Curabitur et lectus vitae purus tincidunt laoreet sit amet ac ipsum. Proin tincidunt mattis nisi a scelerisque. Aliquam placerat dapibus eros non ullamcorper. Integer interdum ullamcorper venenatis. Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas.
Curabitur et lectus vitae purus tincidunt laoreet sit amet ac ipsum. Proin tincidunt mattis nisi a scelerisque. Aliquam placerat dapibus eros non ullamcorper. Integer interdum ullamcorper venenatis. Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas.
Curabitur et lectus vitae purus tincidunt laoreet sit amet ac ipsum. Proin tincidunt mattis nisi a scelerisque. Aliquam placerat dapibus eros non ullamcorper. Integer interdum ullamcorper venenatis. Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas.
Curabitur et lectus vitae purus tincidunt laoreet sit amet ac ipsum. Proin tincidunt mattis nisi a scelerisque. Aliquam placerat dapibus eros non ullamcorper. Integer interdum ullamcorper venenatis. Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas.
Curabitur et lectus vitae purus tincidunt laoreet sit amet ac ipsum. Proin tincidunt mattis nisi a scelerisque. Aliquam placerat dapibus eros non ullamcorper. Integer interdum ullamcorper venenatis. Pellentesque habitant morbi tristique senectus et netus et malesuada fames ac turpis egestas.
TikTok is making it easier for creators and their fans to donate to favorite charities amid the coronavirus pandemic. The company today announced the launch of a new, interactive feature, Donation Stickers, that creators can use on their videos and live streams in order to raise funds for favorite charities directly in the TikTok app. At launch, these stickers will work to support charitable partners including CDC Foundation, James Beard Foundation, Meals on Wheels, MusiCares, National PTA, National Restaurant Association Educational Foundation, No Kid Hungry, and The Actors Fund.
The stickers work like any other, in terms of being added to a video or a TikTok LIVE stream. However, when a user taps on the sticker, they’ll be guided to a pop-up window where they can make a donation to the charity the creator is fundraising for — without ever having to leave the TikTok app.
The donations themselves are being powered by charitable fundraising platform, Tiltify, which handles the payment processing for the donation transactions. Tiltify has experience with donation features embedded in live streams, having previously worked with the Twitch platform on variousinitiatives.
TikTok says the charitable organizations it partnered with for the launch of the feature includes those whose current missions to support vulnerable groups that are also reflective of TikTok communities.
The app today is among those being adopted by doctors, nurses and other health care workers. These medical professionals see TikTok a means of of connecting younger users with credible health information about the coronavirus outbreak and COVID-19 at a time when conspiracy theories and bogus “cures” are being marketed across social media, and even the president is making dangerous off-the-cuff remarks not backed by science.
In addition, many of the other causes supported by the Donation Stickers align with communities hit hard by coronavirus shutdowns — like actors, musicians, educators and restaurant workers, for example.
The company says it will also match donations raised through the Donation Stickers until May 27th. The hashtag #doubleyourimpact will be automatically added to videos and live streams that use the stickers, as a result.
“During this time of uncertainty, our community has come together and given back in countless ways, from applauding health care workers to sharing inspirational messages on how to stay safe and happy at home to making original coronavirus songs to spread positive messages,” wrote TikTok U.S. Head of Product, Sean Kim, in an announcement about the stickers’ launch. “We’ve been impressed and heartened by the selfless steps our community has taken to help each other, and now we’re excited to be able to give our users another way to make a positive impact.”
The addition of the stickers is one of several ways TikTok has been involved in coronavirus relief efforts. The company earlier this month pledged $250 million to support front-line workers, educators and local communities affected by the COVID-19 pandemic. It also provided an additional $125 million in advertising credits to public health organizations and businesses looking to rebuild.
The donation-matching through the new stickers will come from this $250 million fund. As part of the previously announced Community Relief Fund, TikTok is donating $4 million to No Kid Hungry and Meals on Wheels.
On May 5th through May 9th, TikTok is also hosting a week of TikTok LIVE streams focused on fundraising as a part of the “Happy At Home: #OneCommunity” nightly event.
from Social – TechCrunch https://ift.tt/3cMU0UY TikTok launches Donation Stickers, allowing creators to fundraise for coronavirus relief efforts Sarah Perez https://ift.tt/35c43Al
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Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.
As global startup markets enter a slowdown — more on that shortly — we’re starting to get notes on when growth-oriented firms are going to run short of cash. Of course, startups around the world are cutting staff and trying to limit costs as macro uncertainty reins, but their efforts won’t save everyone.
This morning, let’s dig into what venture’s impending investment pace may look like over the next year or two, courtesy of Upfront Ventures‘ Mark Suster. Then we’ll parse cash runway data from UK and Belgian startups. The resulting picture is one detailing falling cash accounts for a number of startups that could reach zero before venture trends are expected to recover.
Downturn
https://ift.tt/eA8V8J The startup cash countdown begins https://ift.tt/3f5kovw
Startup founders who are fundraising in this climate should expect venture investors to take a huge chunk out of their valuation expectations.
“What we’re seeing across the board is discounts,” says Mike Janke, co-founder of early-stage cybersecurity investment firm Datatribe.
Investors are still committing to new deals, he says, but they’re adding new terms and demanding lower valuations from companies as the cost of raising capital during the downturn. Janke, whose firm has several deals in the pipeline, says entrepreneurs should expect VCs to demand concessions like more frequent board meetings and large price cuts compared to what they’d previously seen.
“If you look at 2000 and 2008, venture always views [downturns] as the time to get good deals,” Janke says. “We’re looking at a 15% to 25% discount to do deals.”
In one instance, a company that turned down a $900 million acquisition offer is now in the process of raising a new round at a $500 million valuation, he says. “In 2019 it was just generally accepted that this company was worth over $1 billion.”
Deals are getting done, though. As the pandemic began to spread, Janke says most firms began triaging their portfolios to determine who would need to raise cash and who could remain afloat without an infusion. Now, firms are looking out and seeing what kind of opportunities there are in the broader market — if they can.
“Some of our peers in the Valley have up to 40% of their companies that need an infusion or some sort of bridge to get through,” says Janke. “These companies that had higher valuations that came out of the Valley have had to do more drastic cuts.” Startups that raised cash in markets outside the Bay Area have not had as much difficulty, he says, because they’re more efficient.
https://ift.tt/eA8V8J Pandemic forces fundraising founders to accept ‘discounts across the board’ https://ift.tt/3aG3pwf
Regular Equity episodes still drop each and every Friday morning, so if you’ve listened to the show over the years, don’t worry — we’re only adding to the mix. You can catch last week’s show with Danny Crichton and Natasha Mascarenhas right here if you haven’t yet.
Unlike some weeks when the weekend’s crop of news and thought runs fallow, our recent interlude was stuffed with things to talk about:
Sequoia China and Starbucks are tying up, which is especially notable after the Luckin Coffee story came crashing back to Earth.
It’s earnings week, with everyone from Apple to Microsoft, Alphabet, Amazon, Facebook, Spotify and Tesla reporting. Strap in for the busy week. It’s going to be a lot, but should help us figure out what has been going on in the stock market.
And then, finally, this essay from Founder’s Fund John Luttig, which I encourage you to read. It’s something that everyone is reading, and thus you must even if you don’t want to. We chat about it on the show, but read it yourself anyways. If it’s right, we’re in for a sea change in the startup world. For good, or at least until there’s a new leap forward in tech or technology product distribution. (You can read more on the idea of a SaaS slowdown here.)
Equity drops every Monday at 7:00 AM PT and Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Spotifyand all the casts.
https://ift.tt/eA8V8J Equity Monday: Startups run low on cash, and why some Internet tailwinds are fading https://ift.tt/3eXEo2O
Thanks to smartphones and their downsized keyboards, autocomplete has become a nearly ubiquitous feature of how we write these days. To save us precious seconds composing and (at least in my fat-thumbed case) correcting words, our keyboards now prompt us with suggestions of what we’re trying to write to get the job done a little bit more easily. But email and messaging composing isn’t the only area where artificial intelligence and semantic analytics are being used in this way. Today, a startup that has built a platform that applies the concept to the world of coding is announcing a round of funding to expand its business.
Codota, an Israeli startup that provides an AI tool to developers to let them autocomplete strings of code that they are writing — intended both to speed up their work (it claims to “boost productivity by 25%”) and to make sure that it’s using the right syntax and ‘spelled’ correctly — has picked up $12 million, a Series A led by e.ventures, with participation also from previous backer Khosla Ventures, along with new investors TPY Capital and Hetz Ventures. The company has now raised $16 million in total, and it’s not disclosing its valuation.
The funding comes on the heels of Codotaacquiring one of its bigger competitors, TabNine, out of Canada, late last year (announced only in March however) to expand the number of languages that it can support. It now says it supports all major languages, including Python, JavaScript, Java, C, and HTML; and it operates across a major integrated development environments such as VSCode, Eclipse, and IntelliJ.
The funding will be used to expand its reach into that existing range further, as well as to bring on more customers. Today, the list of those that are already using Codota’s tools is impressive. It includes developers from companies like Google and Amazon, as well as Netflix, Alibaba, Airbnb and Atlassian, amongst many others. It says its user base has grown more than 1,000% in the last year, number over 1 million developers using it monthly.
The funding news coincides with Codota launching a new version of its autocompletion for JavaScript that merges Codota’s semantic technology with TabNine’s textual tech.
The first two names in the customer list above list are particularly surprising, but they underscore what Codota has focused on and seems to be doing right. These two tech giants are AI powerhouses in their own rights; both build and ship formidable sets of tools for developers; and Google specifically is one of the names most synonymous with autocomplete by way of the tools it’s built for Gmail.
The reason Codota — which was founded in 2015 — has had traction, said co-founder and CTO Eran Yahav, is because in fact coding has been a tough nut to crack for semantics teams, despite their advances in other languages.
“Up until a couple of years ago it wasn’t feasible,” he said, noting that four streams of technology are coming together when building auto-completion for coding: high-quality open source code availability to feed the algorithms; advances in semantic analysis to extract insights at scale; machine learning advances that essentially bring ML costs down; and computational resources to run everything in the cloud to make it something everyone can use everywhere. With open source really booming, and everything else coming along, it’s been a perfect storm that Codota has seized, even as others are working on this too.
“Others have done this with varying degrees of success,” Dror Weiss, the other co-founder and CEO said. “I’m guessing and also know that others are doing the same.” Others include the likes of Kite, Ubisoft and Mozilla, and a number of others.
One aspect that Codota has been building that is particularly timely now is the ability not just to provide more precise coding assistance to developers, but to “learn” what is best practice in a particular environment or workplace (it offers both individual and enterprise tiers, and it’s the latter that provides this feature). This can be useful in any situation, but particularly today when developers are working at home and on their own, giving them instant help as if they were physically in the same space.
Notably, while so much AI seems bent on the idea of autonomous systems, Weiss said emphatically that this is not the intention short or even long-term.
“I don’t think we would be able to replace developers and I don’t think we would want to,” he said. “Our aim is to take the mundane and repetitive aspects and do that for them.” In that respect not unlike RPA in back-office functions. “It’s not high value to remember the syntax and the best practice. And even if you have smart compose [in consumer services] it may suggest sentences but can’t read your mind and tell you how you want to respond. So it’s very unlikely to replace you and respond how you would want to. That’s not even in our longest-term plan.”
e.ventureslast year announced a $400 million fund for early-stage investments, and this seems to be coming out of that. With this round, the firm’s general partner Tom Gieselmann is joining the board.
“I’ve been following the developer tools market for over 20 years and believe Codota has distinguished itself as the dominant player in terms of community, product, and technology,” he said in a statement. “We are proud to support Dror and Eran on their mission to transform software development and make coding easier and more efficient for individual developers and teams within the enterprise.”
https://ift.tt/eA8V8J Codota picks up $12M for an AI platform that auto-completes developers’ code https://ift.tt/2SbwVDT
The Facebook-owned service said on Monday that spread of “highly forwarded” messages sent on WhatsApp had dropped by 70% globally in weeks after introducing a new restriction earlier this month.
In one of the biggest changes to its core feature, WhatsApp said earlier this month that users on its platform can now send along frequently forwarded messages they receive to only one person or a group at a time, down from five. The restriction was rolled out globally to WhatsApp’s 2 billion users on April 7.
“We recently introduced a limit to sharing ‘highly forwarded messages’ to just one chat. Since putting into place this new limit, globally there has been a 70% reduction in the number of highly forwarded messages sent on WhatsApp,” a WhatsApp spokesperson told TechCrunch in a statement.
WhatsApp first introduced a similar limit in 2018, when it restricted users from forwarding a message to more than five people or groups at once. While announcing the new restriction earlier this month, WhatsApp said message forwards on its service had dropped by 25% globally in two years.
“This change is helping keep WhatsApp a place for personal and private conversations. WhatsApp is committed to doing our part to tackle viral messages,” the spokesperson said today.
The cut down on forwards should help WhatsApp assuage the scrutiny it is receiving in many countries, including India, its biggest market.
New Delhi asked WhatsApp and other messaging and social media firms last month to do more to control the viral hoaxes circulating on their platforms about coronavirus infection. This is the latest of several similar advisories India has sent to social media firms operating in the country,
WhatsApp said earlier this month that it had seen a “significant” surge in the “amount of forwarding” in recent weeks that “users have told us can feel overwhelming and can contribute to the spread of misinformation.”
In recent weeks, several users in India have circulated messages, often in good faith, that claimed that treatments had been found to battle coronavirus infection and that there were scientific explanations to back some of the community measures New Delhi had enforced such as asking people to make noise for five minutes or lighting candles and oil-lamps. Fact checkers said that none of these claims were factual.
from Social – TechCrunch https://ift.tt/eA8V8J WhatsApp’s new limit cuts virality of ‘highly forwarded’ messages by 70% Manish Singh https://ift.tt/356bObh
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French startup Shine is adding a new option today. If you think there’s a chance that a client is not going to pay your next invoice, you can insure that invoice to avoid any bad surprise.
Shine is building a challenger bank for freelancers and small companies. It lets you send and receive money in a separate business account, pay with a MasterCard, create invoices and stay on top of administrative tasks.
It also helps you get started as the startup can fill out all administrative paperwork to register yourself as a freelancer. You also get notifications to remind you that you should pay your taxes and more. Starting accepting freelancing jobs can be confusing and Shine can help you with that.
Shine has a built-in invoicing tool. It lets you add a client and generate an invoice directly in the mobile app. After that, you can send a link to your client. You get a notification when your client opens the invoice. They can download a PDF and get your bank details to pay you.
And yet, many clients often wait until the last minute to pay an invoice. It can be a month or two after finishing a job, which means that they also forget about outstanding invoices.
In a few weeks, Shine users will be able to create an invoice and insure it before sending it. It costs you 2% of your total amount on your invoice. There’s no subscription fee, it’s a one-off process.
If your client hasn’t paid you after the due date, Shine will reach out to your client again to try to get the payment. If that doesn’t work, you can file a claim with the partner insurance company.
In that case, if the company is still operating, you get paid 100% of your invoice. If the company has collapsed, you get 90% back. (Of course, that’s without taking into account the 2% fees you already paid.)
https://ift.tt/2SaoEzU Shine adds invoice insurance to its freelancer bank account https://ift.tt/2y35K75
BuyMed, a Vietnamese startup that wants to fix Southeast Asia’s complex pharmaceutical distribution networks, announced today it has raised $2.5 million in pre-Series A funding. Investors include Sequoia Capital India’s Surge early-stage accelerator program, and Genesia Ventures. Returning investor Cocoon Capital also participated.
Founded in 2018, BuyMed operates Thuocsi.vn, a pharmaceutical distribution platform in Vietnam. Over the past 12 months, the company says it has tripled its annual revenue, and now plans to add new product lines, including cosmetics, medical devices, supplements and medical services, with the goal of becoming a “one-stop marketplace” for supplies needed by healthcare providers in Southeast Asia.
BuyMed verifies suppliers on its platform, improving safety and reducing the risk of medications making its way into the grey market (or unofficial distribution channels). The startup currently has 700 verified suppliers, distributors and manufacturers on its platform, who serve over 7,000 healthcare providers.
In a press statement, Genesia Ventures general partner Takahiro Suzuki, said, “There is still a tremendous opportunity for growth and improvement in Vietnam’s pharmaceutical supply chain and we believe that BuyMed’s founders have the experience, execution and operational management necessary to tackle this problem.”
BuyMed Co-founder and CEO Peter Nguyen formerly served as a consultant for companies like Eli Lilly, Roche and Siemens, helping them create more efficient operations and supply chains.
Nguyen told TechCrunch that there are no major multi-brand distributors in Vietnam, so most pharmaceutical manufacturers and brands need to set up their own networks. This means the process of getting medications and other pharmaceutical supplies to healthcare providers is highly-fragmented.
There are roughly 200 domestic manufacturers in Vietnam, in addition to imported brands, and their products are handled by over 3,000 distributors. While about 2% of pharmacies in Vietnam are part of a franchise or chain, the vast majority are independent. This means distributors need to serve over 40,000 independent pharmacies and about 5,000 independent clinics.
Nguyen added that fragmentation is similar in many other Southeast Asian markets, giving BuyMed an opportunity to expand across the region.
Thuocsi.vn’s usage has grown over the last 60 days, as more Vietnamese pharmacies source from online channels. In response to the COVID-19 pandemic, BuyMed has expanded its platform so more of its partners can sell online, and added safety measures like frequent warehouse and office sanitization and a no-contact drop-off and cash collection system.
https://ift.tt/eA8V8J Vietnamese online pharmaceutical marketplace BuyMed raises $2.5 million https://ift.tt/2x8B1Fg
{rss:content:encoded} Shine adds invoice insurance to its freelancer bank account https://ift.tt/2y35K75 https://ift.tt/2SaoEzU April 27, 2020 at 08:00AM
French startup Shine is adding a new option today. If you think there’s a chance that a client is not going to pay your next invoice, you can insure that invoice to avoid any bad surprise.
Shine is building a challenger bank for freelancers and small companies. It lets you send and receive money in a separate business account, pay with a MasterCard, create invoices and stay on top of administrative tasks.
It also helps you get started as the startup can fill out all administrative paperwork to register yourself as a freelancer. You also get notifications to remind you that you should pay your taxes and more. Starting accepting freelancing jobs can be confusing and Shine can help you with that.
Shine has a built-in invoicing tool. It lets you add a client and generate an invoice directly in the mobile app. After that, you can send a link to your client. You get a notification when your client opens the invoice. They can download a PDF and get your bank details to pay you.
And yet, many clients often wait until the last minute to pay an invoice. It can be a month or two after finishing a job, which means that they also forget about outstanding invoices.
In a few weeks, Shine users will be able to create an invoice and insure it before sending it. It costs you 2% of your total amount on your invoice. There’s no subscription fee, it’s a one-off process.
If your client hasn’t paid you after the due date, Shine will reach out to your client again to try to get the payment. If that doesn’t work, you can file a claim with the partner insurance company.
In that case, if the company is still operating, you get paid 100% of your invoice. If the company has collapsed, you get 90% back. (Of course, that’s without taking into account the 2% fees you already paid.)
That’s already significantly larger than Icebreaker’s first fund (which closed at €20 million) and reflects the VC’s geographical expansion. In addition to Finland, where Icebreaker claims to be the most active institutional investor by number of deals, the firm is also active in Sweden and Estonia.
In an email exchange, Icebreaker co-founder and Partner Riku Seppälä told me that despite the coronavirus crisis, most of the firm’s LPs from Fund I have invested in this second fund, along with several new LP. “It’s great to see them take the same view as we are; things must go on and this is a great time to start building and investing in pre-seed-stage technology companies in Europe,” he says.
Seppälä also shared some of Icebreaker’s progress to date. He says that via “Fund I” the VC has invested in 38 companies over the last 3 years, which he believes means it has done the most pre-seed investments of any fund in Finland, Sweden and Estonia over that time period.
It typically invests between €150k and €800k in teams that have “deep domain expertise” and are building globally competitive tech companies.
“Within these 3 years and 3 months, we’ve invested €5.8 million in initial investments [with the remainder being deployed in later rounds] and the companies have managed to raise €28 million in total in private follow-on equity funding from investors in 21 rounds”.
Breaking this down further, Seppälä says that so far Icebreaker has a 65% success rate for companies being able to raise seed rounds. “90% of those within 18 months from our initial investment,” he tells me.
Examples of Icebreaker startups that have raised further funding include Hoxhunt (€2.5 million led by Dawn Capital), Kodit.io (backed by Speedinvest, Adevinta, FJ Labs and All Iron), Klaus (€1.7 million led by Creandum), Flowhaven (€4.75 million led by GFC), and Aibidia (€4.2 million led by GFC).
https://ift.tt/eA8V8J Finnish VC Icebreaker launches second fund to continue backing “pre-founders” and pre-seed startups https://ift.tt/3bGntjB
“I didn’t know what the term ‘freight forwarder’ meant until a year into starting the business.” Considering his shipping logistics startup Flexport was last valued at $3.2 billion, that quote from my first interview with CEO and founder Ryan Petersen back in 2016 seems even more surprising now.
But it also hints at why he’s one of the most talented and exciting executives in tech: He learns. Humbly. Relentlessly. About whatever the role requires as it evolves.
Right now, it means learning that 1.15 million medical masks can fit in a pasenger plane if you strap boxes to the seats like they’re people. Flexport has delivered around 62 million pieces of personal protective equipment, with delivery of over 7.7 million of those funded by the company’s non-profit arm Flexport.org. Petersen and Flexport meanwhile helped create the Frontline Responders Fund that’s raised over $7 million for COVID relief.
Flexport.org packed 3 million pieces of PPE into a repurposed passenger plane to get them to frontline responders
“He’s one of the most impressive founders I’ve known” said fellow FRF leader and Science co-founder Peter Pham. “Ryan just wants to solve problems without ego.”
In this profile, TechCrunch charts Petersen’s growth across our six interviews with him over the past four years as he raised $1.3 billion and reached hundreds of millions in revenue.
Overcoming Shlep Blindness
Petersen soon found out that ‘freight forwarding’ means coordinating all the shipping and hand-offs to get pallets and containers of goods on one side of the world, through trucks and boats and planes, to a retailer on the other. By then Flexport was going through Y Combinator in 2014, preparing to take on the trillion-dollar freight industry.
Ryan Petersen
“I thought the problem was too big, and that I wouldn’t be able to solve it” he recalls. “How am I going to fix global trade? Only much later did I realize that, well, let’s try it! It can’t just sit there broken forever.” Somehow, freight forwarding was still being organized with faxed logs and paper manifests, or Excel files and email if a client was lucky.
Freight forwarding had plagued plenty of founders but none had tackled it because it seemed so insurmountable that it engendered ‘schlep blindness’, as YC’s co-creator Paul Graham termed it.
“Schlep blindness is something so hard that your brain won’t think about it. I think it’s a necessary feature of our brains. Otherwise we’d sit here contemplating our mortality all day and never be able to do anything” Petersen explains. “Anyone who ever sold anything on the internet pre-Stripe went through this terrible process. 100% of internet entrepreneurs saw that problem and then went about their way.” With its 100 year-old shipping incumbents and endless regulatory acronyms, who’d want to wade in?
“Ryan is what I call an armor-piercing shell: a founder who keeps going through obstacles that would make other people give up” says Graham, who donated $1 million to Flexport.org’s COVID-19 relief efforts. “But he’s not just determined. He sees things other people don’t see. The freight business is both huge and very backward, and yet who of all the thousands of people starting startups noticed?”
Petersen. What really irked him was that the big freight forwarders didn’t want those clients to learn what influenced prices and timelines to keep them in the dark about how sub-optimal their routes were. “They just made money off the fact that I didn’t understand how it all works. And I assumed at the time that that was just something about entrepreneurs who are new to this space but it turns out even the biggest companies struggle with this stuff. They’re afraid forwarders are trying to take advantage of them.”
But Petersen wasn’t so naive. He’d actually been in the freight business his whole life.
From Slinging Soda To Founding Startups
“Maybe without her realizing it, she was training us to be entrepreneurs” Petersen reflects. He and he brother David grew up with a biochemist mom who ran her own food safety business while their dad did the company’s programming. “All of our childhood conversations were around using software to make government regulations more accessible.” When would Flexport would eventually be jumping through the hoops of the 43 different US trade regulators, it felt natural for its CEO.
Ryan Petersen back in 2015 before Flexport had its own planes
Petersen exudes a kinetic energy that subtly coveys that he’s always itching for the next knot to unwind. “At the time I was terribly bored by everything”. So his Mom put him to work. “She paid my allowance as a kid by having me deliver sodas to stock their office. My dad would drive me to Safeway to buy sodas for four bucks a case and sell them for nine.” With a laugh, he considers, “It was potentially a way for her to make my allowance tax-free.”
Soon Petersen was moving bigger items longer distances, buying scooters in China and selling them online in the States. By 2005, Petersen was living in China to get closer to the supply chains. The next year, he co-founded ImportGenius with his brother and Michael Klanko. They’d realized there was a ton of valuable information locked up in paper shipping manifests, so they began scanning and selling the data to importers and exporters so they could keep tabs on competitors.
Petersen’s first moment in the spotlight came in 2008 when he accidentally butted heads with Steve Jobs. ImportGenius had identified that Apple was shipping a large number of “electronic computers”, a new classification for the company. “We scooped the launch of the iPhone 3G with our public manifest data. Steve Jobs called US Customs, who called me” he told me back in 2016.
Though ImportGenius eventually plateaued, Petersen had accumulated the knowledge to lift the veil and pierce his schlep blindness. “I realized the largest problem was staring me in the face. Global trade is too hard, and there’s not software to manage it” he remembers. “I thought there was no software for SMBs. What I discovered was that there’s NO software.”
At first he wanted to build what would become Flexport inside of ImportGenius, but it was tough to get existing investors to stomach the risk. It’d be scary, but also exciting to start something separate. “My brother is my best friend and my best advisor” Petersen tells me. They’d always pushed each other with a jovial sense of competition — Ryan’s Twitter handle is @TypesFast. David’s is @TypesFaster.
So David made the first move, founding BuildZoom, which has gone on to raise $23 million to coordinate the logistics (are you sensing a pattern?) of hiring contruction contractors. In 2013, Ryan lept. “I think part of me wanted to go out on my own and prove myself . . . to prove that I was capable of running the show. It was areally, really challenging to do it. Then the day I did it, it was the most liberating, awesome feeling ever.”
They Laugh At You, Then You Raise $1 Billion
It took a few years to get all its regulatory approvals and develop the basis of the Flexport product. But with early capital from Founders Fund, Petersen built the freight software he’d spent so long pining for. Still, “Senior execs at big companies were making fun of us. One of them compared us to Doc Emett Brown [from Back To The Future] and his ‘flex capacitor’ but we he missed is that Doc invented a time machine and it worked.”
By 2016, Flexport was serving 700 clients across 64 countries. I described it as the unsexiest trillion-dollar startup, attacking an enormous industry that was so boring that it repelled earlier innovation. Oversaturation in consumer startup verticals was pushing investors to look to where tech was evolving previously untouched markets. Flexport raised a high-profile $110 million round led by DST at a $910 million post-money valuation in 2017, and Silicon Valley was starting to take notice.
The Flexboard Platform dashboard offers maps, notifications, task lists, and chat for Flexport clients and their factory suppliers.
Luckily, the freight big-wigs were still laughing despite Flexport moving 7000 shipping containers per month for 1800 customers. “I don’t worry about startup competitors. I worry the big guys will stop thinking of us as such a joke” Petersen said that year. Soon incumbents like 25-year-old Chinese private delivery giant S.F. Express were allying with Flexport, leading another $100 million round in 2018. Meanwhile, Flexport was trying to sound more like its older competition. Petersen told me “We’re trying to retire the word ‘startup’. [Our clients] want a company that will help them grow, not the fly-by-night startup.”
At that point, Petersen didn’t care if freight was appealing or not. “I never thought it was sexy or unsexy. I just thought it was a backstage pass to the world economy” he’d later say. Yet SoftBank’s Saudi-backed Vision Fund felt the attraction. Flexport was vertically integrating, adding freight financing so retailers could pay factories for good they’d sell months later. It was also chartering its own plane and building its own warehouses where it could experiment with next-generation logistics, scanning the physical dimensions of everything that came through its doors to optimize future shipments.
By then, Flexport had plenty of exit options. But Petersen was enjoying the ride. “I’m just having fun. You have a purpose. You get invited to interesting things. Once you sell your business, you’re just another rich guy.I never want to sell the business.” Luckily, the potential to grab more of the freight forwarding profits convinced SoftBank to invest a jaw-dropping $1 billion into Flexport in early 2019 at a $3.2 billion post-money valuation.
“It was controversial with our board. They thought it was a lot of dilution to take on but I convinced them that, this was going to go up and down and we wanted we to have cash to ride out the cycles. My view is that the world’s uncertain. You should be prepared for all outcomes” Ryan explains. As long as it could weather the storm, “we’re going to win on some time horizon.”
That strategy soon paid off. When trade with China effectively halted as COVID-19 exploded in the country and Flexport had far fewer containers to coordinate, it didn’t have to execute mass layoffs like fellow late-stage startups. It proactively cut 3% of its staff or around 50 people on February 4th, centered in recruiting that it plans to slow. “It’s painful to disappoint people” Petersen reveals.
Flexport chartered its own plane for several years to ship freight
Transitioning to a recession-era CEO and learning to reduce headcount with empathy became Petersen’s new objective. “I wanted people to know that I take personal responsibility for it. I wanted people to know that there’s transparency here” he tells me, his voice straining under the gravity of the situation. “If people feel fear and then they look at the leadership and they think the leadership is not feeling fear, then the fear amplifies. Whereas if people feel fear and they see, ‘oh the leaders are feeling fear also? Then okay, they’re going to behave appropriately.'”
Taking decisive action before COVID-19 spread widely stateside kept Flexport’s momentum strong and its runway long. Petersen is proving he can guide the company through bust as well as boom.
Flexport’s Tricks To Management
“My big learning in the last 18 months or so is that you can’t do everything. You can do anything you want, but you can’t do everything” Petersen outlines. “I see good ideas and I say ‘DO THAT!'” he tells me with a wry smile. “Soon, you’re spread pretty thin. You need some top down discipline to say ‘no’ to things. We really lacked that in the early years.”
The quest for discipline led him to develop and lean on two major frameworks for prioritizing customer needs and preserving company culture. They’re crucial now that Flexport has grown to 1800 employees across 14 offices and 6 warehouses, and 10,000 clients including Sonos, Kleen Kanteen, and Timbuk2.
Ryan Petersen whiteboards his management frameworks
The first framework is from Petersen’s mentor and American business mogul Charlie Munger. It lays out the six stake-holders or ‘customers’ a business must satisfy to succeed. Here’s how Petersen describes them:
Clients: The people who pay you money. For Flexport, we have both importers and exporters
Vendors: The people you pay. For Flexport, who own the planes, ships, and trucks
Employees: Make sure they’re treated well. It has to be a win-win trade.
Investors: They deserve a return on their money. They took a risk
Regulators: They decide who to give licenses to. For Flexport, there are 43 regulators in just the US who take an interest in imported products.
Communities: Where you operate. Maybe one day that’s global society
“If you don’t have at least a B grade in everything and ideally an A, you’re probably not long-term sustainable” Petersen explains. It’s a smart lens for anyone assessing companies, whether that’s ones to work at, invest in, work with, or one you’re leading and trying to improve.
Take Airbnb for example. Clients generally love its alternative to hotels, they’ve been able to continuously recruit employees effectively, and investors have offered it billions and kicked in to help it survive COVID-19. But its vendor hosts and their neighbors have struggled with disruptive guests, and communities and their local regulators have clashed with the startup over its impact on housing supply. The six customers concept identifies where Airbnb needs to work harder.
The second framework Petersen developed himself for how to ensure a company’s core values persist as it scales. It lays out the six culture questions:
Why?: Why do you exist? What’s your purpose, mission, vision, and impact?
Who?: Who do you hire and what values and behaviors do you look for?
What?: What are you focused on and what metrics do you use to measure success?
How?: How do decisions get made and how do you shorten the feedback loop for improvement?
When?: When should things get done and when should you ship your product?
Where?: Where does your team feel like it belongs and how do you become more inclusive?
Petersen likens these tenets to addressing a medical condition. It’s easier if leaders build them into their culture early than trying to fix them later. “If you were to get these things right in any company, you’ll outperform” he believes.
To execute on these, Petersen built a team close to him that just “makes sure our OKRs (objectives and key results) are clear, that we’re running inclusive meetings with good documentation, that we’re holding people accountable.” The method is heavily influenced by Amazon’s corporate style. As Petersen told me last year, “The English language lacks a positive word for bureaucracy.”
Ryan Petersen
Taking process seriously has made the CEO a hit with his employees. “Working for Ryan accelerated my career at least a decade. He has the uncanny ability to push people to their peak performance” said Flexport’s long-time former VP of product Sean Linehan, who went on to found Placement. “Ryan is building the playbook for operationally-intense tech businesses. Building a global logistics behemoth from scratch is an insanely complex job. But Ryan thrives in complexity. Where most entrepreneurs fall apart, he hits his stride.”
With the economics headwinds we’re facing, Petersen will need that drive if he wants to bring Flexport public. As you might expect, he’s learning about it. “I like reading annual reports. It’s like a hobby of mine, particularly with my competitors” Petersen says. “I want to go public. But I don’t want to go public until we’re profitablebecause I don’t want to be at Wall Street’s whims. If you’re losing money andyou’republic and Wall Street doesn’t like your stock, you can get into this death cycle.”
Being the CEO of a company that outperforms has opened doors to new mentors too, like executive coach Matt Messari, and Microsoft’s Satya Nadella. Petersen asked Nadella “How can you make learning and development measurable?”. Redmond’s head honcho answered “You don’t have to measure everything.” Petersen took the note. Sometimes, you just do what you think is right.
The Wartime CEO
Leading with his heart has steered Flexport to join the coronavirus relief effort in huge ways. “We were not put on this earth to lay in bed staying warm under the blankets. It’s time to step up and do something for the world” Petersen tweeted.
Flexport’s response started in Januarury with multiple blog posts per week laying out how COVID-19 was impacting global trade, how aid organizers could navigate supply chain issues, and how governments and private companies could help. Then it launched the Frontline Responders Fund and began routing all Flexport.org contributions to the cause, massively discounting freight forwarding costs to help get PPE wherever it’s needed.
Flexport.org launched the Frontline Responders Fund
“100% of your donation to this cause will go directly toward shipping masks to people on the front lines as fast as possible. I give you my word that we won’t waste a penny of your money” Petersen tweeted. Despite his business encountering its own troubles with global trade and demand disrupted, he shifted to spending his full time running Flexport.org and promoting the FRF. With the help of celebs like Arnold Schwarzenegger and Edward Norton, it’s raised over $7 million. The FRF has delivered over 6.9 million masks, 240,000 gowns, 1,000 ventilators, 155,000 gloves, and 250,000 meals for vulnerable populations.
Petersen hasn’t been shy about rallying more leaders to the cause, writing this expansive guide to the major bottlenecks blocking relief. “Philanthropists should also step up, lending money to organizations that have received purchase orders for PPE, but that can’t afford to buy the equipment unless they are paid upfront. Because they’ll get their money back when the pandemic subsides, this is one of the highest impact forms of philanthropy out there right now.”
That willingness to get involved has inspired his employees to roll up their sleeves too. “During a crisis, leaders really show the values they embody” says Susy Schöneberg, head of Flexport.org.After the COVID-19 outbreak, Ryan immediately offered us more resources to support our commercial and nonprofit clients. Over the last weeks, my days started and ended by talking to him – no matter what time is was.”
Ryan Petersen
From his vantage point, Petersen also has special visibility into who is trying to exploit the crisis. “Effective immediately Flexport will not ship personal protective equipment unless the customer can demonstrate which hospital system or other frontline emergency responder they are being provided to” Petersen wrote. “There are global shortages of these products, and it is immoral to allow war-profiteering from entrepreneurs looking to make an easy dollar.”
In the absence of proper federal crisis management, Petersen has become a defacto general in the war against coronavirus. “Given the scale of the problem and the complexity of the market failures outlined above, there’s no way for the US government to solve this on its own. But it can and must provide leadership, breaking down obstacles and coordinating the response of the private sector.” Until then, Petersen’s learning as fast as he can to become the wartime CEO needed right now.
Paraphrasing Kobe Bryant, Petersen concludes, “When you know what your goal is, the entire world is your library.”
For more of this author Josh Constine’s thoughts on tech, subscribe to his newsletter Moving Product
https://ift.tt/3aGbXmX How Freight master Flexport’s Ryan Petersen learned to CEO https://ift.tt/3eTTpmw
As we continue to ride out the pandemic, security experts are closely monitoring the surge of coronavirus-related cyber threats. Just this week, Google’s Threat Analysis Group, its elite threat hunting unit, says that while the overall number of threats remains largely the same, opportunistic hackers are retooling their efforts to piggyback on coronavirus.
Some startups are downsizing and laying off staff, but several cybersecurity startups are faring better, thanks to an uptick in demand for security protections. As the world continues to pivot toward working from home, it has blown up key cybersecurity verticals in ways we never expected. To wit, identity startups are needed more than ever to make sure only remote employees are getting access to corporate systems.
Can the startups take on the giants at their own game?
THE BIG PICTURE
Another payments processor drops the security ball
For the third time this year, a payments processor has admitted to a security lapse. First it was Cornerstone, then it was nCourt. This time it’s Paay, a New York-based card payment processor startup that left a database on the internet unprotected and without a password. Worse, the data was storing full, plaintext credit card numbers.
Anyone who knew where to look could have accessed the data. Luckily, a security researcher found it and reported it to TechCrunch. We alerted the company; it quickly took the data offline, but Paay denied that the data stored full credit card numbers. We even sent the co-founder a portion of the data showing card numbers stored in plaintext, but he did not respond to our follow-up.
https://ift.tt/eA8V8J Decrypted: Space hacking, iPhone vulnerability, Zoom’s security boom https://ift.tt/3eOASrP
The company says it will also match donations raised through the Donation Stickers until May 27th. The hashtag #doubleyourimpact will be automatically added to videos and live streams that use the stickers, as a result.
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