China’s relaxation of its one-child restriction has not delivered the population targets set by its policy planners. In 2019, the birth rate in China slumped to a seven-decade low, which experts attribute to changes in social attitudes, skyrocketing living costs as well as a demanding work culture.
One way to fix China’s demographic crisis is to lighten mothers’ burden, said Ding Lei, founder and CEO of NetEase, the second-biggest gaming company in China which also runs a popular music streaming service.
Ding made the proposal at China’s annual parliament session this week, comprising the meetings of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC). Each spring, delegates from a wide range of backgrounds, including political elites and tech billionaires, gather in Beijing for the legislative meetings informally known as the “two sessions.”
Ding is a member of the CPPCC, which includes other tech bosses like Tencent’s Pony Ma, Xiaomi’s Lei Jun and Baidu’s Robin Li. Ding suggested efforts should be directed to address costly childbearing, short maternity leave, an undersupply of children’s healthcare, an underdeveloped childcare system and other “practical pain points” to take burdens off women’s shoulders.
Ding further advocated for shared parental leave “at one’s discretion” to “give men more responsibilities in parenting.” The country, he argued, should bear women’s reproductive costs and the number of nursery facilities should be increased.
Most provinces in China have introduced paternity leave in recent years, but the length and implementation efforts vary across regions. In Guangdong, home to NetEase and Tencent, fathers are entitled to up to 15 days of paid paternity leave. Shanghai, on the other hand, falls on the lower end of the spectrum with 10 days.
But some experts argue the one-week average for fathers is far from enough to liberate new mothers, who receive a minimum of 98 days of paid maternity leave but could get more depending on where they reside. NetEase’s family leave policy is in line with national and regional regulations, a company representative told TechCrunch.
Occasionally, China’s tech giants disclose or give hints about their gender ratio. In 2019, 35% of NetEase’s 20,000 employees were women, the company says, and about 25% of its top management were female in the year. Online travel agent Ctrip, which prides itself on benefits for female employees, said in 2018 that over 60% of its staff were female. Jack Ma, a frequent speaker at female leadership forums, pledged in 2019 that females must make up more than 33% of Alibaba staff.
Making money on livestreams has never been easier thanks to a suite of tools from the Los Angeles-based startup Maestro, which just nabbed $15 million in financing to grow its business.
As video commerce becomes the norm and entertainers, brands, businesses, and franchises of all sizes and stripes look to cut out the middle man, the array of services on offer from Maestro may be the scissors these entities need to cut the cord.
The company has already worked with names as diverse as the Golden State Warriors, the Dallas Cowboys, and pop sensation Billy Eilish on embedding its interactive tools into various live events and promotions.
Initially the LA-based company launched to the gaming community with interactive features that folks could use in-stream to create better engagement with fans. But what started in the gaming world quickly spun out as the company slashed prices to $500 per month for its services.
The pandemic also helped as artists who were cut off from their audiences began to explore alternative ways to reach fans — and make money.
“We were targeted to a small number of very premier customers. It was around 50 to 60 and we grew to in the hundreds,” said Maestro chief executive, Ari Evans, said. “2020 was a blowout year… People needed an interactive streaming platform that they could spin up quickly that they could launch on their website.”
Celebrities from Katy Perry to Post Malone to Billie Eilish all turned to the service and so did other streaming platforms like the Los Angeles-based virtual concert platform, The Wave.
Now the company has $15 million in new financing to capitalize on its growth from investors including NetEase, Sony Music Entertainment, and Acronym Venture Capital, alongside a host of industry titans including Twitch co-founder Kevin Lin and Moonwell Capital, founded by former Activision Blizzard executives Michael and Amy Morhaime, the company said in a statement.
Existing investors like SeventySix Capital, The Strand Partners, Stadia Ventures, Hersh Interactive Group, and Transcend Fund, as well as early Zoom employees Richard Gatchalian and Aaron Lewis, also participated.
Since the launch of monetization tools in May of last year, Evans estimated that the platform has paid out at least $5 million to entertainers who used the service.
“We are pleased to be supporting the continued development of Maestro as part of our ongoing investment in new technologies that provide artists with cutting-edge tools and solutions for growing their careers. Maestro gives artists greater flexibility and control to build the most engaging and customized events for their fans, allowing creators at any stage of their career to put together a world class live stream event,” said Dennis Kooker, President, Global Digital Business and U.S. Sales, Sony Music Entertainment, in a statement.
“Maestro is at the forefront of redefining the relationship of content owners and creators with their viewers. Instead of relying on incumbent distribution platforms, customers control the audience relationship directly and maximize engagement and monetization in a way that fits with their brand objectives. We are very excited by Maestro’s potential to be a fundamental driver in the growth of the creator economy,” said Joshua Siegel, General Partner, Acronym Venture Capital.
“Maestro… started off with the content and now we’re adding membership and community management and ticketing and all that stuff,” said Evans.
The next step, and a big part of what Evans and his team of 55 employees will work on building will be a developer ecosystem, so software designers can start building out new tools to sell through the Maestro platform.
“The third piece is a developer ecosystem,” Evans said. “We’re really copying Shopify, Squarespace for video or Shopify for video. It’s kind of strange that this has taken so long to develop.
The one thing that Maestro won’t do is discovery or search services, Evans said. “We’re helping creators make money and build a business on top of video. That’s something creators need to be aware of if they’re going to build that direct to consumer channel,” he said. “If you do do that and you’re successful you’re in control over your audience.”
Der chinesische Internet-Gigant NetEase – mehr als 18.000 Mitarbeiter; Umsatz: 7,4 Milliarden Euro – investiert nach unseren Informationen in die hyperlokale App Jodel. NetEase hält nun stattliche 23 % am jungen Unternehmen. In den vergangenen Jahren flossen rund 10 Millionen Euro in das Berliner Unternehmen, das 2014 von Avellan Borgmeyer als eine Art Campus-App gegründet wurde. Das Startup zeigt seinen Nutzern anonymisiert Beiträge an, die andere Nutzer, die in der Umgebung sind, veröffentlicht haben.
Zu den Investoren von Jodel gehören unter anderem Global Founders Capital, der Geldgeber von Rocket Internet, und Atlantic Internet, also Christophe Maire. Nach eigenen Angaben nutzen über 7 Millionen Menschen Jodel – vor allem in der DACH-Region, Skandinavien und Saudi-Arabien. Rund 70 Mitarbeiter wirken für Jodel. Seit März 2018 wir die Monetarisierung der App über Werbung vorangetrieben. Details gibt es in unserem aktuellen Insider-Podcast.
Im aktuellen #DealMonitor für den 22. Februar werfen wir wieder einen Blick auf die wichtigsten, spannendsten und interessantesten Investments und Exits des Tages in der DACH-Region. Alle Deals der Vortage gibt es im großen und übersichtlichen #DealMonitor-Archiv.
Gorillas +++ Das Berliner Hype-Startup Gorillas, ein sogenannter Flash-Supermarkt, plant derzeit – wie bereits im Januar berichtet – 100 Millionen Euro einzusammeln. Nun steht die erneute Investmentrunde nach unseren Informationen kurz vor der Unterzeichnung. Als Geldgeber steht vermutlich Greenoaks Capital aus San Francisco bereit. Der New Yorker Hedgefonds Coatue investierte gerade erst 44 Millionen US-Dollar in Gorillas – bei einer Bewertung von 160 Millionen (Pre-Money). Das Startup, das bereits über 1.000 Mitarbeiter beschäftigt, wurde 2020 von Kagan Sümer und Jörg Kattner, der schon wieder ausgestiegen ist, gegründet. Details gibt es in unserem aktuellen Insider-Podcast (siehe unten). #EXKLUSIV
Charles +++ Accel und HV Capital investieren nach unseren Informationen 5 Millionen Euro in Charles. Die Bewertung liegt bei 20 Millionen Euro (Pre-Money). Hinter Charles verbirgt sich eine Conversational-Commerce-as-a-Service-Software für Händler und Konsumgütermarken. Das Unternehmen aus Berlin, das von Artjem Weissbeck (Kapten & Son) und Andreas Tussing (McKinsey) gegründet wurde, ermöglicht es Marken ihre Produkte über WhatsApp und andere Chat-Apps anzubieten. Tarek Müller (AboutYou), Alexander Graf (Spryker Systems, Kassenzone) und Nils Seebach (Etribes) investieren zuvor bereits 1 Million in Charles. Details gibt es in unserem aktuellen Insider-Podcast (siehe unten). #EXKLUSIV
Jodel +++ Der chinesische Internet-Gigant NetEase investiert nach unseren Informationen in die hyperlokale App Jodel. NetEase hält nun 23 % am Unternehmen. In den vergangenen Jahren flossen rund 10 Millionen Euro in das Berliner Unternehmen, das 2014 als eine Art Campus-App startete. Das Startup zeigt seinen Nutzern anonymisiert Beiträge an, die andere Nutzer, die in der Umgebung sind, veröffentlicht haben. Zu den Investoren von Jodel gehören unter anderem Global Founders Capital, der Geldgeber von Rocket Internet, und Atlantic Internet, also Christophe Maire. Details gibt es in unserem aktuellen Insider-Podcast (siehe unten). #EXKLUSIV
+++ Cherry Ventures investiert nach unseren Informationen eine unbekannte, sicherlich aber siebenstellige Summe, in Supercam, das neueste Startup von Janis Zech (Fyber). Das junge Unternehmen entwickelt eine Software für Videokonferenzen und Videokommunikation. “Our vision is to make everyone a great presenter”, teilt das Unternehmen in eigener Sache mit. Mit seiner Startup-Schmiede NewCo Labs schob Zech zuletzt Unternehmen wie Back und Good Game/Donut an. Bei Supercam steht ihm Henrik Basten, früher CTO bei Exactag und Fyber, zur Seite. Details gibt es in unserem aktuellen Insider-Podcast (siehe unten). #EXKLUSIV
+++ Das Kieler Startup Gitpod, das von Sven Efftinge, Moritz Eysholdt und Jan Köhnlein geführt wird, steht nach unseren Informationen vor dem Abschluss einer weiteren – millionenschweren – Investmentrunde. Crane Venture Partners, Speedinvest und Vertex Ventures US investieren erst kürzlich 3 Millionen US-Dollar in das Startup. Mit Gitpod können Entwickler ihre Projekte zügig umsetzen. Das Startup bietet seinen Nutzern eine einsatzbereite Entwicklungsumgebung im Browser – und zwar auf Knopfdruck. Details gibt es in unserem aktuellen Insider-Podcast (siehe unten). #EXKLUSIV
+++ Hessen Kapital investiert gemeinsam mit privaten und institutionellen Investoren, wie der DLE Holding, 1 Million Euro in das Frankfurter das Startup LegalTegrity. Das LegalTech, das 2019 von Thomas Altenburg, Pia Michel und Maraja Fistanic gegründet wurde, bietet eine digitale Hinweisgeberlösung als Software-as-a-Service-Produkt an. “Die Lösung können kleine und mittelständische Unternehmen (KMU) einfach in ihre Abläufe sowie Unternehmensprozesse einbinden”, teilt die Jungfirma mit.
+++ Schon die neue Insider-Ausgabe mit Sven Schmidt gehört? In der aktuellen Folge geht es um Gorillas, Charles, Jodel, Supercam, Gitpod, Careship, Capnamic Ventures, AdJust, LeanIX, staffbase und den Spac-Boom.
Achtung! Wir freuen uns über Tipps, Infos und Hinweise, was wir in unserem #DealMonitor alles so aufgreifen sollten. Schreibt uns eure Vorschläge entweder ganz klassisch per E-Mail oder nutzt unsere “Stille Post“, unseren Briefkasten für Insider-Infos.
Startup-Jobs: Auf der Suche nach einer neuen Herausforderung? In der unserer Jobbörse findet Ihr Stellenanzeigen von Startups und Unternehmen.
Digital entertainment titan Tencent continues to drum up its music ambitions. On Tuesday, Tencent Music Entertainment, majority-owned by Tencent with a 55.6% stake, announced establishing a new joint label with its licensing partner Universal Music Group to discover, develop and promote Chinese artists domestically and to the world.
TME, which spun off from Tencent and went public in the U.S. in 2018, commands the lion’s share of China’s music streaming industry through three apps — QQ Music, Kugou and Kuwo. It also operates other music-related businesses, including live events and a popular karaoke app.
651 million users streamed music through TME services in the second quarter, but only 47.1 million were paid subscribers, signaling a much lower conversion rate compared to Spotify, which did a share swap with TME in 2017.
Licensing fees take up a big chunk of streaming services’ expenses. Cultivating its own artists will give TME more control over music content and eventually reduce dependence on content IP owners.
TME hopes that the new label will enable it to “produce new music loved by the younger demographic, bringing in iconic music stars, innovative music works, and more breakthrough music genres to the global music market, ultimately providing music fans in China and around the world with a spectacular music entertainment experience,” said TC Pan, the group’s vice president of content cooperation.
Break with precedent
As part of the announcement, TME also said it signed a multi-year extension of licensing agreement with UMG.
Concurrent with the news is, noticeably, UMG’s licensing deal with TME’s Chinese rival NetEase Cloud Music. This departs from the precedent of TME’s monopoly on streaming Western mainstream music in China. For years, TME had spent heavily on exclusive rights from UMG, Warner Music and Sony Music Entertainment. It further deepened ties with WMG and SME, which bought shares of TME when it went public.
The setup forced TME’s domestic rivals including NetEase to sublicense its catalogs, often at above-market rates, and indirectly prompted smaller players to develop their own artists. NetEase, for instance, is known for developing indie musicians.
NetEase CEO William Ding has been a critic of exclusive music rights. In a February analyst call, he labeled the practice ‘unfair and unreasonable’ and called for an end to it. He achieved his goal.
Speaking on NetEase’s latest licensing tie-up with UMG, Ding remarked: “The partnership further strengthens NetEase Cloud Music’s position as a go-to platform for high-quality international music and marks a great step forward for China’s music industry as a whole.”
Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world. This week, we have updates from Alibaba’s rapidly growing cloud computing unit, Apple’s controversial decision to remove two podcast apps from its Chinese App Store, and more.
Zynn, a TikTok rival that had rocketed to the top of the download charts a few weeks since its launch in May, was removed from Google Play this week over plagiarism. Developed by Kuaishou, the nemesis of TikTok’s Chinese sister Douyin, Zynn is another made-in-China app that has recently taken the international market by storm.
In a statement (in Chinese) this week, Kuaishou said the removal was triggered by one complaint about a user-generated video that had stolen content from another platform. As venture capitalist Turner Novak observed, much of Zynn’s early content seemed to be ripped from TikTok.
The main driver of the app’s rise, however, is its reward system; it essentially pays users to use and promote its app, a strategy that has proven popular among China’s rural and small-town populations. Nasdaq-listed content aggregator Qutoutiao has used the same tactic to grow.
Whether this pay-to-use strategy is sustainable is yet to be seen. Zynn is apparently making efforts to retain users through other means, claiming it’s in talks with “celebrity-level” creators to enrich its content.
Influencers are in high demand these days. After proving the strategy of driving e-commerce sales through influencer live promotion, Alibaba decided it wanted to bring the model to overseas markets. As such, it put out a notice to recruit as many as 100,000 content creators who would help the Chinese giant promote products sold on its international marketplace, AliExpress.
Many may know that China has turned one of its poorest provinces Guizhou into a pivotal tech hub that’s home to many cloud services, including that of Apple China. Now China is morphing Tibet into another cloud computing center. One main project is a 645,000-square-meter data facility that will facilitate data exchange between China and South Asia.
The slogan suggests the strategic role Alibaba wants Dingtalk to play: an operating system built on Alibaba Cloud, the world’s third-largest infrastructure as a service behind Amazon and Microsoft. It’s a relationship that echoes the one between Microsoft 365 and Azure, as president of Alibaba Cloud Zhang Jianfeng previously suggested in an interview (in Chinese).
Dingtalk, built initially for enterprise communication, has blossomed into an all-in-one platform with a myriad of third-party applications tailored to work, education and government services. For instance, the Ministry of Education can easily survey students and parents through Dingtalk. The app is now serving 15 million organizations and 300 million individual users.
On top of Dingtalk integration, Alibaba Cloud said it will hire up to 5,000 engineers this financial year to fuel growth in areas including network, databases and artificial intelligence. The recruitment came after Alibaba committed in April to spend 200 billion yuan ($28 billion) over the next three years to build more data infrastructure amid increased demand for services like video conferencing and live streaming as businesses adapt to the COVID-19 pandemic.
Apple bans podcast apps
Just as podcasts are gaining ground in China, two foreign podcast apps that appeal to independent content creators were banned from the Apple App Store. The move echoed Apple’s crackdown on Chinese-language podcasts on its own podcast platform last year this time.
Investor’s favorite app is back
Speaking of app removal, this week, many venture capitalists and product managers in China are celebrating the return of Jike (即刻). The social media app, which has a loyal following within the Chinese tech circle, was removed nearly a year ago from app stores for unspecified reasons, but many speculated it was due to censorship.
The app is a kind of a hybrid of Reddit and Twitter, allowing users to discover content and connect based on interests and topics. Many VCs and internet firm employees use it to trade gossip and share hot takes. Its death and life are a reminder of the immense regulatory uncertainty facing tech companies operating in China.
Sought-after Hong Kong listings
Two of the largest U.S.-traded Chinese companies are floating their shares in Hong Kong for secondary listings amid fraying ties between Beijing and Washington. NetEase, the second-biggest gaming company in the world after Tencent, jumped 6% from its offer price to HK$130 on the first day of trading this week. JD.com, the Alibaba archrival, has reportedly priced its offering at HK$226 a share.
Eswin, a semiconductor company founded by the boss of Chinese display technology giant BOE Technology, has completed a sizable funding round as the Chinese government encourages domestic chip production.
Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world. Last week, we had a barrage of news ranging from SoftBank’s latest bet on China’s autonomous driving sector to Chinese apps making waves in the U.S. (not TikTok).
TikTok isn’t the only app with a Chinese background that’s making waves in the U.S. A brand new short-video app called Zynn has been topping the iOS chart in America since May 26, just weeks after its debut. Zynn’s maker is no stranger to Chinese users: it was developed by short-video platform Kuaishou, the nemesis of Douyin, TikTok’s Chinese sister.
The killer feature behind Zynn’s rise is an incentive system that pays people small amounts of cash to sign up, watch videos or invite others to join, a common user acquisition tactic in the Chinese internet industry.
Paying people to use & recommend your app to others i.e. the classic Qutoutiao (趣头条 Fun Headlines) model popularized in China from around 2017 has now made it over to the States
Given how many unemployed people there are due to Covid-19. Never been a better time to test this https://t.co/nXXoCrlTvW
The other app that’s been trending in the U.S. for a while is News Break, a hyper-local news app founded by China’s media veteran Jeff Zheng, with teams in China and the U.S. It announced a heavy-hitting move last week as it onboards Harry Shum, former boss of Microsoft AI and Research Group, as its board chairman.
Alibaba looks for overseas influencers
The Chinese e-commerce giant is searching for live-streaming hosts in Europe and other overseas countries to market its products on AliExpress, its marketplace for consumers outside China. Live-streaming dancing and singing is nothing new, but the model of selling through live videos, during which consumers can interact with a salesperson or session host, has gained major ground in China as shops remained shut for weeks during the coronavirus outbreak.
In Q1 2020, China recorded more than 4 million e-commerce live-streaming sessions across various platforms, including Alibaba. Now the Chinese giant wants to replicate its success abroad, pledging that the new business model can create up to 100,000 new jobs for content creators around the world.
Oppo in Germany
Oppo announced last week its new European headquarters in Düsseldorf, Germany, a sign that the Chinese smartphone maker has gotten more serious on the continent. The move came weeks after it signed a distribution deal with Vodafone to sell its phones in seven European countries. Oppo was also one of the first manufacturers to launch a 5G commercial phone in Europe.
Chinese tech stocks return
We speculated last week that Hong Kong might become an increasingly appealing destination for U.S.-listed Chinese tech companies, many of which will be feeling the heat of tightening accounting rules targeting foreign companies. Two firms have already taken action. JD.com and NetEase, two of China’s biggest internet firms, have won approvals to list in Hong Kong, Bloomberg reported, citing sources.
Massive losses in SoftBank’s first Vision Fund didn’t seem to deter the Japanese startup benefactor from placing bold bets. China’s ride-hailing giant Didi has completed an outsized investment of over $500 million in its new autonomous driving subsidiary. The financing led by SoftBank marked the single-largest fundraising round in China’s autonomous driving sector.
The capital will give Didi a huge boost in the race to win the autonomous driving race, where it is a relative latecomer. It’s competing with deep-pocketed players that are aggressively testing across the world, including the likes of Alibaba, Tencent and Baidu, and startups such as Momenta, NIO and Pony.ai.
Speaking of live-streaming e-commerce, two of China’s biggest internet companies have teamed up to exploit the new business model. JD, the online retailer that is Alibaba’s long-time archrival, has signed a strategic partnership with Kuaishou — yes, the maker of Zynn and TikTok’s rival in China.
The collaboration is part of a rising trend in the Chinese internet, where short video apps and e-commerce platforms pally up to explore new monetization avenues. The thinking goes that video platforms can leverage the trust that influencers instill in their audience to tout products.
Notion, the fast-growing work collaboration tool that recently hit a $2 billion valuation and has attracted a loyal following in China, was briefly banned in China last week. It’s still investigating the cause of the ban, but the timing noticeably coincided with China’s annual parliament meeting, which began last week after a two-month delay due to COVID-19. Internet regulation and censorship normally toughen around key political meetings in the country.
TikTok isn’t the only new media app with Chinese background that’s making waves in the U.S. News Break, a news app founded by China’s media veteran Jeff Zheng with teams in Beijing, Shanghai, Seattle and Mountain View, has been sitting among the top three news apps in the U.S. App Store since March, according to third-party data from Sensor Tower.
Positioned as a news aggregator focused on local reporting, the platform surged to be the third-most downloaded U.S. iOS app across the board in mid-March.
Former Microsoft executive Harry Shum joins News Break, a local news aggregator founded in the U.S. by a Chinese media veteran (Photo source: News Break)
News Break is staffed with other storied overseas Chinese tech bosses. Jeff Zheng, the founding chief executive, headed up Yahoo Labs in Beijing where he oversaw algorithm improvements in search, media, advertising and mobile. In 2011, he left Yahoo to launch Yidian Zixun, the Beijing-based startup seen early on as the main rival of Toutiao, the hit news app that made ByteDance a household name in China before Douyin emerged. Together with other algorithm-driven news apps, the duo changed the habits of hundreds of millions in China from consuming human-curated news to machine-recommended content with minimal human oversight.
News Break is Zheng’s effort to replicate Yidian Zixun’s success in foreign markets with his co-founder Ren Xuyang, a former Baidu executive. Founded in Silicon Valley in 2015, News Break now boasts 23 million monthly users with a growing network of over 10,000 content providers.
Screenshots of the News Break app (Source: News Break)
The type of personalized reading experience pioneered by Toutiao is now a default feature across media apps in the U.S., said (in Chinese) Vincent Wu, chief operating officer of News Break, at an event in Silicon Valley. To stand out from the crowd, the company serves up local news and happenings for readers, for Wu observed that America’s mainstream media focus overwhelmingly on national affairs and celebrity gossip, “news that’s irrelevant to my day-to-day.”
“Only high-quality, hyper-relevant local news can provide valuable information to readers,” he added.
ByteDance has tried exporting the Toutiao model through TopBuzz, but the overseas edition never achieved mainstream success and is reportedly looking for a buyer.
Particle Media, the Delaware-registered operating entity of News Break, has raised over $20 million to date from investors including IDG Capital, ZhenFund and Ding Lei, the founder of Chinese online media and gaming giant NetEase.