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Saturday, August 7, 2021

This Week in Apps: In-app events hit the App Store, TikTok tries Stories, Apple reveals new child safety plan

{rss:content:encoded} This Week in Apps: In-app events hit the App Store, TikTok tries Stories, Apple reveals new child safety plan https://ift.tt/37svAja https://ift.tt/3AglAFS August 07, 2021 at 09:30PM

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place, with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Top Stories

Apple to scan for CSAM imagery

Apple announced a major initiative to scan devices for CSAM imagery. The company on Thursday announced a new set of features, arriving later this year, that will detect child sexual abuse material (CSAM) in its cloud and report it to law enforcement. Companies like Dropbox, Google and Microsoft already scan for CSAM in their cloud services, but Apple had allowed users to encrypt their data before it reached iCloud. Now, Apple’s new technology, NeuralHash, will run on users’ devices, to detect when a users upload known CSAM imagery — without having to first decrypt the images. It even can detect the imagery if it’s been cropped or edited in an attempt to avoid detection.

Meanwhile, on iPhone and iPad, the company will roll out protections to Messages app users that will filter images and alert children and parents if sexually explicit photos are sent to or from a child’s account. Children will not be shown the images but will instead see a grayed-out image instead. If they try to view the image anyway through the link, they’ll be shown interruptive screens that explain why the material may be harmful and are warned that their parents will be notified.

Some privacy advocates pushed back at the idea of such a system, believing it could expand to end-to-end encrypted photos, lead to false positives, or set the stage for more on-device government surveillance in the future. But many cryptology experts believe the system Apple developed provides a good balance between privacy and utility, and have offered their endorsement of the technology. In addition, Apple said reports are manually reviewed before being sent to the National Center for Missing and Exploited Children (NCMEC).

The changes may also benefit iOS developers who deal in user photos and uploads, as predators will no longer store CSAM imagery on iOS devices in the first place, given the new risk of detection.

In-App Events appear on the App Store

Image Credits: Apple

Though not yet publicly available to all users, those testing the new iOS 15 mobile operating system got their first glimpse of a new App Store discovery feature this week: “in-app events.” First announced at this year’s WWDC, the feature will allow developers and Apple editors alike to showcase directly on the App Store upcoming events taking place inside apps.

The events can appear on the App Store homepage, on the app’s product pages or can be discovered through personalized recommendations and search. In some cases, editors will curate events to feature on the App Store. But developers will also be provided tools to submit their own in-app events. TikTok’s “Summer Camp” for creators was one of the first in-app events to be featured, where it received a top spot on the iPadOS 15 App Store.

Weekly News

Platforms: Apple

Apple expands support for student IDs on iPhone and Apple Watch ahead of the fall semester. Tens of thousands more U.S. and Canadian colleges will now support mobile student IDs in the Apple Wallet app, including Auburn University, Northern Arizona University, University of Maine, New Mexico State University and others.

Apple was accused of promoting scam apps in the App Store’s featured section. The company’s failure to properly police its store is one thing, but to curate an editorial list that actually includes the scams is quite another. One of the games rounded up under “Slime Relaxations,” an already iffy category to say the least, was a subscription-based slime simulator that locked users into a $13 AUD per week subscription for its slime simulator. One of the apps on the curated list didn’t even function, implying that Apple’s editors hadn’t even tested the apps they recommend.

Tax changes hit the App Store. Apple announced tax and price changes for apps and IAPs in South Africa, the U.K. and all territories using the Euro currency, all of which will see decreases. Increases will occur in Georgia and Tajikistan, due to new tax changes. Proceeds on the App Store in Italy will be increased to reflect a change to the Digital Services Tax effective rate.

Game Center changes, too. Apple said that on August 4, a new certificate for server-based Game Center verification will be available via the publicKeyUrl.

Platforms: Google

Fintech

Robinhood stock jumped more than 24% to $46.80 on Tuesday after initially falling 8% on its first day of trading last week, after which it had continued to trade below its opening price of $38.

Square’s Cash app nearly doubled its gross profit to $546 million in Q2, but also reported a $45 million impairment loss on its bitcoin holdings.

Coinbase’s app now lets you buy your cryptocurrency using Apple Pay. The company previously made its Coinbase Card compatible with Apple Pay in June.

Social

An anonymous app called Sendit, which relies on Snap Kit to function, is climbing the charts of the U.S. App Store after Snap suspended similar apps, YOLO and LMK. Snap was sued by the parent of child who was bullied through those apps, which led to his suicide. Sendit also allows for anonymity, and reviews compare it to YOLO. But some reviews also complained about bullying. This isn’t the first time Snap has been involved in a lawsuit related to a young person’s death related to its app. The company was also sued for its irresponsible “speed filter” that critics said encouraged unsafe driving. Three young men died using the filter, which captured them doing 123 mph.

TikTok is testing Stories. As Twitter’s own Stories integrations, Fleets, shuts down, TikTok confirmed it’s testing its own Stories product. The TikTok Stories appear in a left-hand sidebar and allow users to post ephemeral images or video that disappear in 24 hours. Users can also comment on Stories, which are public to their mutual friends and the creator. Stories on TikTok may make more sense than they did on Twitter, as TikTok is already known as a creative platform and it gives the app a more familiar place to integrate its effects toolset and, eventually, advertisements.

Facebook has again re-arranged its privacy settings. The company continually moves around where its privacy features are located, ostensibly to make them easier to find. But users then have to re-learn where to go to find the tools they need, after they had finally memorized the location. This time, the settings have been grouped into six top-level categories, but “privacy” settings have been unbundled from one location to be scattered among the other categories.

A VICE report details ban-as-a-service operations that allow anyone to harass or censor online creators on Instagram. Assuming you can find it, one operation charged $60 per ban, the listing says.

TikTok merged personal accounts with creator accounts. The change means now all non-business accounts on TikTok will have access to the creator tools under Settings, including Analytics, Creator Portal, Promote and Q&A. TikTok shared the news directly with subscribers of its TikTok Creators newsletter in August, and all users will get a push notification alerting them to the change, the company told us.

Discord now lets users customize their profile on its apps. The company added new features to its iOS and Android apps that let you add a description, links and emojis and select a profile color. Paid subscribers can also choose an image or GIF as their banner.

Twitter Spaces added a co-hosting option that allows up to two co-hosts to be added to the live audio chat rooms. Now Spaces can have one main host, two co-hosts and up to 10 speakers. Co-hosts have all the moderation abilities as hosts, but can’t add or remove others as co-hosts.

Messaging

Tencent reopened new user sign-ups for its WeChat messaging app, after having suspended registrations last week for unspecified “technical upgrades.” The company, like many other Chinese tech giants, had to address new regulations from Beijing impacting the tech industry. New rules address how companies handle user data collection and storage, antitrust behavior and other checks on capitalist “excess.” The gaming industry is now worried it’s next to be impacted, with regulations that would restrict gaming for minors to fight addiction.

WhatsApp is adding a new feature that will allow users to send photos and videos that disappear after a single viewing. The Snapchat-inspired feature, however, doesn’t alert you if the other person takes a screenshot — as Snap’s app does. So it may not be ideal for sharing your most sensitive content.

Telegram’s update expands group video calls to support up to 1,000 viewers. It also announced video messages can be recorded in higher quality and can be expanded, regular videos can be watched at 0.5 or 2x speed, screen sharing with sound is available for all video calls, including 1-on-1 calls, and more.

Streaming & Entertainment

American Airlines added free access to TikTok aboard its Viasat-equipped aircraft. Passengers will be able to watch the app’s videos for up to 30 minutes for free and can even download the app if it’s not already installed. After the free time, they can opt to pay for Wi-Fi to keep watching. Considering how easy it is to fall into multi-hour TikTok viewing sessions without knowing it, the addition of the addictive app could make long plane rides feel shorter. Or at least less painful.

Chinese TikTok rival Kuaishou saw stocks fall by more than 15% in Hong Kong, the most since its February IPO. The company is another victim of an ongoing market selloff triggered by increasing investor uncertainty related to China’s recent crackdown on tech companies. Beijing’s campaign to rein in tech has also impacted Tencent, Alibaba, Jack Ma’s Ant Group, food delivery company Meituan and ride-hailing company Didi. Also related, Kuaishou shut down its controversial app Zynn, which had been paying users to watch its short-form videos, including those stolen from other apps.

Twitch overtook YouTube in consumer spending per user in April 2021, and now sees $6.20 per download as of June compared with YouTube’s $5.60, Sensor Tower found.

Image Credits: Sensor Tower

Spotify confirmed tests of a new ad-supported tier called Spotify Plus, which is only $0.99 per month and offers unlimited skips (like free users get on the desktop) and the ability to play the songs you want, instead of only being forced to use shuffle mode.

The company also noted in a forum posting that it’s no longer working on AirPlay2 support, due to “audio driver compatibility” issues.

Mark Cuban-backed audio app Fireside asked its users to invest in the company via an email sent to creators which didn’t share deal terms. The app has yet to launch.

YouTube kicks off its $100 million Shorts Fund aimed at taking on TikTok by providing creators with cash incentives for top videos. Creators will get bonuses of $100 to $10,000 based on their videos’ performance.

Dating

Match Group announced during its Q2 earnings it plans to add to several of the company’s brands over the next 12 to 24 months audio and video chat, including group live video, and other livestreaming technologies. The developments will be powered by innovations from Hyperconnect, the social networking company that this year became Match’s biggest acquisition to date when it bought the Korean app maker for a sizable $1.73 billion. Since then, Match was spotted testing group live video on Tinder, but says that particular product is not launching in the near-term. At least two brands will see Hyperconnect-powered integrations in 2021.

Photos

The Photo & Video category on U.S. app stores saw strong growth in the first half of the year, a Sensor Tower report found. Consumer spend among the top 100 apps grew 34% YoY to $457 million in Q2 2021, with the majority of the revenue (83%) taking place on iOS.

Image Credits: Sensor Tower

Gaming

Epic Games revealed the host of its in-app Rift Tour event is Ariana Grande, in the event that runs August 6-8.

Pokémon GO influencers threatened to boycott the game after Niantic removed the COVID safety measures that had allowed people to more easily play while social distancing. Niantic’s move seemed ill-timed, given the Delta variant is causing a new wave of COVID cases globally.

Health & Fitness

Apple kicked out an app called Unjected from the App Store. The new social app billed itself as a community for the unvaccinated, allowing like-minded users to connect for dating and friendships. Apple said the app violated its policies for COVID-19 content.

Google Pay expanded support for vaccine cards. In Australia, Google’s payments app now allows users to add their COVID-19 digital certification to their device for easy access. The option is available through Google’s newly updated Passes API which lets government agencies distribute digital versions of vaccine cards.

COVID Tech Connect, a U.S. nonprofit initially dedicated to collecting devices like phones and tablets for COVID ICU patients, has now launched its own app. The app, TeleHome, is a device-agnostic, HIPAA-compliant way for patients to place a video call for free at a time when the Delta variant is again filling ICU wards, this time with the unvaccinated — a condition that sometimes overlaps with being low-income. Some among the working poor have been hesitant to get the shot because they can’t miss a day of work, and are worried about side effects. Which is why the Biden administration offered a tax credit to SMBs who offered paid time off to staff to get vaccinated and recover.

Popular journaling app Day One, which was recently acquired by WordPress.com owner Automattic, rolled out a new “Concealed Journals” feature that lets users hide content from others’ viewing. By tapping the eye icon, the content can be easily concealed on a journal by journal basis, which can be useful for those who write to their journal in public, like coffee shops or public transportation.

Edtech

Recently IPO’d language learning app Duolingo is developing a math app for kids. The company says it’s still “very early” in the development process, but will announce more details at its annual conference, Duocon, later this month.

Educational publisher Pearson launched an app that offers U.S. students access to its 1,500 titles for a monthly subscription of $14.99. the Pearson+ mobile app (ack, another +), also offers the option of paying $9.99 per month for access to a single textbook for a minimum of four months.

News & Reading

Quora jumps into the subscription economy. Still not profitable from ads alone, Quora announced two new products that allow its expert creators to monetize their content on its service. With Quora+ ($5/mo or $50/yr), subscribers can pay for any content that a creator paywalls. Creators can choose to enable a adaptive paywall that will use an algorithm to determine when to show the paywall. Another product, Spaces, lets creators write paywalled publications on Quora, similar to Substack. But only a 5% cut goes to Quora, instead of 10% on Substack.

Utilities

Google Maps on iOS added a new live location-sharing feature for iMessage users, allowing them to more easily show your ETA with friends and even how much battery life you have left. The feature competes with iMessage’s built-in location-sharing feature, and offers location sharing of 1 hour up to 3 days. The app also gained a dark mode.

Security & Privacy

Controversial crime app Citizen launched a $20 per month “Protect” service that includes live agent support (who can refer calls to 911 if need be). The agents can gather your precise location, alert your designated emergency contacts, help you navigate to a safe location and monitor the situation until you feel safe. The system of live agent support is similar to in-car or in-home security and safety systems, like those from ADT or OnStar, but works with users out in the real world. The controversial part, however, is the company behind the product: Citizen has been making headlines for launching private security fleets outside law enforcement, and recently offered a reward in a manhunt for an innocent person based on unsubstantiated tips.

Funding and M&A

🤝 Square announced its acquisition of the “buy now, pay later” giant AfterPay in a $29 billion deal that values the Australian firm at more than 30% higher than the stock’s last closing price of AUS$96.66. AfterPay has served over 16 million customers and nearly 100,000 merchants globally, to date, and comes at a time when the BNPL space is heating up. Apple has also gotten into the market recently with an Affirm partnership in Canada.

🤝 Gaming giant Zynga acquired Chinese game developer StarLark, the team behind the mobile golf game Golf Rival, from Betta Games for $525 million in both cash and stock. Golf Rival is the second-largest mobile golf game behind Playdemic’s Golf Clash, and EA is in the process of buying that studio for $1.4 billion.

💰  U.K.-based Humanity raised an additional $2.5 million for its app that claims to help slow down aging, bringing the total raise to date to $5 million. Backers include Calm’s co-founders, MyFitness Pal’s co-founder and others in the health space. The app works by benchmarking health advice against real-world data, to help users put better health practices into action.

💰 YELA, a Cameo-like app for the Middle East and South Asia, raised $2 million led by U.S. investors that include Tinder co-founder Justin Mateen and Sean Rad, general partner of RAD Fund. The app is focusing on signing celebrities in the regions it serves, where smartphone penetration is high and over 6% of the population is under 35.

💰 London-based health and wellness app maker Palta raised a $100 million Series B led by VNV Global. The company’s products include Flo.Health, Simple Fasting, Zing Fitness Coach and others, which reach a combined 2.4 million active, paid subscribers. The funds will be used to create more mobile subscription products.

🤝 Emoji database and Wikipedia-like site Emojipedia was acquired by Zedge, the makers of a phone personalization app offering wallpapers, ringtones and more to 35 million MAUs. Deal terms weren’t disclosed. Emojipedia says the deal provides it with more stability and the opportunity for future growth. For Zedge, the deal provides🤨….um, a popular web resource it thinks it can better monetize, we suspect.

💰 Mental health app Revery raised $2 million led by Sequoia Capital India’s Surge program for its app that combines cognitive behavioral therapy for insomnia with mobile gaming concepts. The company will focus on other mental health issues in the future.

💰 London-based Nigerian-operating fintech startup Kuda raised a $55 million Series B, valuing its mobile-first challenger bank at $500 million. The inside round was co-led by Valar Ventures and Target Global.

💰 Vietnamese payments provider VNLife raised $250 million in a round led by U.S.-based General Atlantic and Dragoneer Investment Group. PayPal Ventures and others also participated. The round values the business at over $1 billion.

Downloads

Mastodon for iPhone

Fans of decentralized social media efforts now have a new app. The nonprofit behind the open source decentralized social network Mastodon released an official iPhone app, aimed at making the network more accessible to newcomers. The app allows you to find and follow people and topics; post text, images, GIFs, polls, and videos; and get notified of new replies and reblogs, much like Twitter.

Xingtu

@_666eveITS SO COOL FRFR do u guys want a tutorial? #fypシ #醒图 #醒图app♬ original sound – Ian Asher

TikTok users are teaching each other how to switch over to the Chinese App Store in order to get ahold of the Xingtu app for iOS. (An Android version is also available.) The app offers advanced editing tools that let users edit their face and body, like FaceTune, apply makeup, add filters and more. While image-editing apps can be controversial for how they can impact body acceptance, Xingtu offers a variety of artistic filters which is what’s primarily driving the demand. It’s interesting to see the lengths people will go to just to get a few new filters for their photos — perhaps making a case for Instagram to finally update its Post filters instead of pretending no one cares about their static photos anymore.

Tweets

Facebook still dominating top charts, but not the No. 1 spot:  

Not cool, Apple: 

This user acquisition strategy: 

Maybe Stories don’t work everywhere: 

Friday, August 6, 2021

Extra Crunch roundup: Build a founding team, choose a VC and recruit your board

Assembling a startup team is harder than assembling 10 IKEA dressers, and the stakes are much, much higher.

Starting with the assumption that 90% of startups will fail and the most successful ones take an average of six years to IPO, founders must make careful decisions about whom they invite to join the core team.

Will that stellar engineer become a great CTO? Should your product person be opinionated or a team player? Are you even the best choice for CEO?

ThoughtSpot CEO Sudheesh Nair shared some of his thoughts about building a sturdy leadership team and drafted a thorough checklist for entrepreneurs who are putting a crew together. His initial advice?

“Investors love founder-CEOs, and founders are often fantastic candidates for this role. But not everyone can do it well, and more importantly, not everyone wants to.”

In a related article, Gregg Adkin, VP and managing director at Dell Technologies Capital, shared the framework he’s developed for helping founders set up their board.

Choosing the right mix of people can impact everything from fundraising to hiring: “Investors often ask founders about their board [because] it says a lot about their character, their judgment and their willingness to be challenged,” he writes.


Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.


Miranda Halpern spoke to Amsterdam-based coach Ward van Gasteren for our latest growth marketing interview, which is free to read.

In their discussion, van Gasteren addressed misconceptions about growth hacking, the mistakes most startups are likely to make, and the distinctions he draws between growth hacking and growth marketing:

“Growth hacking is great to kickstart growth, test new opportunities and see what tactics work,” he tells us.

“Marketers should be there to continue where the growth hackers left off: Build out those strategies, maintain customer engagement, and keep tactics fresh and relevant.”

Thanks very much for reading Extra Crunch this week; I hope you have a great weekend.

Walter Thompson
Senior Editor, TechCrunch

@yourprotagonist

What Square’s acquisition of Afterpay means for startups

Image Credits: sureeporn / Getty Images

In his first column since returning to TechCrunch, reporter Ryan Lawler considered the potential ripples Square’s purchase of Afterpay may send across the pond of buy now, pay later startups.

For commentary and perspective, he interviewed:

  • Dan Rosen, founder and general partner, Commerce Ventures
  • Jake Gibson, founding partner, Better Tomorrow Ventures
  • TX Zhuo, partner, Fika Ventures
  • Matthew Harris, partner, Bain Capital Ventures

The investors he spoke to agreed that deferring payments helps drive e-commerce, “but scale matters and long-term margins look slim for BNPL startups,” reports Ryan.

Enterprise AI 2.0: The acceleration of B2B AI innovation has begun

Robot and human working together.

Image Credits: Ivan Bajic (opens in a new window) / Getty Images

Businesses have been deploying AI solutions for 20 years, but few have achieved the outstanding gains in efficiency and profitability promised when the technology first appeared.

But there’s a burgeoning new generation of enterprise AI, Eshwar Belani, an operating partner at Symphony AI, writes in a guest column.

“Companies on the leading edge of AI innovation have advanced to the next generation, which will define the coming decade of big data, analytics and automation — Enterprise AI 2.0.”

Embodied AI, superintelligence and the master algorithm

BARCELONA, SPAIN - JUNE 29: Boston dynamics Spot robot, sowed during the second day of Mobile World Congress (MWC) Barcelona, on June 29, 2021 in Barcelona, Spain. (Photo by Joan Cros/Corbis via Getty Images)

Image Credits: Joan Cros Garcia-Corbis (opens in a new window) / Getty Images

Over the next 18 months, one technologist says the increased adoption of embodied artificial intelligence will open a path to superintelligence — incredibly powerful software that dwarfs anything the human mind could produce.

“All the crazy Boston Dynamics videos of robots jumping, dancing, balancing and running are examples of embodied AI,” says Chris Nicholson, founder and CEO of Pathmind, which uses deep reinforcement learning to optimize industrial operations and supply chains.

“The field is moving fast and, in this revolution, you can dance.”

A lot of cash and little love: An insurtech story

The Exchange looks at the valuations of public insurtech companies and considers what that means for startups — but from a slightly different perspective.

“We’d typically riff on the new values of public neoinsurance companies and use that data to work our way into a guess concerning what the price declines might mean for related startups,” Alex Wilhelm writes. “Taking public-market data and using it to better understand private markets is pretty much the national pastime of this column.

“Not today.”

5 factors founders must consider before choosing their VC

Image of a watering can pouring money on lightbulbs to represent choosing a venture capitalist.

Image Credits: Anastassiia (opens in a new window) / Getty Images

The fact that the globe is awash in venture capital should not be news to readers of this newsletter.

For founders, it means more than just fat checks, Kunal Lunawat, the co-founder and managing partner of Agya Ventures, writes in a guest column.

“Founders would be well served to go back to the basics and focus on the principles of fundraising when determining who sits on their cap table.”

Neobanks’ moves toward profitability could be the path to public markets

Alex Wilhelm checks in on results from Starling Bank and Monzo to see what the neobanks’ most recent financial figures say about the state of neobanks overall.

“Although some neobanks are managing to clean up their ledgers and work toward profits — or reach profitability — not all are in the black,” he notes.

But among those that are?

“At least a portion of the neobanking world is financially stable enough to consider public offerings.”

Founders must learn how to build and maintain circles of trust with investors

Human Crowd Surrounding Three People on White Background

Image Credits: MicroStockHub (opens in a new window)/ Getty Images

The red-hot venture capital market may give founders lots of investors to choose from, but the most important thing (if you can be choosy) is being able to trust and rely on your investors, Ripple Ventures’ Matt Cohen and True’s Tony Conrad write in a guest column.

“This … new dynamic is forcing founders to be extremely selective about exactly who is sitting around their mentorship table,” they write.

“It’s simply not possible to have numerous deep and meaningful relationships to extract maximum value at the early stage from seasoned investors.”

What’s the board’s role in an early-stage startup?

Image of a chalkboard illustration of a board of directors meeting.

Image Credits: A-Digit (opens in a new window) / Getty Images

Assembling a board of directors is not merely about finding individuals who can aid your early-stage journey, Gregg Adkin, the vice president and managing director at Dell Technologies Capital, writes in a guest column.

The composition of the board can also impact your fundraising.

“Investors often ask founders about their board [because] it says a lot about their character, their judgment and their willingness to be challenged,” he writes.

Adkins offers a framework he calls “SPIFS” — for strategy, people, image, finance and systems for compliance — to aid founders in setting up a board.

Do bronze medals ever make sense for unicorns?

In the wake of Deliveroo’s plans to abandon the Spanish market after the country passed legislation requiring companies dependent on gig workers to hire employees, Alex Wilhelm wondered about the battle for smaller markets and whether third place is sufficient.

“One company exiting a market is not a big deal, but we were curious about Deliveroo’s comments regarding the need for market leadership — or something close to it — to warrant continued investment,” he writes for The Exchange.

“Is this the common reality for startups battling for market position, no matter if those markets are cities or countries?”



https://ift.tt/3CrHNCK Extra Crunch roundup: Build a founding team, choose a VC and recruit your board https://ift.tt/2TZErWl

SenpAI.GG wants to be your AI-powered video game coach

With most popular online video games, there’s a huge gap between being a good player and a great one. A casual player might be able to hold their own against other casual players, only for a random pro to wander by and chew through everyone like they’re somehow playing with a different set of rules.

Could an AI-driven voice in your ear help close that gap, if only a bit? SenpAI.GG, a company out of Y Combinator’s latest batch, thinks so.

Much of that aforementioned gap boils down to practice, muscle memory and — let’s face it — natural ability. But as a game gets older/bigger/more complex, the best players tend to have a wealth of one resource that’s oh-so-crucial, if not oh-so-fun to gather: information.

Which guns do the most damage at this range? Which character is best suited to counter that character on this map? Hell, what changed in that “minor update” that flashed across your screen as you were booting up the game? Wait, why is my favorite weapon suddenly so much harder to control?

Staying on top of all this information as players discover new tactics and updates shift the “meta” is a challenge in its own right. It usually involves lots of Twitch streams, lots of digging around Reddit threads and lots of poring over patch notes.

SenpAI.GG is looking to surface more of that information automatically and help new players get good, faster. Their desktop client presents you with information it thinks can help, post-game analysis on your strategies, plus in-game audio cues for the things you might not be great at tracking yet.

It currently supports a handful of games — League of Legends, Valorant and Teamfight Tactics — with the info it provides varying from game to game. In LoL, for example, it’ll look at both teams’ selected champions and try to recommend the one you could pick to help most; in Valorant, meanwhile, it can give you an audio heads-up that one of your teammates is running low on health (before said teammate starts yelling at you to heal them), when you’ve forgotten to reload or how long you’ve got before the Spike (read: game-ending bomb) explodes.

SenpAI.GG’s in-game overlay providing League of Legends insights. Image Credits: SenpAI.GG

Just as important as the information it provides is the information it won’t provide. In my chat with him, SenpAI.GG founder Olcay Yilmazcoban seemed very aware that there’s a hard-to-define line here where “assistant” blurs into “cheating tool” — but the company follows certain rules to stay on the right side of things and prevent their players from getting banned.

They won’t, for example, ever take action on a player’s behalf — they might fire an audio cue to say “hey, you should heal that teammate,” but they won’t press the button for you. They’ll only generate their real-time insights from what’s on your screen — not anything hidden within the running process. They also won’t do things like reveal an enemy’s location just because your teammate is also running the app and can see them. Think “good player standing over your shoulder,” not “wall hack.” The company says that they’re always within each game developer’s competitive fairness guidelines, and only work with approved/provided APIs.

It’s a good idea because it’s one that, arguably, never gets old. With each new game they support, they’ve got a new potential audience to serve. Meanwhile, it’s not as if the old games/insights will expire — a game’s big ol’ book-of-stuff-you-need-to-know tends to only get bigger and more complex as a game ages and the patches pile up. There are games I’ve been playing for years where I’d still love a voice assistant that says “Oh hey, the recoil on the gun you just picked up has gotten way more intense since the last time you played.” SenpAI.GG isn’t there yet, but there’s a ton of natural room for growth.

Yilmazcoban tells me that they currently have over 400,000 active users, with a team of 11 people working on it. The base app is free, with plans to offer advanced features for a couple bucks a month.



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How to hire and structure a growth team

Everyone at an organization should own growth, right? Turns out when everyone owns something, no one does. As a result, growth teams can cause an enormous amount of friction in an organization when introduced.

Growth teams are twice as likely to appear among businesses growing their ARR by 100% or more annually. What’s more, they also seem to be more common after product-market fit has been achieved — usually after a company has reached about $5 million to $10 million in revenue.

Graph of the prevalence of growth teams in companies, by ARR

Image Credits: OpenView Partners

I’m not here to sell you on why you need a growth team, but I will point out that product-led businesses with a growth team see dramatic results — double the median free-to-paid conversion rate.

Free-to-paid conversions in companies with growth teams are higher

Image Credits: OpenView Partners

How do you hire an early growth leader?

According to responses from product benchmarks surveys, growth teams have transitioned dramatically from reporting to marketing and sales to reporting directly to the CEO.

Some of the early writing on growth teams says that they can be structured individually as their own standalone team or as a SWAT model, where experts from various other departments in the organization converge on a regular cadence to solve for growth.

Graph showing more growth teams now report to CEOs than marketing, sales or product

Image Credits: OpenView Partners

My experience, and the data I’ve collected from business-user focused software companies, has led me to the conclusion that growth teams in business software should not be structured as “SWAT” teams, with cross-functional leadership coming together to think critically about growth problems facing the business. I find that if problems don’t have a real owner, they’re not going to get solved. Growth issues are no different and are often deprioritized unless it’s someone’s job to think about them.

Becoming product-led isn’t something that happens overnight, and hiring someone will not be a silver bullet for your software.

I put early growth hires into a few simple buckets. You’ve got:

Product-minded growth experts: These folks are all about optimizing the user experience, reducing friction and expanding usage. They’re usually pretty analytical and might have product, data or MarketingOps backgrounds.



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Venture capital probably isn’t dead

Venture capitalists are chatting this week about a recent piece from The Information titled “The End of Venture Capital as We Know It.” As with nearly everything you read, the article in question is a bit more nuanced than its headline. Its author, Sam Lessin, makes some pretty good points. But I don’t fully agree with his conclusions, and want to talk about why.

This will be fun, and, because it’s Friday, both relaxed and cordial. (For fun, here’s a long-ass podcast I participated in with Lessin last year.)

A capital explosion

Lessin notes that venture capitalists once made risky wagers on companies that often withered away. Higher-than-average investment risk meant that returns from winning bets had to be very lucrative, or else the venture model would have failed.

Thus, venture capitalists sold their capital dearly to founders. The prices that venture capitalists have historically paid for startup equity in high-growth tech upstarts make IPO pops appear de minimis; it’s the VCs who make out like bandits when a tech company floats, not the bankers. The Wall Street crew just gets a final lap at the milk saucer.

Over time, however, things changed. Founders could lean on AWS instead of having to spend equity capital on server racks and colocation. The process of building software and taking it to market became better understood by more people.

Even more, recurring fees overtook the traditional method of selling software for a one-time price. This made the revenues of software companies less like those of video game companies, driven by episodic releases and dependent on the market’s reception of the next version of any particular product.

As SaaS took over, software revenues kept their lucrative gross margin profile but became both longer-lasting and more dependable. They got better. And easier to forecast to boot.

So, prices went up for software companies — public and private.

Another result of the revolution in both software construction and distribution — higher-level programming languages, smartphones, app stores, SaaS and, today, on-demand pricing coupled to API delivery — was that more money could pile into the companies busy writing code. Lower risk meant that other forms of capital found startup investing — super-late stage to begin with, but increasingly earlier in the startup lifecycle — not just possible, but rather attractive.

With more capital varieties taking interest in private tech companies thanks in part to reduced risk, pricing changed. Or, as Lessin puts it, thanks to better market ability to metricize startup opportunity and risk, “investors across the board [now] price [startups] more or less the same way.”

You can see where this is going: If that’s the case, then the model of selling expensive capital for huge upside becomes a bit soggy. If there is less risk, then venture capitalists can’t charge as much for their capital. Their return profile might change, with cheaper and more plentiful money chasing deals, leading to higher prices and lower returns.

The result of all of the above is Lessin’s lede: “All signs seem to indicate that by 2022, for the first time, nontraditional tech investors — including hedge funds, mutual funds and the like — will invest more in private tech companies than traditional Silicon Valley-style venture capitalists will.”

Capital crowding into the parts of finance once reserved for the high priests of venture means that the VCs of the world are finding themselves often fighting for deals with all sorts of new, and wealthier, players.

The result of this, per Lessin, is that venture “firms that grew up around software and internet investing and consider themselves venture capitalists” must “enter the bigger pond as a fairly small fish, or go find another small pond.”

Yeah, but

The obvious critique of Lessin’s argument is one that he makes himself, namely that what he is discussing is not as relevant to seed investing. As Lessin puts it, his argument’s impact on seed investing is “far less clear.”

Agreed. Sure, it’s the end of venture capital as we know it. But it’s not the end of venture capital, because if capitalism is going to continue, there’s always going to need to be risky-ass shit for VCs to bet on at the bottom.

The factors that made later-stage SaaS investing something that even idiots can make a few dollars doing become scarce the earlier one looks in the startup world. Investing in areas other than software compounds this effect; if you try to treat biotech startups as less risky than before simply because public clouds exist, you are going to fuck up.

So the Lessin argument matters less in seed-stage and earlier investing than it does in the later stages of startup backing, and doubly less when it comes to earlier investing in non-software companies.

While it’s a little-known fact, some venture capitalists still invest in startups that are not software-focused. Sure, nearly every startup involves code, but you can make a lot of money in a lot of ways by building startups, especially tech startups. The figuring-out of SaaS investing does not mean that investing in marketplaces, for example, has enjoyed a similar decline in risk.

So, the VCs-are-dead concept is less true for seed and non-software startups.

Is Lessin correct, then, that the game really has changed for middle- and late-stage software investing? Of course it has, but I think that he takes the concept of less risky, private-market software investing in the wrong direction.

First, even if private-market investing in software has a lower risk profile than before, it’s not zero. Many software startups will fail or stall out and sell for a modest sum at best. As many in today’s market as before? Probably not, but still some.

This means that the act of picking still matters; we can vamp as long as we’d like about how venture capitalists are going to have to pay more competitive prices for deals, but VCs could retain an edge in startup selection. This can limit downside, but may also do quite a lot more.

Anshu Sharma of Skyflow — and formerly of Salesforce and Storm Ventures, where I first met him — made an argument about this particular point earlier this week with which I am sympathetic.

Sharma thinks, and I agree, that venture winners are getting bigger. Recall that a billion-dollar private company was once a rare thing. Now they are built daily. And the biggest software companies aren’t worth the few hundred billion dollars that Microsoft was largely valued at between 1998 and 2019. Today they are worth several trillion dollars.

More simply, a more attractive software market in terms of risk and value creation means that outliers are even more outlier-y than before. This means that venture capitalists that pick well, and, yes, go earlier than they once did, can still generate bonkers returns. Perhaps even more so than before.

This is what I am hearing about certain funds regarding their present-day performance. If Lessin’s point held up as strongly as he states it, I reckon that we’d see declining rates of return at top VCs. We’re not, at least based on what I am hearing. (Feel free to tell me if I am wrong.)

So yes, venture capital is changing, and the larger funds really are looking more and more like entirely different sorts of capital managers than the VCs of yore. Capitalism is happening to venture capital, changing it as the world of money itself evolves. Services were one way that VCs tried to differentiate from one another, and probably from non-venture capital sources, though that was discussed less when The Services Wars were taking off.

But even the rapid-fire Tiger can’t invest in every company, and not all its bets will pay out. You might decide that you’d be better off putting capital into a slightly smaller fund with a slightly more measured cadence of dealmaking, allowing selection at the hand of fund managers that you trust to allocate your funds among other pooled capital to bet for you. So that you might earn better-than-average returns.

You know, the venture model.



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