Bottomless closes $4.5M Series A to scale its subscription coffee business

As a devoted coffee drinker I was enthused by the idea of Bottomless. The Y Combinator-backed startup sends its users coffee as they run low so that they never run out of the Magic Juice of Life. What could be better?

Because life is somewhat funny, after signing up for its service the company reached out to share that it had raised a Series A. So I got on the phone with Liana Herrera, the company’s co-founder, to chat about the startup, which is part coffee-sourcing engine, part subscription/e-commerce play and part hardware effort.

So before we talk about its Series A, let’s work better to understand what Bottomless is building, and how it works.

What’s Bottomless?

Born from its founders’ issues ordering the right amount of Soylent when they actually needed it, and wondering why there wasn’t a better way to subscribe to goods consumed on a regular basis, Herrera uncovered the idea for Bottomless.

Today the product works by letting users pick the type of coffee they are interested in, be it caffeine level, price and the like. The company then provides customers with a small digital scale that they connect to their home internet. And then as users consume coffee that Bottomless sends them, placing the bag on the hardware in between uses, the scale notes how much is left and orders more before they run out.

A Bottomless scale, via the company as my kitchen lighting is bad.

You can set the sensitivity of the scale, asking it to either be ambitious in keeping you from running out of beans or ground coffee, or more relaxed. As I write to you today, I think that my third bag of decaf has arrived. It’s a neat system.

And from a business perspective, the Bottomless model has plusses. I honestly do not recall the price range of coffee that I picked, and do not know how much I am actually paying Bottomless at the moment. But I do know that having different types of coffee arrive at the house as I run low is pretty damn cool.

To make that happen, however, is not easy. The startup’s business is a little complex. Before and even after Bottomless went through Y Combinator back in 2019, the company hand-built its coffee-weighing scales. Herrera told TechCrunch that the old Silicon Valley saw that hardware is hard is in fact an understatement. After all the soldering she described during an interview, I believe her.

Still, after finishing the accelerator program the company managed to grow in 2019 by what Herrera said was around 10x. That customer expansion allowed the company to order bulk hardware from China in early 2020. After its first production run finished — a few thousand units — COVID-19 shut down that country’s supply chain. Happily for the startup, by the time COVID-19 had taken over America, the Chinese economy opened up and production could begin again.

Per the company, Bottomless scaled another 5-7x in 2020. An October 2020 CNN piece notes that the company had around 750 customers in late 2019, and some 6,000 by the time of publication. Herrera wants to massively expand that number, telling TechCrunch that she’d like to grow by 10x again this year, and that 5x expansion was the lower-end of her expectations.

Powering that growth are a host of coffee companies that Bottomless works with. Those companies handle roasting the beans and sending them to different Bottomless customers. So that no one reaches a zero-coffee state. And dies. Or whatever happens when one actually runs out of coffee.

The startup told TechCrunch that there are some 500 roasters on their wait list, implying that it will have the capacity to take on more customers this year.

Despite all the growth, the company still has some edges to refine. Setting up Wi-Fi on my scale wasn’t super-simple, for example. Herrera did note that her firm has a new scale coming out in the next three months. That could lower the difficulty barrier for new customers. Still, with 6,000 customers last October ordering three to four bags of coffee monthly, per Herrera’s estimate, the company had reached a comfortable seven-figure GMV run-rate before 2021 began.

For coffee roasters who may have seen their customer base slow during the pandemic, and consumers increasingly willing to dive into e-commerce, the company’s model could have long-term legs. Which brings us to the investors making that bet.

The round

Bottomless raised a $4.5 million Series A in January of 2021. It’s a smaller A than we tend to see in recent years, but Herrera said that her company has always been scrappy, which we take to mean that it has a history of being frugal. Patrick OShaughnessy led the round.

TechCrunch asked if the $4.5 million was a lot of money for the startup, as we didn’t have a clear picture at the time of its fundraising history. Herrera said that Bottomless has gotten to where it is today on just $2 million. So, the Series A is more than double all the money that the company as raised to date. It’s a lot of money, in other words.

Besides the new scale design, when asked about what the company intends to do with its funds, Herrera detailed the type of person she’s looking to hire — namely intellectually flexible folks who are informal, scrappy and very hack-y. More staff, in other words.

Let’s see how far Bottomless can get with its new check. Apparently I will be helping its KPIs for the foreseeable future as a customer.

#bottomless, #coffee, #fundings-exits, #recent-funding, #startups, #subscription-services, #tc, #y-combinator

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Lifestyle benefits startup Fringe gets a pandemic boost, raises seed round

Employers today often use perks to attract new talent in the form of discounts and deals, commuter funds, gym memberships, childcare, free lunches and more. But the pandemic has impacted what sort of in-office or other in-person perks employees can access. That’s led to booming growth — and now, a fundraise — for a startup called Fringe, which offers companies a personalized marketplace of perks that people really want, like Netflix, Uber, Airbnb, DoorDash, Headspace, Talkspace and over 100 other apps.

The idea for Fringe came about from the co-founders’ work as financial advisors where they regularly found themselves consulting people who were weighing new job options and their associated benefits.

“Companies are spending a lot money on traditional benefits…$800, $1,000 a month per person. But the perceived value for most employees is relatively small, given the cost,” explains Fringe CEO Jordan Peace. “I started thinking about what could [companies] offer employees that would be a pretty low actual cost, but a really high perceived value?”

He landed on the idea of subscription services — things people use all the time in their daily lives, but sometimes feel just out of reach from a budgetary standpoint.

That’s where Fringe comes in.

Employers sign up for access to Fringe’s platform at a starting cost of $5 per employee per month. (The rate may decrease for larger organizations.) They then place the dollars they would normally spend on lifestyle benefits into the Fringe accounts of their employees, where they’re converted to “points” that can be spent on any of the apps and services.

Fringe Platform Walkthrough from Fringe on Vimeo.

Today, the marketplace offers a range of benefits, including streaming services like Netflix, Spotify, Disney+, and Audible, as well as virtual fitness, virtual coaching and wellness, online therapy like Talkspace, food and grocery delivery, like Grubhub, Uber Eats, Instacart, and Shipt, prepackaged meals, childcare like UrbanSitter, and more.

In the U.S., there are 135 services partners to choose from, with another couple hundred that are available overseas.

The startup’s business model involves negotiating a discount of anywhere from 10% to up to 60% off these services, which it passes along to the employees through its points back (rebate) system. Initially, it only allowed employees to spend their employer-provided lifestyle benefits dollars on Fringe. But due to user demand, it later opened up to allow employees to spend their own money, too — a feature they wanted specifically because of the points back.

Fringe first launched in 2019 — well ahead of the pandemic — and saw some slow but steady growth. It ended the year with 15 clients, representing a couple of hundred employees in total.

But then the COVID-19 pandemic hit, which sent a number of employees to work from home in a radical change to business culture that appears to have lasting impacts.

“After the dust settled from the first few months of COVID, we started getting 10…20 times more inbound interest,” Peace says, as companies realized Fringe could be a way to support their employees working from home.

“We were just in the right place at the right time to begin to profit from this changed workplace. And it’s not just a ‘pandemic perk.’ We’re going to get past COVID, and we’re still going to have two-thirds of people working from home. The workplace has changed,” he adds.

Image Credits: Fringe CEO Jordan Peace

By the end of 2020, Fringe had grown its client base to over 70 employers, representing now over 12,000 users on its platform. Today, its pipeline includes companies with between 200 and 2,000 employees — a sweet spot that allows them to move relatively quickly. This client base often includes tech companies, like car-sharing startup Turo or talent management system Cornerstone OnDemand, for example.

This year, Fringe expects to grow to well over 100,000 users on its platform, and increase its own team’s headcount, which is today around 20. It also plans to update its marketplace website to include things like automatic point gifting, charitable giving, new Slack integrations, improved navigation, and more.

As a result of the recent growth, Fringe has raised $2.2 million in new funding, in a round led by Sovereign’s Capital, with participation from Felton Group, Manchester Story, the Center for Innovative Technology, and angel investors, including Jaffray Woodriff. As part of this investment, the company also added longtime advisor William Boland, Senior Director of Corporate Development and Strategy at Mission Lane, to its Board of Directors.

With the addition of the new funds, the startup’s total raise to date is $4 million.

Fringe believes the advantage of its marketplace is that it can be personalized to the user. Typically, employers determine what benefits to offer by running employee surveys, where the majority wins. That’s why many companies today provide perks like backup child care or discounted gym access. But this system discounts the minority’s needs — people who may not have kids or don’t want to work out. People who wish they could use their benefits dollars in a different way.

In addition to employee perks, Fringe believes that having so many subscriptions under one roof could present other opportunities further down the line.

Woodriff, for example, sees Fringe’s potential as a big data play, in terms of who is signing up for what subscriptions and why.

“But if you think about the fact that you’ve got a subscription service marketplace…there’s more applications to that than just employee benefits,” Peace explains. “I’d like our Series A to be to be predicated upon the much greater total addressable market. And so I think we’re going to spend the next year to 18 months laying down concrete plans and building the tech to be ready to roll out a couple of different use cases,” he says.

#benefits, #employees, #employers, #fringe, #funding, #perks, #recent-funding, #startups, #subscription-services, #tc

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Microsoft announces the next perpetual release of Office

If you use Office, Microsoft would really, really, really like you to buy a cloud-enabled subscription to Microsoft 365 (formerly Office 365). But as the company promised, it will continue to make a stand-alone, perpetual license for Office available for the foreseeable future. A while back, it launched Office 2019, which includes the standard suite of Office tools, but is frozen in time and without the benefit of the regular feature updates and cloud-based tools that come with the subscription offering.

Today, Microsoft is announcing what is now called the Microsoft Office LTSC (Long Term Servicing Channel). It’ll be available as a commercial preview in April and will be available on both Mac and Windows, in both 32-bit and 64-bit versions.

And like with the previous version, it’s clear that Microsoft would really prefer if you just moved to the cloud already. But it also knows that not everybody can do that, so it now calls this version with its perpetual license that you pay for once and then use for as long as you want to (or have compatible hardware) a “specialty product for specific scenarios. Those scenarios, Microsoft agrees, include situations where you have a regulated device that can’t accept feature updates for years at a time, process control devices on a manufacturing floor and other devices that simply can’t be connected to the internet.

“We expect that most customers who use Office LTSC won’t do it across their entire organization, but only in specific scenarios,” Microsoft’s CVP for Microsoft 365, Jared Spataro, writes in today’s announcement.

Because it’s a specialty product, Microsoft will also raise the price for Office Professional Plus, Office Standard, and the individual Office apps by up to 10%.

“To fuel the work of the future, we need the power of the cloud,” writes Spataro. “The cloud is where we invest, where we innovate, where we discover the solutions that help our customers empower everyone in their organization – even as we all adjust to a new world of work. But we also acknowledge that some of our customers need to enable a limited set of locked-in-time scenarios, and these updates reflect our commitment to helping them meet this need.”

If you have one of these special use cases, the price increase will not likely deter you and you’ll likely be happy to hear that Microsoft is committing to another release in this long-term channel in the future, too.

As for the new features in this release, Spataro notes that will have dark mode support, new capabilities like Dynamic Arrays and XLOOKUP in Excel, and performance improvements across the board. One other change worth calling out is that it will not ship with Skype for Business but the Microsoft Teams app (though you can still download Skype for Business if you need it).

#cloud, #cloud-computing, #computing, #jared-spataro, #microsoft, #microsoft-365, #microsoft-office, #office-365, #operating-systems, #software, #subscription-services, #windows-10

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Minna Technologies, a subscription management tool for banking customers, raises $18.8M

With the proliferation of subscription services, combined with our lives becoming almost 100% digital, there’s a rising need to be able to manage these services. But most banks don’t have much of an answer. Step in Minna Technologies, which sells in its subscription management services into banking apps.

It’s now raised $18.8 million (€15.5m / £14m) in Series B fundraising from Element Ventures, MiddleGame Ventures, Nineyards Equity and Visa, to expand its open banking technology to banks globally.

Founded in Gothenburg, Sweden in 2016, Minna enables customers to manage subscription services via their existing bank’s app. Using Minna, customers can terminate subscriptions just from their banking app, automatically, cutting the data and financial ties between the merchant and customer. The platform can also notify customers when a free trial is about to end and facilitates utilities switching allowing them to find better deals. So far, Minna has partnerships with Lloyds Banking Group, Swedbank and ING.

Minna’s technology reduces the burden on a bank’s call centers, plus banks can also benefit financially from Minna’s role in facilitating utility switching, raising the prospect of banks becoming marketplaces.

The appearance of Minna suggests that the first wave of neo-banks is about to be accompanied by a second wave of overlayed services such as this. The average European is spending £301 (€333) a month on 11 subscriptions, which is predicted to increase to £459 (€508) a month on 17 subscriptions by 2025. IDC predicts that by 2050, 50% of the world’s largest enterprises will focus the majority of their businesses on digitally enhanced products, services, and experiences. Subscriptions are even coming from car makers such as Volvo.

Joakim Sjöblom, CEO and co-founder of Minna Technologies, said: “Over the past four years the subscription economy has exploded from Spotify and Netflix to even iPhones and cars. It’s becoming increasingly difficult for consumers to keep track of the payments and harder for banks to handle inquiries to shut them down. Minna’s tech improves the procedure for banks by simplifying the process, as well as providing an in-demand digital product that consumers are starting to expect from their financial institutions.”

Sjöblom told me that by largely working with incumbent banks, Minna is providing them with a way to fight back against challenger banks.

Pascal Bouvier, Managing Partner, MiddleGame Ventures said: “We strongly believe in a vision where banks develop their checking account offerings into “connected and intelligent” platforms and where retail clients are able to interact in many more ways than in the recent past.”

#bank, #banking, #economy, #europe, #finance, #ing, #managing-partner, #middlegame-ventures, #netflix, #open-banking, #spotify, #subscription-services, #sweden, #tc, #up, #visa, #volvo

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Brainly raises $80M as its platform for crowdsourced homework help balloons to 350M users

The Covid-19 pandemic has led to a major upswing in virtual learning — where some schools have gone (and stayed) remote, and others have incorporated significantly stronger online components, in order to help communities maintain more social distancing. That has in turn led to a surge in the usage of tools to help home learners do their work better, and today, one of them is announcing a growth round that speaks to the opportunity in that market.

Brainly, a startup from Poland that has built a popular network for students and their parents to engage with each other for advice and help with homework questions, has raised $80 million, a series D that it will be using both to continue building out the tools that it offers to students as well as to hone in on expansion in some key emerging markets such as Indonesia and Brazil. The news comes on the heels of dramatic growth for the company, which has seen its user base grow from 150 million users in 2019 to 350 million today.

The funding is being led by previous backer Learn Capital, with past investors Prosus Ventures, Runa Capital, MantaRay, and General Catalyst Partners also participating. The company has now raised some $150 million and while it’s not disclosing valuation, CEO and co-founder Michał Borkowski confirmed it is “definitely” an upround for the company. For more context, Pitchbook estimates that the company was valued at $180 million in its last round, a Series C of $30 million in 2019.

That C round was raised specifically to help Brainly grow in the U.S. It currently has some 30 million users in that market, and it happens to be the only one in which Brainly is monetising users. Everywhere else, Brainly is currently free to use. (In the U.S. there are also some formidable competitors, like Chegg, which has strong traction in the market of helping students with homework.)

“Brainly has become one of the world’s largest learning communities, achieving significant organic growth in over 35 countries,” said Vinit Sukhija, Partner at Learn Capital, in a statement.

Even before the Covid-19 pandemic, Brainly was finding an audience with students — primarily those aged 13-19, said Borkowski — who were turning to the service to connect with people who could help them with homework when they found themselves at an impasse with, say, a math problem or getting to grips with the sequence of events that led to the revolutions of 1848. The platform is open-ended and is a little like a Quora for homework, in that people can find and answer questions they are interested in, as well as ask questions themselves.

That platform, however, took on a whole new dimension of importance with the shift to virtual learning, Borkowski said.

“In the western world, online education wasn’t a big investment area [pre-Covid] and that has changed a lot, with huge adoption by students, parents and teachers,” he said. “But that big transition, switching from offline to online, has left kids struggling because teachers have so much more to do, so they can’t engage in the same way.”

So with “homework” becoming “all work”, that has effectively led to needing more help than ever with home studies. And while many parents have tried to get more involved to make up the difference, “having parents as teachers has been hard,” he added. They may have been taught differently from how their kids are learning, or they don’t remember or know answers.

One thing that Brainly started to see, he said, was that with the pandemic more parents started using the app alongside students, either to work out answers together or to get the help themselves before helping their kids, with a number of these being from parents of kids younger than 13. He said that 15-20% of all new registrations currently are coming from parents.

Brainly up to now has been mainly focused on how to build out more tools for the students — and now parents — that use it, and has so far been about organic growth for those communities.

However, there is clearly scope to expand that to more educational stakeholders to better organise what kind of questions are answered and how. Borkowski said that the company has indeed been approached by educators, those building curriculums and others so that answers might tie in better with the kinds of questions that they are most likely to ask of students, although for now the company “wants to keep the focus on students and parents getting stuck.”

In terms of future products, Brainly is looking at ways of bringing in more tutoring, video and AI into the mix. The AI aspect is very interesting and will in fact tie in to wider curriculum coverage based on more localised needs. For example, if you ask for help with a particular kind of quadratic equation technique, you can then be served lots of same practice questions to help better learn and apply what you’ve just been learning, and you might even then get suggested related topics that will appear alongside that in a wider mathematics examination. And, you might be offered the chance to meet with a tutor for further help.

Tutoring, he said, is something that Brainly has already been quietly piloting and has run some 150,000 sessions to date. Having such a large user base, Borkowski said, helps the startup run services at scale while still effectively keeping them in test mode.

“It will be about looking at what students are studying and how to map that to the curriculum in the country, and what we can do to help with that.” Borkowski said. “But it will require a heavy lift and and machine learning to pinpoint students” for it to work properly, which is one reason it has yet to roll it out more comprehensively, he added.

Tutoring and more personalization are not the only areas where Brainly is actively testing out new services. The company is also creating more space for adding in video to demonstrate different techniques (which I suspect is especially good for something like mathematics, but equally helpful for, say, an art technique).

There are “thousands per week” being added already, but as with tutoring “that, for us, is a testing stage,” added Borkowski. There should be more coming in Q1 about new products, he said.

#articles, #artificial-intelligence, #brainly, #brazil, #e-commerce, #education, #europe, #funding, #gamification, #general-catalyst, #general-catalyst-partners, #homework, #indonesia, #machine-learning, #online-education, #poland, #prosus-ventures, #quora, #runa-capital, #subscription-services, #tc, #united-states

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Cloud-gaming platforms were 2020’s most overhyped trend

It was an unprecedented year for [insert anything under the sun], and while plenty of tech verticals saw shifts that warped business models and shifted user habits, the gaming industry experienced plenty of new ideas in 2020. However, the loudest trends don’t always take hold as predicted.

This year, Google, Microsoft, Facebook and Amazon each leaned hard into new cloud-streaming tech that shifts game processing and computing to cloud-based servers, allowing users to play graphics-intensive content on low-powered systems or play titles without dealing with lengthy downloads.

It was heralded by executives as a tectonic shift for gaming, one that would democratize access to the next generation of titles. But in taking a closer look at the products built around this tech, it’s hard to see a future where any of these subscription services succeed.

Massive year-over-year changes in gaming are rare because even if a historically unique platform launches or is unveiled, it takes time for a critical mass of developers to congregate and adopt something new — and longer for users to coalesce. As a result, even in a year where major console makers launch historically powerful hardware, massive tech giants pump cash into new cloud-streaming tech and gamers log more hours collectively than ever before, it can feel like not much has shifted.

That said, the gaming industry did push boundaries in 2020, though it’s unclear where meaningful ground was gained. The most ambitious drives were toward redesigning marketplaces in the image of video streaming networks, aiming to make a more coordinated move toward driving subscription growth and moving farther away from an industry defined for decades by one-time purchases structured around single-player storylines, one dramatically shaped by internet networking and instantaneous payments infrastructure software.

Today’s products are far from dead ends for what the broader industry does with the technology.

But shifting gamers farther away from one-off purchases wasn’t even the gaming industry’s most fundamental reconsideration of the year, a space reserved for a coordinated move by the world’s richest companies to upend the console wars with an invisible competitor. It’s perhaps unsurprising that the most full-featured plays in this arena are coming from the cloud services triumvirate, with Google, Microsoft and Amazon each making significant strides in recent months.

The driving force for this change is both the maturation of virtual desktop streaming and continued developer movement toward online cross-play between gaming platforms, a trend long resisted by legacy platform owners intent on maintaining siloed network effects that pushed gamers toward buying the same consoles that their friends owned.

The cross-play trend reached a fever pitch in recent years as entities like Epic Games’ Fortnite developed massive user bases that gave developers exceptional influence over the deals they struck with platform owners.

While a trend toward deeper cross-play planted the seeds for new corporate players in the gaming world, it has been the tech companies with the deepest pockets that have pioneered the most concerted plays to side-load a third-party candidate into the console wars.

It’s already clear to plenty of gamers that even in their nascent stages, cloud-gaming platforms aren’t meeting up to their hype and standalone efforts aren’t technologically stunning enough to make up for the apparent lack of selection in the content libraries.

#cloud, #cloud-gaming, #epic-games, #gaming, #health, #stadia, #subscription-services, #tc, #ubisoft

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Apple Fitness+ launches on December 14

Apple is launching its subscription fitness service, which is built mainly to complement Apple Watch, on December 14. Apple Fitness+ was first announced at Apple’s iPhone event in September, and will offer guided workouts on iPhone iPad and Apple TV, with live personal metrics delivered by the Apple Watch’s health metrics monitoring.

The fitness offering will cover 10 workout types at launch, including Hight Intensity Interval Training (HIIT), strength, yoga, dance, core, cycling, indoor walking and running, as well as rowing and cooldown. All cases are led by real trainers that Apple selected to record the interactive sessions, and they’re soundtracked from “today’s top artists” according to the company.

The interactive elements are fed mostly by Apple Watch stats, and will display heart rate metrics, countdown timers, and goal achievement ‘celebration’ graphics which display on the screen when a user fills up their Apple Watch Activity rings. This is a level of direct integration that’s similar to what Peloton achieves with its service, but without requiring a whole connected stationary bike or treadmill to work.

Other distinguishing features of the service include a recommendation engine that leverages data including previous Fitness+ courses taken by a user, as well as their Apple Watch Workout App data and other third-party health and fitness app integration information from Apple Health to recommend new workouts, trainers and exercise routines. Apple’s use of third-party integrations is particularly interesting here, since it’s using its platform advantage to inform its service personalization.

Image Credits: Apple

Apple is also committing to weekly updates of new content across all categories of workouts, with varying intensity and difficult levels. Anyone using Fitness+ can also share their workouts with friends and family, and compete with others directly in the app if they want.

There’s also an optional Apple Music integration, which allows users to favorite songs and playlists directly from workouts to add them to their library, but users won’t require Apple Music in order to access the music used for the training videos, which are divided into different selectable “styles” or genres.

Apple Fitness+ is available starting December 14, and will retail for $9.99 per month, or $79.99 when paid for a twelve month period up front. It’s also part of Apple’s new Apple One Premier service bundle alongside other services.

This is definitely a major competitive service launch to existing subscription fitness offerings, including Peloton. Apple’s bundle offering, along with its system’s flexibility and syncing across its devices, could make it an easier choice for beginners and those just getting started with more serious training, though the lack of live classes might be a downside for some.

#apple, #apple-inc, #apple-one, #apple-tv, #apple-watch, #computing, #health, #ios, #ipad, #iphone, #itunes, #premier, #smartwatches, #software, #subscription-services, #tc, #wearable-devices

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Eco-conscious car subscription platform Finn.auto raises $24.2M, with White Star and Zalando founders

finn.auto — which allows people to subscribe to their car instead of owning it, and offsetting their CO2 emissions — has raised a $24.2M / €20M Series A funding round. White Star Capital (which has also invested in Tier Mobility), and the Zalando co-CEOs Rubin Ritter, David Schneider and Robert Gentz are new investors in this round. All previous investors participated.

The funding comes just under a year since the company launched, after selling just 1,000 car subscriptions. It’s also partnered with Deutsche Post AG and Deutsche Telekom AG.

A number of car manufacturers have launched similar subscription services powered by various providers, such as Drover, Leaseplan and Wagonex.

UK-based startup Drover has raised a total of $40M in funding over 5 rounds. Their latest Series B funding round was with Shell Ventures and Cherry Ventures . Plus, there are branded services which include Audi on Demand, BMW, Citroën, DS, Jaguar Carpe, Land Rover Carpe, Mini, Volkswagen and Care by Volvo.

Digitally-led subscription services have the potential to disrupt the traditional car sales model, and new startups are entering the market all the time.

The fin.auto model is proving to appeal to environment-conscious millennials. For each car subscription, the company is offsetting the CO₂ emissions of its vehicles, meaning subscribers can drive their cars in a climate-neutral manner. Its now expanding its range of fully electric vehicles and, in cooperation with ClimatePartner, is supporting selected regional climate protection and development projects.

Key to the Munich-based startups’ play is the automation of fleet management processes and customer interactions, meaning it’s much easier and cheaper to run this kind of subscription operation.

Max-Josef Meier, CEO and founder of finn.auto said: “We are delighted to have been able to bring such high-caliber investors on board and that our existing investors are cementing their confidence with the current round. Mobility with your own car becomes as easy as buying shoes on the Internet. We already offer a large selection of different car brands, whose cars can be ordered online on our platform in just five minutes and at flexible runtimes. The delivery is then conveniently made to the front door.”

Nicholas Stocks, General Partner at White Star Capital added: “There is a huge opportunity globally to streamline outdated customer experiences in the automotive retail space and become the Amazon of the automotive industry. This is something finn.auto is excellently placed to capitalize on with its offering of convenience, flexibility, value and sustainability.”

#amazon, #audi, #bmw, #car-subscriptions, #care, #ceo, #cherry-ventures, #citroen, #drover, #ds, #europe, #general-partner, #mini, #munich, #subscription-services, #tc, #volkswagen, #volvo, #white-star-capital, #zalando

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Microsoft announces its first Azure data center region in Denmark

Microsoft continues to expand its global Azure data center presence at a rapid clip. After announcing new regions in Austria and Taiwan in October, the company today revealed its plans to launch a new region in Denmark.

As with many of Microsoft’s recent announcements, the company is also attaching a commitment to provide digital skills to 200,000 people in the country (in this case, by 2024).

“With this investment, we’re taking the next step in our longstanding commitment to provide Danish society and businesses with the digital tools, skills and infrastructure needed to drive sustainable growth, innovation, and job creation. We’re investing in Denmark’s digital leap into the future – all in a way that supports the country’s ambitious climate goals and economic recovery,” said Nana Bule, General Manager, Microsoft Denmark.

Azure regions

Image Credits: Microsoft

The new data center, which will be powered by 100% renewable energy and feature multiple availability zones, will feature support for what has now become the standard set of Microsoft cloud products: Azure, Microsoft 365, and Dynamics 365 and Power Platform.

As usual, the idea here is to provide low-latency access to Microsoft’s tools and services. It has long been Microsoft’s strategy to blanket the globe with local data centers. Europe is a prime example of this, with regions (both operational and announced) in about a dozen countries already. In the U.S., Azure currently offers 13 regions (including three exclusively for government agencies), with a new region on the West Coast coming soon.

“This is a proud day for Microsoft in Denmark,” said Brad Smith, President, Microsoft. “Building a hyper-scale datacenter in Denmark means we’ll store Danish data in Denmark, make computing more accessible at even faster speeds, secure data with our world-class security, protect data with Danish privacy laws, and do more to provide to the people of Denmark our best digital skills training. This investment reflects our deep appreciation of Denmark’s green and digital leadership globally and our commitment to its future.”

#austria, #cloud, #cloud-computing, #computing, #denmark, #developer, #europe, #microsoft, #microsoft-azure, #renewable-energy, #subscription-services, #taiwan, #united-states, #west-coast

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Are subscription services the future of fintech?

Subscription services are on the rise. During the pandemic, Americans have been spending more time at home and more money on the digital products that make navigating our new normal easier.

More than ever, Americans’ lives are aided by companies like Netflix, Instacart and, of course, Amazon, which reported record-setting earnings from its 2020 Prime Day savings event.

A recent survey even found that spending on subscription services had more than tripled since March, with one in three respondents saying they’d purchased a new online subscription while quarantining.

Now, a new concern lingers: Is the market getting oversaturated? The question doesn’t just apply to streaming services and food delivery companies — it’s an issue financial technology businesses can’t afford to ignore.

As subscriptions become an increasingly alluring business model, fintechs will be forced to consider whether this proven strategy is worth the risk.

Fintechs should take note of subscription services

In the CompareCards survey, two-thirds of respondents said they purchased a new streaming service mainly for entertainment. Still, that doesn’t mean there isn’t room for fintechs to carve out their own space.

Bradley Leimer, co-founder of the financial consulting firm Unconventional Ventures, said he’s certainly seen more fintechs exploring subscription models. As Leimer explained, the financial services industry may have not fully embraced the idea, but it’s “starting to take notice.” Leimer, who has more than 25 years of experience in the industry, believes fintechs can learn a lot from subscription services — provided they’re willing to look in the right place.

One major lesson? Transparency. Subscription services give companies an opportunity to be upfront about their fees, as well as their benefits.

“When we talk about subscriptions, the more clear and more transparent we are, the better,” Leimer said.

Acorns is an easy case study. The microinvesting app offers three subscription levels — lite, personal and family — each with a clearly explained list of features. For what it’s worth, the company added more than 2 million users between March 2019 and March 2020, according to Forbes.

Leimer said fintechs should also take note of the way subscription services collaborate. For example, he pointed out how Amazon users can add an HBO subscription to their Prime Video account, essentially “bundling” two subscriptions into one. Fintechs, Leimer said, could stand to take a page out of that playbook.

“There are a lot of ways to sort of skin that cat — for a fintech company to generate income and for a customer to get value on top of that,” Leimer said.

#column, #disney, #ecommerce, #finance, #financial-services, #financial-technology, #fintech, #patents, #startups, #subscription-services, #tc

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Microsoft Azure announces its first region in Austria

Microsoft today announced its plans to launch a new data center region in Austria, its first in the country. With nearby Azure regions in Switzerland, Germany, France and a planned new region in northern Italy, this part of Europe now has its fair share of Azure coverage. Microsoft also noted that it plans to launch a new ‘Center of Digital Excellence’ to Austria to “to modernize Austria’s IT infrastructure, public governmental services and industry innovation.”

In total, Azure now features 65 cloud regions — though that number includes some that aren’t online yet. As its competitors like to point out, not all of them feature multiple availability zones yet, but the company plans to change that. Until then, the fact that there’s usually another nearby region can often make up for that.

Image Credits: Microsoft

Talking about availability zones, in addition to announcing this new data center region, Microsoft also today announced plans to expand its cloud in Brazil, with new availability zones to enable high-availability workloads launching in the existing Brazil South region in 2021. Currently, this region only supports Azure workloads but will add support for Microsoft 365, Dynamics 365 and Power Platform over the course of the next few months.

This announcement is part of a large commitment to building out its presence in Brazil. Microsoft is also partnering with the Ministry of Economy “to help job matching for up to 25 million workers and is offering free digital skilling with the capacity to train up to 5.5 million people” and to use its AI to protect the rainforest. That last part may sound a bit naive, but the specific plan here is to use AI to predict likely deforestation zones based on data from satellite images.

#artificial-intelligence, #austria, #brazil, #cloud, #cloud-computing, #cloud-infrastructure, #computing, #europe, #france, #germany, #italy, #microsoft, #microsoft-365, #microsoft-azure, #ministry-of-economy, #subscription-services, #switzerland

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Here’s everything Amazon announced at its latest hardware event

From new Ring flying indoor drone cameras to an adorable new kids version of one of its most popular Amazon home products, Jeff Bezos’ Seattle retailer unveiled a slew of new hardware goodies just ahead of the holiday shopping season.

Echo updates

Image Credits: Amazon

Amazon kicked off its latest hardware showcase by unveiling a new version of the company’s Echo devices, which now include spherical speakers (with a version for kids featuring cute animal graphics). Amazon also unveiled an updated, more personalized Echo capabilities and a new tracking feature for its Show 10 that mirrors Facebook’s Portal in its ability to follow users as they move around a room.

Ring’s new things

Ring also had plenty to pitch at the Amazon hardware show. The security camera company is updating its line with the Always Home Cam, a diminutive drone that can be scheduled to fly preset paths, which users can determine themselves.

It also rolled out new hardware for the automotive market with three different devices focused on car owners. A Ring Car Alarm that will retail for $59.99; and the Car Cam and Car Connect will both be $199.99. Ring Car Alarm provides basic features that work with the Ring app, sending alerts to trigger a series of potential responses. The alarm also integrates with other Ring devices or Amazon Alexa hardware and connects using Amazon’s low-bandwidth Sidewalk wireless network protocol.

Meanwhile, the Car Cam allows users to check in on their car via video as long as users are in range of a wifi network, or opt-in to the additional LTE companion plan Ring is selling. The cam also includes an Emergency Crash Assist feature that alerts first responders, and a recording feature that turns on if a user says “Alexa, I’m being pulled over”. Finally, the car connect is an API that manufacturers, starting with Tesla, can use to provide Ring customers with mobile alerts for events detected around vehicles or watch footage recorded with onboard cameras.

Ring also added new opt-in end-to-end video encryption for those users who want it.

New ways to Fire TV

Image Credits: Amazon

The company’s TV platform got several updates. The biggest is probably the addition of the new, lower cost Fire TV Stick Lite at $29.99. For $39.99, meanwhile, you can pick up the new Fire TV Stick, which features a process that’s 50% faster. The platform is also adding Video Calling — a nice addition in the era of working from home — along with a new, improved layout.

Amazon goes ga-ga for gaming

Last, but certainly not least, Amazon announced its new game-streaming platform, Luna.

The long-awaited gaming competitor to Google Stadia and Microsoft xCloud is launching an early access version at a price of $5.99 per-month, the company said. Users will be able to stream titles wirelessly without downloading games and can play across PC, Mac, and iOS (via the web).

Initially, the company will have more than 50 titles in the Luna+ app, including at least one Sonic title and Remedy Entertainment’s control. There’s a partnership with Ubisoft in the works, but access to those games may require a separate subscription.

 

#alexa, #amazon, #amazon-alexa, #amazon-echo, #artificial-intelligence, #bing, #computing, #e-commerce, #facebook, #google, #google-nest, #hardware, #jeff-bezos, #luna, #microsoft, #ring, #seattle, #smart-speakers, #sonic, #subscription-services, #tc, #tesla, #ubisoft, #xcloud

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Fabletics’ Adam Goldenberg and Kevin Hart on what’s next for the activewear empire

Like plenty of other modern direct-to-consumer companies, influencer marketing has been an essential part of Fabletics’ journey. Actress Kate Hudson co-founded the company and co-CEO Adam Goldenberg believes that its network of spokespeople has been key to the company’s growth.

We were joined on our virtual TechCrunch Disrupt 2020 stage by Goldenberg and comedian Kevin Hart who has been working as a brand partner for Fabletics.

“You can have the best product, which we believe we have, but if you can’t get it out there then you’re not going to be the leader that you want to be,” Goldenberg told us. “By having a very broad and diverse ambassador and influencer network, it allows us to become a very inclusive brand.”

Hart joined the company as an official brand partner earlier this year just as the pandemic took hold stateside and the company launched a menswear line. For Hart, the partnership is one of many relationships with brands and startups, but fits into his own lifestyle and thus made a lot of sense for him to work with, he says. 

“[A company I invest in] has to coincide with myself and my lifestyle. If I’m going to talk about it, I have to be true to it,” Hart told TechCrunch. “There’s a plethora of things that I’m involved with that people would be shocked to know I was a part of, but it’s because I have the eyesight for it and a love for it.”

The Fabletics menswear line that Hart has advertised, and served as a brand spokesman for, has seen major growth amid a broader spike in athleisure wear sales. Goldenberg is bullish on just how much growth Fabletics will see from its men’s line so early in its lifecycle.

“It’s a big goal, but I think we could do $75-100 million in sales next year with Fabletics Men, which is our first full year with this line, which would be very, very fast growth,” Goldenberg says.

As the company firms up its offering in activewear, they’re also keeping an eye on what trends will help them grow. Fabletics has already been building out technology trying to connect online and offline user habits in its stores. On the heels of Lululemon’s major acquisition of Mirror, which it announced in late June, moderator Jordan Crook inquired whether Fabletics had its own interests in expanding its footprint beyond activewear.

“We really believe in the importance of living an active lifestyle, so we’re not ready to share it yet, but we’re going to be doing something very large incorporating fitness into Fabletics,” Goldenberg said.

Check out the interview with Hart and Goldenberg below.

#actress, #ambassador, #brand, #clothing, #co-ceo, #comedian, #disrupt-2020, #e-commerce, #fabletics, #influencer-marketing, #jordan-crook, #kate-hudson, #kevin-hart, #lululemon, #marketing, #subscription-services, #tc, #techcrunch

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Microsoft brings transcriptions to Word

Microsoft today launched Transcribe in Word, its new transcription service for Microsoft 365 subscribers, into general availability. It’s now available in the online version of Word, with other platforms launching later. In addition, Word is also getting new dictation features, which now allow you to use your voice to format and edit your text, for example.

As the name implies, this new feature lets you transcribe conversations, both live and pre-recorded, and then edit those transcripts right inside of Word. With this, the company goes head-to-head with startups like Otter and Google’s Recorder app, though they all have their own pros and cons.

Image Credits: Microsoft

To get started with Transcribe in Word, you simply head for the dictate button in the menu bar and click on ‘transcribe.’ From there, you can record a conversation as it happens — by recording it directly through a speakerphone and your laptop’s microphone, for example — or by recording it in some other way and then uploading that file. The service accepts .mp3, .wav, .m4a and .mp4 files.

As Microsoft Principal Group PM Manager for Natural User Interface & Incubation, Dan Parish, noted in a press briefing ahead of today’s announcement, when you record a call live, the transcription actually runs in the background while you conduct your interview, for example. The team purposely decided not to show you the live transcript, though, because its user research showed that it was distracting. I admit that I like to see the live transcript in Otter and Recorder, but maybe I’m alone in that.

Like with other services, Transcribe in Word lets you click on individual paragraphs in the transcript and then listen to that at a variety of speeds. Since the automated transcript will inevitably have errors in it, that’s a must-have feature. Sadly, though, Transcribe doesn’t let you click on individual words.

One major limitation of the service right now is that if you like to record offline and then upload your files, you’ll be limited to 300 minutes, without the ability to extend this for an extra fee, for example. I know I often transcribe far more than 5 hours of interviews in any given month, so that limit seems low, especially given that Otter provides me with 6,000 minutes on its cheapest paid plan. The max length for a transcript on Otter is 4 hours while Microsoft’s only limit for is a 200MB file upload limit, with no limits on live recordings.

Another issue I noticed here is that if you mistakenly exit the tab with Word in it, the transcription process will stop and there doesn’t seem to be a way to restart it.

It also takes quite a while for the uploaded files to be transcribed. It takes roughly as long as the conversations I’ve tried to transcribe), but the results are very good — and often better than those of competing services. Transcribe for Word also does a nice job separating out the different speakers in a conversation. For privacy reasons, you must assign your own names to those — even when you regularly record the same people.

It’d be nice to get the same feature in something like OneNote, for example, and my guess is Microsoft may expand this to its note-taking app over time. To me, that’s the more natural place for it.

Image Credits: Microsoft

The new dictation features in Word now let you give commands like “bold the last sentence,” for example, and say “percentage sign” or “ampersand” if you need to add those symbols to a text (or “smiley face,” if those are the kinds of texts you write in Word).

Even if you don’t often need to transcribe text, this new feature shows how Microsoft is now using its subscription service to launch new premium features to convert free users to paying ones. I’d be surprised if tools like the Microsoft Editor (which offers more features for paying users), this transcription service, as well as some of the new AI features in the likes of Excel and PowerPoint, didn’t help to convert some users into paying ones, especially now that the company has combined Office 365 and Microsoft 365 for consumers into a single bundle. After all, just a subscription to something like Grammarly and Otter would be significantly more expensive than a Microsoft 365 subscription.

 

#artificial-intelligence, #enterprise, #head, #microsoft, #microsoft-365, #microsoft-word, #microsoft-office, #office-365, #operating-systems, #software, #speech-recognition, #subscription-services, #tc, #transcribe, #transcription

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Apple said to soon offer subscription bundles combining multiple of its services

Apple is reportedly getting ready to launch new bundles of its various subscription services, according to Bloomberg. The bundled services packages, said to be potentially called ‘Apple One,’ will include Apple services including Apple Music, Apple Arcade, Apple TV+, Apple News+ and iCloud in a number of different tiered offerings, all for one fee lower that would be lower than subscribing to each individually.

Bloomberg says that these could launch as early as October, which is when the new iPhone is said to be coming to market. Different package options will include one entry-level offering with Apple Music and Apple TV+, alongside an upgrade option that adds Apple Arcade, and other that also includes Apple News+. A higher-priced option will also bundle in extra iCloud storage, according to the report, though Bloomberg also claims that these arrangements and plans could still change prior to launch.

While the final pricing isn’t included in the report, it does say that the aim is to save subscribers between $2 and $5 per month depending on the tier, vs. the standard cost of subscribing to those services currently. All subscriptions would also work with Apple’s existing Family Sharing system, meaning up to six members of a single household can have access through Apple’s existing shared family digital goods infrastructure.

Apple is also said to be planning to continue its strategy of bundling free subscriptions to its services with new hardware purchases – a tactic it used last year with the introduction of Apple TV+, which it offered free for a year to customers who bought recently-released Apple hardware.

Service subscription bundling is move that a lot of Apple observers have been calling for basically ever since Apple started investing more seriously in its service options. The strategy makes a lot of sense, especially in terms of helping Apple boost adoption of its services which aren’t necessarily as popular as some of the others. It also provides a way for the company to begin to build out a more comprehensive and potentially stable recurring revenue business similar to something like Amazon Prime, which is a regular standout success story for Amazon in terms of its fiscal performance.

#amazon, #apple, #apple-arcade, #apple-inc, #apple-music, #apple-news, #apple-tv, #apps, #cloud-applications, #computing, #icloud, #ios, #iphone, #itunes, #subscription-services, #tc, #webmail

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VCs and startups consider HaaS model for consumer devices

I’ve been following consumer audio electronics company Nura with great interest for a few years now — the Melbourne-based startup was one of the first companies I met with after starting with TechCrunch. At the time, its first prototype was a big mess of circuits and wires — the sort of thing you could never imagine shrunk down into a reasonably-sized consumer device.

Nura managed, of course. And the final product looked and sounded great; hell, even the box was nice. If I’m lucky, I see a consumer hardware product once or twice a year that seems reasonably capable of disrupting an industry, and Nura’s custom sound profiles fit that bill. But the company was unique for another reason. A graduate of the HAX accelerator, the startup announced NuraNow roughly this time last year.

Hardware as a service (HaaS) has been a popular concept in the IT/enterprise space for some time, but it’s still fairly uncommon in the consumer category. For one thing: a hardware subscription presents a new paradigm for thinking about purchases. And that is a big lift in a country like the U.S., which spent years weaning consumers off contract-based smartphones.

That Nura jumped at the chance shouldn’t be a big surprise. Backers HAX/SOSV have been proponents of the model for some time now. I’ve visited their Shenzhen offices a few times, and the topic of HaaS always seems to come up.

In a recent email exchange, General Partner Duncan Turner described HaaS as “a great way to keep in contact with your customers and up sell them on new features. Most importantly, for start-ups, recurring revenue is critical for scaling a business with venture capital (and will help appeal to a broad set of investors). HaaS often has a low churn (as easier to put onto long-term contracts).”

#business-models, #consumer-electronics, #consumer-hardware, #duncan-turner, #economy, #eric-migicovsky, #events, #extra-crunch, #gadgets, #hardware, #hardware-as-a-service, #hbo, #headphones, #market-analysis, #marketing, #marketing-strategy, #merchandising, #netflix, #smartphones, #spotify, #startups, #subscription-services, #techcrunch-early-stage, #wearables

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After ad revenue drop, Twitter tells investors it’s eyeing subscription options

After reporting Q2 earnings that showed a marked dip in ad revenue, Twitter has said its exploring alternatives — dangling the possibility of a subscription option.

Earlier today the social media giant reported ad revenues of $562M, down almost a quarter (23%) on a year ago — saying that the pandemic and “civil unrest” leading many advertisers to pause campaigns had both contributed to the decline. While the US, its biggest market, saw a drop of 25% in ad spend.

Twitter CEO Jack Dorsey told investors it’ll likely run subscription “tests” this year (via CNN), though he also said the bar for charging users for aspects of the service would be set “really high”.

So presumably it’s not considering a ‘your first ten tweets are free’ style pay-to-tweet model.

“We want to make sure any new line of revenue is complementary to our advertising business,” CNN reports Dorsey remarking during the investor call. “We do think there is a world where subscription is complementary, where commerce is complementary, where helping people manage paywalls… we think is complementary.”

The prospect of a paid version of Twitter — free from trackers, annoying ads and irritating algorithms which meddle with the clean chronology of the timeline — has been a holy grail for certain Twitter addicts since (basically) forever. So plenty of its most fervent users will be watching keenly to see exactly what Dorsey cooks up.

We’re spitballing here — but perhaps Twitter could charge, er, certain high profile, high risk users billions of dollars per month for the privilege of tweet-threatening the rest of humanity… Just a thought.

Twitter casting around for ad revenue diversification looks interesting in light of broader digital privacy trends that have put the ad tracking industry under increasing (and increasingly awkward) scrutiny.

Certain adtech players and mechanisms are facing challenges under European data protection rules, for instance, while there are also moves afoot in California to further tighten the consumer protections introduced this year, under the Consumer Privacy Act, which could see more US users blocking the tracking industry’s access to their data.

Last week’s massive Twitter security breach also hardly throws a positive light on the company from a privacy perspective. Dorsey addressed the breach in remarks on today’s call, with CNN reporting he apologized to investors — admitting the company “fell behind” on its security obligations.

“We feel terrible about the security incident,” he said. “Security doesn’t have an end point. It’s a constant iteration… We will continue to go above and beyond here as we continue to secure our systems and as we continue to work with external firms and law enforcement.”

#advertising-tech, #apps, #california, #jack-dorsey, #privacy, #social, #social-media, #subscription-services, #twitter, #united-states

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How startups can leverage elastic services for cost optimization

Due to COVID-19, business continuity has been put to the test for many companies in the manufacturing, agriculture, transport, hospitality, energy and retail sectors. Cost reduction is the primary focus of companies in these sectors due to massive losses in revenue caused by this pandemic. The other side of the crisis is, however, significantly different.

Companies in industries such as medical, government and financial services, as well as cloud-native tech startups that are providing essential services, have experienced a considerable increase in their operational demands — leading to rising operational costs. Irrespective of the industry your company belongs to, and whether your company is experiencing reduced or increased operations, cost optimization is a reality for all companies to ensure a sustained existence.

One of the most reliable measures for cost optimization at this stage is to leverage elastic services designed to grow or shrink according to demand, such as cloud and managed services. A modern product with a cloud-native architecture can auto-scale cloud consumption to mitigate lost operational demand. What may not have been obvious to startup leaders is a strategy often employed by incumbent, mature enterprises — achieving cost optimization by leveraging managed services providers (MSPs). MSPs enable organizations to repurpose full-time staff members from impacted operations to more strategic product lines or initiatives.

Why companies need cost optimization in the long run

#business-process-management, #cloud, #cloud-computing, #cloud-infrastructure, #column, #coronavirus, #covid-19, #economy, #enterprise, #extra-crunch, #finance, #financial-services, #growth-and-monetization, #managed-services, #manufacturing, #pricing, #saas, #startups, #subscription-services

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Google and Facebook must pay media for content reuse, says Australia

The Australia government has said it will adopt a mandatory code to require tech giants such as Google and Facebook to pay local media for reusing their content. The requirement for them to share ad revenue with domestic publishers was reported earlier by Reuters.

Treasurer Josh Frydenberg published an opinion article in The Australian Friday — writing that an earlier plan to create a voluntary code by November this year to govern the relationship between digital platforms and media businesses — in order to “protect consumers, improve transparency and address the power imbalance between the parties” — had failed owing to “insufficient progress”.

“On the fundamental issue of payment for content, which the code was seeking to resolve, there was no meaningful progress and, in the words of the ACCC [Australia’s competition commission], “no expectation of any even being made”,” he wrote.

The ACCC has been tasked with devising the code which Frydenberg said will include provisions related to value exchange and revenue sharing; transparency of ranking algorithms; access to user data; presentation of news content; and penalties and sanctions for non-compliance.

“The intention is to have a draft code of conduct released for comment by the end of July and legislated shortly thereafter,” he added. “It is only fair that the search engines and social media giants pay for the original news content that they use to drive traffic to their sites.”

The debate around compensation for tech giants’ reuse of (and indirect monetization of) others’ editorial content — by displaying snippets of news stories on their platforms and aggregation services — is not a new one, though the coronavirus crisis has likely dialled up publisher pressure on policymakers as advertiser marketing budgets nose-dive globally and media companies stare down the barrel of a revenue crunch.

Earlier this month France’s competition watchdog ordered Google to negotiate in good faith with local media firms to pay for reusing their content.

The move followed a national law last year to transpose a pan-EU copyright reform that’s intended to extend rights to news snippets. However instead of paying French publishers for reusing their content Google stopped displaying content that’s covered by the law in local search and Google News.

France’s competition watchdog said it believes the unilateral move constitutes an abuse of a dominant market position — taking the step of applying an interim order to force Google to the negotiating table while it continues to investigate.

Frydenberg’s article references the French move, as well as pointing back to a 2014 attempt by Spain which also created legislation seeking to make Google to pay for snippets of news reused in its News aggregator product. In the latter case Google simply pulled the plug on its News service in the market — which it remains closed in Spain to this day…

Google’s message to desktop users in Spain if they try to navigate to its News product

“We are under no illusions as to the difficulty and complexity of implementing a mandatory code to govern the relationship between the digital platforms and the news media businesses. However, there is a need to take this issue head-on,” Frydenberg goes on. “We are not seeking to protect traditional media companies from the rigour of competition or technological disruption.

“Rather, to create a level playing field where market power is not misused, companies get a fair go and there is appropriate compensation for the production of original news content.”

Reached for comment on the Australian government’s plan, a Google spokesperson sent us this statement:

We’ve worked for many years to be a collaborative partner to the news industry, helping them grow their businesses through ads and subscription services and increase audiences by driving valuable traffic. Since February, we have engaged with more than 25 Australian publishers to get their input on a voluntary code and worked to the timetable and process set out by the ACCC. We have sought to work constructively with industry, the ACCC and Government to develop a Code of Conduct, and we will continue to do so in the revised process set out by the Government today.

Google continues to argue that it provides ample value to news publishers by directing traffic to their websites, where they can monetize it via ads and/or subscription conversions, saying that in 2018 alone it sent in excess of 2BN clicks to Australian news publishers from Australian users.

It also points out publishers can choose whether or not they wish their content to appear in Google search results. Though, in France, it’s worth noting the competition watchdog took the view that Google declaring that it won’t not pay to display any news could put some publishers at a disadvantage vs others.

The dominance of Google’s search engine certainly looks to be a key component for such interventions, along with Facebook’s grip on digital attention spans.

On this, Frydenberg’s articles cites a report by the country’s competition commission which found more than 98 per cent of online searches on mobile devices in Australia are with Google. While Facebook was found to have some 17M local users who connected to its platform for at least half an hour a day. (Australia’s total population is around 25M.)

“For every $100 spent by advertisers in Australia on online advertising, excluding classifieds, $47 goes to Google, $24 to Facebook and $29 to other participants,” Frydenberg also wrote, noting that the local online ad market is worth around $9BN per year — growing more than 8x since 2005.

Reached for comment on the government plan for a mandatory code for reuse of news content, Facebook sent us the following statement — attributed to Will Easton, MD, Facebook Australia and New Zealand:

We’re disappointed by the Government’s announcement, especially as we’ve worked hard to meet their agreed deadline. COVID-19 has impacted every business and industry across the country, including publishers, which is why we announced a new, global investment to support news organisations at a time when advertising revenue is declining. We believe that strong innovation and more transparency around the distribution of news content is critical to building a sustainable news ecosystem. We’ve invested millions of dollars locally to support Australian publishers through content arrangements, partnerships and training for the industry and hope the code will protect the interests of millions of Australians and small businesses that use our services every day.

If enough countries pursue a competition-flavored legislative fix against Google and Facebook to try to extract rents for media publishers it may be more difficult for them to dodge some form of payment for reusing news content. Though the adtech giants still hold other levers they could pull to increase their charges on publishers.

Indeed, their duel role — involved in both the distribution, discovery and monetization of online content and ads, controlling massive ad networks as well as applying algorithms to create content hierarchies to service ads alongside — has attracted additional antitrust scrutiny in certain markets.

After launching a market study of Google and Facebook’s ad platforms last July, the UK’s Competition and Markets Authority (CMA) raised concerns in an interim report in December — kicking off a consultation on a range of potential inventions from breaking up the platform giants to limiting their ability to set self-serving defaults and enforcing data sharing and/or feature interoperability to help rivals compete.

Per its initial findings, the CMA said there were “reasonable grounds” for suspecting serious impediments to competition in the online platforms and digital advertising market. However the regulator has so far favored making recommendations to government, to feed a planned “comprehensive regulatory framework” to govern the behaviour of online platforms, rather than taking it upon itself to intervene directly.

#advertising-tech, #australia, #competition-and-markets-authority, #european-union, #facebook, #france, #google, #local-search, #media, #new-zealand, #online-advertising, #online-content, #online-platforms, #search-engine, #search-engines, #spain, #subscription-services, #united-kingdom

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Gousto, a UK meal-kit service, raises another $41M as business booms under lockdown

Food delivery — be it ready-made restaurant meals, groceries, or anything in between — has seen a huge surge of activity in the last few weeks as people have sheltered in place to slow down the spread of the novel coronavirus. Today, one of the startups that’s built a business specifically in meal-kits in the UK is announcing funding to double down on its growth.

Gousto, a London-based meal-kit service, has closed £33 million ($41 million) in funding, money that it’s going to be using to continue investing in its technology — both in the AI engine that it says customers use to get more personalised recommendations of what to cook and eat, and in the backend tech used to optimise its own logistics and other operations — and in building more capacity to meet rising demand and expanding next-day delivery in the near future (it mainly operates on a three-day turnaround between ordering and delivery currently).

The company said that it’s currently delivering some 4 million meals to 380,000 UK households each month and is on course to cross 400 million meals delivered by 2025. It offers currently a choice of more than 50 recipes each week and gives people the option to tailor what they get, with the whole system running in an automated packing process, working out to average price per meal per person to £2.98 at its cheapest.

The funding — which was being raised before the novel coronavirus hit — is being led by Perwyn, with participation also from BGF Ventures, MMC Ventures and Joe Wicks — a hugely popular YouTube fitness coach who has built a lifestyle brand around healthy eating. This brings the total raised by Gousto to around £130 million ($162 million). It’s not disclosing its valuation with this round. It has 100 employees today and plans to expand that to 700 by 2022.

CTO Shaun Pearce said that Gousto was in high-growth mode before COVID-19, operating on forecasts of growing 70% year-on-year. That number — as with so many other delivery and specifically food-based delivery businesses right now — has spiked upward in recent weeks, not just from paying customers but also for Gousto’s own efforts to do something for the relief efforts, with food businesses like Gousto’s some of the remaining “key” businesses that have been allowed to stay open when others like restaurants have closed.

“We continue to be laser-focused on our vision to become the UK’s most-loved way to eat dinner. This additional investment is not only a validation of our track record, but it is also an endorsement of our strategic vision of the future which is rooted in investing in innovative technology to transform the way we search for, shop for, and cook our food,” said Timo Boldt, CEO and founder, in a statement. “In these challenging times, we want to continue offering people more choice and especially more convenience. We will maintain our close relationships with the government and other charitable partners to ensure those already struggling don’t see their situation worsen.”

In the last several weeks, Pearce said Gousto has also seen big changes in customer behavior from pre-existing customers, with a 28% increase in family boxes. “Those who buy from us want to buy more,” he said. Like some other smaller food delivery companies (and small can be as big as the online grocery Ocado) it’s also no longer accepting new customer sign-ups and is focused just on meeting the demand of pre-existing customers.

Gousto’s has also been trying to do its part in relief operations. It’s been working with the UK’s Department for Environment, Food and Rural Affairs to produce meal kits for vulnerable people, and it has donated some 6,000 meals to The Trussell Trust foodbank network and to the homeless charity, Shelter. It’s also ensuring that when its system is overcrowded that NHS employees get priority access to its ordering platform. (This is in addition to the contactless and other safety procedures that Pearce said that Gousto has put in place to minimise the risk of spreading the virus both to its workers and customers.)

Meal kit services in recent years have taken a beating in recent years, typified perhaps most publicly by Blue Apron, which saw its stock drop drastically after going public in part because of the huge amount of competition (not just from other pure-play meal kit companies but a plethora of others like Amazon that have added on meal kits to other existing business lines such as other grocery delivery).

Pearce said that Gousto’s growth and popularity and flexibility that it offers users by way of the AI engine to craft recipes they might actually want to use sets it apart from current competition, which in the UK includes HelloFresh, Mindful Chef, offerings from most major grocers, and many more.

“We continue to be impressed by Gousto and its dedication to its customers,” said Andrew Wynn, founder and managing partner at Perwyn, in a statement. “The business has adapted quickly to continue providing an essential service to so many. This reaffirms the decision we took far before COVID-19, that we’re investing in the right people and a business set for even greater success.”

 

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