Startups Weekly: The US is finally getting serious about 5G

Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

There are few things that US political leaders can agree on these days, but one of them thankfully appears to be 5G. Manufacturing, transportation, agriculture, health care and many other industries are beginning to incorporate the fast, device-to-device connectivity provided by the fifth-generation wireless standard. But the key 3.5 GHz band of spectrum had been reserved for military and government use. Following years of congressional and most recently executive-branch action, it will now be auctioned off in early 2021. The marketing fluff will finally make way for the technology’s promise(s). More analysis from Danny Crichton:

There has been growing pressure on U.S. government leaders in recent years over the plodding 5G transition, which has fallen behind peer countries like China and South Korea. Korea in particular has been a world leader, with more than two million 5G subscribers already in the country thanks to an aggressive industrial policy by Seoul to invest in the country’s telecommunications infrastructure and take a lead in this new wireless transition.

The U.S. has been faster at moving ahead in millimeter (high frequency) spectrum for 5G that will have the greatest bandwidth, but it has lagged in midband spectrum allocation. While the announcements today is notable, there will also be concerns whether 100 Mhz of spectrum is sufficient to support the widest variety of 5G devices, and thus, this allocation may well be just the first in a series.

Nonetheless, additional midband spectrum for 5G will help move the transition forward, and will also help device and chip manufacturers begin to focus their efforts on the specific bands they need to support in their products. While it may be a couple of more years until 5G devices are widely available (and useful) in the United States, spectrum has been a key gating factor to reaching the next-generation of wireless, and a gate that is finally opening up.

Image Credits: Nigel Sussman (opens in a new window)

All sorts of IPOs

“Today, it’s nearly hard to recall the fear that took over startup-land,” Alex Wilhelm writes in a review of recent unicorn news for Extra Crunch. “Sure, there are warning signs about cloud growth rates, but for many unicorns, we still live in boom times.” Indeed, two of the biggest names in pre-public startups appear once again track for IPOs. Airbnb could file to go public this month, despite pandemic losses to its business. Payments provider Stripe seems to be headed that way, too. The Valley’s oldest unicorn, Palantir, may finally do that direct filing. In the meantime, Accenture spinout Duck Creek Technologies had its big liquidity event for its private equity owners yesterday, with a 50% pop — Alex did a closer look at the insurtech company’s financials on Monday for Extra Crunch, and predicted events basically:

[T]o understand its revenue base, we’ll need to annualize the nine-month period that ended May 31, 2020 (ew), and use that to extrapolate a (kinda) revenue multiple using a set of metrics that we don’t tend to use for such things (yuck).

• Duck Creek nine-months’ revenue for period ending May 31, 2020: $153.35 million.
• That figure, annualized: $204.5 million.
• Implies revenue multiple at its two IPO valuations: 11.9x, and 13.2x.

Those seem somewhat reasonable? Maybe a little expensive given the company’s slow aggregate revenue growth and lower-than-average SaaS gross margins?

By that logic, the company will raise its IPO range, price above the boosted interval, and quintuple on its first day’s trading…

Want more zingers like this? He’s busy covering the 2020 unicorn-to-IPO path through all its twists and turns over on The Exchange, which subscribers can get as a daily post and as a weekly newsletter coming out every Saturday.

Image Credits: Bryce Durbin / TechCrunch / Getty Images

Don’t let a TechCrunch reporter accidentally crash your company meeting

Our security editor Zack Whittaker had a first-person situation this week with poor security practices at a startup. And not just any kind of startup:

I got a tip about a new security startup, with fresh funding and an idea that caught my interest. I didn’t have much to go on, so I did what any curious reporter would do and started digging around. The startup’s website was splashy but largely word salad. I couldn’t find basic answers to my simple questions. But the company’s idea still seemed smart. I just wanted to know how the company actually worked.

So I poked the website a little harder.

Reporters use a ton of tools to collect information, monitor changes in websites, check if someone opened their email for comment, and navigate vast pools of public data. These tools aren’t special, reserved only for card-carrying members of the press, but rather are open to anyone who wants to find and report information. One tool I use frequently on the security beat lists all the subdomains on a company’s website. These subdomains are public but deliberately hidden from view, yet you can often find things that you wouldn’t from the website itself.

Bingo! I immediately found the company’s pitch deck. Another subdomain had a ton of documentation on how its product works. A bunch of subdomains didn’t load, and a couple were blocked off for employees only. (It’s also a line in the legal sand. If it’s not public and you’re not allowed in, you’re not allowed to knock down the door.) I clicked on another subdomain. A page flashed open, an icon in my Mac dock briefly bounced, and the camera light flashed on. Before I could register what was happening, I had joined what appeared to be the company’s morning meeting….

Founders, lock up those docs!

Image Credits: TechCrunch (opens in a new window)

Studying up on diversity

Megan Rose Dickey, who has started writing weekly column about tech labor called Human Capital, put together a quick set of resources for companies including a glossary of terms and key organizations, as well as key issues and data points for context. Here’s more:

After Minneapolis police killed George Floyd and the subsequent racial justice uprising, many people in tech shouted from the rooftops that “Black Lives Matter,” despite having subpar representation of Black and Latinx folks at their companies. In some cases, these companies’ proclamations of ‘Black Lives Matter’ felt especially performative in contrast to their respective stances on Trump and selling their technology to law enforcement agencies.

Still, this has led to an increased focus on diversity, inclusion and equity in the tech industry. If you’re wondering things like, “Where do I find Black and brown talent?” or saying, “I’d invest in Black and Latinx people if I could find them!,” then this is for you.

Below, you’ll learn about some of the issues at play, some of the key organizations doing work in this space and access a glossary of frequently used terms in the realm of diversity, equity and inclusion in tech.

Minimum viable email and other growth marketing tips

Lucas Matney took a look through three growth marketing talks at early stage to glean key tactics for those who didn’t attend. Along discussions around SEO and landing pages, here’s a big presentation from Sound Venture’s Susan Su about growing a business through email marketing in 2020. Here’s an excerpt:

“The first role email plays in growth is as a tool to help you accelerate your reinforcing feedback loops. For example, email growth can help you expand LTV if you’re building a consumer e-comm or it can help you shorten your sales cycle if you’re a B2B, or enterprise SaaS business. It’s also really powerful for reducing attrition or churn, which is key, obviously, and sometimes it’s an overlooked way of actually increasing growth.”

The second role that [email] plays in growth is as a two-way channel connecting your product and your user, and that channel can carry information either about your product value from your brand out to your user, or it can carry information about your users needs and preferences from them to you.”

Check out her full talk, which was moderated by your faithful correspondent, for advanced topics like how to improve the credibility of your domain with spam filters.

Around TechCrunch

Save with group discounts to TC Sessions: Mobility 2020

Ready, set, network: CrunchMatch is open for Disrupt 2020

We’re exploring the future of SaaS at Disrupt this year

Waymo COO Tekedra Mawakana is coming to TC Sessions: Mobility 2020

Rep. Zoe Lofgren to talk privacy and policy at Disrupt 2020

Across the week

TechCrunch

Facebook launches support for paid online events

Digitizing Burning Man

The robots occupying our sidewalks

Beware bankers talking TikTok

Kamala Harris brings a view from tech’s epicenter to the presidential race

Extra Crunch

Building a fintech giant is very expensive

Minted.com CEO Mariam Naficy shares ‘the biggest surprise about entrepreneurship’

IoT and data science will boost foodtech in the post-pandemic era

What’s different about hiring data scientists in 2020?

No pen required: The digital future of real estate closings

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.

This week we had the full crew around once again — Natasha Mascarenhas, Danny Crichton, Chris Gates and myself. And as always, it was key to have the full crew as there was an ocean of news to get through. Before we get into the show, make sure you’ve checked out Danny’s latest work on the TechCrunch List… now, let’s get to it:

• The TikTok saga continues: This week we spent a few minutes discussing why bankers are incentivized to make the proposed TikTok-Microsoft deal as competitive as possible. Or at least make it look as competitive as possible. And, there’s some data from inside Microsoft about how the deal is being viewed.
• Airbnb could file to go public this month! It might go public before the year is out! That’s way better than we expected. (Bloomberg got its Q2 finances.)
• Palantir could file for a direct listing next month! That’s great. We wanted to know what Palantir really is, namely a consultancy or a tech company. And then we played valuation bingo so we can look back later and mock ourselves.
• I was very excited about the Duck Creek IPO. Few of my friends joined me in being excited.
• The three of us also took a minute to riff on the latest Pinterest news, namely that it’s poorly run and is sexist per its now-former COO. We’d love to stop covering these stories, but they keep happening so, on we go.
• Danny had some neat SPAC data to share, helping illustrate that SPACs are not merely a meme, they are a real, driving force of public company action this year. As was Tesla’s announced stock split, which led us to ask why a few times.
• Next up, Natasha walked us through her latest work digging into how Gen Z is shaking up the funding world. We framed the changes in some historical context, and decided that really in the end the kids are alright.
• Danny brought us to a close, with a note on Conduit (connecting founders and early-stage investors) and Circle (creator software). Both are worth your time.

And that was our show! We are back Monday morning. Stay cool!

Equity drops every Monday at 7:00 a.m. PT and Friday at 6:00 a.m. PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

https://ift.tt/31Ubg7d Startups Weekly: The US is finally getting serious about 5G https://ift.tt/2DMJm56

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Extra Crunch Live: Join Anu Duggal for a live Q&A on August 20 at 11am PT/2pm ET

Rent the Runway and Glossier became unicorns within the same week in June 2019. That same year, only 2.7% of venture capital dollars went toward female-founded companies.

Silicon Valley’s disconnect between the monetary success of female-founded companies and funding them in the first place is disheartening. The conversation is there, but the dollar sign momentum remains missing.

Anu Duggal founded the Female Founders Fund before both were even a tangible reality. In 2014, the entrepreneur launched her first fund to invest in female-led startups. It took her 700 meetings over two years to make that first close, she said. Years later, venture capital has slightly taken note. But the Female Founders Fund, or “F Cubed,” has tracked female-led wins and bet big on the underestimated asset class.

Her early focus on female founders hasn’t evolved, but the landscape has. And in an unprecedented world of remote deals and democratization of venture capital, we’re even more excited to have Duggal join us on Extra Crunch Live this upcoming Thursday at 11 a.m. PT/2 p.m. EST/6 p.m. GMT

Those tuning in and taking notes are encouraged to ask questions, but you have to be an Extra Crunch member to access the chat. If you still haven’t signed up, now’s your chance! With the subscription, you’ll also be able to check out all of our stellar previous guests on-demand (watch those episodes here).

Female Founders Fund has provided seed institutional capital to entrepreneurs with over $3 billion in enterprise value. The firm has cut checks into women-led companies such as Rent the Runway, Billie, Tala, Peanut, Thrive Global and Zola. The fund has also attracted limited partners like Melinda Gates and Girls Who Code founder Reshma Saujani.

Duggal herself has a fascinating trajectory into technology investing. At 25, she started a wine bar in Bombay called The Tasting Room. She went on to get an MBA from London Business School, and co-founded Exclusively.in, an e-commerce company that got acquired by Indian fashion e-commerce company Myntra in 2011.

Hear from Duggal on August 20 about how the investment landscape has changed for female founders, what she thinks of as a success story and if 2020 feels different than 2014. And Extra Crunch fam, make sure to bring your thoughtful questions for me to ask her live on air.

You can find the full details of the conversation below the jump.

https://ift.tt/eA8V8J Extra Crunch Live: Join Anu Duggal for a live Q&A on August 20 at 11am PT/2pm ET https://ift.tt/2Y2drEw

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Facebook’s former PR chief explains why no one is paying attention to your startup

At TechCrunch Early Stage, I spoke with Coatue Management GP Caryn Marooney about startup branding and how founders can get people to pay attention to what they’re building.

Marooney recently made the jump into venture capital; previously she was co-founder and CEO of The Outcast Agency, one of Silicon Valley’s best-regarded public relations firms, which she left to become VP of Global Communications at Facebook, where she led comms for eight years.

While founders often may think of PR as a way to get messaging across to reporters, Marooney says that making someone care about what you’re working on — whether that’s customers, investors or journalists — requires many of the same skills.

One of the biggest insights she shared: at a base level, no one really cares about what you have to say.

Describing something as newsworthy or a great value isn’t the same as demonstrating it, and while big companies like Amazon can get people to pay attention to anything they say, smaller startups have to be even more strategic with their messaging, Marooney says. “People just fundamentally aren’t walking around caring about this new startup — actually, nobody does.”

Getting someone to care first depends on proving your relevance. When founders are forming their messaging to address this, they should ask themselves three questions about their strategy, she recommends:

• Why should anyone care?
• Is there a purchase order existing for this?
• Who loses if you win?
  
  
  https://ift.tt/eA8V8J Facebook’s former PR chief explains why no one is paying attention to your startup https://ift.tt/3kSS0jd

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Sequoia Capital has internal crash courses for its founders — here’s how they work

No matter what you think of Sequoia Capital, the firm doesn’t rest on its laurels. Though it’s now managing ungodly amounts of money and has for decades been considered among the top venture firms in the world, it routinely finds new ways to stay relevant and to ensure that it gets a first look at the most promising founders.

It was the first firm to employ scouts, for example. Recently, to create more room between itself and its ever-growing number of competitors, the firm has also begun fine-tuning a curriculum for the founders of both the pre-seed and seed-stage startups it has funded, as well as its Series A- and B-stage founders.

According to Roelof Botha — the U.S. head of the venture firm since 2017 — and Jess Lee, a partner at Sequoia for nearly four years, the idea is to arm the individuals it backs with Sequoia’s vast “tribal knowledge” so they can not only compete with their rivals but, hopefully, outperform them. “We were already delivering this on an on-demand basis,” says Botha, “so we figured why not [institutionalize it]?”

How do they work? Much as you might imagine. The pre-seed and seed-stage program is shorter but more intensive than the later-stage program — think three weeks of between three to six hours of programming a day, versus up to 10 weeks of more occasional programming for founders whose companies are more mature and who maybe can’t drop in for quite as much hands-on education. The content differs meaningfully, too. The seed-stage modules are really about creating a foundation that can stand the test of time, whereas the later-stage sessions center more around metrics, building out a sales organization, and so forth.

Both programs entirely opt-in, and so far, over the last three years, 100 founders have participated, with another 20 engaged in a seed-stage program that kicked off virtually last week. Both are highly interactive and involve enough workshopping that founders are “walking out with deliverables,” says Lee. “Everyone does show-and-tell demos. You see sausage making that you wouldn’t typically get to see.”

Lee happens to lead programming around storytelling with Sequoia’s in-house design partner, James Buckhouse. (They presented one small part of that module at our recent Extra Crunch event, which you can watch below.) But many of the firm’s partners are involved in the program.

Longtime partner Alfred Lee, who was formerly the COO and chairman of Zappos, teaches a module on culture, for example. Partner Bryan Schreier, long ago a senior director at Google, talks with founders about category creation and how to sell their products. Carl Eschenbach, the former president and COO of VMWare (who, notably, persuaded Sequoia to invest nearly $100 million in Zoom in early 2017), separately coaches founders on their go-to-market strategies.

As a result, founders are exposed to many of the firm’s partners beyond the one who may have a seat on their board. They’re also exposed to founders like Julia Hartz and Tony Xu who’ve been backed by Sequoia over time and who drop in to help mentor their peers. Combined, the two prongs go a long way toward fostering community, says Lee.

In fact, “Community is really the core element” of the programs, she says, adding that each “cohort really bonds with each other” and that more than one set of founders has gone on to rent office space with fellow Sequoia-backed founders, as well as become close friends.

Of course, the programming — first launched in 2018 —  was happening in-person until earlier this year. Now and for the foreseeable future, it will be happening online, suggests Botha, who says he “emcees the entire Series A stage program,” while Lee plays master of ceremonies to its earlier-stage founders.

They insist that transition to a virtual setting isn’t slowing anyone down and that on the contrary, it has enabled the growing number of Sequoia-backed founders elsewhere in the world to participate. (According to Lee, some actually used to fly in to join these sessions.)

In fact, a bigger change that Botha can foresee right now is layering in more education around “how to deal with a culture with a remote workforce.”

As he says, in a future where people may be working in smaller hubs, taking turns at the office, or working remotely entirely, “it will be interesting to see what it means for young founders who are first-time managers and who have to manage a distributing team.”

It will most certainly be “more taxing on [their] people skills,” he notes.

https://ift.tt/eA8V8J Sequoia Capital has internal crash courses for its founders — here’s how they work https://ift.tt/3aqvnxo

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Thoughts on ‘self-driving money,’ day trading and product development from Wealthfront’s Andy Rachleff

Andy Rachleff founded Wealthfront a decade ago to give investors a better and smarter way to manage their wealth, building on core academic research showing that a carefully balanced portfolio of low-fee ETFs outperformed more aggressive strategies. Since then, the company has taken in billions of dollars of invested capital under management and expanded into new banking services, including high-interest checking accounts.

Rachleff and I talked on Extra Crunch Live about where Wealthfront is heading as it speeds toward its second decade, how he sees the competition from other, more active trading platforms like Robinhood and his advice for startup founders looking to build enduring products and companies away from the daily status quo.

Self-driving money

Rachleff began our conversation talking about the future of Wealthfront, which is increasingly moving beyond its wealth management app to new services.

“Our vision is to automate all of your finances — we call this self-driving money,” he said. That platform is expected to role out in September, and include features like easy direct deposit and automated bill pay, with any savings left over automatically moving to the right investment assets that meet a user’s chosen risk tolerance.

https://ift.tt/eA8V8J Thoughts on ‘self-driving money,’ day trading and product development from Wealthfront’s Andy Rachleff https://ift.tt/3kKvjNV

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Facebook pushes back against Apple’s App Store fees

Facebook joined the growing ranks of companies publicly complaining about the 30% fee that Apple collects on payments made through its App Store.

Those complaints came midway through a blog post about the social network’s new feature supporting paid online events. Facebook said that to support struggling businesses, it won’t be collecting any fees on those events, at least for the next year, which means that those businesses keep 100% of payments on the web and on Android.

But Facebook said that won’t be the case on iOS, due to App Store fees, and it took aim at Apple with surprisingly direct language (at least, direct for a corporate blog post):

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

iOS purchase flow on left, Android purchase flow on right

To that end, the post includes screenshots of how the events payment flow will look on iOS and Android. On Android, it says, “Facebook doesn’t take a fee from this purchase,” while on iOS, it says, “Apple takes 30% of this purchase.”

Facebook said this language is included in the app update “which we submitted to Apple today for approval” — suggesting that there’s a possibility that the update won’t be approved.

This comes just about 24 hours after Fortnite was removed from the App Store, after Epic Games introduced direct payments into its hit title. It seemed like Epic was intentionally trying to provoke a fight, with the company quickly announcing a lawsuit against Apple and releasing a short in-game video parodying Apple’s famous 1984 commercial, with Apple cast as the villain. (The game publisher is in a similar battle with Google and Android.)

While Apple’s 30% fee has been around for as long as the App Store itself, the issue came to the forefront earlier this summer after Basecamp got into a public feud with the company over its subscription email app Hey, for which the developer tried to circumvent App Store fees by only accepting subscription payments on its website.

Apple’s Phil Schiller told us at the time that the controversy was not prompting the company to reconsider any of its rules, which he said were designed for a better app experience — to avoid situations where “you download the app and it doesn’t work.”

Epic Games launches a campaign (and lawsuit) against Apple

from Social – TechCrunch https://ift.tt/2E8zbY0 Facebook pushes back against Apple’s App Store fees Anthony Ha https://ift.tt/2FpRA3s
via IFTTT

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Facebook pushes back against Apple’s App Store fees

{rss:content:encoded} Facebook pushes back against Apple’s App Store fees https://ift.tt/2FpRA3s https://ift.tt/2E8zbY0 August 14, 2020 at 10:08PM

Facebook joined the growing ranks of companies publicly complaining about the 30% fee that Apple collects on payments made through its App Store.

Those complaints came midway through a blog post about the social network’s new feature supporting paid online events. Facebook said that to support struggling businesses, it won’t be collecting any fees on those events, at least for the next year, which means that those businesses keep 100% of payments on the web and on Android.

But Facebook said that won’t be the case on iOS, due to App Store fees, and it took aim at Apple with surprisingly direct language (at least, direct for a corporate blog post):

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

iOS purchase flow on left, Android purchase flow on right

To that end, the post includes screenshots of how the events payment flow will look on iOS and Android. On Android, it says, “Facebook doesn’t take a fee from this purchase,” while on iOS, it says, “Apple takes 30% of this purchase.”

Facebook said this language is included in the app update “which we submitted to Apple today for approval” — suggesting that there’s a possibility that the update won’t be approved.

This comes just about 24 hours after Fortnite was removed from the App Store, after Epic Games introduced direct payments into its hit title. It seemed like Epic was intentionally trying to provoke a fight, with the company quickly announcing a lawsuit against Apple and releasing a short in-game video parodying Apple’s famous 1984 commercial, with Apple cast as the villain. (The game publisher is in a similar battle with Google and Android.)

While Apple’s 30% fee has been around for as long as the App Store itself, the issue came to the forefront earlier this summer after Basecamp got into a public feud with the company over its subscription email app Hey, for which the developer tried to circumvent App Store fees by only accepting subscription payments on its website.

Apple’s Phil Schiller told us at the time that the controversy was not prompting the company to reconsider any of its rules, which he said were designed for a better app experience — to avoid situations where “you download the app and it doesn’t work.”

Epic Games launches a campaign (and lawsuit) against Apple

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Facebook launches support for paid online events

Businesses will now be able to monetize online events on Facebook, thanks to a new feature that the social network is launching in the United States and 19 other countries today.

In a call with reporters, Head of Facebook App Fidji Sumo said that Facebook’s Events feature was designed for in-person events, but with the COVID-19 pandemic and resulting social distancing orders, the company “really quickly pivoted” to supporting online events.

In fact, Sumo said that in June of this year, live broadcasts on Facebook Pages doubled compared to the same period in 2019.

Sumo also outlined the new feature in a Facebook blog post. Businesses will be able to host larger events through Facebook Live, and the company is also testing the ability to host smaller, more interactive gatherings in Messenger Rooms. The goal is to give business owners the ability to create the event, set the price, promote the event, collect the payment and host the event itself all from one place.

Apparently some of the paid events that  have already been organized during tests with early users include talks, trivia, podcast recordings, boxing matches, cooking classes, meet-and-greets and fitness classes.

iOS purchase flow on left, Android purchase flow on right

“With social distancing mandates still in place, many businesses and creators are bringing their events and services online to connect with existing customers and reach new ones,” Sumo wrote. “People are also relying on live video and interactive experiences more when they can’t come together physically.”

Sumo said Facebook will not be collecting any fees from paid online events for at least the next year year. So on the web and on Android “in countries where we have rolled out Facebook Pay,” businesses should be able to keep 100% of their online events revenue. That won’t, however, be the case on iOS, and Sumo’s blog post includes a surprisingly direct dig at Apple:

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

To that end, the post also includes an iOS screenshot (“which we submitted to Apple today for approval”) showing that the purchase button will include a small text message saying “Apple takes 30% of this purchase” beneath the purchase button (vs. “Facebook doesn’t take a fee from this purchase” on Android).

Facebook and Instagram roll out Shops, turning business profiles into storefronts

from Social – TechCrunch https://ift.tt/2E8zbY0 Facebook launches support for paid online events Anthony Ha https://ift.tt/2E1y7oX
via IFTTT

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Facebook launches support for paid online events

{rss:content:encoded} Facebook launches support for paid online events https://ift.tt/2E1y7oX https://ift.tt/2E8zbY0 August 14, 2020 at 09:42PM

Businesses will now be able to monetize online events on Facebook, thanks to a new feature that the social network is launching in the United States and 19 other countries today.

In a call with reporters, Head of Facebook App Fidji Sumo said that Facebook’s Events feature was designed for in-person events, but with the COVID-19 pandemic and resulting social distancing orders, the company “really quickly pivoted” to supporting online events.

In fact, Sumo said that in June of this year, live broadcasts on Facebook Pages doubled compared to the same period in 2019.

Sumo also outlined the new feature in a Facebook blog post. Businesses will be able to host larger events through Facebook Live, and the company is also testing the ability to host smaller, more interactive gatherings in Messenger Rooms. The goal is to give business owners the ability to create the event, set the price, promote the event, collect the payment and host the event itself all from one place.

Apparently some of the paid events that  have already been organized during tests with early users include talks, trivia, podcast recordings, boxing matches, cooking classes, meet-and-greets and fitness classes.

iOS purchase flow on left, Android purchase flow on right

“With social distancing mandates still in place, many businesses and creators are bringing their events and services online to connect with existing customers and reach new ones,” Sumo wrote. “People are also relying on live video and interactive experiences more when they can’t come together physically.”

Sumo said Facebook will not be collecting any fees from paid online events for at least the next year year. So on the web and on Android “in countries where we have rolled out Facebook Pay,” businesses should be able to keep 100% of their online events revenue. That won’t, however, be the case on iOS, and Sumo’s blog post includes a surprisingly direct dig at Apple:

We asked Apple to reduce its 30% App Store tax or allow us to offer Facebook Pay so we could absorb all costs for businesses struggling during COVID-19. Unfortunately, they dismissed both our requests and SMBs will only be paid 70% of their hard-earned revenue. Because this is complicated, as long as Facebook is waiving its fees, we will make all fees clear in our products.

To that end, the post also includes an iOS screenshot (“which we submitted to Apple today for approval”) showing that the purchase button will include a small text message saying “Apple takes 30% of this purchase” beneath the purchase button (vs. “Facebook doesn’t take a fee from this purchase” on Android).

Facebook and Instagram roll out Shops, turning business profiles into storefronts

Read More

Travel startups cry foul over what Google’s doing with their data

As the antitrust drumbeat continues to pound on tech giants, with Reuters reporting comments today from the U.S. Justice Department that it’s moving “full-tilt” on an investigation of platform giants including Google parent Alphabet, startups in Europe’s travel sector are dialing up their allegations of anti-competitive behavior against the search giant.

Google has near complete grip on the search market in Europe, with a regional market share in excess of 90%, according to Statcounter. Unsurprisingly, industry sources say a majority of travel bookings start as a Google search — giving the tech giant huge leverage over the coronavirus-hit sector.

More than half a dozen travel startups in Germany are united in a shared complaint that Google is abusing its search dominance in a number of ways they argue are negatively impacting their businesses.

Complaints we’ve heard from multiple sources in online travel range from Google forcing its own data standards on ad partners to Google unfairly extracting partner data to power its own competing products on the cheap.

Startups are limited in how much detail they can provide on the record about Google’s processes because the company requires advertising partners to sign NDAs to access its ad products. But this week German newspaper Handelsblatt reported on antitrust complaints from a number of local startups — including experience booking platform GetYourGuide and vacation rental search engine HomeToGo — which are accusing the tech giant of stealing content and data.

The group is considering filing a cartel complaint against Google, per its report.

We’ve also heard from multiple sources in the European travel sector that Google has exhibited a pattern of trying to secure the rights to travel partners’ content and data through contracts and service agreements.

One source, who did not wish to be identified for fear of retaliation against their business, told us: “Each travel partner has certain specialities in their business model but overall the strategy of Google has been the same: Grab as much data from your partners and build competing products with that data.”

Not OK, Google

This is now a very familiar complaint against Google. Crowdsourced reviews platform Yelp has been accusing the tech giant of stealing content for years. More recently, Genius got creative with a digital watermark that caught Google redhanded scraping lyrics content from its site which it pays to license (but Google does not). As Lily Allen might put it, it’s really not okay.

Last month’s congressional antitrust subcommittee hearing kicked off with exactly this accusation too — as chair David Cicilline barked at Google and Alphabet CEO Sundar Pichai: “Why does Google steal content from honest businesses?” Pichai dodged the question by claiming he doesn’t agree with the characterization. But for Google and parent Alphabet there’s no dodging the antitrust drumbeat pounding violently in the company’s backyard.

Based on this exchange, it seems like Google CEO Sundar Pichai *really* does not want to answer questions about local search. Perhaps because there are no good answers? pic.twitter.com/49RVwHMHS8

— Luther Lowe (@lutherlowe) July 29, 2020

In Europe, Google’s business already has a clutch of antitrust enforcements against it — starting three years ago, in a case which dated back six years at that point, with a record-breaking penalty for anti-competitive behavior in how it operated a product search service called Google Shopping. EU enforcements against Android and AdSense swiftly followed. Google is appealing all three decisions, even as it continues to expand its operations in lucrative verticals like travel.

The Commission’s 2017 finding that Google is dominant in the regional search market carried what lawmakers couch as a “special responsibility” to avoid breaching the bloc’s antitrust rules in any market in which Google plays. That finding puts the travel sector squarely in the frame, although not yet under formal probe by EU regulators (although they have opened an active probe of Google’s data collection practices, announced last year).

EU regulators are also examining a range of competition concerns over its proposed acquisition of Fitbit, delaying the merger while they consider whether the deal would further entrench Google’s position in the ad market by giving it access to a trove of Fitbit users’ health data that could be used for increased ad personalization.

But so far, on travel, the Commission has been keeping its powder dry.

Yet for around a decade the tech giant has been building out products that directly compete for travel bookings in growth areas like flight search. More recently it’s added hotels, vacation rentals and experiences — bringing its search tool into direct competition with an increasing range of third-party booking platforms which, at least in Europe, have no choice but to advertise on Google’s platform to drive customer acquisition.

One key acquisition underpinning Google’s travel ambitions dates back to 2010 — when it shelled out $700 million for ITA, a provider of flight information to airlines, travel agencies and online reservation systems. The same year it also picked up travel guide community, Ruba.

Google beat out a consortium of rivals for ITA, including Microsoft, Kayak, Expedia and Travelport, which relied on its data to power their own travel products — and had wanted to prevent Google getting its hands on the data.

Back then travel was already a huge segment of search and online commerce. And it’s continued to grow — worth close to $700 billion globally in 2018, per eMarketer (although the coronavirus crisis is likely to impact some recent growth projections, even as the public health crisis accelerates the industry’s transition to digital bookings) — all of which gives Google huge incentive to carve itself a bigger and bigger share of the pie. 

This is what Google is aiming to do by building out ad units that cater to travelers’ searches by offering flights, vacation rentals and trip experiences, searchable without needing to leave Google’s platform. 

Google defends this type of expansion by saying it’s just making life easier for the user by putting sought for information even closer to their search query. But competitors contend the choices it’s making are far more insidious. Simply put, they’re better for Google’s bottom line — and will ultimately result in less choice and innovation for consumers — is the core argument. The key contention is Google is only able to do this because it wields vast monopoly power in search, which gives it unfair access to travel rivals’ content and data.

It’s certainly notable that Alphabet hasn’t felt the need to shell out to acquire any of the major travel booking platforms since its ITA acquisition. Instead, its market might allow it to repackage and monetize rival travel platforms’ data via an expanding array of its own vertical travel search products. 

One of the German consortia of travel startups with a major beef against Google is Berlin-based HomeToGo. The vacation rentals platform confirmed to TechCrunch it has filed an antitrust complaint against the company with the European Commission.

It told us it’s watched with alarm as Google introduced a new ad unit in search results which promotes a vacation rental search and booking experience — displaying property thumbnails, alongside locations and prices plotted on a map — right from inside Google’s platform.

Screengrab showing Google vacation rental ad unit, populated with content from a range of partners

Discussing the complaint, HomeToGo CEO and co-founder, Dr Patrick Andrae, told us: “Due to the monopoly Google has in horizontal search, just by having this kind of access [to the vast majority of European Internet searchers], they’re so top of the funnel that they theoretically can go into any vertical. And with the power of their monopoly they can turn on products there without doing any prior investment in it.

“Anyone else has to work a lot on SEO strategies and these kind of things to slowly go up in the ranking but Google can just snap its fingers and say, basically, tomorrow I want to have a product.”

The complaint is not just that Google has built a competing ad product in vacation rentals but — following what has become a standard colonizing playbook for seemingly any vertical area Google sees is grabbing traffic — its packaging of the competing product is so fully featured and eye-catching that it results in greater prominence for Google’s ad versus organic search results (or indeed paid ad links) where rivals may appear as plain-old blue links.

“They create this giant, colorful super CTA [call-to-action], as we call it — this one-box thing — where everything is clickable and leads you into the Google product,” said Andrae. “They explain that it’s better for the user experience but no one ever said that the user wants to have a one-box there from Google. Or why shouldn’t it be a one-box from HomeToGo? Or why shouldn’t it be a one-box in the flight world from Kayak? Or in the hotel world from Trivago? So why is it just the Google product that’s colorful, nice, and showing up?”

Andrae argues that the design of the unit is intended to give the user the impression that “Google has everything there,” on its platform. So, y’know, why go looking elsewhere for a vertical search engine?

He also points out that the special unit is not available to competitors. “You cannot buy it,” he said. “So even if you would like to have this prominent kind of placement you cannot buy that as a third-party company. Even if you would like to pay money for it — I’m not talking about being in the product itself, that’s another topic — but just having the same kind of advertisement, because it is what they do — they advertise their own product there for free — and this is our complaint.”

Pay with your data

In 2017, when the Commission slapped Google with the first record-breaking penalty over its search comparison service — finding it had systematically given prominent placement to its own comparison shopping service over and above rival services in organic search results — competition chief Margrethe Vestager disclosed it had also received complaints about Google’s behavior in the travel sector.

Asked about the sector’s concerns now, some three years later, a Commission spokeswoman told us it’s “monitoring the markets concerned” — but declined to comment on any specific gripes.

Here’s another complaint: GetYourGuide, a Berlin-based travel startup that’s created a discovery and booking platform for travel tours and experiences, has similar concerns about Google’s designs on travel experience booking — another travel segment the tech giant is moving into via its own eye-catching ad units flogging experiences.

“They want to create experience products now directly on Google search itself, with the aim that ultimately people can book these type of things on Google,” said GetYourGuide CEO and co-founder Johannes Reck. “What Google tries to do now is they try to get [travel startups’] content and our data in order to create new competitive products on Google.”

The startup is unhappy, for example, that a “Things to do” ad product Google shows in its search results doesn’t link to GetYourGuide’s own search page — which would be the equivalent and competing third party product.

“Google will not allow us to link them into our search but only into the details page so the customer sees even less of our brand,” he said. “Or in Maps, for instance, if you go to Eiffel Tower and press to book tickets you don’t see any of GetYourGuide despite us fulfilling that order.”

He also rejects Google’s claim against this sort of complaint that it’s simply “doing the right thing for the user” by not linking them out to the rival platform. “We do know from our data that users convert better and spend more time on our site and have higher engagement rates when we link them into our search and then deeper down into the funnel,” he told TechCrunch. “What Google is saying is not that it serves the user — it serves Google and it serves their profits. Because the deeper down the funnel that you link, the user will either buy or they will bounce back to Google and search for the next product. If you link into searches — if you don’t verticalize as much — then the user will end up in a different ecosystem and might not bounce back to Google.”

“As a partner [of Google] you have limited choice to participate [in its ad products]. You do need to give Google that content and then Google will try to move as many of the customers to them,” Reck added. “I don’t think there ever will be a world where booking.com or Expedia or GetYourGuide will disappear — rather our brands will start to disappear.

“That is something that I think ultimately is bad for the customer and only serves Google, again, because the customer will, in the long run, have no other choice and no other visibility on how he can get to choice than to go through Google because our brands will basically be hidden behind a Google wall. That will turn Google firmly away from what their original mission was… to steer people to the most relevant content on the web… Now they are trying to be completely the opposite; they’re trying to be the Amazon or Alibaba of travel and try to keep and contain people in their ecosystem.”

During the congressional antitrust subcommittee hearing last month Pichai claimed Google faces fierce competition in travel. Again, Reck contends that’s simply not true. “In Europe more than 75% of travelers go to Google to search for travel and all those users are free,” he said. “Everyone else in the travel industry pays Google top dollar… for these queries. Which competition exactly is he referring to?”

“[Pichai] then claimed that they’re not leveraging partners’ content — that’s not accurate. If you look at Google if you want to be in the top results these days you either pay or you give them data so that they can build their own products into search.”

“This dates back 10 years now when they acquired ITA software, which is the leading data provider for flights,” Reck added. “They’ve just paved their way into travel. I think their intent is very clear at this point that they have no interest in their partners — or their customers for that matter, who like the choice that’s being offered on Google.

“What they want to morph into, basically, is to turn Google into the Amazon of travel where everyone else may be a content provider or a fulfillment agent but the consumer has no choice but to go through Google. I think that is the key intent here. They want to limit consumer choice. And they want to monopolise the space. We don’t want that and we will fight that. And if that means we need to go to the EU Commission to protect our and the customers’ interests then we’ll do that and we’re currently reviewing that option.”

The looming harm for consumers around reduced choice could manifest in poorer customer service, which is an area vertical players tend to focus on — whereas Google, as a platform funnel, does not.

Another German travel startup — Munich-based FlixBus — was also willing to go on the record with concerns about the impact of Google’s market power on the sector, despite not being in the same position as its business is not an aggregator.

Nonetheless, FlixBus founder and CEO Jochen Engert called on regional lawmakers to act against what he described as Google’s “systematic abuses” of market dominance.

“We call on the politicians in Germany and the EU to now work for fair competition on the internet. It must be forbidden that monopolistic companies like Google abuse their market power, especially in times of crisis, and prevent competition for the benefit of the customer due to their dominance,” he told us. “Google systematically abuses its dominant market position to seal off access to customers from competitors and gets away with it time and again. It is only a matter of time before other industries and business models, in addition to travel, hotel and flight bookings, are permanently threatened.

“For FlixMobility [FlixBus’ parent company] as an internationally positioned market leader with its own platform, technology and our unique content, the situation is more relaxed than for smaller startups or those which also aggregate content such as Google. Nevertheless, in our opinion Google should be obliged to list and market its own products in search results on an equal footing with comparable offers. Here regulation must not stand by and watch for too long, but must react before Google irretrievably controls customer access and excludes competition.”

GetYourGuide’s Reck expressed hope that German lawmakers might be able to offer more expeditious relief to the sector than the European Commission — whose competition investigations typically grind through the details for years.

“The German government is actually very alert at this point in time,” he said. “They’re currently working on a new competition legislation that they will put in place probably within the next six months. It’s already in the making — and that will also be addressed to exactly that type of behavior of global, quasi-monopolistic platforms crossing the demarcation line, moving into other fields and trying to leverage their monopoly in order to create synergies in adjacent fields and crowd out competition.”

Asked what kind of intervention he would like to see regulators make against Google, Reck suggests its business should be regulated akin to a utility — advocating for controls on data, including around the openness of data, to level the playing field.

Though he also told us he would be supportive of more radical measures, such as breaking Google up. (But, again, he says speed of intervention is of the essence.)

“If you look at all of the data that Google collects, whether that’s consumer reviews, availability from its partners, all of the content from its partners, all of the information that they have through Android, whether that’s geo-specific data, whether that is interests, whether that is contextual information, Google is training their algorithms day and night on this data, no one else can. But we all have to provide data to Google,” he said.

“That’s not a level playing field. We need to think about how we can have a more open data architecture, that obviously is compliant with our data privacy laws but where developers from anywhere can build products based on the Google platform… As a developer in travel it’s currently very hard for me to access any data from Google so I can build better products for consumers. And I think that really needs to change — Google needs to open us for us to create a more vibrant and competitive ecosystem.”

“At a national or EU level we need to have an updated legal code that allows for quick interventions,” Reck added, saying competition enforcement simply can’t carry on at the same pace as for the markets of the past. “Things are moving way too quickly for that. You need to take a completely new approach.

“As Google correctly pointed out consumer prices have fallen but falling consumer prices is the weapon in tech; offering products for free allows you to gain market share in order to crowd out competition, which again leaves less choice for the customer, so I think we need to think about how we think about tech and platforms in new ways.”

The Commission is currently consulting on whether competition regulators need a new tool to be able to intervene more quickly in digital markets. But there’s more than a trace of irony that its adherence to process means further delay as regulators question whether they need more power to intervene in digital markets to prevent tipping, instead of acting on longstanding complaints of market abuse attached to the 800-lb gorilla of internet search — with its “special responsibility” not to trample on other markets.

Reached for comment on the travel startups’ complaints, a Google spokeswoman sent us this statement:

There are now more ways than ever to find information online, and for travel searches, people can easily choose from an array of specialized sites, like TripAdvisor, Kayak, Expedia and many more. With Google Search, we aim to provide the most helpful and relevant results possible to create the best experience for users around the world and deliver valuable traffic to travel companies.

During the pandemic, we’ve been working hard with our partners in the travel industry to help them protect their businesses and look toward recovery. We launched new tools for airlines so they can better predict consumer demand and plan their routes. For hotels, we expanded our ‘pay per stay’ program globally to shift the risk of cancellation from our partners to us. And we’ve updated our search products so consumers can make informed decisions when planning future travel, further reducing the risk of cancellation.

The company did not respond to our request for a response to claims we heard that it seeks to secure rights to partners’ content and data via contracts and service agreements.

No relief

In another sign of the growing rift between Google and its travel partners in Europe, German startups in the sector banded together to press it for better terms during the coronavirus crisis earlier this year — accusing the tech giant of being inflexible over payments for ads they’d run before the crisis hit. This meant they were left with a huge hole in their balance sheets after making mass refunds for travelers who could no longer take their planned trip. But the gorilla wasn’t sympathetic, demanding full payment immediately.

Asked what happened after TechCrunch reported on their concerns at the end of April, Reck said Google went silent for a few weeks. But as soon as the travel market started picking up in Germany — and GetYourGuide decided it needed to start advertising on Google again — it reissued the demand for full payment.

GetYourGuide says it was left with no choice but to pay, given it needed to be able to run Google ads.

Reck describes the recovery package Google offered after it made the payment as “a Google recovery package” — as it was tied to GetYourGuide spending a large amount on YouTube ads in order to get a small discount.

The offer would recoup only a “fraction” of GetYourGuide’s original losses on Google ads during the peak of the COVID-19 crisis, per Reck. “YouTube obviously is not where we lost the money. We lost the money in search where we had high-intent customers, Google customers that wanted to come and shop. So that to us was [another] slap in the face,” he added.

https://ift.tt/2DSFU8K Travel startups cry foul over what Google’s doing with their data https://ift.tt/2Y4LvzY

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Warner Music acquires IMGN, a social media publishing platform, for under $100M

It’s a whole new playing field these days for music labels and publishers, and today one of the biggies made an acquisition to help it sharpen up its strategy to better understand what people want to see and hear online today.

Warner Music — with a market cap of $15.4 billion, one of the big three recording giants alongside Universal and Sony and which owns labels like Atlantic, Elektra and others and has a huge roster of artists that includes the likes of Madonna, Ed Sheeran and Linkin Park — is acquiring IMGN Media, a Tel Aviv and New York-based startup that builds and tracks viral social media content in categories like e-sports and gaming, ASMR and entertainment.

IMGN used be called Comedy.com. It widened its remit from simply funny stuff and rebranded in 2017, and according to its site has about 3 billion views per month and has some 40 million subscribers to its content, with some 85% of that classified as “Gen Z and millennials.”

The news caps off several weeks of speculation about the startup. In July, reports in the Israeli press emerged that said IMGN was being circled by Snap for about $180 million; and further to that, a source told us that TikTok was also in the frame, looking at the company at around a price tag of $150 million. In the end, the terms of the acquisition were not disclosed but we understand that the deal was done for just under $100 million.

IMGN was founded in 2015 and had raised about $6 million from a long list of angels and firms including Rhodium, Dot Capital and Prism Venture Management.

The plan will be to keep IMGN independent of Warner, continuing to develop and analyse viral content across a range of platforms, with founder Barak Shragai staying on to lead the team.

Warner, meanwhile, does not plan to use the platform to simply market Warner artists, but to tap it for more insights into where people are going online these days, and what they want to see, so that it can better target its own marketing efforts accordingly.

That’s not to say that the two will not work together at all. Warner became acquainted with the startup because it had been a customer of IMGN’s.

Warner has a history both of investing and acquiring startups, depending on its strategic interests. In July, for example, it took part in a Series B round for Canadian audio mastering startup Landr. Further back, it has acquired the likes of music concert listings platform Songkick and pop culture site Uproxx — which it also uses to help track trends in the world of music and among its target demographics.

IMGN will continue working with other third-party brands under its new owner. Past customers have included Electronic Arts, Burger King and Microsoft. The Microsoft deal was by way of its Mixer live game streaming platform, and the fact that this Twitch competitor was shut down last month says a lot about the state of the market and how precarious an audience can be.

Not just consumer tastes, but companies’ business strategies, shift all the time. Microsoft pulling the plug on Mixer underscores how IMGN itself can quickly lose a customer, pointing to why ownership by WMG can feel more secure. As for Warner — which is traded publicly these days but still majority owned by Access Industries, the holding company controlled by Len Blavatnik — the fact that Mixer is tracking and building content for a range of platforms gives it more of a bird’s-eye view on that bigger picture, rather than simply relying on data from the platforms themselves, or its own research, to figure out what the world wants to see and hear.

“WMG not only offers us greater investment and support, but an entrepreneurial environment to continue growing our business, with the people running our accounts having editorial independence,” said Shragai. “We’re excited to partner with them as we take our company into the future.”

The bigger picture here is that the music industry has evolved well beyond the traditional, analogue world of publishing and selling physical media, where consumers learned about and listened to new artists and songs over the radio and TV (and read about their favorite musicians or genres in magazines).

With the shift to mobile and digital platforms, there’s now a much wider, and quickly-shifting, plethora of places where people discover and listen to music.

And digital platforms themselves — from those focused specifically on audio and music, like Spotify, through to those where music is a side-hustle to continue to capture audience, like Facebook, through to those that are neither but are still huge music destinations, like TikTok — are also getting deeply involved in tracking how tastes are evolving, and where people are going to get their music fix.

So it’s only natural to see labels looking for ways to have more direct access to those insights themselves, bypassing all those platforms — even as they also work with them (and indeed, to help them negotiate better with those platforms, at the end of the day).

from Social – TechCrunch https://ift.tt/eA8V8J Warner Music acquires IMGN, a social media publishing platform, for under $100M Ingrid Lunden https://ift.tt/2DVX9Ge
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