Uber prices IPO at $44-50, to raise $7.9-9B, PayPal takes $500M stake in strategic partnership

Uber, the transportation-on-demand behemoth, today filed its much-anticipated updated S-1, where it announced that it would be pricing its initial public offering at $44-50 per share.

Selling 180 million common shares, Uber plans to raise between $7.9 billion and $9 billion ahead of its public debut on the NYSE, valuing it at $84 billion — squarely in the middle of the $80-90 billion that was projected as late as yesterday. With the greenshoe, shareholders selling shares in the IPO, it could raise as much as $10.4 billion.

Separately, there were two surprise announcements in the S-1. First, PayPal said it would make a $500 million investment in the company in a private placement, as part of an extension of the partnership between the two, where they will develop new digital wallet services. Secondly, Uber said it expects to post a loss of between $1 billion and $1.1 billion for the first quarter of this year, a huge swing from net income of some $3.7 billion a year ago.

PayPal has been working with Uber providing payment services since 2013 and is its lead processing partner in the US and Australia (but not the only one globally).

This is the second big pre-IPO investment that Uber has announced this month. Last week, it announced a strategic $1 billion investment from SoftBank, Toyota and auto parts maker Denso, which valued the company at $7.25 billion.

The $500 million placement is being made at the same valuation as the IPO price range, Uber said.

“In April 2019, we entered into a stock purchase agreement with PayPal, Inc. (“PayPal”), pursuant to which PayPal will purchase $500 million of our common stock from us in a private placement at a price per share equal to the initial public offering price,” Uber notes. “The sale of the shares in the private placement is subject to certain closing conditions, including the closing of this offering and certain regulatory approvals. Concurrently, and subject to the closing of the private placement, we and PayPal extended our global partnership through the execution of an addendum to our existing commercial agreement. We and PayPal intend to explore future commercial payment collaborations, including the development of our digital wallet.”

“This is another significant milestone on our journey to be a platform partner of choice, helping to enable global commerce by connecting the world’s leading marketplaces and payment networks,” said PayPal president and CEO Dan Schulman in a statement. The is the second-biggest investment ever made by PayPal since its eBay spinout. The biggest is MercadoLibre in Latin America, in which PayPal invested $750 million in March.

In addition to the 180 million shares in the IPO, Uber notes that the underwriters have the option to purchase up to an additional 27 million shares of common stock from the selling stockholders solely to cover over-allotments, if any.

Additionally, Uber notes that it requested the underwriters to reserve up to 5.4 billion shares — three percent of the 180 million — through a directed share program to certain qualifying Drivers in the United States.

Bumpy and long road ahead

Uber’s pricing is more than three times the amount of Lyft’s $2.34 billion IPO, making it one of the largest IPOs in the U.S. since Alibaba’s debut on the public markets in 2014.

But the company has a long road ahead of it in its efforts to bring the business into profitability. The S-1 contains preliminary figures for the most recent quarter that ended March 31, and in them Uber said it expects its net income to be a net loss, with the range of between negative $1 and $1.11 billion. As a point of comparison, Uber’s positive net income in the same period a year ago was $3.748 billion.

Uber noted that the “expected net loss” came from several areas. First and foremost it’s spending a huge amount of money on what it describes as incentives and promotions — that is, offers both to drivers to keep working for Uber rather than, say, Lyft; and for passengers to continue riding with Uber — marketing in the face of heavy competition from Lyft and a variety of local competitors in other markets.

On top of that, Uber noted that the positive bump in the quarter a year ago came from its sales of operations in Southeast Asia (to Grab) and Russia (to Yandex), plus an unrealized gain of $2 billion on an investment in Didi.

“Our incentive and promotion spend varies widely from period to period and within various markets based on competitive dynamics and other factors,” Uber notes. It doesn’t note exactly what these dynamics factors might be, but they potentially include spend levelled by competitors for the same ends, as well as seasonal surges that might bring about specific promotions, and so on.

Uber also noted that monthly active platform consumers went up to 93 million from 70 million a year before, while revenues were up to between $3 billion and $3.1 billion, versus $2.6 billion a year ago.

In 2018, Uber reported 2018 revenues of $11.27 billion, net income of $997 million and adjusted EBITDA losses of $1.85 billion. Uber, which filed for its IPO two weeks ago, will list on the New York Stock Exchange in May.

More to come.

https://tcrn.ch/2GA2fp3 Uber prices IPO at $44-50, to raise $7.9-9B, PayPal takes $500M stake in strategic partnership https://tcrn.ch/2vpaHCg

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Lattice raises another $15M to improve performance reviews

Sam Altman’s little brother Jack is an entrepreneur, too.

Jack Altman, whose resume includes a stint as vice president of business development at Teespring, has raised $15 million in Series B funding for his startup, Lattice, a modern approach to corporate goal setting. Shasta Ventures led the round, with participation from Thrive Capital, Khosla Ventures and Y Combinator, the latter being the organization his brother led as president until very recently.

Lattice, used by high-growth companies like Reddit, Slack, Coinbase and Glossier, helps human resources professionals develop insights about their teams. Founded in 2015, Altman and Eric Koslow, like most entrepreneurs, developed the idea for Lattice out of their own pain points.

“We realized that with quarterly goal settings, OKRs, we would write them up and get the leadership together and then they would sit on a shelf and nothing would happen,” Altman told TechCrunch.

Lattice, a SaaS business, is a flexible platform that caters to startups and larger businesses’ specific cultures, management practices and varying approaches to employee engagement. The product, inspired by platforms like Gmail and Slack, is designed with consumers in mind. Lattice, the team hopes, has a look and feel that makes incumbent HR platforms feel antiquated. 

The product makes it simple for employees and their managers to complete engagement surveys, share feedback, arrange one-on-one meetings and complete comprehensive performance reviews with a larger goal of reworking the company goal-setting process entirely. No more once-yearly check-ins; Lattice enables businesses to check-in with their employees on a weekly basis. 

Lattice currently has 1,200 customers, 60 employees and was cash flow break-even for the first time in Q1 2019. With the latest financing, the San Francisco-based startup plans to invest in product development.

“Life is short,” Altman said. “You want to have work that you enjoy and an office that feels good to be at.”

Lattice has previously raised capital from investors including SV Angel, Marc Benioff, Slack Fund and Fuel Capital, Sam Altman, Elad Gil, Alexis Ohanian, Kevin Mahaffey, Daniel Gross and Jake Gibson. Lattice completed the Y Combinator startup accelerator in 2016.

https://ift.tt/eA8V8J Lattice raises another $15M to improve performance reviews https://tcrn.ch/2GF46ZX

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Twitter makes ‘likes’ easier to use in its twttr prototype app. (Nobody tell Jack.)

{rss:content:encoded} Twitter makes ‘likes’ easier to use in its twttr prototype app. (Nobody tell Jack.) https://tcrn.ch/2PvCLxf https://tcrn.ch/2VwOOQ4 April 26, 2019 at 05:21PM

On the one hand, you’ve got Twitter CEO Jack Dorsey lamenting the “like” button’s existence, and threatening to just kill the thing off entirely for incentivizing the wrong kind of behavior. On the other hand, you have twttr — Twitter’s prototype app where the company is testing new concepts including, most recently, a way to make liking tweets even easier than before.

Confused about Twitter’s product direction? Apparently, so is the company.

In the latest version of the twttr prototype, released on Thursday, users are now able to swipe right to left on any tweet in order to “like” it. Previously, this gesture only worked on tweets in conversation threads, where the engagement buttons had been hidden. With the change, however, the swipe works anywhere — including the Home timeline, the Notifications tab, your Profile page, or even within Twitter Search results. In other words, it becomes a more universal gesture.

You like their Tweets. Swipe right and really show them. No seriously, you can now swipe right on any Tweet on twttr to like it on your Home timeline, notifications tab, profile page, or search results.

— Twitter Support (@TwitterSupport) April 25, 2019

This makes sense because once you got used to swiping right, it was confusing that the gesture didn’t work in some places, but did in others. Still, it’s odd to see the company doubling down on making “likes” easier to use — and even rolling out a feature that could increase user engagement with the “Like” button — given Jack Dorsey’s repeated comments about his distaste for “likes” and the conversations around the button’s removal.

Of course, twttr is not supposed to be Dorsey’s vision. Instead, it’s meant to be a new experiment in product development, where users and Twitter’s product teams work together, in the open, to develop, test, and then one day officially launch new features for Twitter.

For the time being, the app is largely focused on redesigning conversation threads. On Twitter today, these get long and unwieldy, and it’s not always clear who’s talking to who. On twttr, however, threads are nested with a thin line connecting the various posts.

The app is also rolling out other, smaller tweaks like labels on tweets within conversations that highlight the original “Author’s” replies, or if a post comes from someone you’re “following.”

And, of course, twttr introduced the “swipe to like” gesture.

While it’s one thing to want to collaborate more directly with the community, it seems strange that twttr is rolling out a feature designed to increase — not decrease — engagement with “likes” at this point in time.

Last August, for example, Dorsey said he wanted to redesign key elements of the social network, including the “like” button and the way Twitter displays follower counts.

“The most important thing that we can do is we look at the incentives that we’re building into our product,” Dorsey had said at the time. “Because they do express a point of view of what we want people to do — and I don’t think they are correct anymore.”

Soon after, at an industry event in October 2018, Dorsey again noted how the “like” button sends the wrong kind of message.

“Right now we have a big ‘like’ button with a heart on it, and we’re incentivizing people to want to drive that up,” said Dorsey. “We have a follower count that was bolded because it felt good twelve years ago, but that’s what people see us saying: that should go up. Is that the right thing?,” he wondered.

Short story on "like." We've been open that we're considering it. Jack even mentioned it in front of the US Congress. There's no timeline. It's not happening "soon." https://t.co/jXBmkudWYv

— Brandon Borrman (@bborrman) October 29, 2018

While these comments may have seemed like a little navel-gazing over Twitter’s past, a Telegraph report about the “like” button’s removal quickly caught fire. It claimed Dorsey had said the “like” button was going to go away entirely, which caused so much user backlash that Twitter comms had to respond. The company said the idea has been discussed, but it wasn’t something happening “soon.” (See above tweet).

Arguably, the “like” button is appreciated by Twitter’s user base, so it’s not surprising that a gesture that could increase its usage would become something that gets tried out in the community-led twttr prototype app. It’s worth noting, however, how remarkably different the development process is when it’s about what Twitter’s users want, not the CEO.

Hmmm.

Hey, twttr team? Maybe we can get that “edit” button now?

 

 

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Twitter makes ‘likes’ easier to use in its twttr prototype app. (Nobody tell Jack.)

On the one hand, you’ve got Twitter CEO Jack Dorsey lamenting the “like” button’s existence, and threatening to just kill the thing off entirely for incentivizing the wrong kind of behavior. On the other hand, you have twttr — Twitter’s prototype app where the company is testing new concepts including, most recently, a way to make liking tweets even easier than before.

Confused about Twitter’s product direction? Apparently, so is the company.

In the latest version of the twttr prototype, released on Thursday, users are now able to swipe from left to right on any tweet in order to “like” it. Previously, this gesture only worked on tweets in conversation threads, where the engagement buttons had been hidden. With the change, however, the swipe works anywhere — including the Home timeline, the Notifications tab, your Profile page, or even within Search results. In other words, it becomes a more universal gesture.

You like their Tweets. Swipe right and really show them. No seriously, you can now swipe right on any Tweet on twttr to like it on your Home timeline, notifications tab, profile page, or search results.

— Twitter Support (@TwitterSupport) April 25, 2019

This makes sense because once you get used to swiping right, it was confusing that the gesture didn’t work in some places, but did in others. Still, it’s odd to see the company doubling down on making “likes” easier to use — and even rolling out a feature that could increase user engagement with the “Like” button — given Jack Dorsey’s repeated comments about his distaste for “likes” and the conversations around the button’s removal.

Of course, twttr is not supposed to be Dorsey’s vision. Instead, it’s meant to be a new experiment in product development, where users and Twitter’s product teams work together, in the open, to develop, test, and then one day officially launch new features for Twitter.

For the time being, the app is largely focused on redesigning conversation threads. On Twitter today, these get long and unwieldy, and it’s not always clear who’s talking to who. On twttr, however, threads are nested with a thin line connecting the various posts.

The app is also rolling out other, smaller tweaks like labels on tweets within conversations that highlight the original “Author’s” replies, or if a post comes from someone you’re “following.”

And, of course, twttr introduced the “swipe to like” gesture.

While it’s one thing to want to collaborate more directly with the community, it seems strange that twttr is rolling out a feature designed to increase — not decrease — engagement with “likes” at this point in time.

Last August, for example, Dorsey said he wanted to redesign key elements of the social network, including the “like” button and the way Twitter displays follower counts.

“The most important thing that we can do is we look at the incentives that we’re building into our product,” Dorsey had said at the time. “Because they do express a point of view of what we want people to do — and I don’t think they are correct anymore.”

Soon after, at an industry event in October 2018, Dorsey again noted how the “like” button sends the wrong kind of message.

“Right now we have a big ‘like’ button with a heart on it, and we’re incentivizing people to want to drive that up,” said Dorsey. “We have a follower count that was bolded because it felt good twelve years ago, but that’s what people see us saying: that should go up. Is that the right thing?,” he wondered.

Short story on "like." We've been open that we're considering it. Jack even mentioned it in front of the US Congress. There's no timeline. It's not happening "soon." https://t.co/jXBmkudWYv

— Brandon Borrman (@bborrman) October 29, 2018

While these comments may have seemed like a little navel-gazing over Twitter’s past, a Telegraph report about the “like” button’s removal quickly caught fire. It claimed Dorsey had said the “like” button was going to go away entirely, and caused so much user backlash that Twitter comms had to respond. The company said the idea has been discussed, but it wasn’t something happening “soon.”

Arguably, the “like” button is appreciated by Twitter’s user base, so it’s not surprising that a gesture that could increase its use would become a feature that gets tried out in the community-led twttr prototype app. It’s worth noting, however, how remarkably different the development process is when it’s about what Twitter’s users want, not the CEO.

Hmmm.

Hey, twttr team? Maybe we can get that “edit” button now?

 

 

from Social – TechCrunch https://ift.tt/eA8V8J Twitter makes ‘likes’ easier to use in its twttr prototype app. (Nobody tell Jack.) Sarah Perez https://tcrn.ch/2PvCLxf
via IFTTT

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Wireless broadband startup Starry files to raise up to $125 million

The never-ending quest to kill Comcast is poised to receive some renewed investment as an ambitious startup readies to secure some new cash.

Starry, a Boston-based wireless broadband internet startup, has filed to raise up to $125 million in Series D funding according to a Delaware stock authorization filing uncovered by PitchBook. If Starry closes the full authorized raise it will hold a post-money valuation of $870 million.

A spokesperson for the company confirmed it had already raised new capital, but disputed the numbers. The company has already raised over $160 million from investors, including FirstMark Capital and IAC. The company most recently closed a $100 million Series C this past July.

The internet startup takes a different approach from fiber-toting competitors by relying on radio tower and high-rise-mounted transmitters that dispatch millimeter wavelength signals to receivers connected to a building’s existing wiring. Customers with Starry’s slick touchscreen routers can whirl through setup, contact customer service, tailor parental controls and conduct speed tests. The company claims its solution can provide up to 200 Mbps up/download service for just $50 per month with no data caps or long-term contracts.

The Power and the Promise of 5G with Chaitanya Kanojia (Starry) | Disrupt SF 2018

The technology is not without its skeptics; while laying fiber-optic cable has proven to be an expensive task for internet companies, going over the airwaves with the company’s high-frequency radio waves has its own set of problems. Signals can be affected by harsh weather and obstacles, though Starry has indicated they are content with their performance in less-than-ideal conditions.

“We’ve built a robust network in Boston and our technology is working well,” CEO Chet Kanojia told us last year. “We’ve gone through a full year of seasonality to test various weather and foliage conditions and we’ve been very happy with our network’s performance.”

Last year marked a major period of expansion for Starry, which expanded beyond its home market of Boston and now holds a presence in Los Angeles, New York City, Denver and DC.

Kanojia previously founded Aereo, which raised $97 million in VC funding with the dream of letting consumers watch live TV over the web. The company proved a little too disruptive for its time, and was shut down as the result of a Supreme Court case brought about by major broadcasting networks.

https://tcrn.ch/2IIKMOQ Wireless broadband startup Starry files to raise up to $125 million https://tcrn.ch/2ZBWsYE

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Slack files to go public, reports $138.9M of losses on revenue of $400.6M

Slack has filed to go public via a direct listing. Similar to what Spotify did last year, this means that the company won’t have a traditional IPO, and will instead allow existing shareholders to sell their stock to investors.

The company’s S-1 filing says it plans to make $100 million worth of shares available, but that’s probably a placeholder figure.

The S-1 offers data about the company’s financial performance, reporting a net loss of $138.9 million and revenue of $400.6 million in the fiscal year ending January 31, 2019. That’s compared to a loss of $140.1 million on revenue of $220.5 million for the year before.

The company attributes these losses to its decision “to invest in growing our business to capitalize on our market opportunity,” and notes that they’re shrinking as a percentage of revenue.

Slack also says that in the three months ending on January 31, it had more than 10 million daily active users across more than 600,000 organizations — 88,000 on the paid plan and 550,000 on the free plan.

In the filing, the company says the Slack team created the product to meet its own collaboration needs.

“Since our public launch in 2014, it has become apparent that organizations worldwide have similar needs, and are now finding the solution with Slack,” it says. “Our growth is largely due to word-of-mouth recommendations. Slack usage inside organizations of all kinds is typically initially driven bottoms-up, by end users. Despite this, we (and the rest of the world) still have a hard time explaining Slack. It’s been called an operating system for teams, a hub for collaboration, a connective tissue across the organization, and much else. Fundamentally, it is a new layer of the business technology stack in a category that is still being defined.”

The company suggests that the total market opportunity for Slack and other makers of workplace collaboration software is $28 billion, and it plans to grow through strategies like expanding its footprint within organizations already using Slack, investing in more enterprise features, expanding internationally and growing the developer ecosystem.

The risk factors mentioned in the filing sound pretty boilerplate and/or similar to other Internet companies going public, like the aforementioned net losses and the fact that its current growth rate might not be sustainable, as well as new compliance risks under Europe’s GDPR.

Slack has previously raised a total of $1.2 billion in funding, according to Crunchbase, from investors including Accel, Andreessen Horowitz, Social Capital, SoftBank, Google Ventures and Kleiner Perkins.

https://ift.tt/eA8V8J Slack files to go public, reports $138.9M of losses on revenue of $400.6M https://tcrn.ch/2VA6bjn

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Mary Meeker’s new fund, two IPOs from China, and what’s next for Uber and Slack?

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

This week Kate Clark and Alex Wilhelm dug into the latest, namely big news on the fund front from folks you know, two China-based companies going public on domestic exchanges, and what’s next in the long-running sagas of getting Uber and Slack public.

First up Kate talked us through the latest at Kleiner Perkins and Mary Meeker’s new growth fund, called Bond Capital. Alex has some more great context on that here, for interested parties, Kate has more here.

Next, we turned to the F-1 filings of Luckin Coffee and DouYu, two China-based companies joining the list of firms from the country that have chosen to go public here in the United States. With Luckin’s filing, we have a fascinating look into the costs of building a hyper-growth company; as you can imagine, Luckin running pretty steep deficits, but adding revenue incredibly quickly on a year-over-year basis. DouYo is fascinating for a different reason, namely that it only recently began generating gross profit. And in 2018, when it did begin to create some margin to cover its operating costs, it didn’t make much.

DouYu works in the live streaming and esports worlds, places where Twitch and Huya (another China-based company that went public in the States) have found success.

Finally, we had two domestic public offerings to dig into. Slack, an exit we’ve long anticipated, is supposed to drop its S-1 today. If that’s the case Alex and Kate will be back at their mics to bring you the highlights from that filing. And then there’s Uber.

To cap off a fun show, we chatted through the impending Uber debut. We expect the company to set a price range tomorrow, but if early reports are correct, the firm could be sandbagging a bit in hopes of raising its price next week. Lyft reports earnings on May 7, giving Uber a somewhat tight window to jump through if it wants to control its own narrative. (If Lyft’s earnings fall short, for example, and Uber hasn’t gone public by that point, it could be forced to lower its own pricing.)

That’s all we got for now. We’ll probably be back later today with an Equity shot. Stay cool!

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Pocket Casts, Downcast and all the casts.

https://ift.tt/eA8V8J Mary Meeker’s new fund, two IPOs from China, and what’s next for Uber and Slack? https://tcrn.ch/2V32uTT

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RosieReality, a Swiss startup using AR to get kids interested in robotics and programming, scores £2.2M seed

{rss:content:encoded} RosieReality, a Swiss startup using AR to get kids interested in robotics and programming, scores £2.2M seed https://tcrn.ch/2W9brqT https://tcrn.ch/2DBpoGU April 26, 2019 at 10:00AM

RosieReality, a startup out of Zürich developing consumer augmented reality experiences, has raised $2.2 million in seed funding led by RedAlpine. Other backers include Shasta Ventures, Atomico Partners Mattias Ljungman and Siraj Khaliq (both of whom invested in a personal capacity), and Akatsuki Entertainment Fund.

Founded in early 2018, RosieReality’s first AR experience is designed to ignite kids interested in robotics and programming. The smart phone camera-based app is centred around “Rosie,” a cute AR robot that inhabits a “Lego-like” modular AR world within which you and your friends are tasked with building and solving world-size 3D puzzles.

The kicker: to solve these 3D-puzzle games requires “programming” Rosie to move around the augmented reality world.

“By developing Rosie the Robot, we created the first interactive and modular world that exclusively lives in your camera feed,” RosieReality co-founder and CEO Selim Benayat tells TechCrunch. “We use this new computational platform to enable kids to creatively build, solve and share world-sized puzzle games with friends and families – much like modern-day Lego”.

Describing Rosie the Robot’s typical users as teens that “like the challenge of intricately crafted puzzles,” Benayat says part of the inspiration behind the AR game was remembering how as a kid he used to love spending time building stuff and then inviting friends over to show them what he’d built.

“Kids today are not that different,” he argues, before adding that AR makes it possible for them to have the same tangible and contextual sensation while giving them a bigger outlet for their creativity.

“We see the camera as a tool to teach and enable [the] next generation of creators. For us gaming is the ultimate creative, social and educational outlet,” says the RosieReality CEO.

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Wheely raises $15 million for its luxury ride-hailing app

London-based startup Wheely has raised a $15 million Series B round led by Concentric with Oleg Tscheltzoff, Misha Sokolov and other investors also participating. The company wants to build an Uber competitor focused on the luxury market.

It’s a bit ironic when you think about it as Uber started as a luxury company. But everybody knows someone with horrific Uber stories. That’s why Wheely is building a reliable and predictable ride-hailing experience.

The company is currently live in London, Moscow and St. Petersburg — Paris is coming this summer. It works with 3,500 drivers and it currently has a run rate of $80 million in gross bookings.

Wheely doesn’t try to reinvent the wheel as the company works with third-party partners and doesn’t employ its drivers. Similarly, the company takes a 20 percent cut on each ride.

But the startup insists on its strict recruitment process. For instance, you can’t become a Wheely driver from day one. The company requires at least three years of previous chauffeur driving experience. You also need to pass multiple tests including driving tests and etiquette tests. Only one in four UberBlack drivers pass the exam.

There are currently three different classes — a normal one with Mercedes-Benz E-Class cars, a fancy one with Mercedes-Benz S-Class cars and a van category with Mercedes-Benz V-Class vehicles.

Minimum rides cost £12 with the entry-level class, £16 in an S-Class and at least £40 for a van. You then pay more depending on distance traveled and time spent in the car.

And it’s been working well as Wheely now represents around 11 percent of gross bookings in London. Given that each ride is more expensive than a traditional ride-hailing ride, it makes sense that Wheely already captured a good chunk of the money pie. Now let’s see if the company can find enough cities with affluent people to scale its business.

Anton Chirkunov – Founder of Wheely.

https://tcrn.ch/2XPCiZP Wheely raises $15 million for its luxury ride-hailing app https://tcrn.ch/2GJ5agx

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RosieReality, a Swiss startup using AR to get kids interested in robotics and programming, scores £2.2M seed

RosieReality, a startup out of Zürich developing consumer augmented reality experiences, has raised $2.2 million in seed funding led by RedAlpine. Other backers include Shasta Ventures, Atomico Partners Mattias Ljungman and Siraj Khaliq (both of whom invested in a personal capacity), and Akatsuki Entertainment Fund.

Founded in early 2018, RosieReality’s first AR experience is designed to ignite kids interested in robotics and programming. The smart phone camera-based app is centred around “Rosie,” a cute AR robot that inhabits a “Lego-like” modular AR world within which you and your friends are tasked with building and solving world-size 3D puzzles.

The kicker: to solve these 3D-puzzle games requires “programming” Rosie to move around the augmented reality world.

“By developing Rosie the Robot, we created the first interactive and modular world that exclusively lives in your camera feed,” RosieReality co-founder and CEO Selim Benayat tells TechCrunch. “We use this new computational platform to enable kids to creatively build, solve and share world-sized puzzle games with friends and families – much like modern-day Lego”.

Describing Rosie the Robot’s typical users as teens that “like the challenge of intricately crafted puzzles,” Benayat says part of the inspiration behind the AR game was remembering how as a kid he used to love spending time building stuff and then inviting friends over to show them what he’d built.

“Kids today are not that different,” he argues, before adding that AR makes it possible for them to have the same tangible and contextual sensation while giving them a bigger outlet for their creativity.

“We see the camera as a tool to teach and enable [the] next generation of creators. For us gaming is the ultimate creative, social and educational outlet,” says the RosieReality CEO.

https://tcrn.ch/2DBpoGU RosieReality, a Swiss startup using AR to get kids interested in robotics and programming, scores £2.2M seed https://tcrn.ch/2W9brqT

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Facebook says it filed a US lawsuit to shut down a follower-buying service in New Zealand

Facebook is cracking down on services that promise to help Instagram users buy themselves a large following on the photo app. The social network said today that it has filed a lawsuit against a New Zealand-based company that operates one such ‘follower-buying service.’

The suit is in a U.S. court and is targeting the three individuals running the company, which has been named as Social Media Series Limited.

“The complaint alleges the company and individuals used different companies and websites to sell fake engagement services to Instagram users. We previously suspended accounts associated with the defendants and formally warned them in writing that they were in violation of our Terms of Use, however, their activity persisted,” Facebook wrote in a post.

We were not initially able to get a copy of the lawsuit, but have asked Facebook for further details.

This action comes months after a TechCrunch expose identified 17 follower-buyer services that were using Instagram’s own advertising network to peddle their wares to users of the service.

Instagram responded by saying it had removed all ads as well as disabled all the Facebook Pages and Instagram accounts of the services that we reported were violating its policies. However, just one day later, TechCrunch found advertising from two of the companies Instagram, while a further five were found to be paying to promote policy-violating follower-growth services.

Facebook has stepped up its efforts to crack down on “inauthentic behavior” on its platforms in recent months. That’s included removing accounts and pages from Facebook and Instagram in countries that include India, Pakistan, the Philippines, the U.K, Romania, Iran, Russia, Macedonia and Kosovo this year. Higher-profile action has included the suspension of removal of UK far-right activist Tommy Robinson from Facebook and in Myanmar, where Facebook has been much-criticized, the company banned four armed groups.

Note: the original version of this article has been updated to include the name of the company

from Social – TechCrunch https://ift.tt/eA8V8J Facebook says it filed a US lawsuit to shut down a follower-buying service in New Zealand Jon Russell https://tcrn.ch/2J4Cq3x
via IFTTT

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Grocery delivery startup Honestbee is running out of money and trying to sell

Honestbee, the online grocery delivery service in Asia, is nearly out of money and trying to offload its business.

The company has held early conversations with a number of suitors in Asia, including ride-hailing giants Grab and Go-Jek, over the potential acquisition of part, or all, of its business, according to two industry sources with knowledge of the talks.

Founded in 2015, Honestbee works with supermarkets and retailers to deliver goods to customers using its store pickers, delivery fleet and mobile apps. The company is based in Singapore and operates in eight markets across Asia: Hong Kong, Singapore, Taiwan, Thailand, Indonesia, Malaysia, Philippines and Japan. In some markets it has expanded to food deliveries and, in Singapore, it operates an Alibaba-style online/offline store called Habitat.

The company makes its money by taking a cut of transactions from consumer transactions, while it also monetizes delivery services separately.

Despite looking impressive from the outside, the company is currently in crisis mode due to a cash crunch — there’s a lot happening right now.

From talking to several former and current staff, TechCrunch has come to learn that Honestbee is laying off employees, it has a range of suppliers who are owed money, it has “paused” its business in the Philippines, it has closed R&D centers in Vietnam and India, it isn’t going to make payroll in some markets and a range of executives have quit the firm in recent months.

Honestbee’s Habitat store includes a cashless and automated checkout experience, among other online-offline services

The issue is that the company is running out of money thanks to a business model with tight margins that’s largely unproven in Asia Pacific.

One source told TechCrunch that the company doesn’t currently have the funds to pay its staff this month. A source inside the company confirmed that Honestbee has told Singapore-based staff that they won’t be paid in time, but it isn’t clear about employees based in other markets. Previously, staff have been paid inconsistently — with late salary payments sent as bank transfers happening twice this year, according to the source.

One reason that the Philippines business has closed temporarily — as Tech In Asia first reported this week — is that it is out money, and waiting on Honestbee HQ in Singapore to provide further capital. Already, the saga has proven to be too much for Honestbee’s head of the Philippines — Crystal Gonzalez — who has quit the company, according to a source within Honestbee Philippines.

Gonzalez helped build Viber’s business in the Philippines, where it is a top messaging player, and she was previously with Yahoo before launching Honestbee. She is said to have grown frustrated at a lack of funds when the Philippines is the company’s best-performing market on paper.

Indeed, the situation is so dire that suppliers and partners have been paid late, or left unpaid entirely, in the Philippines and other markets. Honestbee takes payment for grocery deliveries, after which it is supposed to provide the transaction, minus its cut, to its supermarket partners. But it has been slow to pay vendors, with two in Singapore — FairPrice and U Stars — cutting ties with the startup.

Unclear financing

On the subject of financials, Honestbee looks to be toward the end of its runway.

The company has always taken a fairly secretive line on its financing. On launch, it announced a $15 million Series A investment from Formation8, a Korean firm where Honestbee CEO Joel Sng was a co-founder, but it has said nothing more since. Tech In Asia dug up filings last year that show it has raised a further $46 million from more Korean investors, but the startup declined to comment on its financing when contacted by TechCrunch.

It looks like that capital is nearly gone, at least based on what has been declared.

Internal numbers for Honestbee in December 2018, seen by TechCrunch, show that it lost nearly $6.5 million, with around $2.5 million in net revenue for the month. GMV — the total amount of transactions on its platform before deductions to partners — reached nearly $12.5 million in December, but costs — chiefly discounts to lure new customers and online marketing spend — dragged the company down. A former employee said that monthly retention is often single-digit percent in some markets because of the “outrageous” use of coupons to hit short-term revenue goals.

That internal data showed that the Philippines business accounted for around 40 percent of Honestbee’s overall GMV, which backs up Gonzalez’ apparent frustration at a lack of investment. That said, the Philippines unit remains some way from profitability, with a net loss of more than $1 million in December.

High burn rate

Three markets — Singapore, the Philippines and Taiwan — accounted for more than 80 percent of GMV and net income, making it unclear why Honestbee continues to operate in other countries, including the expensive Japanese market, when its funding level is perilously low.

Brian Koo, whose family controls LG, is listed as a shareholder for both of Honestbee’s ventures registered in Singapore. His Formation 8 VC firm has provided significant funding for the startup.

More pertinently, operating at that burn rate would give Honestbee less than 10 months of runway if it used the $61 million capital float that it is known to have raised. That suggests that the company has raised more money; however, none of the sources who spoke to TechCrunch were able to verify whether there has been additional fundraising.

Current and former employees explained that Honestbee doesn’t have a CFO and that all high-level decisions, and particularly those around budgets and spending, are managed by CEO Sng and his right-hand man, Roger Koh, whose LinkedIn lists his current job as a principal with Formation 8.

Filings in Singapore indicate that Honestbee has $55.9 million in assets through two registered companies. A common shareholder across the two is Brian Koo, a member of the LG family that founded Formation Group, the parent behind the Formation 8 fund.

Layoffs and a potential sale

While the financials are hazy, it is very clear that Honestbee is up against it right now.

The company released a statement earlier this week that makes some admissions around layoffs and restructuring but still glosses over current struggles:

In 2014, honestbee started in Singapore with the mission of providing a positive social and financial impact on the lives and businesses that we touch. Today, we are a regional business with footprints in Hong Kong, Thailand, Indonesia, Taiwan, Philippines, Japan and Malaysia.

Over the years, we have continued to be committed to our staff, partners and consumers. We have made good progress to implement new process and ways of working to remain efficient and relevant in the ever-changing business environment. The launch of habitat by honestbee in Singapore was a valuable lesson for us where it showed the potential growth in the O2O business and *it has been voted one of the must-see retail innovations in the world this year.

Following a strategic review of our company’s business, we are temporarily suspending our food verticals in Hong Kong and Thailand to simplify what we do and how we do it to better meet what our consumers want. Some roles within the organization will no longer be available. Approximately 6% of our global headcount in the organization are affected.

The status of honestbee in the remaining markets remain unchanged as we evaluate and we will continue to operate and contribute to honestbee Pte Ltd.

Sources close to the company told TechCrunch that more job losses are likely to come beyond the six percent in this statement. Executives who saw the writing on the wall have left in recent months, including the heads of business for Japan and Indonesia, a senior member of the team behind Habitat and the company’s head of people. One executive hired to raise capital for Honestbee quit within a month; he declined to comment and doesn’t list the company on his LinkedIn bio.

Secondly, Honestbee’s temporary suspension of food services in Hong Kong and Thailand isn’t likely to have a huge impact on its overall business, as groceries are the primary focus and neither market is particularly huge for the company. While Habitat has gotten attention for its forward-thinking, a physical retail store will require significant capital and it is likely, in its early days, to only increase the burn rate. Sources in the company told TechCrunch that, already, it has switched suppliers for some items as invoices went unpaid.

Despite the chaos, the potential of a sale is real.

Fresh from a recent $1.5 billion Vision Fund investment with the promise of $2 billion more this year, Grab — which is valued at $14 billion — is on a spending spree.

The Singapore-based company has pledged to make at least half a dozen acquisitions in 2019 and a deal to boost its nascent food and grocery play in Southeast Asia has some merit. Grab has the challenge of competing with Go-Jek, its $9.5 billion-valued rival that built a strong offering in Indonesia and is expanding across Southeast Asia with an emphasis on its food delivery. Grab, meanwhile, is active in eight markets across Southeast Asia and is now actively expanding from transportation services to food and more.

Likely adding to the frustration for Honestbee, its rival HappyFresh this week announced a $20 million investment. HappyFresh has undergone tough times, too. It pulled out of markets in 2016 to make its business more sustainable and today its CEO Guillem Segarra told TechCrunch that it is now operationally profitable.

Honestbee declined to respond to a range of questions from TechCrunch on whether it has plans to sell its business, its financing history and whether it has delayed paying employees.

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