Study finds half of Americans get news on social media, but percentage has dropped

A new report from Pew Research finds that around a third of U.S. adults continue to get their news regularly from Facebook, though the exact percentage has slipped from 36% in 2020 to 31% in 2021. This drop reflects an overall slight decline in the number of Americans who say they get their news from any social media platform — a percentage that also fell by 5 percentage points year-over-year, going from 53% in 2020 to a little under 48%, Pew’s study found.

By definition, “regularly” here means the survey respondents said they get their news either “often” or “sometimes,” as opposed to “rarely,” “never,” or “don’t get digital news.”

The change comes at a time when tech companies have come under heavy scrutiny for allowing misinformation to spread across their platforms, Pew notes. That criticism has ramped up over the course of the pandemic, leading to vaccine hesitancy and refusal, which in turn has led to worsened health outcomes for many Americans who consumed the misleading information.

Despite these issues, the percentage of Americans who regularly get their news from various social media sites hasn’t changed too much over the past year, demonstrating how much a part of people’s daily news habits these sites have become.

Image Credits: Pew Research

In addition to the one-third of U.S. adults who regularly get their news on Facebook, 22% say they regularly get news on YouTube. Twitter and Instagram are regular news sources for 13% and 11% of Americans, respectively.

However, many of the sites have seen small declines as a regular source of news among their own users, says Pew. This is a different measurement compared with the much smaller percentage of U.S. adults who use the sites for news, as it speaks to how the sites’ own user bases may perceive them. In a way, it’s a measurement of the shifting news consumption behaviors of the often younger social media user, more specifically.

Today, 55% of Twitter users regularly get news from its platform, compared with 59% last year. Meanwhile, Reddit users’ use of the site for news dropped from 42% to 39% in 2021. YouTube fell from 32% to 30%, and Snapchat fell from 19% to 16%. Instagram is roughly the same, at 28% in 2020 to 27% in 2021.

Only one social media platform grew as a news source during this time: TikTok.

In 2020, 22% of the short-form video platform’s users said they regularly got their news there, compared with an increased 29% in 2021.

Overall, though, most of these sites have very little traction with the wider adult population in the U.S. Fewer than 1 in 10 Americans regularly get their news from Reddit (7%), TikTok (6%), LinkedIn (4%), Snapchat (4%), WhatsApp (3%) or Twitch (1%).

Image Credits: Pew Research

There are demographic differences between who uses which sites, as well.

White adults tend to turn to Facebook and Reddit for news (60% and 54%, respectively). Black and Hispanic adults make up significant proportions of the regular news consumers on Instagram (20% and 33%, respectively.) Younger adults tend to turn to Snapchat and TikTok, while the majority of news consumers on LinkedIn have four-year college degrees.

Of course, Pew’s latest survey, conducted from July 26 to Aug. 8, 2021, is based on self-reported data. That means people’s answers are based on how the users perceive their own usage of these various sites for newsgathering. This can produce different results compared with real-world measurements of how often users visited the sites to read news. Some users may underestimate their usage and others may overestimate it.

People may also not fully understand the ramifications of reading news on social media, where headlines and posts are often molded into inflammatory clickbait in order to entice engagement in the form of reactions and comments. This, in turn, may encourage strong reactions — but not necessarily from those worth listening to. In recent Pew studies, it found that social media news consumers tended to be less knowledgeable about the facts on key news topics, like elections or Covid-19. And social media consumers were more frequently exposed to fringe conspiracies (which is pretty apparent to anyone reading the comments!)

For the current study, the full sample size was 11,178 respondents, and the margin of sampling error was plus or minus 1.4 percentage points.

 

#americans, #computing, #facebook, #instagram, #like-button, #linkedin, #media, #news, #news-media, #pew, #pew-research, #reading, #reddit, #snapchat, #social, #social-media, #software, #tiktok, #twitch, #twitter, #united-states, #website, #world-wide-web, #youtube

Reddit bans r/NoNewNormal and quarantines 54 “COVID-denial subreddits”

The Reddit app icon on an iPhone screen.

Enlarge (credit: Getty Images | stockcam)

Reddit yesterday banned r/NoNewNormal, a hub of anti-mask and anti-vaccine posts, after a protest against the platform’s refusal to take more aggressive action against COVID misinformation. In a post titled “COVID denialism and policy clarifications,” Reddit said it also quarantined “54 additional COVID-denial subreddits.” While NoNewNormal was taken off Reddit entirely, quarantining a subreddit imposes restrictions that “prevent its content from being accidentally viewed by those who do not wish to do so.”

NoNewNormal was banned not for spreading misinformation but for breaking Reddit’s rule against “brigading,” which refers to members of one subreddit conducting “targeted interference” in other subreddits. Reddit said:

While we want to be a place where people can explore unpopular views, it is never acceptable to interfere with other communities. Claims of “brigading” are common and often hard to quantify. However, in this case, we found very clear signals indicating that r/NoNewNormal was the source of around 80 brigades in the last 30 days (largely directed at communities with more mainstream views on COVID or location-based communities that have been discussing COVID restrictions). This behavior continued even after a warning was issued from our team to the Mods. r/NoNewNormal is the only subreddit in our list of high-signal subs where we have identified this behavior and it is one of the largest sources of community interference we surfaced as part of this work (we will be investigating a few other unrelated subreddits as well).

Although not mentioned in Reddit’s announcement, a subreddit called CoronavirusConspiracy was also banned yesterday “due to being unmoderated.” That community was already quarantined last year because it “may contain misinformation or hoax content.”

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#covid, #policy, #reddit

Reddit’s teach-the-controversy stance on COVID vaccines sparks wider protest

Photo illustration with a hand holding a mobile phone and a Reddit logo in the background.

Enlarge (credit: Getty Images | SOPA Images )

Over 135 subreddits have gone dark this week in protest of Reddit’s refusal to ban communities that spread misinformation about the COVID pandemic and vaccines.

Subreddits that went private include two with 10 million or more subscribers, namely r/Futurology and r/TIFU. The PokemonGo community is one of 15 other subreddits with at least 1 million subscribers that went private; another 15 subreddits with at least 500,000 subscribers also went private. They’re all listed in a post on “r/VaxxHappened” which has been coordinating opposition to Reddit management’s stance on pandemic misinformation. More subreddits are being added as they join the protest.

“Futurology has gone private to protest Reddit’s inaction on COVID-19 misinformation,” a message on that subreddit says. “Reddit won’t enforce their policies against misinformation, brigading, and spamming. Misinformation subreddits such as NoNewNormal and r/conspiracy must be shut down. People are dying from misinformation.”

Read 12 remaining paragraphs | Comments

#covid, #misinformation, #policy, #reddit, #vaccine

Reddit resists banning pandemic misinformation, allows vaccine “dissent”

The Reddit app icon on a smartphone screen.

Enlarge (credit: Getty Images | Yuriko Nakao )

Reddit yesterday defended its stance on allowing pandemic misinformation after hundreds of subreddit moderators joined an open letter urging the company to “take action against the rampant Coronavirus misinformation on their website.”

The open letter on r/VaxxHappened was joined by over 450 moderators and said that subreddits existing “solely to spread medical disinformation and undermine efforts to combat the global pandemic should be banned.” The hundreds of subreddits that joined the open letter include 10 with over 10 million subscribers each, over 40 subreddits with 1 million to 10 million subscribers each, and about 20 others with 500,000 to 1 million subscribers.

In response, Reddit posted an explanation of its approach, saying it will continue to allow “debate” and “dissent” on vaccines and other COVID-related matters, even when there is a scientific consensus.

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#covid, #pandemic, #policy, #reddit, #vaccine

Reddit is quietly rolling out a TikTok-like video feed button on iOS

From Instagram’s Reels to Snapchat’s Spotlight, most social media platforms are looking toward the TikTok boom for inspiration. Now, even Reddit, a discussion-based forum, is making short-form video more pronounced on its iOS app.

According to Reddit, most iOS users should have a button on their app directly to the right of the search bar — when tapped, it will show a stream of videos in a TikTok-like configuration. When presented with a video, (which shows the poster who uploaded it and the subreddit it’s from), users can upvote or downvote, comment, gift an award, or share it. Like TikTok, users can swipe up to see another video, feeding content from subreddits the user is subscribed to, as well as related ones. For instance, if you’re subscribed to r/printmaking, you might see content from r/pottery or r/bookbinding.

The user interface of the videos isn’t new — Reddit has been experimenting with this format over the last year. But before, this manner of watching Reddit videos was only accessible by tapping on a video while scrolling through your feed — rather than promoting discovery of other communities, the first several videos recommended would be from the same subreddit.

Images of new Reddit features

Image Credits: Reddit, screenshots by TechCrunch

“Reddit’s mission is to bring community and belonging to everyone in the world, and subsequently, Reddit’s video team’s mission is to bring community through video,” a Reddit spokesperson told TechCrunch, about the new addition. “Over the course of the last year, our goal was to build a unified video player, and re-envision the player interface to match what users (new and old) expect when it comes to an in-app video player — especially commenting, viewing, engaging, and discovering new content and communities through video,” they noted.

Reddit doesn’t yet have a timeline for when the feature will roll out to everyone, but confirmed that this icon first appeared for some users in late July and has continued to roll out to almost all iOS users. But by placing a broader, yet still personalized video feed on the home screen, Reddit is signaling a growing curiosity in short form video. In December 2020, Reddit acquired Dubsmash, a Brooklyn-via-Berlin-based TikTok competitor. The terms of the deals were undisclosed, but Facebook and Snap also reportedly showed interest in the platform, which hit 1 billion monthly views in January 2020.

Reddit declined to comment on whether or not its new video player is using an algorithm to promote discovery of new subreddits based on user activity. However, a Reddit spokesperson confirmed that the company will use Dubsmash’s technology to develop other features down the road, though not for this particular product, they said.

Reddit first launched its native video platform in 2017, which allows users to upload MP4 and MOV files to the site. Then, in August 2019, it launched RPAN (Reddit Public Access Network), which lets people livestream to the r/pan subreddit — the most popular live streams are promoted across the platform. Reddit currently attracts 50 million daily active visitors and hosts 100,000 active subreddits.

#apps, #dubsmash, #mobile, #reddit, #reels, #short-form-video, #social, #spotlight, #tiktok, #video

Reddit is raising up to $700M in Series F funding

Earlier this year, Reddit raised $250 million, bringing the 16-year-old site up to around $800 million in total funding. Today, it announced plans for an even more massive windfall, with a Series F led by Fidelity. The company has secured $410 million, with plans to raise up to $700 million, putting Reddit at a $10 billion valuation.

The company says funding will go toward building out community and advertising efforts and increasing headcount.

“These efforts require us to grow our teams and make smart bets on how to make Reddit better, faster, easier to use, and more empowering for communities,” Reddit writes. “We are also evolving as a business, maturing, and building the operational structures that will help propel us into the future with transparency, values and integrity.”

As we noted back in February, an extraordinarily strange couple of years found the content aggregation service playing a key role in rollercoaster stock figures for companies like Gamestop and AMC, by way of the r/WallStreetBets subreddit. It also kicked off 2021 with a short Super Bowl spot. All of that helped lead to a doubling of the company’s valuation to $6 billion.

For now, it seems, the hype train is continuing. In Q2, Reddit broke $100 million in advertising revenue for the first time, marking a 192% year-over-year increase for the quarter. The site now attracts 50 million daily visitors and hosts 100,000 active subreddits. In March, it announced Drew Vollero would be joining on the site’s first-ever CFO, after assisting with Snap’s IPO efforts, four years prior.

In an interview with The New York Times, cofounder Steve Huffman notes that it hadn’t planned to raise another round so quickly, but ultimately couldn’t turn down what Fidelity was offering. He adds that the funding will also factor into Reddit’s eventual IPO plans.

“We are still planning on going public, but we don’t have a firm timeline there yet,” he told the paper. “All good companies should go public when they can.”

#apps, #funding, #reddit

Twitter tests Reddit-style upvote and downvote buttons

Twitter will test the use of Reddit-like upvote and downvote buttons as a way to better highlight the more interesting and relevant replies in a longer conversation thread. The company announced this afternoon it would begin what it’s calling a “small research experiment” that will add upvote and downvote buttons to replies, or even replace the “Like” button entirely. In some cases, the upvote and downvote buttons may be up arrows and down arrows, while in other cases they may be thumbs up and thumbs down buttons.

And in one group of testers, users may continue to see the “Like” button (the red heart) but will now find a downvote button alongside it. In this group, the upvote would count as a “Like,” Twitter said.

Twitter clarified to TechCrunch that only a small number of testers will see these options appear in their Twitter iOS app, and users’ votes will not become public.

The company also said it’s not currently using this vote information to rank the replies at this time. (If, however, such a system ever become a public feature, that could certainly change.)

The goal with the test is to help Twitter to learn what sort of replies users find most relevant during their conversations, which is something Twitter has studied for some time. According to Twitter user researcher Cody Elam, past studies determined that users tended believed replies that were informative, supportive, positive and funny were the “best” types of replies. However, some of the best replies wouldn’t surface quickly enough — an issue Twitter hopes to be able to address with an upvoting and downvoting feature.

Elam says the feature would allow users to privately voice their opinion on the replies’ quality without having to publicly shame other users. Over time, this data could help Twitter to improve its conversation ranking systems.

If Twitter were to act on this information to actually rank the replies, it could make it easier and more enjoyable to read longer Twitter threads — like those that follow viral tweets, for example. But it could also help to better showcase the replies that add something informative or interesting or even just funny to a conversation, while pushing any trolling remarks down the thread.

Today, Twitter allows users to manually hide the replies that detract from a conversation by placing them behind an extra click. Perhaps, in time, it could do something similar for replies that received too many downvotes, too — like Reddit does. But none of these types of features are being tested right now, to be clear.

This isn’t the first time Twitter has shown interest in other types of engagement buttons beyond the Like and Retweet. Earlier this year, for example, Twitter was spotted surveying users about their interest in a broader set of emoji-style reactions, similar to what you’d find on Facebook. That feature has since been put into development, it seems.

The same survey had also asked users how they felt about upvote and downvote buttons, in addition to emoji reactions.

Twitter says the test is rolling out now to a small group on iOS only.

#conversations, #downvote, #like-button, #reddit, #social, #social-media, #social-software, #tc, #tweets, #twitter, #upvote

Colombian on-demand delivery startup Rappi raises ‘over’ $500M at a $5.25B valuation

Rappi, a Colombian on-demand delivery startup, has raised “over” $500 million at a $5.25 billion valuation in a Series G round led by T. Rowe Price, the company announced late Friday.

Baillie Gifford, Third Point, Octahedron, GIC SoftBank, DST Global, Y Combinator, Andreessen Horowitz and Sequoia Capital and others also participated in the round.

The new financing brings Rappi’s total raised since its 2015 inception to over $2 billion, according to Crunchbase. Today, the country has operations in 9 countries and more than 250 cities across Latin America. Its last raise was a $300 million a Series F funding round in September of 2020.

According to the Latin American Venture Capital and Private Equity Association (LAVCA), Rappi focused on delivering beverages and first, and has since expanded into meals, groceries, tech goods and medicine. The company also offers a cash withdrawal feature, allowing users to pay with credit cards and then receive cash from one of Rappi’s delivery agents. Today, the company says its app allows consumers to “order nearly any good or service.”

In addition to traditional delivery, it says “users can get products delivered in less than 10 minutes, can access financial services, as well as ‘whims,” and “favors.’ Whims allow users to order anything available in their coverage area. Favors offer an array of custom services, such as running an errand, going to the hardware store or picking out and delivering a gift. The two products allow users to connect directly with a courier. 

Simón Borrero, Sebastian Mejia, and Felipe Villamarin launched the company in 2015, graduating from Y Combinator the following year. A16z’s initial investment in July 2016 was the Silicon Valley firm’s first investment in Latin America, according to LAVCA.

#andreessen-horowitz, #apps, #baillie-gifford, #colombia, #companies, #delivery, #dst-global, #feature, #funding, #fundings-exits, #gic, #latin-america, #online-food-ordering, #rappi, #recent-funding, #reddit, #sequoia-capital, #softbank, #softbank-group, #startup, #startups, #t-rowe-price, #venture-capital, #websites, #y-combinator

The price differential for engineers is declining

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

The whole crew was here this week, with Danny and Natasha and Alex  together with Grace and Chris to sort through a very, very busy week. Yep, somehow it is Friday again which means it’s time for our weekly news roundup.

Here’s what we got to in our short window of time:

Like we said, a busy week! Chat you all on Monday morning, early.

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

#affirm, #ai, #apple, #artificial-intelligence, #beyond-meat, #bnpl, #china, #chorus-ai, #commodity-capital, #discord, #early-stage-startup, #edtech, #emerging-fund-manager, #equity, #equity-podcast, #fintech, #gourmey, #india, #ipo, #jianzhi-education, #klarna, #next-gen-foods, #nooks, #public-market, #reddit, #sentropy, #tc, #venture-capital, #virtual-hq, #zomato, #zoominfo

Discord buys Sentropy, which makes AI moderation software to fight online hate and abuse

The online chat platform Discord is buying Sentropy, a company that makes AI-powered software to detect and remove online harassment and hate.

Discord currently uses a “multilevel” approach to moderation, relying on an in-house human moderation team as well as volunteer mods and admins to create ground rules for individual servers. A Trust and Safety team dedicated to protecting users and shaping content moderation policies comprised 15% of Discord’s workforce as of May 2020.

Discord plans to integrate Sentropy’s own products into its existing toolkit and the company will also bring the smaller company’s leadership group aboard. The terms of the deal were not disclosed, but the acquisition is a sign that taking toxic content and harassment seriously isn’t just the right thing to do — it’s good business too.

“T&S tech and processes should not be used as a competitive advantage,” Sentropy CEO John Redgrave said in a blog post on the announcement. “We all deserve digital and physical safety, and moderators deserve better tooling to help them do one of the hardest jobs online more effectively and with fewer harmful impacts.”

Discord hasn’t always had a reputation for taking dangerous content seriously. Far-right groups with ties to real-world violence previously thrived on the platform. Discord cracked down on hate and extremism following the Unite the Right rally in Charlottesville, which left anti-racist protester Heather Heyer dead.

By February of 2018, the company was purging white supremacist and neo-Nazi groups, cleaning up the platform on its journey to transcend its gaming roots and grow into a mainstream social network. Now, Discord boasts 150 million monthly active users and is positioning itself as a comfy home for all kinds of communities while holding onto its core user base of gamers.

In a blog post, Redgrave elaborated on the company’s natural connection with Discord:

“Discord represents the next generation of social companies — a generation where users are not the product to be sold, but the engine of connectivity, creativity, and growth. In this model, user privacy and user safety are essential product features, not an afterthought. The success of this model depends upon building next-generation Trust and Safety into every product. We don’t take this responsibility lightly and are humbled to work at the scale of Discord and with Discord’s resources to increase the depth of our impact.”

Sentropy launched out of stealth last summer with an AI system designed to detect, track and cleanse platforms of online harassment and abuse. The company emerged then with $13 million in funding from notable backers including Reddit co-founder Alexis Ohanian and his VC firm Initialized Capital, King River Capital, Horizons Ventures and Playground Global.

Sentropy will offer existing enterprise customers who use its software products Detect and Defend service through the end of September. The company shut down its free consumer dashboard, Sentropy Protect, earlier this month.

Sentropy’s products were conceived as social network-agnostic tools rather than as platform-specific solutions. It sounds like even under Discord’s wing, the team plans to share insights on building safer online spaces with the internet at large.

“We are excited to help Discord decide how we can most effectively share with the rest of the Internet the best practices, technology, and tools that we’ve developed to protect our own communities,” Redgrave said.

Discord’s future is looking bright. The company walked away from a possible acquisition by Microsoft earlier this year that reportedly valued it at around $10 billion. Discord looks content to remain independent for now and could chart a path toward an IPO in the not-too-distant future.

#alexis-ohanian, #artificial-intelligence, #discord, #horizons-ventures, #initialized-capital, #internet-culture, #john-redgrave, #king-river-capital, #online-harassment, #playground-global, #reddit, #sentropy, #social, #software, #tc

Digital greeting card startup Givingli wraps $3 million seed round

While the digital revolution has transformed nearly every social interaction and communication type in the past couple decades, the humble birthday card has shown surprising resiliency.

Givingli, a small LA-based startup with an app aiming to challenge how Gen Z sends digital greeting cards, is picking up some seed funding from investors betting on their philosophy around modern gifting. The startup has raised a $3 million seed round led by Reddit co-founder Alexis Ohanian’s Seven Seven Six, while Snap’s Yellow Accelerator also participated in the raise.

The wife and husband co-founding team stumbled into the world of digital greetings and gifts after abandoning physical invitations for their wedding and exploring how the digital greetings space had and hadn’t evolved. They’ve taken a mobile-first approach to tackling greetings for special events and moments where users just want to let someone know they’re thinking of them.

Image via Givingli

“Initially, we thought it would mainly be birthdays and categories like weddings, graduation, etc., and I think we just threw in some ‘just because’ cards, but then that became the most popular category, by far,” CEO Nicole Emrani Green tells TechCrunch. “I think that it’s what kicked off our virality, because obviously with every Givingli sent you’re pulling someone else in and then the conversation continues.”

The app monetizes through a $3.99 monthly premium subscription which gives users access to a greater variety of digital greeting designs from the more than 40 artists that the startup has licensed work from. Alongside paying for premium subscriptions, users can also shop for digital gift cards to send along with their greetings. Givingli’s gift card storefront has more than 150 brands available including Amazon, Spotify, Nike and DoorDash.

A big sell for Givingli’s offering has been its customization. Although users are pushed to select from the hundreds of available greeting cards, they can also spice them up by adding photos or videos in addition to writing text. The aim is to create a moment that rivals messages that can be shared via email, text or on social media services.

“For a generation of digitally native users, it’s not surprising that the ability to like, swipe, upvote or shoot a quick text from our phones have become the predominant ways we connect with others,” said Ohanian in a press release announcing the seed round. “What first attracted me to Givingli is that Nicole and Ben acutely understood this evolution and built a platform that provides the creative tools needed to elevate those interactions and deepen connections. Whether it’s sending a digital birthday gift, or a note just because – it’s clear that Givingli has put snail mail on notice.”

One of the team’s big challenges has been highlighting the visibility of their native app which users download to send greetings. Last fall, the Givingli team debuted a partnership with Snap that brought their gifting service inside Snapchat via a bite-sized Snap Mini app integration. The rollout followed the startup’s participation in Snap’s Yellow Accelerator program.

Emrani Green says that partnership has helped bring more users to their platform, and that more than 5 million people have used Givingli to send greetings since the app launched in 2019.

 

#alexis-ohanian, #amazon, #birthdays, #ceo, #co-founder, #computing, #doordash, #gift-card, #greeting-cards, #louisiana, #nike, #postcards, #recent-funding, #reddit, #snap, #snap-inc, #snapchat, #spotify, #startups, #tc, #technology

Twitch, Pinterest, Reddit and more go down in Fastly CDN outage

Countless popular websites including Reddit, Spotify, Twitch, Stack Overflow, GitHub, gov.uk, Hulu, HBO Max, Quora, PayPal, Vimeo, Shopify, and news outlets CNN, The Guardian, The New York Times, BBC and Financial Times are currently facing an outage. A glitch at Fastly, a popular CDN provider, is thought to be the reason, according to a product manager at Financial Times. Fastly has confirmed it’s facing an outage on its status website.

“We’re currently investigating potential impact to performance with our CDN services,” the firm said.

Content delivery networks (CDNs) are a key part of the internet infrastructure. These companies run global networks of server to improve performance and availability of web services. CDNs act as proxy servers and cache some data as close to the end user as possible. For instance, media content is often cached to a CDN server near you so that it doesn’t have to be fetched on the original server every time a user loads a web page.

Over time, CDNs have started adding more features, such as load balancing, DDoS protection, web application firewalls and several security features. Popular CDNs include Fastly, Cloudflare, CloudFront on Amazon Web Services and Akamai.

Fastly in particular is quite popular with media websites in particular. The company went public in 2019. Fastly shares (NYSE:FSLY) are currently trading at $48.06, down 5.21% compared to yesterday’s closing price.

This is a developing story. More to follow…

#apps, #developer, #fastly, #github, #reddit, #spotify, #stackoverflow, #tc, #twitch

Figure raises $7.5M to help startup employees better understand their compensation

The topic of compensation has historically been a delicate one that has left many people — especially startup employees — wondering just what drives what can feel like random decisions around pay and equity.

Last June, software engineers (and housemates) Miles Hobby and Geoffrey Tisserand set about trying to solve the problem for companies by developing a data-driven platform that aims to help companies structure their compensation plans and transparently communicate them to candidates.

Now today, the startup behind that platform, Figure, announced it has raised $7.5 million in seed funding led by CRV. Bling Capital, Better Tomorrow Ventures and Garage Capital also participated in the financing, along with angel investors such as AngelList co-founder Naval Ravikant, Jason Calacanis, Reddit CEO Steve Huffman and other executives based in Silicon Valley.

The startup has amassed a client list that includes other startups such as fintechs Brex and NerdWallet and AI-powered fitness company Tempo. 

Put simply, Hobby and Tisserand’s mission is to improve workflows and transparency around pay, particularly equity. The pair had both worked at startups themselves (Uber and Instacart, respectively) and ended up leaving money on the table when they left those companies because no one had properly explained to them what their equity, which changed at every valuation, meant.  

Figure co-founders and co-CEOs Miles Hobby and Geoffrey Tisserand. Image Credits: Figure

So, one of their goals was to create a solution that would provide a user-friendly explanation of what a person’s equity stake really means, from tax implications to whether or not they have to buy the stock and/or hold onto it.

“I’ve gone through the job search process many times before and there’s all these complex legal documents to understand why you’re getting 10,000 stock options, but obviously we knew the vast majority of people have no idea how that works,” Tisserand told TechCrunch. “We saw an opportunity there to help companies actually convey the value to their candidates while also making them aware of the potential risks of owning something that’s so illiquid.”

Image Credits: Figure

Another goal of Figure’s is to help create a more fair and balanced process about decisions around pay and equity so that there’s less inequality out there. Pointedly, it aims to remove some of the biases that exist around those decisions by systematizing the process.

“We saw a void in this kind of context around equity…and knew that there had to be a better way for companies to structure, manage and explain their compensation plans,” Hobby said.

To Hobby and Tisserand, Figure is designed to help stop instances of implicit bias.

“Compensation should be based on the work that you’re doing, and not gender or ethnic background,” Tisserand told TechCrunch. “We’re trying to give that context and remove biases. So, we’re trying to help at two different stages –– to surface inequities that already exist and make sure there are no anomalies, and then to help stop them before they can exist.”

Figure also aims to give companies the tools to educate candidates and employees on their total compensation — including equity, salary, benefits and bonuses — in a “straightforward and user-friendly” way. For example, it can create custom offer letters that interactively detail a candidate’s compensation.

“Our goal is for Figure to become an operating system for compensation, where a company can encode their compensation philosophy into our system, and we help them determine their job architecture, compensation bands and offer numbers while monitoring their compensation health to provide adjustment suggestions when needed,” Hobby said.

Post-hire, Figure’s compensation management system “helps keep everything running smoothly.”

Anna Khan, general partner of enterprise software at CRV, is joining Figure’s board as part of the funding. The decision to back the startup was in part personal, she said.

“I’d been investing in software for eight years and was alarmed that no one was building anything around pay equity when it comes to how we’re paid, why we’re paid what we’re paid and on how to build equity long term,” Khan told TechCrunch. “Unfortunately, discussions around compensation and equity still happen behind closed doors and this extends into workflow around compensation — equally broken — with manual leveling, old data and large pay inequities.”

The company plans to use its new capital to expand its product offerings and scale its organization.

#angellist, #anna-khan, #artificial-intelligence, #better-tomorrow-ventures, #bling-capital, #crv, #economy, #enterprise-software, #entrepreneurship, #figure, #finance, #funding, #fundings-exits, #hiring, #instacart, #jason-calacanis, #naval-ravikant, #operating-system, #private-equity, #recent-funding, #reddit, #silicon-valley, #startup, #startup-company, #startups, #steve-huffman, #talent, #uber, #venture-capital

In a room with no smart speaker, Alexa can’t hear you scream

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

For this week’s deep dive Natasha and Alex and Danny and Chris dove into the world of audio. Sure, you’ve heard of Clubhouse, but there’s lots more going on than just a single app’s cultural rise. So from the biggest companies to niche startups, we compiled all the recent audio news into a single show for all our delectation.

Here’s the rundown:

  • Facebook is building a number of audio products, including a Clubhouse clone and a short-form audio service that we think could be neat.
  • Reddit is also building a Clubhouse-like service, and Alex is excited about it.
  • It’s not just the established social networks that are trying out live audio. Peanut, a social networking app for women, added live audio “Pods” to its platform. It kicked off a conversation on what it takes to win this market, and what’s a smart versus silly bet.
  • While a drop in downloads doesn’t necessarily mean a drop in active users, it’s worth pointing out that Clubhouse’s monthly downloads dropped 72% in March. Where is that gosh darn Android app?
  • And Alex explained why the Clubhouse-NFL deal matters for the company, as it could molt into something more akin to a platform over time.
  • Danny explained how Apple and Spotify are building paid podcast services — more here, and here, respectively — and we have thoughts about which service is being more fair with the money. Natasha tied in how sentiment around the creator economy might be driving some of these individual-friendly business models.
  • Alex brought up TWiT’s new business model.

All told there’s quite a lot of excitement around the spoken word. Which is good as Equity is a podcast? Right?

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

#audio, #clubhouse, #discord, #equity, #equity-podcast, #facebook, #fundings-exits, #reddit, #startups

Reddit unveils its Clubhouse clone, Reddit Talk

On the heels of Clubhouse’s latest fundraise, Reddit today officially unveiled its Clubhouse rival, Reddit Talk following a recent report from Mashable that revealed the company had been developing audio-based social networking features. Like many of the newly launched Clubhouse clones, Reddit’s voice chat experience hasn’t deviated much from Clubhouse’s overall design where speakers sit at the top of the screen in a stage area of sorts, and listeners appear below — all with rounded profile icons, plus tools to react or raise a hand to ask to speak.

In Reddit’s case, however, it’s repurposed this Clubhouse-style format for its own communities, known as subreddits. Initially, Reddit Talk will live within subreddits, which are individual forums focused on a given topic or theme. Those community’s moderators will be the only ones able to start a talk for the time being, as the audio feature is still being tested, Reddit says.

These moderators will be given tools that allow them invite users to join, mute participants, and remove speakers during the live sessions. They can also ban unwanted users from the talk entirely and stop them from being able to rejoin.

Although only the subreddit moderators can start talks, once they are underway, they can invite anyone they choose to join them to speak. The other users can listen the Reddit Talk sessions across both iOS and Android.

Image Credits: Reddit

While the overall style is very much Clubhouse-like, Reddit has added its own touches. For example, users can react to speakers using a different set of emojis than you might find on rival services. Reddit’s product images today showed reactions that included popular Reddit designs like a rocket ship, the Reddit alien, and the diamond emoji, among others. Reddit says it’s currently testing a way for moderators to customize the background colors and the emoji used in their own communities when they launch Reddit Talk. They’re also able to change their own avatar’s appearance to fit the talk, too.

Reddit suggests the new audio features will make sense for things like Q&As, AMAs (Ask Me Anything), lectures, sports radio-style discussions, community feedback sessions or even just hangouts.

The company is currently developing other features designed specifically to support AMAs and other types of conversations, it also noted.

In the comments of the Reddit Talk announcement, Reddit responded to questions from users about why it’s doing this, and acknowledged the Clubhouse similarities.

Image Credits: Reddit

 

“We believe that there is more to offer here by letting users have real-time live voice discussions with others in their communities — maybe talking about a sporting event while it’s on TV or listening to a casual chat or AMA with field experts,” Reddit’s Product Lead for creators wrote. “Yes, there are a few different platforms diving into live audio right now. Our hope is that by announcing this early with a community-first design, we will see engaging conversations hosted first by moderators, who we’ll be working with closely to ensure we’re creating a unique, supportive, and positive user experience,” the comment read.

There are more than a “few” other platforms now building out Clubhouse clones at this point, of course. Facebook has several tools on the way, Twitter has Spaces, and there are audio platforms in various stages of development from Discord, Telegram, Spotify and even LinkedIn, in the works.

Reddit Talk is not publicly available as it’s in a test period. But community moderators can join a waitlist to be alerted as to when they can try out the feature for themselves. After the test period, Reddit says it will work with moderators to allow other trusted users to host talks through the new feature, too.

#apps, #audio, #audio-networking, #clubhouse, #reddit, #social, #social-media, #voice-chat

Crypto social network BitClout arrives with a bevy of high profile investors, and skeptics

While much of the recent wave of relentless hype around NFTs — or non-fungible tokens — has been most visibly manifested in high-dollar art auctions or digital trading cards sales, there’s also been a relentless string of chatter among bullish investors who see a future that ties the tokens to the future of social media and creator monetization.

Much of the most spirited conversations have centered on a pre-launch project called BitClout, a social crypto-exchange where users can buy and sell tokens based on people’s reputations. The app, which launches out of private beta tomorrow morning, has already courted plenty of controversy inside the crypto community, but it’s also amassed quite a war chest as investors pump tens of millions into its proprietary currency.

Early backers of the platform’s BitClout currency include a who’s who of Silicon Valley investors including Sequoia Capital and Andreessen Horowitz, the startup’s founder tells TechCrunch. Other investors include Chamath Palihapitiya’s Social Capital, Coinbase Ventures, Winklevoss Capital and Reddit co-founder Alexis Ohanian. A report in Decrypt notes that a single wallet connected to BitClout has received more than $165 million worth of Bitcoin deposits suggesting that huge sums have already poured into the network ahead of its public launch.

BitClout falls into an exploding category of crypto companies that are focusing on tokenized versions of social currency. Others working on building out these individual tokens include Roll and Rally, which aim to allow creators to directly monetize their internet presence and allow their fans to bet on them. Users who believe in a budding artist can invest in their social currency and could earn returns as the creator became more famous and their coins accrued more value.

“If you look at people’s existing relationships with social media companies, it’s this very adversarial thing where all the content they produce is not really theirs but it belongs to the corporation that doesn’t share the monetization with them,” BitClout’s founder, who refers to themselves pseudonymously as “diamondhands,” tells TechCrunch. (There’s been some speculation on their identity as a former founder in the cryptocurrency space, but in a call with TechCrunch, they would not confirm their identity.)

The BitClout platform revolves around the BitClout currency. At the moment users can deposit Bitcoin into the platform which is instantly converted to BitClout tokens and can then be spent on individual creators inside the network. When a creator gets more popular as more users buy their coin, it gets more expensive to buy denominations of their coin. Creators can also opt in to receive a certain percentage of transactions deposited into their own BitClout wallets so that they continue to benefit from their own success.

The company’s biggest point of controversy hinges on what has been opt-in and what has been opt-out for the early group of accounts on the platform. Most other social currency offerings are strictly opt-in. Users come to the platform in search of a way to create tokens that allow them to monetize a fanbase and build a social fabric across multiple platforms. The thought being that if the platforms own the audience then you are at their mercy.

BitClout has taken an aggressive growth strategy here, turning that model on its head. The startup has pre-populated the BitClout network with 15,000 accounts after scraping information from popular public Twitter profiles. This means that BitClout users can buy shares of Kim Kardashian’s social coin or Elon Musk’s without those individuals ever having signed up for a profile or agreeing to it. This hasn’t been well-received by all of those who unwittingly had accounts set up on their behalf including many crypto-savvy users who got scooped up in the initial wave of seeding.

The startup’s founder says that this effort was largely an effort to prevent handle squatting and user impersonation but he believes that as the platform opens, a sizable pre-purchase of creator coins reserved for the owners of these accounts will entice those users to verify their handles to claim the funds.

Perhaps BitClout’s most eyebrow raising quirk is that the platform is launching with a way to invest into the platform and convert bitcoin into BitClout, but at launch there’s no way to cash out funds. The project’s founder says that it’s only a matter of time before this is resolved, and points to Coinbase and the Winkelvoss twin’s status as coin holders as a sign of future exchange support to come, but the company has no specifics to share at launch.

While the founders and investors behind the project see a bright future for social currencies on the blockchain, many in the decentralized community have been less impressed with BitClout’s early efforts to achieve viral adoption among creators in a permission-less manner.

“BitClout will make a great case study on how badly crypto projects can mess up incentive engineering when they try to monetize social networks.” Jay Graber, a decentralized platform researcher involved in Twitter’s bluesky effort, said in a tweet. “Trust and reputation are key, and if you create a sketchy platform and mess with people’s reputations without their consent it is not going to go well.”

If BitClout comes out of the gate and manages to convert enough of its pre-seeded early adopter list that there is value in joining its closed ecosystem version of a social token then it may have strong early momentum in an explosive new space that many creators are finding valuable. The concepts explored by others in the social currency space are sound, but this particular execution of it is a high-risk one. The network launches tomorrow morning so we’ll see soon enough.

#alexis-ohanian, #andreessen-horowitz, #artist, #bitclout, #bitcoin, #co-founder, #coinbase, #coinbase-ventures, #cryptocurrencies, #cryptocurrency, #cryptography, #currency, #digital-currencies, #gemini, #kim-kardashian, #reddit, #sequoia-capital, #social-media, #social-networks, #tc, #winklevoss-capital

Sports trading card platform Alt launches with $31 million in funding and plenty of market hype

The alternative asset market showed promise pre-pandemic but amid a broader rally among traditional asset classes, the number of investors searching for and promoting value in the space has exploded. That has, in turn, promoted a pretty major influx of VC dollars into startups building platforms that wrangle these buyers into specific communities.

Enter, Alt. The young startup has received more than $31 million from top investors intrigued by the particularly hot space it has bulked up its expertise in — physical sports trading cards. The company provides a Goat-like marketplace for the cards, authenticating the transactions and providing buyers with the peace of mind that the slice of cardboard they’re dropping several thousands of dollars on is no fake. While entities like NBA Top Shot have rallied a new generation of buyers around blockchain era digital trading cards, its success has been enabled by the excitement that traditional collectibles markets have been garnering recently.

After years of stocking up on sports trading cards, Alt CEO Leore Avidar is just happy to have more people to talk about his obsession with. Like many in the sports card community, Avidar has spent years collecting cards and engaging with forums online, but it’s been an interest he hasn’t been able to share with friends and family given its somewhat fringe appeal. This isn’t the case today, Avidar says, with old collectors re-entering the market as they dust off aged collections and new collectors intrigued by skyrocketing prices and a more connected online community.

“I’ve talked with a lot of people in the community and one of the things I love is how intergenerational this is, I see a lot of like kids and their parents doing this together,” Avidar tells TechCrunch.

As the market has moved more mainstream, platforms like Alt have also begun seeing more investor interest. In the span of a few months, Alt wrapped a pair of funding rounds from investors hungry to embrace a play in the market — a seed round led by First Round and a Series A led by Reddit co-founder Alexis Ohanian’s new firm Seven Seven Six. Other Alt investors include John and Patrick Collison, Kevin Durant, SV Angel, BoxGroup, Sue Wagner, and Jeff Morris’s Chapter One.

Avidar wants Alt’s platform to increase transparency and liquidity in the alternative assets space and make acquiring assets here just as easy as platforms like Robinhood have made buying and selling stocks. Avidar’s central strategy to capturing this market and bringing it to his platform is by significantly undercutting the fees structure of other sites, with Alt charging 1.5% of the total sales price including processing fees.

In addition to authenticating its stock, Alt has had to build some infrastructure that’s somewhat custom to the trading cards market. Users that are less concerned with holding their physical cards and more worried about them being lost or damaged over time can opt to have Alt store their physical cards in a temperature and light-controlled vault (for a fee), ensuring that physical degradations of the card don’t affect its value. One of Alt’s key features that Avidar expects to be popular with collectors is their Zestimate-like Alt Value rating which will give card buyers and sellers a closer idea of what the market value of their card is based on historic transactions and the trending growth metrics.

The team is launching the Alt market with sports trading cards, but plans to expand its reach to other alternative assets as the marketplace matures further, with Avidar highlighting markets like watches, sneakers and art as potential growth areas.

#alexis-ohanian, #boxgroup, #ceo, #co-founder, #john, #kevin-durant, #market, #national-basketball-association, #nba, #patrick-collison, #reddit, #seven-seven-six, #tc

Why are we still dating LinkedIn in 2021?

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

Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. Before we get into this week’s show, make sure to check out all the news here about how Equity is expanding, and becoming even more of a thing in 2021! We are beyond hyped about it.

Coming on the back of such a wild news week, we had to cut and cut from the notes doc to get the show to size. So, here’s what made the cut:

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

#alexis-ohanian, #bitcoin, #coinbase, #equity-podcast, #finix, #fundings-exits, #hopin, #olo, #reddit, #shippo, #startup-communities, #startups, #toast

Reddit ups Series E round by another $116 million

Reddit, which announced a $250 million Series E earlier this month, has added over $116 million to the financing event, upping the round’s most recent total to $367 million, according to a new SEC filing. The document shows that Reddit is aiming to raise up to $500 million in this capital raise.

A Reddit spokesperson confirmed the news, saying that the new capital is from ”new and existing investors.” They offered no specifics on names. The spokesperson did confirm that the new capital did not come with a new valuation, keeping the platform at its previously-announced valuation of $6 billion pre-money.

Reddit is a 16-year-old company with over $800 million in known venture funding. It has been in the spotlight for the past few months, with co-founder Alexis Ohanian resigning over moderation concerns, to, more recently, its role in the Election and the meteoric rise of GameStop’s stock due to the subreddit r/WallStreetBets.

#media, #reddit, #social, #tc

Reddit’s transparency report shows a big spam problem and relatively few government requests

Reddit has published its transparency report for 2020, showing various numbers relating to removed content, government requests and other administrative actions. The largest problem by far — in terms of volume, anyway — is spam, which made up nearly all content taken down. Legal requests for content takedown and user information were far fewer, but not trivial, in number.

The full report is quite readable, but a bit long; the main points to understand are summarized below.

Of nearly 3.4 billion pieces of content created on Reddit (which is to say posts, comments, hosted images, etc.), 233 million were removed. These numbers are both up by 20%-30% from 2019. Of those 233 million, 131 million were “proactive” removals by the AutoMod system and 13.6 million were removed after user reports by subreddit moderators.

The remaining 85 million were taken down by Reddit admins; 99.76% of these were spam or “content manipulation” like brigading and astroturfing, with around 50,000 each of harassment, hate and sexualization of minors, smaller amounts of violent speech, doxing and so on.

Chart showing that content removal on reddit was largely spam.

Image Credits: Reddit

82,858 subreddits were removed, nearly four times more than 2019. The majority of these were for lack of moderation, followed by hate, harassment and ban evasion (e.g., r/bannedsub starts r/bannedsub2).

When it came to removing comments, hate, violence and harassment were much more prevalent. And 92% of private messages removed (of about 25,000 total) were for harassment.

Outside of spam and content manipulation, hate speech resulted in far more bans than any other infraction; more accounts were permanently banned for hate in 2020 than for all causes combined in 2019. (But far fewer for content violations than for spam and ban evasion.)

Government requests to remove content were relatively few. Overall Reddit received a couple hundred requests covering about 5,000 pieces of content or subreddits. For example, 753 subreddits had their access restricted to Pakistani users due to anti-obscenity laws there.

Requests from individuals or companies to remove things numbered in the hundreds, and copyright takedown notices asked for about half a million pieces of content to be removed (375,774 were), more than twice 2019’s. Only a handful of DMCA counter-notices were received.

Law enforcement came to Reddit 611 times for user information, up 50% from last year, and the company granted 424 of those requests. These are mostly subpoenas, court orders and search warrants. Since Reddit isn’t really a social network and accounts can be essentially anonymous or throwaway, it’s hard to say what level of disclosure this actually represents. Emergency disclosure requests numbered about 300 and were mostly complied with — these are supposedly life-or-death situations in which a Reddit account is concerned.

Lastly Reddit received somewhere between 0 and 249 secret requests for data, targeting somewhere between 0 and 249 users, same as last year. Sadly, federal law prohibits them from saying any more than this regarding FISA orders and National Security Letters.

Overall the picture painted of Reddit in 2020 is of a growing community plagued by spam and inauthentic activity, plus a significant and growing contingent of hate, harassment and other prohibited content (though last year was surely an exceptional one for this). Lacking much fundamental access to or use of personally identifiable data, Reddit isn’t much of a target for three-letter agencies and law enforcement. And with “free speech”-focused alternatives to Reddit and other platforms popping up, it’s likely that the hate and harassment that were deplatformed will roost elsewhere in 2021.

#reddit, #social, #transparency-report

Does SoftBank have 20 more DoorDashes?

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

Natasha and Danny and Alex and Grace were all here to chat through the week’s biggest tech happenings. This week felt oddly comforting from a tech news perspective: Facebook is copying something, early-stage startup data is flawed enough to talk about and sweet DoorDash is buying robots for undisclosed sums.

So, here’s a rundown of the tech news we got into (as always, jokes aren’t previewed so you’ll have to listen to the actual show to get our critique and Award Winning Analysis*):

In good news, long-time Equity producer Chris Gates is back starting next week, which means we’ll have our biggest crew ever helping get the show put together. And, in other good news, there’s going to be more Equity than ever for you to hear. Coming soon.

Equity drops every Monday at 7:00 a.m. PST and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.

*OK, so not award-winning yet. But soon enough, because manifestation works.

#bumble, #doordash, #early-stage, #equity-podcast, #ethena, #fintech, #fundings-exits, #j-curve, #justo, #podcasts, #reddit, #softbank, #startups, #zeta

Daily Crunch: Reddit raises $250M

Reddit raises more funding, Shopify expands payments to Facebook and a study suggests that the Apple Watch might be able to predict COVID diagnoses. This is your Daily Crunch for February 9, 2021.

The big story: Reddit raises $250M

This latest funding announcement comes after Reddit has returned to the headlines, with the WallStreetBets subreddit playing a crucial role in the spectacular rise and fall of GameStop shares (along with other stocks). The company also ran a five-second Super Bowl ad on Sunday, consisting of a single static image.

Reddit announced the round in a blog post that said the money comes from “existing and new investors” and will allow the company to “make strategic investments in Reddit including video, advertising, consumer products and expanding into international markets.”

The tech giants

Shopify expands its payment option, Shop Pay, to its merchants on Facebook and Instagram — This is the first time Shop Pay will be made available outside of Shopify’s own platform.

CD Projekt hit by ransomware attack, refuses to pay ransom — “We have already secured our IT infrastructure and begun restoring data,” the game company said.

Spotify confirms it’s (finally) testing a live lyrics feature in the US — Though the streaming music service today offers live lyrics in a number of markets, it has not done so in the U.S. for many years.

Startups, funding and venture capital

Swarm’s low-cost satellite data network is now available to commercial clients — One of the original startups that set out to create a low-Earth orbit satellite constellation to provide a data network here on Earth is now open for business.

Mighty Buildings nabs $40M Series B to 3D print your next house — The startup says it can 3D print a 350-square-foot studio apartment in just 24 hours.

Seed firm Eniac Ventures raises $125M for its fifth fund — The size of Eniac’s funds has grown dramatically over the past decade, from its $1.6 million first fund in 2010 to its $100 million fourth fund in 2017.

Advice and analysis from Extra Crunch

Decrypted: A hacker attempted to poison Florida town’s water supply — Oldsmar is a small town in Florida that became the center of the cyber world this week.

Are SAFEs obscuring today’s seed volume? — SAFEs are a quick and cheap method for raising capital.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Everything else

Announcing the agenda for TC Sessions: Justice — Our second-ever dedicated event to diversity, equity, inclusion and labor in tech is coming up on March 3.

Mount Sinai study finds Apple Watch can predict COVID-19 diagnosis up to a week before testing — The investigation, dubbed the “Warrior Watch Study,” used a dedicated Apple Watch and iPhone app and included participants from Mount Sinai staff.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

#daily-crunch, #funding, #fundings-exits, #media, #reddit, #startups

Reddit raises $250 million in Series E funding

Reddit has raised a new funding round, totalling $250 million. This is the company’s Series E round of financing, and it comes hot on the heels of renewed public attention on the site that has dubbed itself ‘the front page of the Internet,’ owing to the role the subreddit r/WallStreetBets played in the recent meteoric rise (and subsequent steep fall) of the value of GameStop stock. Reddit also ran a 5-second Super Bowl ad on Sunday, consisting of. a single static image that looked like a standard post on the network itself.

This is Reddit’s 16th year of operation, and the company has raised around $800 million to date, including a Tencent-led $300 million Series D in February, 2019. Today’s round including financing from “existing and new investors,” Reddit noted in a blog post in which it announced the funding. In the post, Reddit notes that the company felt “now was the right opportunity to make strategic investments in Reddit including video, advertising, consumer products and expanding into international markets.”

Reddit’s 5-second Super Bowl ad.

It’s unclear how the round came together exactly, but given the network’s time in the spotlight over the past few weeks, culminating in yesterday’s very brief, but also very memorable and high-profile ad, it seems likely it was at least finalized fast in order to help the company make the most of its time in the spotlight. In terms of what kind of specific moves Reddit could make with its new cash on hand, the blog post also namecheck its acquisition late last year of short video sharing platform Dubsmash, and announced plans to double its team over the course of this year with new hires.

Reddit’s long history has also included some significant tumult, and efforts to clean up its act in order to present a better face to advertisers, and to potential new community members. The network still struggles with balancing its commitments to fostering a home for a range of communities with the potential for hate speech and discrimination to take root within some of these, and it was also in the news earlier this year for finally banning controversial subreddit r/donaldtrump following “repeat´d policy violations” surrounding the attempted insurrection a the U.S. Capitol by a mob of domestic terrorists.

 

#apps, #consumer-products, #dubsmash, #funding, #gamestop, #like-button, #recent-funding, #reddit, #robinhood, #short-selling, #social, #software, #startups, #super-bowl, #tc, #websites, #wikis, #world-wide-web

In 2021 everyone gets 15 minutes of wealth

Trades in the infamous Reddit-basket of stocks and trades are taking a pounding today, with GameStop down 52.7%, AMC Entertainment off 42.7%, the silver-squeeze flopping and more. CNBC has a longer list if you want to feast your eyes on the carnage.

What a surprise that the thing that was always going to happen, has happened.

While it was quite honestly entertaining as hell to watch WallStreetBets go from cult-classic to internet hero overnight, tempting scads of new traders (check out how much Public has been growing while Robinhood raced to the top of app store charts) to try and take on the professional investing world, this was always going to be the result. Always.

Why? Because the companies that Reddit’s legion of traders decided to pump were ultimately not selected for anything other than price plasticity. GameStop was picked because traders thought they could punish shorts, remember, not because it was going to bring a revolution to video game distribution. Like what Steam did precisely 8 billion years ago.

Let’s make our point by way of comparison.

Tesla shares are up 3.7% today, as are the broader American stock markets. Tesla is up not because it is fairly valued, per se, but at least it’s a company that’s growing, makes money and has a good argument for what the future should look like. It’s hard to kill an idea based on something durable.

Compare the Tesla situation to GameStop. There’s little relation.

The brick-and-mortar game sales company has lots more room to fall. So does the movie theater chain suffering from the pandemic. But the original trader is still comfortably up. DeepFuckingValue, the Reddit trading icon, was still up 2,800% yesterday. That’s probably lower today, if he didn’t sell.

What worries me is all these dorks are getting torched today, after promising to stay in the trade yesterday when DeepFuckingValue updated the world on his epic trade:

Those folks probably weren’t up 2,800%.

Most of the people who are going to take a bath on the Reddit trades are regular folks: my friends, your siblings. Whereas professional money is probably making money on the way up and down.

This is how these things go. Gravity is real, and no matter how many times you shout stonks in the mirror, crying, while clutching your smartphone, it’s hard to keep a bag of shit in the air forever.

In 2021 maybe we don’t get 15 minutes of fame. There are so many different social platforms the very idea of 15 minutes of fame is outmoded; there are more slots than ever for everyone to build an audience. Perhaps instead the thing that the common person really wants is their 15 minutes of wealth. That feeling of safety and security and having made it that modern society so reserves for the wealthy few.

Which the stock market gave to a bunch of folks last week. And is taking away this week.

Andy Warhol is generally credited with the 15 minutes of fame concept. Today, however, our own Ron Miller came up with the variation, and was kind enough to let me use it for this post.

#gamestop, #reddit, #startups, #tc

Hedge fund Melvin sustains 53% loss after Reddit onslaught

Hedge fund Melvin sustains 53% loss after Reddit onslaught

Enlarge (credit: Innocenti | Getty Images)

Melvin Capital, the hedge fund that was wrongfooted by retail traders who drove up shares in GameStop and other companies it had bet against, lost 53 percent in January, according to people familiar with the firm’s results.

The New York-based hedge fund sustained a $4.5 billion fall in its assets from the end of last year to $8 billion, even after a $2.75 billion cash injection from Steve Cohen’s Point72 Asset Management and Ken Griffin’s Citadel.

Melvin became the target of retail traders who coordinated to drive up the share price of GameStop on online message boards such as Reddit, after the firm disclosed its bet against the company in regulatory filings.

Read 10 remaining paragraphs | Comments

#gamestop, #gme, #reddit, #short-selling, #stocks, #tech, #troll

No, WallStreetBets isn’t robbing Wall Street to help the little guy

A closed GameStop store in Frankfurt, Germany, on Friday, Jan. 29, 2021.

Enlarge / A closed GameStop store in Frankfurt, Germany, on Friday, Jan. 29, 2021. (credit: Alex Kraus/Bloomberg via Getty Images)

You’ve probably seen stories about GameStop, the struggling video game retailer that has improbably seen its stock quintuple since the start of the week. The stock isn’t up because GameStop announced strong financial results or a new turnaround strategy. Instead, it was the focus of a coordinated buying campaign by members of the WallStreetBets subreddit.

The effort has been so effective in part because its architects have convinced people that it’s not just a pump and dump scheme. Instead, they’ve painted a seductive story in which retail investors found a loophole that allows them to make money at the expense of hedge funds and other wealthy investors who had shorted the stock.

In reality, most of the gains captured by early GameStop investors will come at the expense of later investors who will be left holding the bag when the stock falls.

Read 11 remaining paragraphs | Comments

#gamestop, #lol, #policy, #reddit, #wallstreetbets

Webull, M1 and Public remove restrictions on ‘meme stocks’ after citing trade settlement firm as the cause

Three of the popular retail stock market trading apps that have hosted much of the activity related to the Wall Street Bets subreddit-spurred run on stocks including GameStop (GME) and AMC, among others, have removed all restrictions on their exchange by their users. M1, Webull and Public had restricted transactions for the affected stocks earlier in the day, along with Robinhood.

M1, Webull and Public all attributed the restrictions placed on these volatile stocks not to any effort to curb their purchase or sale, but instead cited the costs associated with settling the trades on the part of their clearing firm, Apex. All three platforms employ Apex to clear trades made by users via their platform. In an interview with Webull CEO Anthony Denier, Yahoo Finance confirmed that the restriction was not something the company had any hand in deciding.

Public confirmed via Twitter that users can now buy and sell GME and AMC and KOSS on the platform, thanks to the resolution of the Apex blocker. Meanwhile Webull noted that all three stocks are now also available for exchange via their app, as did M1 shortly after. Other platforms like SoFi so far haven’t restricted the stocks, CEO Anthony Noto confirmed on Twitter.

Robinhood earlier issued a blog post noting that it is restricting a number of stocks tied to the r/WallStreetBets action to counter short-seller hedge funds, arguing that it’s doing so in the best interest of users. This has not seemed to have been much appreciated by most users, based on the reaction on social media to that action thus far. Robinhood at no time references any technical barriers imposed by any clearing house.

#anthony-noto, #apex, #california, #ceo, #finance, #gamestop, #reddit, #robinhood, #social, #social-media, #sofi, #stock-market, #tc, #yahoo

Robinhood restricts trading in GameStop after retail brouhaha shakes markets

Update: Robinhood has made public note of the changes, stating that “in light of recent volatility” it is “restricting transactions for certain securities to position closing only, including $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK.” The company added that it has “raised margin requirements for certain securities.”

Robinhood, the popular consumer trading application, has restricted its users from making some popular investments and wagers, public reports indicate. Social media is awash with notes from individual Robinhood users indicating that some popular securities are now untradable, and the company reportedly sent out a note yesterday saying that it is “implementing certain restrictions for for GME [GameStop] and AMC [the theater chain] options trading.”

TechCrunch has multiple emails in to the company asking for clarification regarding what trades, and securities are banned in aggregate, and the reasoning behind the move, but we’ve yet to hear back at time of publication. User commentary thus far concerning Robinhood’s choice has been swift, and negative, however.

Robinhood’s decision comes after zero-cost trading platforms found themselves at the center of one of the public market’s more bizarre sagas, in which a horde of retail investors bid shares of heavily-shorted securities higher in an attempt to break the trades of professional investors; precisely who is making the bets, and what portion of the new wagers are from individual investors and not larger pools of capital following the trade is not clear.

Yesterday, after noting that some traditional online brokers had restricted some user access to certain securities, citing their volatility, TechCrunch asked Robinhood and a number of its peers if they were taking similar precautions.

One of the group added some protection, but most cited their focus on long-term shareholding over day trading; a fair position but one at odds with the fact that most free-trading apps generate revenue from consumer trade volume. And options and other more exotic trades generate more revenue for neo-brokers than trades executed in well-known stocks.

Robinhood’s latest move, then, will ding its revenues as it is no longer allowing for trading in some very popular securities and other market-based wagers.

This is not the first time that neo-brokers have come up against tension between their business model and user access to exotic investments. After a Robinhood user committed suicide after trading options and not understanding one of their trades, a tragedy, Robinhood worked to make options trading harder to get into. That was definitely the right call, but likely not great for its revenue in the short-term, we imagine, given how lucrative those trades have historically proven for the company.

Options volume is setting records. Trading volume is at historical highs. And at the time of writing, shares of GameStop are set to rally at the open yet again today. Let’s see what happens.

#apps, #fundings-exits, #gamestop, #reddit, #robinhood, #tc

WallStreetBets goes dark

After a wild day for public markets driven by Reddit traders commandeering stocks and combatting hedge fund short sellers, the community at r/wallstreetbets no longer has a home on Discord and its Reddit community has been locked down as an invite-only subreddit for the time being.

Discord announced this afternoon that they had banned the WallStreetBets Discord server following hate speech violations after “repeated warnings.” The Discord server had been seeing heavy traffic of new users in the past several days as traffic surged to the subreddit as well.

On Reddit’s end, it’s not quite so clear what has happened. It does not appear as though Reddit took direct action against the community, but instead that r/wallstreetbets moderators were overwhelmed by the influx of new users and have taken the subreddit down themselves. The site notes that only moderators and “approved users” are currently allowed in the community. A number of long-time subscribers have noted on social media that they are unable to access the community which boasted several million subscribers.

We’ve reached out to Reddit for further clarification.

In a statement given to TechCrunch earlier today before the WallStreetBets subreddit went private, a company spokesperson says, “Reddit’s site-wide policies prohibit posting illegal content or soliciting or facilitating illegal transactions. We will review and cooperate with valid law enforcement investigations or actions as needed.”

The full statement from a Discord spokesperson to TechCrunch:

The WallStreetBets server has been on our Trust & Safety team’s radar for some time due to occasional content that violates our Community Guidelines, including hate speech, glorifying violence, and spreading misinformation. Over the past few months, we have issued multiple warnings to the server admin.

Today, we decided to remove the server and its owner from Discord for continuing to allow hateful and discriminatory content after repeated warnings.

To be clear, we did not ban this server due to financial fraud related to GameStop or other stocks. Discord welcomes a broad variety of personal finance discussions, from investment clubs and day traders to college students and professional financial advisors. We are monitoring this situation and in the event there are allegations of illegal activities, we will cooperate with authorities as appropriate.

Updating

#articles, #discord, #gamestop, #internet-culture, #reddit, #software, #spokesperson, #tc, #wikis

Reddit’s largest remaining Trump community banned for “inciting violence”

The image currently at the top of r/donaldtrump.

Enlarge / The image currently at the top of r/donaldtrump. (credit: Reddit)

On Friday, Reddit joined this week’s response to violent online rhetoric as spearheaded by President Donald Trump and removed its “r/donaldtrump” community, the site’s largest existing community dedicated specifically to Trump. Visiting any of that community’s pages now leads to a simple message pointing to Reddit’s rules about “inciting violence,” which starts by saying, “Do not post violent content.”

Without a citation of specific Reddit threads or a formal announcement from Reddit administrators clarifying the move, users may be left wondering about the exact reason for the removal. It’s possible, for example, that the community page was punished for reposting Trump’s speeches and statements from earlier in the week, which alternated between false claims about election fraud, calls to action by his followers in response to his claims about fraud, or sympathetic statements about the seditionists who stormed the US Capitol on Wednesday.

While searching through r/donaldtrump archives is a bit unwieldy (owing to how such archives are maintained at sites like archive.is), cursory searches point to the community hosting pre-protest conversations about the January 6 protest, usually with titles pointing to Trump’s direct request that his followers from across the nation attend. The issue may also have come from multiple claims at r/donaldtrump shortly before its shutdown about Wednesday’s seditionists being disguised as “antifa,” despite a majority of Capitol building invaders being identified with clear links to white nationalist organizations and calls for a violent January 6 protest.

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#biz-it, #donald-trump, #reddit, #trump

Reddit bans r/donaldtrump following violence at the U.S. Capitol

Days after a mob broke into the U.S. Capitol amid protests against Donald Trump’s 2020 election loss, another major social media platform has banned a popular pro-Trump forum. Reddit this morning confirmed that it has banned the r/donaldtrump subreddit.

A spokesperson for the site tells TechCrunch,

Reddit’s site-wide policies prohibit content that promotes hate, or encourages, glorifies, incites, or calls for violence against groups of people or individuals. In accordance with this, we have been proactively reaching out to moderators to remind them of our policies and to offer support or resources as needed. We have also taken action to ban the community r/donaldtrump given repeated policy violations in recent days regarding the violence at the U.S. Capitol.”

While r/donaldtrump didn’t approach the infamy of some other pro-Trump subreddits, the site was a current hub for the Stop the Steal movement. The subreddit also encouraged attendees to attend the D.C. rally that turned into deadly violence at the Capitol: A side banner on r/donaldtrump showed an image of President Trump as Uncle Sam. “POTUS wants you in D.C. on 1/06/21” it read.

TechCrunch has reached out to Reddit for more specifics about why the subreddit was removed.

Prior to the invasion of the Capitol, many Trump supporters attended Trump’s own event, a rally near the White House. While that event was stationary around a stage, Trump eventually encouraged its attendees to march toward Congress to continue expressing their outrage at the election results.

Reddit has historically hosted large pro-Trump communities known for their toxic behavior and open violent threats against public figures. Last June, Reddit banned the most prominent of those, controversial subreddit r/The_Donald, amid a larger sweep of pages. A year prior, Reddit quarantined r/The_Donald, making it more difficult to discover and requiring an opt-in screen for anyone seeking to visit.

Reddit’s decision to close the hub for Trump supporters follows several other de-platformings on major services, including Facebook, Twitch, Twitter, Instagram, Snapchat and Shopify.

#apps, #donald-trump, #policy, #reddit

Reddit ‘taking action’ on site violations as rioters storm US Capitol

As chaos and violence have erupted in Washington D.C., social media platforms are grappling with the fallout. A spokesperson for Reddit tells TechCrunch,

Reddit’s site-wide policies prohibit content that promotes hate or encourages, glorifies, incites, or calls for violence. In accordance with this, we have been proactively reaching out to moderators to remind them of our policies and to offer support or resources as needed. We are also taking action on reported violations.

The site reportedly hasn’t seen a major change in user activity leading up to today’s  storming of the U.S. Capitol building — apparently owing in part to the banning of a number of Subreddits, including The_Donald, over violations earlier this year.

The statement follows similar wording from Twitter,

In regard to the ongoing situation in Washington, DC, Twitter’s Trust & Safety teams are working to protect the public conversation occurring on the service and will take action on any content that violates the Twitter Rules.

It seems clear that much of the current reaction to the situation is in flux as this unprecedented and dark moment continues to unfold in Washington D.C. For now, much of Reddit’s content control lies in the hands of site moderators.

#apps, #donald-trump, #policy, #reddit, #riots, #trump

Reddit clone Voat, home to hate speech and QAnon, has shut down

That's the book shut on <em>one</em> unsavory corner of the Internet...

Enlarge / That’s the book shut on one unsavory corner of the Internet… (credit: LdF | Getty Images)

Reddit alternative Voat shut down on Christmas Day, citing a lack of operational funding, and casting doubt on the abilities of other similar almost-anything-goes, “free speech” platforms to stay online in the long run.

“I just can’t keep it up,” Voat cofounder Justin Chastain said in the shutdown announcement. Investment dried up in March 2020, he explained. “I personally decided to keep Voat up until after the U.S. election of 2020. I’ve been paying the costs out of pocket but now I’m out of money.”

Voat first launched in 2014 as a smaller Reddit alternative dedicated to “free speech,” including explicit hate speech, extreme right-wing content, racism, and other content limited or prohibited on other sites. It gained traction in 2015, when Reddit finally banned several explicitly racist subreddits from its platform in a bid to limit harassment, and some discontented Reddit users decided to migrate over.

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#extremism, #free-speech, #gab, #harassment, #hate-speech, #online-hate-speech, #parler, #policy, #reddit, #terrorism, #voat

FTC kicks off sweeping privacy probe of nine major social media firms

A scalpel labeled FTC is surrounded by the logos of social media giants.

Enlarge (credit: Aurich Lawson / Ars Technica)

The Federal Trade Commission is stepping up its digital privacy work and has asked just about every major social media platform you can think of to explain what personal data it collects from users and why.

The requests for information went out today to nine platforms (or their parent companies, where applicable), including Discord, Facebook, Reddit, Snapchat, TikTok, Twitch, Twitter, WhatsApp, and YouTube, according to the press release. The companies that receive the orders have 45 days to explain to the FTC:

  • How social media and video streaming services collect, use, track, estimate, or derive personal and demographic information
  • How they determine which ads and other content are shown to consumers
  • Whether they apply algorithms or data analytics to personal information
  • How they measure, promote, and research user engagement
  • How their practices affect children and teens

A sample order (PDF) shows the depth and specificity of the information the FTC is requesting from each firm, including extremely granular data about monthly and daily active users, business and advertising strategies, and potential plans for acquisitions or divestments. Interestingly, each firm is also required to say how many users it has inaccurate demographic information for and how it accounts for targeted advertising, including inaccurately targeted advertising. In other words, among other things the FTC wants to know: do you give advertisers their money back if you don’t actually target the groups they’re trying to reach?

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#alphabet, #amazon, #consumer-privacy, #data-privacy, #discord, #facebook, #federal-trade-commission, #ftc, #policy, #privacy, #reddit, #snapchat, #tiktok, #twitch, #twitter, #whatsapp, #youtube

Equity Monday: IPO delays and mega-deals kickstart the week

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

This is Equity Monday, our weekly kickoff that tracks the latest big news, chats about the coming week, digs into some recent funding rounds, and mulls over a larger theme or narrative from the private markets. You can follow the show on Twitter here and myself here — and don’t forget to check out last Thursday’s episode that dug into the impact of celebrity endorsement, and investment.

This morning we had a lot to get through, so here are the headlines:

We didn’t get to the Google story or the huge hack news. So, there’s more to read if you are so inclined.

And that is the show! Hugs and good vibes from the Equity crew!

Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.

#cledara, #codemasters, #equity-podcast, #reddit, #roblox, #tc