational data-set”.

It’s fair to say there are still many unanswered questions attached to the data misuse scandal. Last month, for example, the UK’s data watchdog — which raided Cambridge Analytica’s UK offices in 2018, seizing evidence, before going on to fine and then settle with Facebook (which did not admit any liability) over the scandal — said it would no longer be publishing a final report on its data analytics investigation.

Asked about the fate of the final report on Cambridge Analytica, an ICO spokesperson told us: “As part of the conclusion to our data analytics investigation we will be writing to the DCMS select committee to answer the outstanding questions from April 2019. We have committed to updating the select committee on our final findings but this will not be in the form of a further report.”

It’s not clear whether the DCMS committee — which has reformed with a different chair vs the one who in 2018 led the charge to dig into the Cambridge Analytica scandal as part of an enquiry into the impact of online disinformation — will publish the ICO’s written answers. Last year its final report called for Facebook’s business to be investigated over data protection and competition concerns.

You can read a TechCrunch interview with Nix here, from 2017 before the Facebook data scandal broke, in which he discusses how his company helped the Trump campaign.

#alexander-nix, #cambridge-analytica, #election-interference, #europe, #facebook, #microtargeting, #political-advertising, #privacy, #scl, #trump

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Spotify CEO Daniel Ek pledges $1Bn of his wealth to back deeptech startups from Europe

At an online event today, Daniel Ek, the founder of Spotify, said he would invest 1 billion euros ($1.2 billion) of his personal fortune in deeptech “moonshot projects”, spread across the next 10 years.

Ek indicated that he was referring to machine learning, biotechnology, materials sciences and energy as the sectors he’d like to invest in.

“I want to do my part; we all know that one of the greatest challenges is access to capital,” Ek said, adding he wanted to achieve a “new European dream”.

“I get really frustrated when I see European entrepreneurs giving up on their amazing visions selling early on to non-European companies, or when some of the most promising tech talent in Europe leaves because they don’t feel valued here,” Ek said. “We need more super companies that raise the bar and can act as an inspiration.”

According to Forbes, Ek is worth $3.6 billion, which would suggest he’s putting aside roughly a third of his own wealth for the investments.

And it would appear his personal cash will be deployed with the help of a close confidant of Ek’s. He retweeted a post by Shakhil Khan, one of the first investors in Spotify, who said “it’s time to come out of retirement then.”

During a fireside chat held by the Slush conference, he said: “We all know that one of the greatest challenges is access to capital. And that is why I’m sharing today that I will devote €1bn of my personal resources to enable the ecosystem of builders.” He said he would do this by “funding so-called moonshots focusing on the deep technology necessary to make a significant positive dent, and work with scientists, entrepreneurs, investors and governments to do so.”

He expressed his desire to level-up Europe against the US I terms of tech unicorns: “Europe needs more super companies, both for the ecosystem to develop and thrive. But I think more importantly if we’re going to have any chance to tackle the infinitely complex problems that our societies are dealing with at the moment, we need different stakeholders, including companies, governments, academic institutions, non-profits and investors of all kinds to work together.”

He also expressed his frustration at seeing “European entrepreneurs, giving up on their amazing visions by selling very early in the process… We need more super companies to raise the bar and can act as an inspiration… There’s lots and lots of really exciting areas where there are tons of scientists and entrepreneurs right now around Europe.”

Ek said he will work with scientists, investors, and governments to deploy his funds. A $1.2 billion fund would see him competing with other large European VCs such as Atomico, Balderton Capital, Accel, Index Ventures and Northzone.

Ek has been previously known for his interest in deeptech. He has invested in €16m in Swedish telemedicine startup Kry. He’s also put €3m into HJN Sverige, an artificial intelligence company in the health tech arena.

#articles, #artificial-intelligence, #balderton-capital, #biotechnology, #business, #daniel-ek, #economy, #energy, #entrepreneurship, #europe, #forbes, #founder, #kry, #machine-learning, #northzone, #private-equity, #spotify, #startup-company, #tc, #telemedicine, #united-states

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Snyk acquires DeepCode to boost its code review smarts

Switzerland-based machine learning code review startup DeepCode — which bills itself as ‘Grammarly for coders’ — has been acquired by Snyk, a post-unicorn valuation cybersecurity startup which is focused on helping developers secure their code.

Financial terms of the deal have not been disclosed. But the ‘big code’ parsing startup had only raised around $5.2M since being founded back in 2016, per CrunchBase — mostly recently closing a $4M seed round from investors including Earlybird, 3VC and btov Partners last year.

DeepCode CEO and co-founder Boris Paskalev confirmed the whole team is “eagerly” joining Snyk to continue what he couched as “the mission of making semantic AI-driven code analysis available for every developer on the planet”.

“DeepCode as a company will continue to exist (fully owned by Snyk), we will keep and plan to grow the Zurich office and tap into the amazing talent pool here and we will continue supporting and expanding the cutting-edge product offering for the global development community,” Paskalev told TechCrunch.

Asked whether DeepCode’s product will continue to exist as a standalone in the future or whether full assimilation into Snyk’s platform will include closing down the code-review bot it currently offers developers he said no decision has yet been taken.

“We are still to evaluate that in details but the main goal is to maintain/expand the benefits that we offer to all developers and specifically to grow the open-source adoption and engagement,” he said, adding: “Initially clearly nothing will change and the DeepCode product will remain as a standalone product.”

“Both companies have a very clear vision and passion for developer-first and helping developers and security teams to further reduce risk and become more productive,” Paskalev added.

In a statement announcing the acquisition Snyk said it will be integrating DeepCode’s technology into its Cloud Native Application Security platform — going on to tout the benefits of bolting on its AI engine which it said would enable developers to “more quickly identify vulnerabilities”.

“DeepCode’s AI engine will help Snyk both increase speed and ensure a new level of accuracy in finding and fixing vulnerabilities, while constantly learning from the Snyk vulnerability database to become smarter,” wrote CEO Peter McKay. “It will enable an even faster integration for developers, testing for issues while they develop rather than as an additional step. And it will further increase the accuracy of our results, almost eliminating the need to waste time chasing down false positives.”

Among the features that have impressed Snyk about DeepCode, McKay lauded code scanning that’s “10-50x faster than alternatives”; and what he described as an “exceptional developer UX” — which allows for “high precision semantic code analysis in real-time” because scanning is carried out at the IDE and git level.

In its own blog post about the acquisition of the ETH Zurich spin-off, the university writes that the AI startup’s “decisive advantage” is that ‘it has developed the first AI system that can learn from billions of program codes quickly, enabling AI-​based detection of security and reliability code issues”.

“DeepCode is an excellent example of a modern AI system that can learn from data, program codes in this case, yet remain transparent and interpretable for humans,” it adds.

The university research work underpinning DeepCode dates back to 2013 — when its co-founders were figuring out how to combine data-​driven machine learning methods with semantic static code analysis methods based on symbolic reasoning, per the blog post.

DeepCode’s tech currently reaches more than 4M contributing developers, with more than 100,000 repositories subscribed to its service.

#code-review, #cybersecurity, #deepcode, #developer, #eth-zurich, #europe, #fundings-exits, #machine-learning, #snyk, #startups

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As Virus Cases Surge in Europe, Hospitalizations Lag. But for How Long?

For now, countries are betting they can suppress hospital admissions and deaths without imposing more lockdowns, even as case numbers approach peak levels from last spring.

#belgium, #coronavirus-2019-ncov, #disease-rates, #epidemics, #europe, #france, #germany, #great-britain, #hospitals, #italy, #quarantines, #spain

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UK launches COVID-19 exposure notification app for England and Wales

The last two regions of the UK now have an official coronavirus contacts tracing app, after the UK government pushed the button to launch the NHS COVID-19 app across England and Wales today.

Northern Ireland and Scotland launched their own official apps to automate coronavirus exposure notifications earlier this year. But the England and Wales app was delayed after a false start back in May. The key point is that the version that’s launched now has a completely different app architecture.

All three of the UK’s official coronavirus contacts tracing apps make use of smartphones’ Bluetooth radios to generate alerts of potential exposure to COVID-19 — based on estimating the proximity of the devices.

A very condensed version of how this works is that ephemeral IDs are exchanged by devices that come into close contact and stored locally on app users’ phones. If a person is subsequently diagnosed with COVID-19 they are able to notify the system, via their public health authority, which will broadcast the relevant (i.e. ‘risky’) IDs to all other devices.

Matching to see whether an app user has been exposed to any of the risky IDs also takes place locally — meaning exposure alerts are not centralized.

The use of this decentralized, privacy-preserving architecture for the NHS COVID-19 app is a major shift vs the original app which was being designed to centralize data with the public health authority.

However the government U-turned after a backlash over privacy and ongoing technical problems linked to trying to hack its way around iOS limits on background access to Bluetooth.

Switching the NHS COVID-19 app to a decentralized architecture has allowed it to plug into coronavirus exposure notification APIs developed by Apple and Google — resolving technical problems related to device detection which caused problems for the earlier version of the app.

In June, the government suggested there were issues with the APIs related to the reliability of estimating distance between devices. Asked about the reliability of the Bluetooth technology the app is used on BBC Radio 4’s Today program this morning, health secretary Matt Hancock said: “What we know for absolute sure is that the app will not tell you to self isolate because you’ve been in close contact with someone unless you have been in close contact. The accuracy with which it does that is increasing all of the time — and we’ve been working very closely with Apple and with Google who’ve done a great job in working to make this happen and to ensure that accuracy is constantly improved.”

The health secretary described the app as “an important tool in addition to all the other tools that we have” — adding that one of the reasons he’d delayed the launch until now was because he didn’t want to release an app that wasn’t effective.

“Everybody who downloads the app will be helping to protect themselves, helping to protect their loves one, helping to protect their community — because the more people who download it the more effective it will be. And it will help to keep us safe,” Hancock went on.

“One of the things that we’ve learnt over the course of the pandemic is where people are likely to have close contacts and in fact the app that we’re launching today will help to find more of those close contacts,” he added.

The England and Wales app does have some of unique quirks — as the government has opted to pack in multiple features, rather than limiting it to only exposure notifications.

These bells & whistles include: risk alerts based on postcode district; a system of QR code check-in at venues (which are now required by law to display a QR code for app users to scan); a COVID-19 symptom checker and test booking feature — including the ability to get results through the app; and a timer for users who have been told to self-isolate to help them keep count of the number of days left before they can come out of quarantine, with pointers offered to “relevant advice”.

“[The app] helps you to easily go to the pub or a restaurant or hospitality venue because you can then click through on the QR code which automatically does the contact tracing that is now mandatory,” said Hancock explaining the thinking behind some of the extra features. “And it helps by explaining what the rules are and the risk in your area for people easily and straightforwardly to be able to answer questions and consult on the rules so it has a whole series of features.”

It remains to be seen whether it was sensible product design to bolt on all these extras — and QR code venue check-ins could carry a risk of confusing users. However the government’s logic appears to be that more features will encourage more people to download the app and thereby increase uptake and utility.

Once widespread, the mandatory venue QR codes will also effectively double as free ads for the app so that could help drive downloads.

More saliently, the Bluetooth exposure notification system depends on an effective testing regime and will therefore be useless in limiting the spread of COVID-19 if the government can’t improve coronavirus test turnaround times — which it has been struggling with in recent weeks, as major backlogs have built up.

Internet law expert, professor Lilian Edwards — who was on an ethics advisory panel for the earlier, now defunct version of the England & Wales app — made this point to BBC Radio 4’s World at One program yesterday.

“My main concern is not the app itself but the interaction with the testing schedule,” she said. The app only sends out proximity warnings to the contacts on upload of a positive test. The whole idea is to catch contacts before they develop symptoms in that seven-day window when they won’t be isolating. If tests are taking five to seven days to get back then by that time the contacts will have developed symptoms and should hopefully be isolating or reporting their symptoms themselves. So if we don’t speed up testing then the app is functionally useless.”

#apple, #apps, #coronavirus-contacts-tracing, #decentralized, #europe, #exposure-notifications, #google, #health, #matt-hancock, #nhs-covid-19-app

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Ripjar, founded by GCHQ alums, raises $36.8M for AI that detects financial crime

Financial crime as a wider category of cybercrime continues to be one of the most potent of online threats, covering nefarious actives as diverse as fraud, money laundering and funding terrorism. Today, one of the startups that has been building data intelligence solutions to help combat that is announcing a fundraise to continue fueling its growth.

Ripjar, a UK company founded by five data scientists who previously worked together in British intelligence at the Government Communications Headquarters (GCHQ, the UK’s equivalent of the NSA), has raised $36.8 million (£28 million) in a Series B, money that it plans to use to continue expanding the scope of its AI platform — which it calls Labyrinth — and scaling the business.

Labyrinth, as Ripjar describes it, works with both structured and unstructured data, using natural language processing and an API-based platform that lets organizations incorporate any data source they would like to analyse and monitor for activity.

Sources close to the company say that the funding values the startup in the region of £100 million, or about $127 million. Ripjar is currently profitable, the company confirmed.

The funding is being led by Long Ridge Equity Partners, a specialist fintech investor, with previous investors Winton Capital Ltd and Accenture plc also participating. Accenture is a strategic partner: the consultancy/systems integrator uses Ripjar’s tech to work with a number of clients in the financial services sector. Ripjar also has government clients, where its platform is used for counterterrorism work. It declines to disclose any specific names but it does note that its extensive partner list also includes the likes of PWC, BAE Systems, Dow Jones and more.

“We are excited to partner with Long Ridge who bring expertise and resources in scaling fast-growing software companies,” said Jeremy Annis, the co-founder who is both the CEO and CTO of Ripjar. “This investment signals enormous confidence in our world-leading data intelligence technology and ability to protect companies and governments from criminal behaviour which threatens their assets and prosperity. With this funding, we will accelerate the expansion of Ripjar worldwide to provide our customers with the most advanced financial crime solutions, as well as creating new iterations of the Labyrinth platform.”

The startup says that it’s had its biggest year yet — no surprise, given the circumstances. Not only has there been huge shift to online transactions in 2020 because of the rise of the Covid-19 global health pandemic; but a tightening of the world economy has led to more financial scrambling and new nefarious activity, as well as criminal acts to profit from the instability.

That’s led to inking deals with six new enterprise customers and expanding deals with four existing major clients, and Ripjar said that it now has some 20,000 clients globally.

And if you are curious about the name as I was, it’s if anything a meta reference to some of the kind of work that Ripjar does.

“It doesn’t mean anything,” a spokesperson said. “It was created using technology to ensure a name was selected that had never been used before.”

London, as one of the world’s financial centers, has developed a strong reputation for hatching and growing interesting fintech startups, and that has also meant the UK — which also has a strong talent base in artificial intelligence — has become very fertile ground also for startups building services to help protect those fintechs.

Ripjar’s raise, and rise, come within months of two other companies building AI to combat fraud and financial crime also raising money and growing. In July, ComplyAdvantage, which has also been building a database and platform to help combat financial crime, announced a $50 million raise. And a week before that, another UK company also building AI for financial and other cybercrime detection, Quantexa, raised $64.7 million.

Ripjar counts both of these, as well as bigger targets like Palantir, among its competitors. As is most likely, the big institutions that are grappling with financial crime are most likely using a several companies’ technology at the same time.

It claims to have the more sophisticated approach. “We believe that Labyrinth is the most advanced solution in the market as we’ve developed it after decades of first hand experience of fighting crime and terrorism within the national security community,” said David Balson, Director of Intelligence at Ripjar, in answer to my question about competitors. “There is no silver bullet in the fight against crime. As such, we’ve had to come up with hundreds of innovations to increase the efficiency and effectiveness of the vital work that goes on in the financial sector and law enforcement. This includes our world leading natural language processing (NLP) and identity resolution capabilities, which work over any global language and script, joining the dots automatically between structured data and unstructured text like documents, news reports, web pages and intelligence reports. It’s a vital tool to help analysts overcome the information overload that is so often associated with the sector.”

Indeed, the silver bullet reference applies to more than just Ripjar’s technology. With the issue of money laundering alone a $2 trillion problem (with only 1-2% of that ever identified and recovered), you can see why, at least for right now, banks, governments and others might be willing to put multiple resources on the problem to try to tackle it.

“Financial institutions, corporates and government agencies face ever-increasing risks associated with financial crime and cyber threats” said Kevin Bhatt, a Managing Partner at Long Ridge, in a statement. “We believe Ripjar is well-positioned to provide artificial intelligence solutions that will allow its clients to reduce the cost of compliance, while uncovering new threats through automation. We are incredibly excited to partner with Ripjar to support their continued growth and look forward to working closely with the Ripjar team as they expand to new geographies, customers, and verticals.”

#artificial-intelligence, #counterterrorism, #cybercrime, #enterprise, #europe

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Small business challenger bank Finom raises another $12 million to expand in Europe

B2B financial service start-up Finom — which provides online financial services for SMEs, freelancers, and the self-employed in Europe — has raised an additional $12 million (€10.3 million) to add to its previous Seed round of €6.5 million last April. The total funding raised in 2020 is now €16.8 million, and this is before the company has done a Series A round. Investors include Target Global (Germany), Cogito Capital (Poland), Entree Capital (Israel), Avala Capital (Germany), Tal Capital (India), and Adfirst Ventures FJ Labs (USA).

The additional investment round will allow Finom to extend its licensed activities, develop product and enter new European markets.

Founded in 2019, Finom is based out of the Netherlands and was founded by the team previously responsible to Modulbank, a B2B online banks in Russia. So far it providing an e-invoicing service in Italy, and will launch in France this October.

Similar to other online challenger banks aimed at SMEs, the company is aiming at countries where there is a relatively low penetration of online SME banking players, such as as Poland, Spain, Austria, Switzerland.

#europe, #tc

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New report finds VC investment into climate tech growing five times faster than overall VC

VC and corporate investment into climate tech grew at a faster rate than overall VC investment as a whole between 2013 – 2019, according to a major new report — to the tune of $60 billion of early-stage capital.

The new research by PwC (“The State of Climate Tech 2020“) found that although it’s still early days for climate tech in terms of the overall VC market (approx 6% of total capital invested in 2019), VC investment into the space is growing at a clip: it increased from $418 million per annum in 2013 to $16.3 billion in 2019. According to the report, that is approximately three times the growth rate of VC investment into AI over the same period, and five times the average growth in VC.

The reasons are, predictably, to do with market economics. It’s quickly becoming more capitally efficient to prove and scale the technologies involved, and carbon-neutral or even carbon negative solutions have fewer costs than carbon-producing ones.

Nearly half of this venture cash ($60bn) went to US and Canadian climate tech startups ($29 billion), while China comes in second at $20 billion. The European market attracted $7 billion. The majority of investments for the US and China go to mobility and transport solutions.

Climate tech startup investment in the San Francisco Bay area, at $11.7 billion, was 56% higher than its nearest rival, Shanghai, which reached $7.5 billion. Europe is more invested in renewable energy generation (predominantly photovoltaics cells) and batteries.

Celine Herweijer, global leader, Innovation & Sustainability, PwC UK in a statement: “The analysis shows the urgency of the opportunity, and gap to close, to support and scale innovative technologies and business models to address the climate crisis. Climate tech is a new frontier in venture investing for the 2020s.”

“Some of the technologies and solutions critical to enabling this transformation are proven and need rapid commercialization, which is why venture capital is key. It will not need trillions invested in startups to make a difference. But for the trickier technologies and markets it will need targeted support, including from governments, to make it through research and development, and the early stages beyond which capital increasingly is lining up,” she added.

The biggest drivers for growth in climate tech, according to the report, relate to mobility and transport, heavy industry, and Greenhouse Gas (GHG) capture and storage> These are followed by food, agriculture, land use, built environment, energy, and climate and Earth data generation.

Anyone who reads TechCrunch will be well aware of the electric scooter and e-bike wars that have broken out in recent years. And sure enough, the report finds that investment in these micro-mobility startups has grown dramatically, recording a CAGR of 151%, and representing 63% $37.4 billion of all climate tech funding over the past seven years.

Azeem Azhar, senior advisor to PwC UK, founder of Exponential View, and co-author of the report, said: “The climate tech market is maturing. As a society we are seeing more entrepreneurs launch startups, more investors back them, and an increasing number of larger funding rounds for later-stage high-potential deals. But PwC’s analysis shows the ecosystem is still nascent, with key gaps in the depth and nature of funding available to founders and tricky structural hurdles for them to navigate as they scale their businesses.”

Where is the investment coming from? From a wide range of sources: traditional VC firms and venture funds specializing in sustainability, corporate investors including energy majors, global consumer goods companies and big tech, government-backed investment firms, and private equity players.

The report found that corporate venture capital (CVC) looms large in the sector, especially startups typified by high capital costs aimed at disrupting incumbent industries with high barriers to entry, such as in energy, heavy industry and transport. For Mobility and Transport, 30% of the climate tech deals include a CVC firm, and in Energy, 32% of capital deployed came from CVCs. Overall, nearly a quarter of climate tech deals (24%) included a corporate investor.

Herweijer said: “The involvement of corporates will be key to the continued success of climate tech – both in terms of their net-zero commitments driving demand for new solutions, and their investments into commercializing innovation. It’s not just the financial means they bring, but the commercial know-how, and industry knowledge to help startups navigate how to rapidly deploy and scale new innovations into the market.”

Amongst the top ten cities for climate tech startup investment are – outside of the US and China – were Berlin, London, Labege (France) and Bengaluru, India. These attracting $1.3 billion, mainly across energy, agriculture and food and land use.

The sections perhaps most relevant to a TechCrunch audience occur on page 44 onwards which shows that the ClimateTech market is starting to behave like the high-growth tech startup world. Where barriers existed before such as technical risk, product risk, market risk, these are being addressed. Recognizable VC names such as Sequoia, GV, Kosler, Horizons, YC, USV are all getting involved.

And although almost 300 global companies have committed to achieving net-zero emissions before 2050, “with just ten years to reduce by half global greenhouse gas emissions to limit global warming to 1.5C, climate tech needs a rapid injection of capital, talent and public-private support to match its potential to build and accelerate faster, bolder innovation,” added Herweijer.

#europe, #tc, #venture-capital

0

E.U. Offers Cash and More Deportations in New Plan for Migrants

The bloc wants to persuade its most anti-immigrant member countries to agree to a common policy. But the future of its new plan, like many of its details, remains uncertain.

#asylum-right-of, #europe, #european-commission, #european-union, #immigration-and-emigration, #middle-east-and-africa-migrant-crisis, #refugees-and-displaced-persons

0

Kard raises another $3.5 million for its challenger bank for teens

French startup Kard has added $3.5 million (€3 million) to its seed round. The company already raised the same amount last year, which means that Kard has raised $7 million (€6 million) in total for its seed round.

Founders Future is leading the round, with Laurence Krieger, Michael Vaughan, Jon Oringer and Iris Mittenaere also participating.

Kard is building a challenger bank specifically designed for teenagers. When you create an account, you receive your own IBAN and a Mastercard debit card. You can block and unblock the card, you receive instant transaction notifications and you can send and receive money with other Kard users.

For the past year, the service has been completely free and 50,000 teenagers signed up. Starting today, Kard is switching to paid subscriptions for new users. Each family has to pay €4.99 per month or €49.90 per year to create a family account. After that, you can create as many account as you want — if you have two, three or four children, it still costs €4.99 per month.

With today’s change, Kard is also adding some additional features. Parents can download the Kard app and manage allowances from the app. You can schedule weekly or monthly transfers, block your child’s card and send money instantly by pairing a card with the app.

As for teenagers, Kard users now get a virtual card for online payments. As a Kard user, your smartphone is insured against screen damage (up to €100). There are now three different card designs as well — black, silver or pink.

The startup says that Apple Pay and Google Pay are on the roadmap, as well as money pots. There will be some personalized discounts in the app as well, which could open up a new revenue stream.

Kard competes with PixPay, Xaalys, Vybe, but also Revolut Junior, Lydia and services from traditional banks. Let’s see how the new pricing strategy affects Kard’s growth going forward.

#challenger-bank, #europe, #finance, #fundings-exits, #kard, #neobank, #startups

0

EU’s antitrust probe of Google-Fitbit gets more time

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

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

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

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

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

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

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

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

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

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

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

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

#antitrust, #europe, #european-commission, #european-union, #fitbit, #google, #health, #health-data, #policy, #privacy, #wearables

0

Facebook denies it will pull service in Europe over data transfer ban

Facebook’s head of global policy has denied the tech giant could close its service to Europeans if local regulators order it to suspend data transfers to the US following a landmark Court of Justice ruling in July that has cemented the schism between US surveillance laws and EU privacy rights.

Press reports emerged this week of a Dublin court filing by Facebook, which is seeking a stay to a preliminary suspension order on its EU-US data transfers, that suggested the tech giant could pull out of the region if regulators enforce a ban against its use of a data transfer mechanism known as Standard Contractual Clauses.

The court filing is attached to Facebook’s application for a judicial review of a preliminary suspension order from Ireland’s Data Protection Commission earlier this month, as Facebook’s lead EU data supervisor responded to the implications of the CJEU ruling.

“We of course won’t [shut down in Europe] — and the reason we won’t of course is precisely because we want to continue to serve customer and small and medium sized businesses in Europe,” said Facebook VP Nick Clegg during a livestreamed EU policy debate yesterday.

However he also warned of “profound effects” on scores of digital businesses if a way is not found by lawmakers on both sides of the pond to resolve the legal uncertainty around US data transfers — making a pitch to politicians to come up with a new legal ‘sticking plaster’ for EU-US data transfers now that a flagship arrangement, called Privacy Shield, is dead.

“We have a major issue — which is that for various complex, legal, political and other reasons question marks are being raised about the current legal basis under which data transfers occur. If those legal means of data transfer are removed — not by us, but by regulators — then of course that will have a profound effect on how, not just our services, but countless other companies operate. We’re trying to avoid that.”

The Facebook VP was speaking during an EBS panel debate on rebooting the regional economy “towards a green, digital and resilient union” — which included the EU’s commissioner for the economy, Paolo Gentiloni, and others.

Discussing the Dublin legal filing, Clegg suggested that an overenthusiastic reporter “slightly overwrote” in their interpretation of the document. “We’ve taken legal action in the Dublin courts to — in a sense — to try to send a signal that this is a really big issue for the whole European economy, for all small and large companies that rely on data transfers,” he said.

Clegg went on to claim that while Facebook being forced to suspend data transfers from the EU to the US “would of course be very bad for Facebook” the impact of such an order “would be absolutely disastrous for the economy as a whole”.

“What is at stake here is quite a big issue that in the end can only be resolved politically between a continued negotiation between the US and the EU that clearly is not going to happen until there’s a new US administration in place after the transition period in the early part of next year,” he said, indicating Facebook is using Ireland’s courts to try to buy time for a political fix.

“We need the time and the space for the political process between the EU and the US to work out so that companies can have confidence going fwd that they’re able to transfer data going forward,” he added.

Clegg also sought to present Facebook’s platform as a vital component of any regional economy recovery — talking up its utility to European SMEs for reaching customers.

Some 25M European companies use its apps and tools, he said — impressing that the “vast majority” do so for free and further claiming activity on Facebook’s ad platform could be linked to sales of 208BN, and 3M+ jobs, per independent estimates.

“In terms of the economic recovery, our most important role is to continue to provide that extraordinary capacity for small businesses to do something which in the past only big businesses could do,” he said. “In the past only big businesses had the fancy marketing budgets and could take out bill boards and television and radio ads. The transformational effect of social media and Facebook in part economically speaking is that it’s levelled the playing field.”

Clegg went further on this point — linking the mass exploitation of Internet users’ personal data to the economic value generated by regional businesses via what he badged “personalized advertising” — aka “Facebook’s business model”.

“The personalized advertising model allows us to do that — allows us to level the playing field,” he claimed.

The tech giant’s processing of Europeans’ personal data remains under investigation on multiple fronts by EU regulators — meaning that as well as the clear threat to its US transfers Facebook’s core business model risks being unpicked by regulators if it faces enforcement action over multiple claimed data protection violations in future.

“I’m acutely aware that it is a business model that has plenty of criticism aimed at it and there’s a totally legitimate debate which rages in Brussels and elsewhere about how Facebook gathers, stores and monetizes data — and that is a totally legitimate and ongoing debate — but I hope people will not overlook that that business model has one ingenious benefit, amongst others, which is that it allows small businesses to operate on the same basis as big businesses in reaching their customers,” he said.

Never one to waste a lobbying opportunity, Clegg argued the pandemic has made this capacity “even more important” with EU populations under lockdown and fewer opportunities for businesses to engage in face to face selling.

Taxing times

The knotty issue of digital tax reform also came up during the debate.

Gentiloni reiterated the Commission position that it wants to see global agreement on reforming tax rules to take account of the shift to online business but he said the bloc is willing to go ahead with a European digital tax if that effort fails.

“We can’t remain with the model of the previous century,” he said, before going on to flesh out the challenges facing global accord on the issue. “We don’t want to be the one breaking this OECD process. To be honest, there was a lot of progress in this thing that we call ‘inclusive framework’ — more than dozens of countries working together and reaching something like an agreement on a new form of digital tax but then one single country — but a very important one — is not agreeing with this solution, is proposing a different one. But this different solution, the so called ‘Safe Harbor’, appears a little bit like an optional solution and it’s a bit difficult to conceive of an optional solution because of course you don’t pay ‘optional taxes’, I don’t think so. But we are still committed towards the end of this year to try to find this solution.

“My absolute preferred solution would be a global one. For many reasons — for avoiding tensions among different countries, and for facilitating for business the payment of taxes — but I want to say very clearly that we have a second best solution which is a European digital taxation because the alternative to this would be to have, as we already have in legislation, a French one, an Italian one, a Spanish one and I don’t think this is a good solution for Facebook or other companies. So we’re working for global but if global is not possible we will go European.”

Facebook’s Clegg said the company “will pay the taxes that are due under the rules that operate”, adding that if there is a European digital tax it will “of course” abide by it. But he too said Facebook’s preference is for a global arrangement.

#data-transfers, #digital-tax-reform, #europe, #facebook, #nick-clegg, #policy, #privacy, #privacy-shield, #schrems-ii, #social

0

Belarus Needs New Elections, Says Opposition Leader Svetlana Tikhanovskaya

My husband was jailed for daring to run against our president. So I ran in his place.

#belarus, #demonstrations-protests-and-riots, #elections, #europe, #european-parliament, #lithuania, #lukashenko-aleksandr-g, #minsk-belarus, #politics-and-government

0

New research shows European startups are spending drastically less on a US launch, for the same gains

It used to be the case that in order to scale glocally, European companies needed to spend big on launching in the US to achieve the kind of growth they wanted. That usually meant re-locating large swathes of the team to the San Francisco / Bay Area, or New York. New research suggests that is no longer the case, as the US has become more expensive, and as the opportunity in Europe has improved. This means European startups are committing much less of their team and resources to a US launch, but still getting decent results. That said, European startups will still look to the US for exits, as European corporates remain laggards in innovation.

New research by Index Ventures today reveals that less than 1 in 5 (50 out of 275) European tech firms are choosing to relocate their engineering base as they expand to the US, in stark contrast with the general strategy 10 years ago.
 Instead, says Index, Europe’s top tech start-ups are managing to get the growth gains they need about of the US with much smaller ‘on the ground’ footprint.

The survey of 275 European startups over the last decade (including an in-depth survey of over 100 firms) indicates that creating US-based engineering, tech and R&D teams has fallen out of favor, and they are staying in Europe for longer, taking advantage of Europe’s much-improved availability of talent and funding. 

Between 2008-2014 almost two thirds (59%) of European start-ups expanded, or moved entirely, to the US ahead of  Series A funding rounds. However, between 2015-2019 this number decreased to a third (33%). 

This chimes with research from StackOverflow which has found that the European tech scene has lifted, with more than 6 million professional developers residing in Europe, compared to just 4.3 million in the US. Tightened US immigration rules, and demand outstripping supply have inflated US tech salaries, which are 42% higher in San Francisco compared to London, making it more expensive and less cost efficient for European startups to double down in the US. Especially when they can achieve similar growth from home.

European founders are also now raising more, with rounds growing from $15.3bn to $34.3bn over the past four years.

Danny Rimer, Partner at Index Ventures said in a statement: “While for some founders, and certainly once a business reaches certain milestones, establishing a US base is a good decision, it is becoming increasingly costly and challenging.”

At the same time, however, Index found that European corporates invest three quarters (76%) less than their US counterparts on software, and this is normally on compliance rather than innovation. This means European startups are likely to continue to look to the US for exits to corporates.

The research findings are revealed in ‘Expanding to the US’, Index Ventures’ third handbook for tech founders seeking domestic and international growth. It also includes a ‘personality test’ for startups to figure out at what stage they need to prepare for a US launch.

As well as analysis of 353 European (275) and Israeli (78) VC-backed startups that have expanded into the US over the last 10 years it includes US expansion strategies and interviews with founders who’ve done it.

#europe, #tc

0

TransferWise reports accelerating revenue growth to 70% in its March, 2020 fiscal year

TransferWise, a European fintech unicorn, announced the financial results of its fiscal year ending March, 2020.

The company posted strong growth, continued profit and new customer records. TransferWise was most recently valued at $5 billion during a secondary sale worth $319 million in July of this year.

On the results front, we can compare the company’s March 2020 year to its March 2019 year, the results of which we also have available. Here are the nuts and bolts, picking from the provided metrics to share the most material:

  • TransferWise fiscal 2020 revenue: £302.6 million, up 70% from its fiscal 2019 result of £179 million. That’s a venture-level revenue result from a mature company that is self-powering.
  • TransferWise grew more quickly in its March 2020 year than in its March 2019 year, when it managed a slower 53% growth rate per the company. Accelerating revenue growth at this scale is very valuable.
  • TransferWise managed a fourth year of consecutive profitability, generating £21.3 million in “net profit after tax” for the March 2020 fiscal year. The company first started generating profit “since 2017” per its own release, which we presume means the year ending March 2017.
  • The company reported that it now has 8 million worldwide customers, up from 6 million in the preceding fiscal year. That’s 33% growth.
  • The pace at which business customers sign up for TransferWise appeared to include slower growth, moving from 10,000 per month in the March 2019 year to “over 10,000” in its most recent release.
  • TransferWise processed £42 billion in “cross currency transfers,” or around 63% of its total processing volume of £67 billion.

Instead of merely shouting at this point that TransferWise should go public, as it is providing granular data on its performance we’re already somewhat sated. More notes on gross margins would be good, for example, but this level of transparency is still welcome.

Turning to future growth, TransferWise stated in a release that APAC is the company’s “fastest growing region.” Its U.S. business was worth around a fourth of its March 2020 year’s revenue. Europe was just over half for the same period.

The company’s ability to pay for its own growth means that it has not raised money for some time. Indeed, the last equity round that we have on the company is its November, 2017 investment. That capital was $280 million raised at a $1.3 billion pre-money valuation in a deal led by Merian Global Investors and IVP. Since then the company has sold secondary shares from time to time.

That should lessen internal demands for a traditional liquidity event, but not quash them altogether. The unavoidable question is why not go public when the firm already reports so much public performance data. On the other hand, when a company needs no capital, it need not accept advice, either.

Regardless, TransferWise shows that fintech can make money after all.

#europe, #fundings-exits, #ivp, #startups, #tc, #transferwise

0

Big tech has 2 elephants in the room: Privacy and competition

The question of how policymakers should respond to the power of big tech didn’t get a great deal of airtime at TechCrunch Disrupt last week, despite a number of investigations now underway in the United States (hi, Google).

It’s also clear that attention- and data-monopolizing platforms compel many startups to use their comparatively slender resources to find ways to compete with the giants — or hope to be acquired by them.

But there’s clearly a nervousness among even well-established tech firms to discuss this topic, given how much their profits rely on frictionless access to users of some of the gatekeepers in question.

Dropbox founder and CEO Drew Houston evinced this dilemma when TechCrunch Editor-in-Chief Matthew Panzarino asked him if Apple’s control of the iOS App Store should be “reexamined” by regulators or whether it’s just legit competition.

“I think it’s an important conversation on a bunch of dimensions,” said Houston, before offering a circular and scrupulously balanced reply in which he mentioned the “ton of opportunity” app stores have unlocked for third-party developers, checking off some of Apple’s preferred talking points like “being able to trust your device” and the distribution the App Store affords startups.

“They also are a huge competitive advantage,” Houston added. “And so I think the question of … how do we make sure that there’s still a level playing field and so that owning an app store isn’t too much of an advantage? I don’t know where it’s all going to end up. I do think it’s an important conversation to be had.”

Rep. Zoe Lofgren (D-CA) said the question of whether large tech companies are too powerful needs to be reframed.

“Big per se is not bad,” she told TC’s Zack Whittaker. “We need to focus on whether competitors and consumers are being harmed. And, if that’s the case, what are the remedies?”

In recent years, U.S. lawmakers have advanced their understanding of digital business models — making great strides since Facebook’s Mark Zuckerberg answered a question two years ago about how his platform makes money: “Senator, we sell ads.”

A House antitrust subcommittee hearing in July 2020 that saw the CEOs of Google, Facebook, Amazon and Apple answer awkward questions and achieved a higher dimension of detail than the big tech hearings of 2018.

Nonetheless, there still seems to be a lack of consensus among lawmakers over how exactly to grapple with big tech, even though the issue elicits bipartisan support, as was in plain view during a Senate Judiciary Committee interrogation of Google’s ad business earlier this month.

On stage, Lofgren demonstrated some of this tension by discouraging what she called “bulky” and “lengthy” antitrust investigations, making a general statement in favor of “innovation” and suggesting a harder push for overarching privacy legislation. She also advocated at length for inalienable rights for U.S. citizens so platform manipulators can’t circumvent rules with their own big data holdings and some dark pattern design.

#antitrust, #big-tech, #data-protection, #digital-regulation, #disrupt-2020, #europe, #gdpr, #government, #platforms, #policy, #privacy

0

U.K.’s Boris Johnson to Order Pubs and Restaurants to Close Early

As Britain endures a second wave of coronavirus, experts fear much worse is yet to come. But critics argue that restrictions damage the economy and threaten liberties.

#conservative-party-great-britain, #coronavirus-2019-ncov, #england, #europe, #great-britain, #johnson-boris, #northern-ireland, #politics-and-government, #scotland, #wales

0

Amnesty calls for human rights controls on EU digital surveillance exports

In a new report, Amnesty International says it’s found evidence of EU companies selling digital surveillance technologies to China — despite the stark human rights risks of technologies like facial recognition ending up in the hands of an authoritarian regime that’s been rounding up ethnic Uyghurs and holding them in “re-education” camps.

The human rights charity has called for the bloc to update its export framework, given that the export of most digital surveillance technologies is currently unregulated — urging EU lawmakers to bake in a requirement to consider human rights risks as a matter of urgency.

“The current EU exports regulation (i.e. Dual Use Regulation) fails to address the rapidly changing surveillance dynamics and fails to mitigate emerging risks that are posed by new forms of digital surveillance technologies [such as facial recognition tech],” it writes. “These technologies can be exported freely to every buyer around the globe, including Chinese public security bureaus. The export regulation framework also does not obligate the exporting companies to conduct human rights due diligence, which is unacceptable considering the human rights risk associated with digital surveillance technologies.”

“The EU exports regulation framework needs fixing, and it needs it fast,” it adds, saying there’s a window of opportunity as the European legislature is in the process of amending the exports regulation framework.

Amnesty’s report contains a number of recommendations for updating the framework so it’s able to respond to fast-paced developments in surveillance tech — including saying the scope of the Recast Dual Use Regulation should be “technology-neutral”, and suggesting obligations are placed on exporting companies to carry out human rights due diligence, regardless of size, location or structure.

We’ve reached out to the European Commission for a response to Amnesty’s call for updates to the EU export framework.

The report identifies three EU-based companies — biometrics authentication solutions provider Morpho (now Idemia) from France; networked camera maker Axis Communications from Sweden; and human (and animal) behavioral research software provider Noldus Information Technology from the Netherlands — as having exported digital surveillance tools to China.

“These technologies included facial and emotion recognition software, and are now used by Chinese public security bureaus, criminal law enforcement agencies, and/or government-related research institutes, including in the region of Xinjiang,” it writes, referring to a region of north-west China that’s home to many ethnic minorities, including the persecuted Uyghurs.

“None of the companies fulfilled their human rights due diligence responsibilities for these transactions, as prescribed by international human rights law,” it adds. “The exports pose significant risks to human rights.”

Amnesty suggests the risks posed by some of the technologies that have already been exported from the EU include interference with the right to privacy — such as via eliminating the possibility for individuals to remain anonymous in public spaces — as well as interference with non-discrimination, freedom of opinion and expression, and potential impacts on the rights to assembly and association too.

We contacted the three EU companies named in the report for a response.

At the time of writing only Axis Communications had replied — pointing us to a public statement, where it writes that its network video solutions are “used all over the world to help increase security and safety”, adding that it “always” respects human rights and opposes discrimination and repression “in any form”.

“In relation to the ethics of how our solutions are used by our customers, customers are systematically screened to highlight any legal restrictions or inclusion on lists of national and international sanctions,” it also claims, although the statement makes no reference to why this process did not prevent it from selling its technology to China.

On the domestic front, European lawmakers are in the process of fashioning regional rules for the use of ‘high risk’ applications of AI across the bloc — with a draft proposal due next year, per a recent speech by the Commission president.

Thus far the EU’s executive has steered away from an earlier suggestion that it could seek a temporary ban on the use of facial recognition tech in public places. It also appears to favor lighter touch regulation which defines only a sub-set of ‘high risk’ applications, rather than imposing any blanket bans. Additionally regional lawmakers have sought a ‘broad’ debate on circumstances where use of remote use of biometric identification could be justified, suggesting nothing is yet off the table.

#amnesty-international, #artificial-intelligence, #china, #digital-surveillance, #eu, #europe, #human-rights

0

Ireland’s data watchdog slammed for letting adtech carry on ‘biggest breach of all time’

A dossier of evidence detailing how the online ad targeting industry profiles Internet users’ intimate characteristics without their knowledge or consent has been published today by the Irish Council for Civil Liberties (ICCL), piling more pressure on the country’s data watchdog to take enforcement action over what complainants contend is the “biggest data breach of all time”.

The publication follows a now two-year-old complaint lodged with Ireland’s Data Protection Commission (DPC) claiming unlawful exploitation of personal data via the programmatic advertising Real-Time Bidding (RTB) process — including dominant RTB systems devised by Google and the Internet Advertising Bureau (IAB).

The Irish DPC opened an investigation into Google’s online Ad Exchange in May 2019, following a complaint filed by Dr Johnny Ryan (then at Brave, now a senior fellow at the ICCL) in September 2018 — but two years on that complaint, like so many major cross-border GDPR cases, remains unresolved.

And, indeed, multiple RTB complaints have been filed with regulators across the EU but none have yet been resolved. It’s a major black mark against the bloc’s flagship data protection framework.

“September 2020 marks two years since my formal complaint to the Irish Data Protection Commission about the “Real-Time Bidding” data breach. This submission demonstrates the consequences of two years of failure to enforce,” writes Ryan in the report.

Among hair-raising highlights in the ICCL dossier are that:

  • Google’s RTB system sends data to 968 companies;
  • that a data broker company which uses RTB data to profile people influenced the 2019 Polish Parliamentary Election by targeting LGBTQ+ people; 
  • that a profile built by a data broker with RTB data allows users of Google’s system to target 1,200 people in Ireland profiled in a “Substance abuse” category, with other health condition profiles offered by the same data broker available via Google reported to include “Diabetes”, “Chronic Pain”, and “Sleep Disorders”;
  • that the IAB’s RTB system allows users to target 1,300 people in Ireland profiled in a “AIDS & HIV” category, based on a data broker profile build with RTB data, while other categories from the same data broker include “Incest & Abuse Support”, “Brain Tumor”, “Incontinence”, and “Depression”;
  • that a data broker that gathers RTB data tracked the movements of people in Italy to see if they observed the Covid-19 lockdown;
  • that a data broker that illicitly profiled Black Lives Matters protesters in the US has also been allowed to gather RTB data about Europeans;
  • that the industry template for profiles includes intimate personal characteristics such as “Infertility”, “STD”, and “Conservative” politics;

Under EU data protection law, personal information that relates to highly sensitive and intimate topics — such as health, sexuality and politics — is what’s known as special category personal data. Processing this type of information generally requires explicit consent from users — with only very narrow exceptions, such as for protecting the vital interests of the data subjects (and serving behavioral ads clearly wouldn’t meet such a bar).

So it’s hard to see how the current practices of the targeted ad industry can possibly be compliant with EU law, in spite of the massive scale on which Internet users’ data is being processed.

In the report, the ICCL estimates that just three ad exchanges (OpenX, IndexExchange and PubMatic) have made around 113.9 trillion RTB broadcasts in the past year.

“Google’s RTB system now sends people’s private data to more companies, and from more websites than when the DPC was notified two years ago,” it writes. “A single ad exchange using the IAB RTB system now sends 120 billion RTB broadcasts in a day, an increase of 140% over two years ago when the DPC was notified.”

“Real-Time Bidding operates behind the scenes on websites and apps. It constantly broadcasts the private things we do and watch online, and where we are in the real-world, to countless companies. As a result, we are all an open book to data broker companies, and others, who can build intimate dossiers about each of us,” it adds. 

Reached for a response to the report, Google sent us the following statement:

We enforce strict privacy protocols and standards to protect people’s personal information, including industry-leading safeguards on the use of data for real-time bidding. We do not allow advertisers to select ads based on sensitive personal data and we do not share people’s sensitive personal data, browsing histories or profiles with advertisers. We perform audits of ad buyers on Google’s ad exchange and if we find breaches of our policies we take action.

We also reached out to the IAB Europe for comment on the report. A spokeswoman told us it would issue a response tomorrow.

Responding to the ICCL submission, the DPC’s deputy commissioner Graham Doyle sent this statement: “Extensive recent updates and correspondence on this matter, including a meeting, have been provided by the DPC. The investigation has progressed and a full update on the next steps provided to the concerned party.”

However in a follow up to Doyle’s remarks, Ryan told TechCrunch he has “no idea” what the DPC is referring to when it mentions a “full update”. On “next steps” he said the regulator informed him it will produce a document setting out what it believes the issues are — within four weeks of its letter, dated September 15.

Ryan expressed particular concern that the DPC’s enquiry does not appear to cover security — which is the crux of the RTB complaints, since GDPR’s security principle puts an obligation on processors to ensure data is handled securely and protected against unauthorized processing or loss. (Whereas RTB broadcasts personal data across the Internet, leaking highly sensitive information in the process, per earlier evidence gathered by the complainants.)

He told TechCrunch the regulator finally sent him a letter, in May 2020, in response to his request to know what the scope of the inquiry is — saying then that it is examining the following issues:

  • Whether Google has a lawful basis for processing of personal data, including special category data, for the purposes of targeted advertising via the Authorised Buyers mechanism and, specifically, for the sourcing, sharing and combining of the personal data collected by Google with other companies / partners;
  • How Google complies with its transparency obligations, particularly with regard to Art. 5(1), 12, 13 and 14 of the GDPR;
  • The legal basis / bases for Google’s retention of personal data processed in the context of the Authorised Buyers mechanism and how it complies with Article 5(1)(c) in respect of its retention of personal data processed through the Authorised Buyers mechanism;

We’ve asked the DPC to confirm whether its investigation of Google’s adtech is also examining compliance with GDPR Article 5(1)f and will update this report with any response.

The DPC did not respond to our question about the timing for any draft decision on Ryan’s two-year-old complaint. But Doyle also pointed us to work this year around cookies and other tracking technologies — including guidance on compliant usage — adding that it has set out its intention to begin related enforcement from next month, when a six-month grace period for industry to comply with the rules on tracking elapses.

The regulator also pointed to another related open enquiry — into adtech veteran Quantcast, also beginning in May 2019. (That enquiry followed a submission by privacy rights advocacy group, Privacy International.)

The DPC has said the Quantcast enquiry is examining the lawful basis claimed for processing Internet users’ data for ad targeting purposes, as well as considering whether transparency and data retention obligations are being fulfilled. It’s not clear whether the regulator is looking at the security of the data in that case, either. A summary of the scope of Quantcast enquiry in the DPC’s annual report states:

In particular, the DPC is examining whether Quantcast has discharged its obligations in connection with the processing and aggregating of personal data which it conducts for the purposes of profiling and utilising the profiles generated for targeted advertising. The inquiry is examining how, and to what extent, Quantcast fulfils its obligation to be transparent to individuals in relation to what it does with personal data (including sources of collection, combining and making the data available to its customers) as well as Quantcast’s personal data retention practices. The inquiry will also examine the lawful basis pursuant to which processing occurs.

While Ireland remains under huge pressure over the glacial pace of cross-border GDPR investigations, given it’s the lead regulator for many major tech platforms, it’s not the only EU regulator accused of sitting on its hands where enforcement is concerned.

The UK’s data watchdog has similarly faced anger for failing to act over RTB complaints — despite acknowledging systematic breaches. In its case, after months of regulatory inaction, the ICO announced earlier this year that it had ‘paused ‘its investigation into the industry’s processing of Internet users’ personal data — owing to disruption to businesses as a result of the COVID-19 pandemic.

#adtech, #advertising-tech, #data-protection, #dpc, #dr-johnny-ryan, #eu, #europe, #gdpr, #google, #iab, #ireland, #privacy, #rtb

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Language learning service Babbel says it has now sold over 10M subscriptions

Babbel, the popular Berlin-based online language learning service, today announced that it has now sold a total of 10 million subscriptions to its service. For a language learning service, that’s quite a substantial number, especially given that Babbel doesn’t really offer a free tier. In part, the company’s march to 10 million subscriptions was accelerated by the COVID-19 pandemic, but Babbel had already seen accelerating growth before, in no small part thanks to its aggressive expansion in the U.S. where Babbel’s subscriber volume and revenue have tripled year over year.

Image Credits: Babbel

The fact that growth accelerated during the pandemic actually came as a bit of a surprise to the team. Typically, at least in the U.S., demand for language learning is somewhat seasonal and users are often motivated to learn a new language because they are preparing a big trip to Europe, for example.

“We know that in the U.S., we typically find the number one motivation that our users give for why they would want to learn a language is travel, which of course, makes sense, because that is your chance to use the language,” Babbel US CEO Julie Hansen told me. “And in fact, last year, there was record travel from the U.S. to Europe. […] I was very, very concerned for the prospects of our business, not to mention the prospects of our national health.”

But with a bit of lag, after the lockdowns in the U.S. (and around the globe) started, Babbel saw an increase in interest in its service because people wanted to use this time for self-improvement. At the same time, Babbel — like so many other education-related services — launched free tiers for high school and college students, too. Hansen said the company saw at least a “couple of hundred thousand” downloads from those initiatives alone. With that, the company’s user base now also skews a little bit younger (though Hansen also credited the company’s advertising on social and especially TikTok for this).

“You can literally draw a graph per country with the date of school closures, the date of lockdown — and then maybe a day or two for the first couple of Netflix series to go by — and then language learning picked up quite quickly,” Babbel CEO Arne Schepker said.

One area that has been challenging is B2B sales, where Babbel (and its competitors) saw an immediate slowdown, but as Hansen noted, some companies also started leaning more into digital training for their employees, maybe in part because they replaced in-person classes with tools like Babbel. Yet, despite the overall slowdown, Babbel still doubled its B2B revenue year-over-year and recently signed on its fellow Berlin -based company Delivery Hero as one of its customers.

Image Credits: Babbel

Ahead of the pandemic, Babbel also started investing in its language travel business after it acquired LingoVentura in 2018. And while the team believes that this business will pick up again over time, Schebker acknowledged that nobody is traveling right now, so this business is currently in a holding pattern.

Looking ahead, the company will soon launch what Hensen called “other learning methods,” but the team isn’t quite ready to talk about these yet beyond the fact that Babbel plans to embrace “a multitude of learning experiences” to meet learners where they are.

#arne-schepker, #articles, #babbel, #berlin, #ceo, #ecommerce, #education, #europe, #julie-hansen, #learning, #united-states, #wikis

0

Hi, There. Want to Triple Voter Turnout?

Campaign volunteers go door to door to rouse voters on Election Day. Now some stay outside polling places, asking voters to text friends to join in.

#black-people, #colleges-and-universities, #content-type-service, #democratic-party, #europe, #fraternities-and-sororities, #moveon-org, #oberlin-college, #ohio, #polls-and-public-opinion, #presidential-election-of-2020, #primaries-and-caucuses, #republican-party, #sanders-bernard, #text-messaging, #volunteers-and-community-service

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With Moria’s Displaced, a Larger Conundrum for Europe

Years after the Syrian refugee crisis subsided, asylum seekers from other nations face even higher obstacles to enter Europe, which is more ambivalent about accepting them than ever.

#asylum-right-of, #europe, #european-union, #immigration-and-emigration, #lesbos-greece, #middle-east-and-africa-migrant-crisis, #refugees-and-displaced-persons

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What makes Checkout.com different from Stripe

While Checkout.com has kept a low profile for many years, the company raised $380 million within a year and reached an impressive valuation of $5.5 billion. It wants to build a one-stop shop for all things related to payments, such as accepting transactions, processing them and detecting fraud.

You might think that it sounds a bit like Stripe. In an interview at TechCrunch Disrupt, I asked founder and CEO Guillaume Pousaz what makes Checkout.com different from Stripe, Adyen and other companies in the payment space. It comes down to a very different philosophy when it comes to product and market approach.

“We only do enterprise. We really only work with the big merchants. There are a few exceptions here and there but it’s mostly enterprise-only and it’s purely online,” Pousaz said.

“I once met [Stripe CEO] Patrick Collison and I joked with him. I said you might have a million merchants, I have 1,200 merchants but I know every single one by name and they all process tens of millions every year. So I think it’s just a different business,” he added later in the interview.

Checkout.com now has a ton of money sitting in its bank account, but it has been a long and slow journey to reach that level. The company has been around for many years and reached profitability in 2012. It has been spending very meticulously over the years.

When talking about the early days of the company, Pousaz said the team grew really slowly. “We can hire one employee this month. Now we can hire two employees this month,” he said.

Today, the company still tries to remain as lean as possible. “It’s really a matter of discipline. All these companies, they raise a lot of money, they spend a lot of money and I don’t challenge that model. For us, embedding that discipline and frugality in the company in how we run it is something that was important to us,” Pousaz said.

“There’s no problem with spending. Just make sure that when you’re spending, you’re wise about it. You just don’t spray and pray. You see this unfortunately too much with tech companies.”

That’s why Checkout.com mostly invests in its own product. Nearly two-thirds of the company is working in product, IT and engineering. Only 13% of the company is working in sales, which is much less than some of its competitors.

But why did Checkout.com raise hundreds of millions of dollars then? “At some point, you need validation. And the validation was really important for us. When you have Insight, DST, Coatue, GIC, Blossom it changes your dimension,” Pousaz said.

When talking about regulators, Checkout.com has licenses in Brazil, the U.K. and France (for contingency), Hong Kong, Singapore, etc. It’s a never-ending process as the company is still working on licenses in other key markets, such as Japan.

“These regulators are super thorough. You don’t pass because you’re a nice guy, you pass because you have the right processes,” Pousaz said.

I challenged that notion and mentioned the Wirecard collapse. He obviously thinks that Wirecard and Checkout.com are in a different position right now.

“All my money is sitting with JP Morgan, it’s pretty simple. There’s no bank account in the Philippines and funny stuff,” Pousaz said. “The Wirecard story is so big that the real question is — go and ask the question to the auditors. Because the auditors that I have, which for the record is PwC, ask me to show them the bank statements and everything. And there are super thorough, it’s a super long process.”

“How did the Wirecard story happen? I don’t know,” he added.

#checkout-com, #disrupt, #disrupt-2020, #disrupt-sf, #disrupt-sf-2020, #europe, #guillaume-pousaz, #startups, #tc

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Calling VCs in Zurich & Geneva: Be featured in The Great TechCrunch Survey of European VC

TechCrunch is embarking on a major new project to survey the venture capital investors of Europe, and their cities.

Our <a href=”https://forms.gle/k4Ji2Ch7zdrn7o2p6”>survey of VCs in Zurich and Geneva will capture how those cities are faring in terms of investment, and what changes are being wrought amongst investors by the coronavirus pandemic. (Please note, if you have filled the survey out already, there is no need to do it again).

We’d like to know how the Zurich and Geneva startup scenes are evolving, how the tech sector is being impacted by COVID-19, and, generally, how your thinking will evolve from here.

Our survey will only be about investors, and only the contributions of VC investors will be included. More than one partner is welcome to fill out the survey.

The shortlist of questions will require only brief responses, but the more you can add, the better.

You can fill out the survey here.

Obviously, investors who contribute will be featured in the final surveys, with links to their companies and profiles.

What kinds of things do we want to know? Questions include: Which trends are you most excited by? What startup do you wish someone would create? Where are the overlooked opportunities? What are you looking for in your next investment, in general? How is your local ecosystem going? And how has COVID-19 impacted your investment strategy?

This survey is part of a broader series of surveys we’re doing to help founders find the right investors.

For example, here is the recent survey of London.

You are not in Zurich or Geneva, but would like to take part? European VC investors can STILL fill out the survey, as we will be putting a call out to your city next anyway!

The survey is covering almost every European country on the continent of Europe (not just EU members, btw), so just look for your country and city on the survey and please participate (if you’re a venture capital investor).

Thank you for participating. If you have questions you can email mike@techcrunch.com

#europe, #tc

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Does early-stage health tech need more ‘patient’ capital?

Crista Galli Ventures, a new early-stage health tech fund in Europe, officially launched last week. The firm offers “patient capital” — with only a single LP (the Danish family office IPQ Capital) — and promises to provide portfolio companies with deep healthcare expertise and the extra runway needed to get over regulatory and efficacy hurdles and to the next stage.

The firm has an initial $65 million to deploy and is led by consultant radiologist Dr. Fiona Pathiraja. With offices in London and Copenhagen, it operates as an “evergreen” fund, meaning it doesn’t follow traditional five-year VC fundraising cycles.

In fact, Crista Galli Ventures’ pitch is that traditional venture isn’t well-suited to early-stage health tech where it can take significantly longer to find product-market fit with healthcare practitioners and systems and then become licensed by local regulators.

To dig deeper into this and CGV’s investment remit more generally, I interviewed Pathiraja about what she looks for in health tech founders and startups. We also discussed Crista Galli LABS, which operates alongside the main fund and backs founders from underrepresented backgrounds at the pre-seed stage.

TechCrunch: You describe Crista Galli Ventures (CGV) as an early-stage health tech fund that offers patient capital and backs companies in Europe. In particular, you cite deep tech, digital health and personalised healthcare. Can you elaborate a bit more on the fund’s remit and what you look for in founders and startups at such an early stage?

Dr. Fiona Pathiraja: We like founders with bold ideas and international ambitions. We look for mission-driven founders who believe their companies can make a real and positive impact on the lives of people and patients the world over.

We will look for founders who deeply understand the problem they are trying to tackle from all angles — especially the patient’s perspective, but also that of the clinician and relevant regulators — and we want to see that they are building their solutions to solve this. This means they will make an effort to understand the complex and nuanced healthcare landscape and all the stakeholders in it.

In terms of founder characteristics, in my opinion, the best founders will be mission driven, able to tell a compelling story, and motivate others to join them. Grit and resilience are important and several of our portfolio companies were founded around 6-8 years ago and they are doggedly continuing to build.

#biotechnology, #crista-galli-ventures, #entrepreneurship, #europe, #health, #healthcare, #healthtech, #skin-cancer, #startups, #tc, #venture-capital

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China, Seeking a Friend in Europe, Finds Rising Anger and Frustration

Beijing’s hopes of using Europe as a counterweight to the United States have faltered as country after country confronts China over trade, Hong Kong, human rights and other issues.

#china, #coronavirus-2019-ncov, #europe, #european-commission, #european-union, #international-trade-and-world-market, #political-prisoners, #politics-and-government, #united-states-international-relations, #wang-yi, #xi-jinping

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Caroline Brochado and Sophia Bendz on the boom in Europe’s early- and growth-stage startups

As part of Disrupt 2020 we wanted to look at the contrasting positions of both early and later-stage investing in Europe. Who better to unpack this subject than two highly experienced operators in these fields?

After a career at Spotify and then as a VC at Atomico, Sophia Bendz has rapidly gained a reputation in Europe as a keen early-stage investor. She recently left Atomico to pursue her early and seed-stage passion with Cherry Ventures. Bendz is a prolific angel investor, with a total of over 44 deals in the last 9 years. Her angel investments include as AidenAI, Tictail, Joints Academy, Omnius, LifeX, Eastnine, Manual, Headvig, Simple Feast, and Sana Labs. She is known for being a champion of the femtech space, and her angel investments in that space include Clue, Grace Health, Daye, O School, and Boost Thyroid.

Carolina Brochado, the former Atomico partner and most recently a partner at SoftBank Vision Fund’s London office, recently joined EQT Ventures to help launch EQT’s Growth fund, which is positioned between Ventures and Private Equity. Brochado led investments in a number of promising companies at Atomico,  including logistics company OnTruck, health tech company Hinge Health and restaurant supply chain app Rekki.

After establishing that these two knew each other while at Atomico, I asked Bendz why she headed back into the seed stage arena.

“I’m a trained marketeer and storyteller by heart… What makes me excited is new markets opportunities, people, culture, teams. So with that, in combination with my angel investing, I think I’m better suited to be in the earlier stages of investing. When I was investing before joining Atomico, I said to myself, I want to learn from the best, I want to see how it’s done how you structure the process and how you think about the bigger investments.”

Brochado says the European ‘cat is out of the bag’ as it were:

When I first moved to Europe in 2012 and first joined Atomico, after having been at a very small startup, there was still a massive gap in funding and Europe versus the US. I think you know the European secret is no longer a secret, and you have incredible funds being started at that early stage seed and series A, and because I was here in 2012, I’ve seen the amazing pipeline of growth companies that are coming up the curve, how the momentum of those companies is accelerating and how the market cap of those businesses are growing. And so I just became super excited about helping those businesses scale… I just you now felt like bridging that gap in between ass really exciting and.

One of the perennial topics that come up time and time again is whether or not founders should go with VC partners who have previously been operators, versus those with a finance background.

“Looking back, my years at Spotify, we had great investors, but there were not many of them that had the experience of scaling a big company,” Bendz said. “So, I’m happy to give [a startup] more than just the check in a way that I would have wished I had a sounding board when I was 25 and tackling that challenge at Spotify.”

Brochado concurred: “Having operators in the room is just is an incredible gift I think to a fund and at certain levels, having people that understand you know different forms of financing and different structures can also be incredibly helpful to founders who may not necessarily have that background. So I think that the funds that do it best have that diversity.”

Bendz is passionate about investing in female founders and femtech: “It’s such a massive business opportunity that is completely untapped. We’ve seen it many times when you have a female investment partner [that] the pipeline opens up and you get more deal flow from female founders…. So I think we have a lot of work to do. I think it’s definitely improved a lot in the last couple of years but not enough… That is one of the drivers for why I put my money where my mouth is and invest in lifting the founders, but also because there are incredibly interesting business opportunities… There are so many opportunities and products or services that we will see being developed. When we have a more equal society, and more women, both building their own companies, coding and also investing… I can’t wait to see what that world will look like.”

Brochado’s view is that “even beyond founders… the best managers today are putting a lot of focus on this and I think what’s exciting is, I think we’re past the point where you have to explain to people why diversity matters.”

Is there a post-Series A chasm?

Bendz thinks: “We have more big funds in Europe [now]. We have a really solid ground here in Europe of a, b and c investors.”

Brochado said: “it’s definitely getting better. You don’t hear as many founders say that to do my Series B or my Series C I have to move to the Valley as you used to. But there’s a lot of room still for growth investors in Europe. I think Series B is the hardest round actually because, at seed or series A, you can raise on very early traction or the quality of the management team. At Series B the price goes up but the risk doesn’t necessarily go down as much. And so I think that’s where you really need investors who are sector or thematic focused, who can come with conviction and also some knowledge around the company to really propel that company forward.”

Did they both see European entrepreneurs still making silly mistakes, or has the ecosystem mastered?

Brochado thinks ten years ago was it was hard for European founders as a lot of the talent to scale companies was still in the US. “What you’ve seen is a lot of big companies grow up in Europe, a lot of people come back from the US, and so I think that pool of talent now is larger, which is very helpful. I don’t think it’s yet at the scale of where the US is. But it gives us, you know as investors, a great window of opportunity to help get some of that talent for our portfolio companies.”

The impact of COVID-19

Bendz thinks we will “see a much slower Spring, but… I think it has been overall a good exercise for some companies, and I have not seen a slower deal flow. I’ve actually done more Angel deals this Spring than I normally do… Some businesses have definitely accelerated their whole business concept because of COVID. Investments are being made even though we haven’t met the founders. We’re able to do everything remotely so I think the system is kind of adjusting.”

Brocado’s view is that at the growth stage “there’s been a flight to quality. So actually, the really great companies or the companies that are seeing great tailwinds or companies that will still be category-leading once [have] seen a lot of interest. It’s been a very busy summer, which usually it isn’t usually, particularly at the growth stage… I think a lot of money is still in the system, and has flown into technology. And so if you look at how tech in the public markets has performed it’s performed extremely well. And that includes European public companies and within tech.”

Watch the full panel below.

#angel-investor, #atomico, #carolina-brochado, #cherry-ventures, #economy, #eqt-ventures, #europe, #hinge-health, #o-school, #ontruck, #partner, #softbank-vision-fund, #sophia-bendz, #spotify, #startup-company, #tc, #united-states, #vc-partners, #venture-capitalists

0

Supercell’s CEO talks about its majority owner Tencent, finding its next hit, and more

Mobile games maker Supercell has been one of the great, understated, breakthroughs of the European startup world. The Helsinki-based mobile games maker built an empire out of Clash of Clans, raking in tons of money and catching the eye of world class investors and eventually a new strategic majority shareholder in the form of Tencent at a $10.2 billion valuation.

That was in 2016. So how does a hot startup keep its edge?

As part of this year’s virtual Disrupt,we sat down to talk with the company’s founder and CEO, Ilkka Paananen, about that and the other challenges and opportunities facing the company, and asked for his tips and opinion on spinning up and running startups in Europe today.

Times are definitely not easy right now: all of us are living through a global health pandemic, and economies as a result of that are teetering; and there is an interesting sea change happening as gaming companies (along with other content makers) face off against big tech, where question of whether platforms or the games themselves have the upper hand. (The most visible and recent example of that: the counter-lawsuits between Epic and Apple over in-app payments.)

For Supercell specifically, its majority owner, Tencent, is in hot water in the US (a major market for Supercell); and it’s sitting on a still-popular but now-ageing game franchise that you could argue is in the middle of its own Battle Royale against the many other big games that are vying for people’s attention (and spending power to keep playing and levelling up). In short, the company itself, now 10 years old, may itself be facing more existential questions of, who are we now, and what comes next?

As you’ll see in the video below, Paananen is very sanguine and calm, which is to say quite Finnish, about a lot of this.

Even without the experience thus far of Supercell under his belt, he has been in the industry for years. Supercell is his second big hit company: before that he founded Sumea, which was acquired by Digital Chocolate, where he became president in the now-defunct bigger studio’s heyday. And, he has been and is an investor, too: most recently Paananen backed Zwift, the gamefied home fitness startup, in its most recent, $450 million round, which included him joining the company’s board. All of this is to say that he can see the bigger picture.

The Tencent issues in the US, he said, are something that the company is watching. But not only are they unresolved — indeed just this week, ahead of any proposed bans on Tencent properties and WeChat in particular, the US government issued more clarification on how people are liable for using WeChat. In any case, Paananen said in the interview that he believes that Supercell doesn’t fall under the US executive order to be shut down, since Tencent is only a shareholder, not a full owner. He’s still waiting to see how it all plays out.

“Our current understanding [is that] it’s about WeChat not Tencent as a whole,” he said, “and that it doesn’t apply to Tencent-invested companies like Supercell.” (Also: one of the good things to have come out of not getting fully acquired, it seems.)

Similarly, Paananen is not overly concerned about the fact that its big hit, while still one of the highest grossing apps globally, is getting on and slowly bringing in less revenues.

Judging by the fact that Supercell has yet to follow up with another successful franchise, and has killed quite a few attempts in the meantime, the process to produce a hit, in fact, still seems to be as elusive to a company that has produced a hit already as it is to those that have not.

“It would be nice to be always on this kind of a growth curve, but the reality is… it’s very much about hits or misses,” he said.

“Sometimes figures go up, and sometimes they go down [so] what’s your time horizon? We never ever think about the next quarter, and very, very rarely think about it and maybe next year, I think that’s a target in itself, you know. We try to think in decades. Our dream is to build a game so as many people as possible will play for a very long time. We are inspired by companies like, say, Nintendo. And if you’re going to take that… then that changes your perspective.”

The company has been building out its options, though, making about three investments a year in other gaming startups, and some full acquisitions of studios, to diversify the team and bring in more options for new games in the future. Later in the Q&A with viewers, Paananen said Supercell has no plans yet for anything in AR or VR, with a firm belief that mobile, and the mechanics of a touch screen, are the best for what it’s building.

It seems that most valuable lesson Paananen has learned, it turns out, is the thing that continues to be his top priority: building the right team for the long haul.

Making sure you have a group that can work together, inspire each other and be productive has been the constant, one that perhaps means even more as the company grows bigger and we continue to work under very decentralised circumstances.

“We are currently on the look-out for people from all around the world to join Supercell to build the be the best teams and then of course the best games,” he said.

Hear about all this, plus Paananen’s opinion on raising money and more, below.

#apps, #clash-of-clans, #disrupt, #europe, #finland, #gaming, #mobile-gaming, #startups, #supercell, #talent, #tc, #tc-disrupt, #tcuk, #tencent

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Volocopter kicks off presales for its first air taxi flights — with a wait time of 2-3 years

If your sad-faced technology mantra is ‘we were promised flying cars and all we got were these shitty Internet trolls’ never fear, Berlin-based autonomous air mobility startup, Volocopter, wants to revive your sci-fi dreams.

It’s just kicked off presales for trips in its forthcoming electric air taxi service, VoloCity — albeit, there’s no date on when exactly (or where) the commercial service will fire up. But if you shell out for one of the 1,000 available pre-launch reservations — which it’s branding ‘VoloFirst’* — you’ll be able to look forward to a future flight of up to 15 minutes, within 12 months of the service’s commercial launch, whenever and wherever that will be.

“Services will start in 2-3 years,” a Volocopter spokeswoman told us. “Cities are not defined yet, as it is not clear which of the many cities we are in contact with for commercial start will make the race.”

The price for the limited edition joyride — which will include a video of your trip and a “limited edition, personalized certificate” — is €300 (~$355).

Volocopter notes that tickets can be reserved with a 10% deposit.

“Based on our public test flights and regulatory achievement record, we have paved the way to make electric flight in cities common in just a few years. With the start of reservations, we now invite our supporters and innovators around the world to join us and be amongst the first to experience this new and exciting form of mobility,” said Volocopter CEO Florian Reuter in a supporting statement.

“While the final certification for air taxis is still pending, we do have a detailed realistic timeline to launch commercial VoloCity flights in the next 2-3 years,” added Volocopter’s chief commercial officer, Christian Bauer, in another, further noting that VoloFirst ticket buyers will be able to get the latest updates on its progress and commercial launch plan.

Reservations for the VoloFirst flights are available via the Volocopter Reservation Platform.

The German startup undertook the first-ever manned flight of a purely electric multicopter back in 2011, and has gone on to demo numerous public flights with its full-scale aircraft — including public test flights at Singapore’s Marina Bay in October 2019 and the world’s first autonomous eVTOL flight in Dubai in 2017.

The company topped up its Series C funding round to $94M earlier this year, bringing its total raised to circa $132M.

It’s one of a number of flying taxi startups vying to get a commercial service off the ground. Others include EHang, Lilium and Airbus with its Vahana VTOL.

*Volocopter doesn’t guarantee ‘VoloFirst’ trip buyers will be the first public users of the air taxi service — rather it says these early birds will have “among the first” bragging rights

#aerospace, #air-taxis, #europe, #transportation, #volocopter, #volofirst

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After lockdowns lead to an e-bike boom, VanMoof raises $40M Series B to expand globally

E-bike startup VanMoof, has raised a $40 million investment from Norwest Venture Partners, Felix Capital and Balderton Capital. The Series B financing comes after a $13.5 million investment in May. The funding brings VanMoof’s total raised to $73 million and furthers the e-bike brand’s ultimate mission of getting the next billion on bikes.

The Series B funding will be used to meet the increased demand, shorten delivery times and build a suite of rider service solutions. It also aims to boost its share of the e-bike market in North America, Europe and Japan.

Partly driven by the switch of commuters away from public transport because of the COVID-19 pandemic, the e-bike craze is taking off.

Governments are now investing in cycling infrastructure and the e-bike market is set to surpass $46 billion in the next six years, according to reports.

Ties Carlier, co-founder VanMoof commented: “E-bike adoption was an inevitable global shift that was already taking place for many years now but COVID-19 put an absolute turbo on it to the point that we’re approaching a critical mass to transform cities for the better.”

VanMoof says it realized a 220% global revenue growth during the worldwide lockdown and sold more bikes in the first four months of 2020 than the previous two years combined.

Stew Campbell, Principal at Norwest said: “Taco, Ties and the VanMoof team have not only built an unparalleled brand and best-selling product, but they’re reshaping city mobility all over the world.”

Colin Hanna, Principal at Balderton: “As the COVID-19 crisis hit supply chains worldwide, VanMoof’s unique control over design and production was a key advantage that allowed the company to react nimbly and effectively. Moreover, VanMoof’s direct to consumer approach allows the company to build a close relationship to their riders, one that will be strengthened by new products and services in the years to come.”

VanMoof launched the new VanMoof S3 and X3 in April of this year. I reviewed the S3 here and checked out the earlier X2 version here.

#balderton-capital, #bicycles, #co-founder, #colin-hanna, #cycling, #e-bike, #e-bikes, #electric-bicycle, #europe, #felix-capital, #japan, #micromobility, #north-america, #norwest-venture-partners, #supply-chains, #tc, #transport, #vanmoof, #vanmoof-s3

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Cloud gaming platform Shadow gets a new CEO and CTO

There are some changes at the helm of Blade, the French startup behind Shadow. Mike Fischer is going to work for the company and become Chief Executive Officer. Jean-Baptiste Kempf is joining the company as Chief Technology Officer.

Shadow is a cloud computing service for gamers. For a monthly subscription fee, you can access a gaming PC in a data center near you. Compared to other cloud gaming services, such as GeForce Now or Google’s Stadia, Shadow provides a full Windows 10 instance. You can install anything you want — Steam, Photoshop or Word.

The company has been growing rapidly over the past few years and raised more than $100 million in total. Last year, the company announced ambitious plans with a wide-ranging partnership with OVHcloud and high-end configurations.

At the same time, co-founder Emmanuel Freund stepped aside as CEO with Jérôme Arnaud taking over. There have been multiple delays with the new product offering and the company is no longer working with OVHcloud. Freund left the company in April and, as INpact Hardware reported in July, Arnaud has been on the way out for a couple of months.

All of this leads us to today’s announcement. Mike Fischer, the company’s new CEO, has been quite active in the video game industry. In the past, he has worked at Sega, Bandai Namco, Microsoft and Epic Games. He was the president and CEO of Square Enix between 2010 and 2013.

Jean-Baptiste Kempf is a well-known figure in the open source community. For the past 14 years, he has been the president of VideoLAN, the organization behind popular media player VLC. VideoLAN has also contributed to widely used video encoding technologies. He also founded VideoLabs, a company that works on VLC-related integrations and support.

The company is still working on rolling out the new Ultra and Infinite configurations to European users who pre-ordered. It originally planned to start rolling out new tiers in the U.S. starting this summer but the company now says it expects to launch these new tiers by the end of the year.

For customers in the U.S., there are no pre-orders, there will simply be a button to upgrade in your account when it’s available. LG invested in the company earlier this year and the service will go live in South Korea later this year as well.

#blade, #europe, #gaming, #shadow, #startups, #tc

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Balderton’s Chandratillake doffs his cap to Clubhouse, says enterprise audio is next

Suranga Chandratillake has (almost) seen it all. After being the early CTO for Autonomy, he went on to found the blinkx video search engine in 2004, long before many thought we’d even need one. He scaled the company to San Francisco and the US market, eventually IPO’ing blinkx for over $1 billion. On his return to Europe, he joined Balderton Capital, of Europe’s top-tier VCs, and has invested in many of Europe’s hottest startups. As part of TechCrunch Disrupt 2020, we caught up with him.

Last year Balderton raised a $400 million fund. But has the way that fund is being invested changed because of COVID-19?

“In many ways, nothing has changed,” he said. ”We have been a series a focused pan-European VC for 20 years… If anything, I think COVID-19 has demonstrated how tech can help us get through various challenges, and I mean all of the work from home stuff…It’s been really weird, not being able to spend time in person with [entrepreneurs] those people… But the overall strategy of investing in tech in Europe, it’s exactly the same as it was before.”

Although it’s not that simple. For instance, Balderton invested in car rental startup Virtuo to the tune of 20 million euros. And travel is not exactly a great sector right now.

Chandratillake admitted, “some industries we have had challenges this year.” However, he said they “had a difficult April and May, but they’ve actually had a booming August” as holidays came back.

“I would say that by and large, most [startups] have navigated fairly well.” He noted that European governments have put in place funds to support tech companies, and of course, other sectors of tech have boomed.

During the pandemic lockdown, many consumers jumped into virtual networking via apps like Zoom and Houseparty, but Balderton did a small investment into a stealth-mode startup called Riff, which, not unlike Clubhouse, is using audio in a new way. He hinted that this will be an enterprise-play on Audio.

“Funnily enough, the closest to it right now is probably Discord which obviously is already a large network, but really a very much a vertical app aimed at gamers… But I think there’s a there’s an opportunity to do something similar in enterprise in the same way that Slack, you know, arguably got a lot of its initial cues from consumer messaging [such as] from WhatsApp or Facebook Messenger. I think we’ll see a similar thing where the enterprise gets something that’s based a bit on what we’ve seen in consumer products.”

He said Riff solves the “classic cliche of the watercooler moment when you bump into someone in the office and have a chat, and it’s really hard to do that in this new reality.”

He also said there are interesting sub-markets following on in the coattails of Zoom “that also need to be worked out.” Balderton invested in a company called DemoDesk (a cloud-based screen sharing platform), which looks at, for example, “webinars and sales meetings and specific kinds of conversations like that, where the requirements are a bit different.”

Chandratillake is of the opinion that the world will have to live with COVID-19 for many years, but that new solutions will emerge to mitigate the downsides: “Anything that helps you stay more connected to your colleagues and your co-workers is going to be interesting from a VC point of view, right?”

In terms of the diversity issues thrown up by the Black Lives Matter movement, Balderton has backed initiatives such as Diversity VC in Europe.

“If you’ve got a more diverse venture capital industry, they will start to back more diverse founders doing more diverse things, and that will naturally propagate. That’s really important to me and that’s a big part of what we focused on….

“In the last three years, we’ve hired more women than we have men into the investment team. We recently hired our first female general partner directly into the firm… three more people of color in the partnership and so on. So it’s beginning to change to where it should be, but I think it’s one of these things where you have to battle on many fronts.”

#balderton-capital, #disrupt-2020, #europe, #facebook, #suranga-chandratillake, #tc, #virtuo, #zoom

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Europe’s Economic Revival Is Imperiled, Raising the Specter of a Grinding Downturn

As the coronavirus regains force, economists fear that Europe’s tentative recovery is at risk from traditional political concerns.

#coronavirus-2019-ncov, #europe, #european-central-bank, #european-union, #france, #germany, #great-britain, #international-trade-and-world-market, #johnson-boris, #lagarde-christine, #politics-and-government, #recession-and-depression, #stimulus-economic

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Europe will go it alone on digital tax reform in 2021 if it must, says EU president, as bloc directs €150BN in COVID-19 relief toward cloud, AI and broadband

Europe will propose its own digital tax early next year if there’s no agreement at a global level on how to update taxation rules for the Internet age, EU president Ursula von der Leyen said today, reiterating the bloc’s determination not to let tax reform slide in a ‘state of the union’ speech to the European Parliament.

“We will spare no effort to reach agreement in the framework of OECD and G20. But let there be no doubt: should an agreement fall short of a fair tax system that provides long-term sustainable revenues, Europe will come forward with a proposal early next year,” she told MEPs.

In the wide-ranging speech — which also called for the 2020s to be Europe’s “digital decade” — von der Leyen committed the bloc to spending a fifth (€150BN) of the €750BN coronavirus support fund announced earlier this year on digital investments.

“There has never been a better time to invest in European tech companies with new digital hubs growing everywhere from Sofia to Lisbon to Katowice,” she said. “We have the people, the ideas and the strength as a Union to succeed. And this is why we will invest 20% of NextGenerationEU on digital.”

“We are reaching the limits of the things we can do in an analogue way. And this great acceleration is just beginning. We must make this Europe’s Digital Decade,” von der Leyen added.

“We need a common plan for digital Europe with clearly defined goals for 2030, such as for connectivity, skills and digital public services. And we need to follow clear principles: the right to privacy and connectivity, freedom of speech, free flow of data and cybersecurity.

“But Europe must now lead the way on digital – or it will have to follow the way of others, who are setting these standards for us. This is why we must move fast.”

Beneath the rousing ‘digital sovereignty’ rhetoric, the speech didn’t offer much new on the tech policy front — but the EU president confirmed that updates to Europe’s competition rules and regulation on the use of AI are coming next year.

The Commission is currently consulting on whether a new competition tool is needed to respond to digital network effects that can lead to tipping markets, as well as more widely around a forthcoming Digital Services Act (which didn’t get any direct mentions in the speech).

“On personalized data — business to consumer — Europe has been too slow and is now dependent on others,” she said. “This cannot happen with industrial data. And here the good news is that Europe is in the lead — we have the technology, and crucially we have the industry.”

“We presented our new industry strategy in March to ensure industry could lead the twin green and digital transition. The last six months have only accelerated that transformation — at a time when the global competitive landscape is fundamentally changing. This is why we will update our industry strategy in the first half of next year and adapt our competition framework which should also keep pace,” she said.

Tech investment priorities

Priorities for digital investment she highlighted are the plan to build a European cloud — which will be based on the GaiaX federated data infrastructure that’s developing common requirements for pan-EU data sharing. (This is part of a major Commission push around industrial data reuse, announced earlier this year.)

The second area of investment focus named was artificial intelligence — with the EU president citing the tech’s potential to deliver innovations such as “precision farming in agriculture, more accurate medical diagnosis and safe autonomous driving”. However she also emphasized the importance of having rules in place to wrap around the tech, reiterating EU lawmakers’ conviction that a framework is needed to ensure what they dub ‘human-centric’ AI.

Earlier this year the EU put out a white paper — setting out proposals for regulating ‘high risk’ applications of artificial intelligence. Though the final shape of the proposal will have to wait for 2021.

von der Leyen also suggested lawmakers are looking for ways to give consumers more control over how their data is used in the big data-powered AI era.

“We want a set of rules that puts people at the centre. Algorithms must not be a black box and there must be clear rules if something goes wrong. The Commission will propose a law to this effect next year,” she said today.

“This includes control over our personal data which [we] still have far too rarely today. Every time an App or website asks us to create a new digital identity or to easily log on via a big platform, we have no idea what happens to our data in reality.”

To this end, she said the Commission wants to develop “a secure European e-identity” that EU citizens could use anywhere in the bloc — “to do anything from paying your taxes to renting a bicycle”. It would be “a technology where we can control ourselves what data and how data is used”, she added, riffing on her digital sovereignty theme.

The Commission is reviewing existing regulations around eID, including running a consultation that’s due to end next month — where it says it’s looking at barriers to uptake of eID and trusted services, and considering how to evolve the framework towards an “EU digital identity”.

It now sounds like lawmakers have concrete plans to overhaul eID — with the aim of promoting a proprietary digital authentication mechanism that can help drive the wider strategy around digitization and data reuse.

The third focus for ‘COVID-19 relief’ digital spending is infrastructure, with a push planned around broadband access.

“The investment boost through NextGenerationEU is a unique chance to drive [broadband] expansion to every village. This is why we want to focus our investments on secure connectivity, on the expansion of 5G, 6G and fiber,” said von der Leyen, adding: “NextGenerationEU is also a unique opportunity to develop a more coherent European approach to connectivity and digital infrastructure deployment.”

Her speech also highlighted a planned €8BN investment in developing next-gen supercomputers. And reiterated calls for European industry to develop its own next-generation chips — “that will allow us to use the increasing data volumes energy-efficient and securely”.

“None of this is an end in itself — it is about Europe’s digital sovereignty, on a small and large scale,” she added.

Green Deal

von der Leyen also spend a fair amount of time on the environment and the risks attached to climate change.

The European Green Deal is set to account for a larger chunk of COVID-19 relief spending than digital projects — although there could, presumably, be some overlap, with von der Leyen talking about “a world where we use digital technologies to build a healthier, greener society”.

She said 37% (€277BN) of the NextGenerationEU fund to be spent directly on Green Deal objectives.

This spending looks set to give a major boost to electric cars via investment in charging infrastructure. Other areas of focus she mentioned are hydrogen replacing coal for industrial production; and adapting the construction industry to make it more sustainable and less polluting, including by the use of AI and smart technologies.

“NextGenerationEU should invest in lighthouse European projects with the biggest impact: hydrogen, renovation and 1 million electric charging points,” she said. “I want NextGenerationEU to create new European Hydrogen Valleys to modernise our industries, power our vehicles and bring new life to rural areas.”

“Our buildings generate 40% of our emissions. They need to become less wasteful, less expensive and more sustainable,” she added. “And we know that the construction sector can even be turned from a carbon source into a carbon sink, if organic building materials like wood and smart technologies like AI are applied.”

The systemic change needed to support a wholesale shift to a circular economy was dubbed”a new cultural project for Europe”.

“Every movement has its own look and feel. And we need to give our systemic change its own distinct aesthetic – to match style with sustainability,” she said, announcing a plan to set up “a new European Bauhaus” — aka “a co-creation space where architects, artists, students, engineers, designers work together to make that happen”.

#artificial-intelligence, #broadband, #cloud, #coronavirus, #covid-19, #digital-investment, #eu, #eu-tech-policy, #europe, #green-deal, #policy, #ursula-von-der-leyen

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