Nov
12

BlaBlaCar to acquire Ouibus and offer bus service

French startup BlaBlaCar is announcing plans to acquire Ouibus, the bus division of France’s national railway company SNCF. For the first time, BlaBlaCar is moving beyond carpooling and plans to offer both long-distance carpooling rides and bus rides.

BlaBlaCar already ran a test with Ouibus for the past six months on popular corridors. It looks like both companies are happy with this test, as SNCF is willing to let BlaBlaCar run Ouibus from now on.

As part of this deal, BlaBlaCar is announcing a new $114 million investment (€101 million) from SNCF and existing BlaBlaCar investors. I’d guess that this isn’t just cash but probably cash and shares as part of the move with SNCF. Yes, you read that correctly, SNCF is now an investor in BlaBlaCar.

Ouibus has transported more than 12 million passengers over the past few years in France and Europe. Many thought that buses would hurt BlaBlaCar over the long run. By offering buses on BlaBlaCar directly, the company can capitalize on its brand and huge community to counter that trend. BlaBlaCar is now a marketplace for road travel.

BlaBlaCar is taking a risk, as Ouibus has been relentlessly losing money. Just like other bus companies, Ouibus relies heavily on contractors, which means that BlaBlaCar could quickly adjust the offering. It’ll also depend on product integrations on BlaBlaCar, OUI.sncf and other platforms.

BlaBlaCar currently has 65 million users in 22 countries and is about to reach profitability. And you can expect to find ridesharing offers on OUI.sncf in the coming months.

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Mar
31

Axonius nabs $58M for its cybersecurity-focused network asset management platform

Tel Aviv-based Audioburst has been developing a search engine for audio news, which allows users to locate audio content within podcasts and other talk radio programs. Today, the company is capitalizing on its technology to launch personalized playlists that deliver custom news briefs that get better over time the more you use the product.

The feature has been built using deep AI learning, the company says.

The content itself is drawn from top podcasts and the radio stations in Audioburst’s index, and will alert you to new information based on your chosen keywords and topics.

To use the feature, you first sign up on the Audioburst website, then select from a set of interests or add your own. When you’re finished with the selection process, you just hit the “I’m done” button to be taken to your personalized playlist of audio clips.

The end result is being able to listen to the parts of the podcasts or other audio programs you would actually care about, rather than slogging through half an hour or more of chatter for the one tidbit of news you were interested in.

For example, when testing the feature this morning, I chose a variety of topics like “tech news,” “movies,” “entertainment,” “science,” “parenting” and more, and was delivered a set of audio clips that included a discussion of Disney’s “Star Wars” spin-off series starring Diego Luna; a chat about the 2018 MacBook Air overhaul; an assessment of the smog in L.A.; and a lot of other clips I chose to skip (but will hopefully train the AI further).

You can try the feature yourself at search.audioburst.com by clicking on “Personalized Playlist” in the top left.

The results were hit or miss, which is expected — to some extent — fresh out of the gate. But there were also times when the clips didn’t actually serve up too much information. That is, you’d still need to turn to the podcast itself for the full story.

However, the feature itself isn’t necessarily going to be used by consumers directly on Audioburst’s website. Instead, its development came about thanks to requests from partners using its API.

The company says you can expect to see the personalized playlists integrated into its partners’ products in the smart speaker, mobile, in-car infotainment, and wearable tech spaces in 2019.

Audioburst currently has partnerships with ByteDance, Nippon, Bose, Harman, Samsung and more.

“Our mission is to deliver the most interesting news and audio content to our users wherever they are and personalization is the key ingredient. Through this feature, Audioburst is changing the way people consume audio in the same way that users consume music on Spotify,” said Assaf Gad, VP Marketing and Strategic Partnerships at Audioburst. “Expanding this experience through our partnerships with top OEMs, media companies and content creators means this has the power to reach users wherever they are,” he added.

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Nov
12

1Mby1M Virtual Accelerator Investor Forum: With Kelly Perdew of Moonshots Capital (Part 3) - Sramana Mitra

Sramana Mitra: Let’s do a couple of things next. I’d like to understand what are you really proud of in your portfolio. What’s really scaling? What’s looking really interesting? As you explain to us...

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Original author: Sramana Mitra

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Nov
12

Infibeam Bootstraps to Success in Indian E-Commerce Market - Sramana Mitra

According to India Brand Equity Foundation (IBEF), the Indian e-commerce market is projected to grow 51% annually from $39 billion in 2017 to $120 billion by 2020 driven by a young demographic...

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Original author: Sramana_Mitra

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Nov
12

412th 1Mby1M Entrepreneurship Podcast With Bill Baumel, Ohio Innovation Fund - Sramana Mitra

Bill Baumel, Managing Director at Ohio Innovation Fund, shares terrific insight into the region’s progress.

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Original author: Sramana Mitra

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Jun
22

A Tesla recycling machine caught fire at its Fremont factory, but the company says production was not affected (TSLA)

Framer, the Amsterdam-based startup behind interactive design platform Framer X, has raised $24 million in Series B investment. The round is led by European VC firm Atomico, with participation from Accel and AngelList. The startup says it will use the new capital to continue building out its platform for designers and product teams. It brings the total raised to date by Framer to $33 million.

Founded by ex-Facebookers Koen Bok and Jorn van Dijk, Framer has set out to ride (and power) a trend that is seeing every company having to become a digital business and often a product-first company, as consumers become accustomed to high-quality apps and other desirable digital experiences. This means that better tools are required to prototype news apps or features, and therefore help shorten the feedback loop and speed up the development process overall.

To that end, Framer X is described as a “fully integrated design, prototyping and developer handoff tool” that makes it easy to create app designs and prototypes that are as visually polished as a production app. Designs created in Framer X are powered by the React framework, and the platform enables a lot of off-the-shelf interactivity, rather than prototypes simply being static wireframes or designs with limited transitions or hotspots. You can also export front-end code for use in your production apps, should you so desire.

However, as explained during a video presentation by Bok and Dijk, what potentially sets Framer X apart from other competing app design and prototyping tools is that you can also import production components and assets into the software for re-use so that designers aren’t continually re-inventing the wheel. Via the “Framer X Store,” these React-based components can also come from and be shared by the wider developer community. Examples include video players (such as YouTube), live maps and data generators, to UI kits and interactive design systems.

This means that Framer is attempting to be a platform play in the true sense of the word, while in turn the Framer X Store is a clever way of creating network effects. Tech brands that have their own developer ecosystems (and are in part “API businesses”) can make components and visual assets available in the store to further lower the barriers for third-party app developers who want to build integrations.

Related to this, the company is announcing the beta launch of a private design store for teams on Framer X. The Team Store enables members of teams at the same company to collaborate and share brand assets, design components and more, so as to allow for internal interactive design systems to also live within the Framer platform.

Cue a statement from Atomico partner Hiro Tamura, who led on behalf of the London-based venture capital firm: “The world’s best digital products, like Google, Facebook, Dropbox, Twitter and Snap, are designed and built by teams. Those teams are already using Framer X. We are excited about partnering with Koen, Jorn and the Framer team to help make that level of digital product excellence and innovation accessible to any company in any traditional industry, from financial services to retail and beyond.”

Meanwhile, the Framer founding backstory is worth noting. Bok and Dijk previously founded app and design studio Sofa, which they sold to Facebook in 2011. As part of the deal they relocated to Facebook’s headquarters in the U.S., and worked on various products, reporting directly to Facebook founder Mark Zuckerberg. However, seeing an opportunity to help more companies transition to becoming digital-first and product-led, the pair left to found Framer in 2014.

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Nov
12

London’s transport regulator looks to startups to help fix urban mobility

London’s transport regulator, TfL has announced a partnership with Bosch for its forthcoming co-working space in Shoreditch.

The civic tech project is intended to run for 18 months as a pilot — though Bosch’s ‘Connectory’ co-working facility won’t open until the end of January. A company spokeswoman confirmed the partnership is nonetheless up and running now.

The aim of the collaborative project is to share data and expertise, including by tapping into London’s startup ecosystem, to land on new ideas for tackling urban mobility issues — from traffic jams to awful air quality.

Transport issues are especially pressing for the city as London’s population is forecast to reach a staggering 10.8 million by 2041 — which would mean around six million additional trips being generated per day.

Specific issues TfL is looking for help with include developing more efficient, greener and safer vehicles; reducing congestion; and encouraging more people to walk, cycle and take public transport across London, it said today.

TfL will be providing technical knowledge and “a wide range” of datasets throughout the pilot to allow participating companies to test ideas and “understand patterns in more detail than has previously been possible”, it added.

The data will be based on its existing Unified API and open data platform, which it notes is already underpinning nearly 700 apps used by approaching half (42 per cent) of Londoners.

Startups selected for the collaboration will be provided with dedicated space within Bosch’s Connectory, alongside TfL staff who will also be based there during the pilot.

Commenting in a statement, Arun Srinivasan, executive VP and head of mobility solutions at Bosch UK said: “We believe that the collaboration between Bosch and TfL will enable us to accelerate the development of technologies, products and services that have a positive impact on city life.”

Startups will be selected by Bosch, according to a TfL spokesman. We’ve asked for more details on selection criteria.

Update: A Bosch spokeswomen told us: “There will be a number of programmes running for start ups in the Connectory. These programmes will be around specific mobility challenges and many will have open calls for start ups to enter. We also welcome direct approaches by small business/start ups who want to be part of the Connectory community feel they have something to offer that will help solve London’s transport challenges. Get in touch!”

She said there is no fixed number of startup planned to be selected for the pilot, saying they will have rolling cohorts “designed around specific London mobility challenges” — launching this process in the New Year.

“This new ‘urban mobility’ lab is the first of its kind with a primary focus on urban mobility, and will provide the forum for private sector partners, academia and public sector to work together to tackle a range of problems facing Londoners in years to come,” the pair added in a press release today.

“By facilitating closer collaboration, TfL and Bosch hope to support start-ups to develop a range of smart products and help them identify ways to bring them to market more quickly through open procurement.”

The entire co-working facility is focused on urban mobility — but will also be open to other interested companies and startups to rent or bag a space (i.e. via Bosch’s scouting programs where it does take equity), not just to the startups selected for the TfL pilot.

Bosch’s network of Connectory co-innovation spaces also links out to cities internationally, including Chicago and Stuttgart, further expanding potential knowledge-sharing opportunities.

Commenting in a statement, the mayor of London, Sadiq Khan, said: “This initiative will foster closer working between London’s tech sector and other leading tech cities. If we are to use data and smart technology to help solve the biggest problems our city faces, it’s crucial we take a more collaborative approach. I see London’s future as a global ‘test-bed city’ for civic innovation, where the best ideas are developed, amplified and scaled.”

Depending on the outcome of the pilot, TfL said the Greater London Authority may seek similar collaborative approaches to support other aspects of its work — including housing, environment and policing, aligning with the mayor of London’s strategic priorities.

“I’ve been clear I want London to become the world’s smartest city and this is a further step towards realising that ambition,” Khan added.

This report was updated with additional detail about startup selection; and to correct that the lab will focus exclusively on urban mobility — but is also open to interested companies to rent space, as well as to startups Bosch selects to take a stake in  

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Nov
12

Clearbanc raises $70M to give startups ad money for a rev share

Selling equity to buy Facebook and Google ads is a bad deal for startups. Clearbanc offers a fundraising alternative. For fast-growing businesses reliably earning sales from their marketing spend, Clearbanc offers funding from $5,000 to $10 million in exchange for a steady revenue share of their earnings until it’s paid back plus a 6 percent fee. Clearbanc picks which merchants qualify by developing tech that scans their Stripe, Facebook ads and other accounts to assess financial health and momentum. It’s already doled out $100 million this year.

“As a business successfully scales, we continue to provide them ongoing capital,” co-founder and CEO Andrew D’Souza tells me. “Our goal is to be the first and last backer of a successful business and save the entrepreneur from having to take hundreds of pitch meetings to keep their company funded.”

After largely flying under the radar since being found in 2015, now Clearbanc has some big funding news of its own. It’s now raised $70 million from a seed and new Series A round from Emergence Capital, Social Capital, CoVenture, Founders Fund, 8VC and more, with Emergence’s Santi Subotovsky joining the board.

“Venture capital has shifted. Instead of funding true research and development, today 40 percent of venture capital goes directly to buying Google and Facebook ads,” D’Souza claims (that may be true for some e-commerce startups, but TechCrunch could not verify that stat for all startups). “Equity is the most expensive way to fund digital ad spend and repeatable growth. So we created something new.”

Clearbanc emerged from an angel investing alliance between two serial entrepreneurs. D’Souza built Andreessen Horowitz-funded social recruiting site Top Prospect, USV-backed education tech company Top Hat and Mastercard portfolio biometric authentication wearable startup Nymi. He helped raise more than $300 million in venture after a stint at McKinsey, when he began co-investing with Michele Romanow, a VC from Canada’s version of the TV show Shark Tank called Dragons’ Den. She’d bootstrapped shopping hub Buytopia that acquired 10 other e-commerce companies, and discount-finder SnapSaves that she sold to Groupon in 2014.

“We started investing together in some of the deals we would see from Dragons’ Den and often found that an equity investment wasn’t the right structure for these consumer product companies. They had great economics and had found a niche of customers, but often didn’t want to exit the business at any point,” D’Souza recalls. “They needed money to acquire more customers, scale up their marketing efforts and online ad spend. So we started to do these revenue share deals.”

Both engineers, they built tech to automate the due diligence and find companies with healthy unit economics and customer acquisition costs. The partnership blossomed into Clearbanc, and romance. “We’re also a couple, so we spend a lot of time together,” D’Souza writes. Inter-startup dating can be problematic, but so far seems to be working for Clearbanc.

Clearbanc’s team

Now Clearbanc has poured over $100 million into 500 companies in 2018, like Vinebox. The subscription wine box company used Clearbanc to grow its membership numbers while raising a Series A for developing new products. Clearbanc’s companies pay out 5 percent in revenue share until the investment plus 6 percent is paid back. That’s a great deal for companies that are already proven moneymakers, like Hunt A Killer, a murder mystery game subscription box that had raised $10,000 and was selling swiftly. Derisked, it didn’t need venture, and has now taken $8 million from Clearbanc to ramp its business.

Clearbanc co-founders Andrew D’Souza and Michele Romanow

Clearbanc is rising up at a time when organic growth channels are shutting down. The ruthless optimization of algorithmic feeds by Facebook, Instagram and Twitter suppress marketing content unless businesses are willing to pay. Without free virality opportunities, companies must rely on venture funding or loans just to turn around and pay that money to big ad platforms. With the new cash, which also comes from iNovia Capital, Real Ventures, Portag3, Precursor, WTI, Berggruen and FJ Labs, Clearbanc plans to expand abroad after doing deals in the U.S. and Canada. It’s also going to invest in building awareness as well as its data science capabilities.

D’Souza and Romanow must have confidence in their tech, as a wrong investment means they might never get their cash back. “We pay a lot of attention to our underwriting and decision-making process because if we make a mistake, we can lose a lot of money. Unlike a VC, we don’t expect the majority of our companies to fail and have the winners make up for the losses,” says D’Souza. One big misstep could wipe out the gains from a bunch of other investments.

Meanwhile, it has to break the norms of how businesses find funding. Startups immediately seek traditional venture or debt financing that can depend on the flashy names already on their cap table, while merchants turn to exploitative online lenders that require a personal guarantee and base their decisions on the founders’ own credit history instead of the business.

While riskier hard-tech startups that will take years to get to market will still need venture, a new crop of direct-to-consumer products and other fast-monetizing startups that are already humming can avoid diluting their team and investors by using Clearbanc. D’Souza concludes, “We’ve spent our entire careers as entrepreneurs and wanted to build a new asset class to help entrepreneurs grow.”

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Nov
12

The world's biggest tech investor will target a $21 billion IPO in December

SoftBank will target a $21 billion IPO for its mobile division - Business Insider Edition USUKDEAUSFRINITJPMYNLSEPLSGZAES Follow us on: SoftBank CEO Masayoshi Son. AP

Learn More About Artificial Intelligence With This Exclusive Research Report

Discover The Future Of Fintech With This Exclusive Slide Deck

Original author: Isobel Asher Hamilton

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Jun
22

Nintendo is about to bring back its outrageously popular $60 NES console

Some of the biggest darlings of the tech industry have joined Tesla recently in piling on cheap debt to fuel booming growth plans, relying on their size and brand-name appeal to secure funding typically deemed too risky for lesser-known peers with better credit.

WeWork, rated B, (otherwise known as junk) issued a $702 million bond in April. Uber issued a $2 billion junk bond deal last month, despite rapid cash burn and growing competition. And while Tesla's precarious debt situation is nothing new, it's in a similar boat to the others. Tesla is giving some investors jitters because it has $1.6 billion of maturities looming over the next 12 months.

Investors are favoring companies' potential over their underlying financial health, in part because they're benefitting from the "halo effect" of their sexy, big-name brands, says Christian Hoffmann, a portfolio manager at Thornburg Investment Management.

It's a marked shift in the industry. Demand is growing, for now. But it's a risky scenario.

Unicorns don't belong

"In general, unicorns don't belong in high yield," said John McClain, a portfolio manager at Diamond Hill, a US investment firm that manages fixed-income funds. "Putting financial leverage on companies with high levels of operating leverage, minimal tangible assets, and/or the ability to generate cash flow is irresponsible."

Leverage refers to the amount of debt a company has amassed over its earnings. Having high leverage means a company has more debt than assets available to pay off debts at a given time.

On the whole, investors tend to steer clear of companies that are highly leveraged or have far from robust credit metrics, says Christian Hoffmann, a portfolio manager at Thornburg Investment Management.

Take WeWork: The company received $4.4 billion in investment from a major SoftBank fund last year but runs an "asset light" model because it leases most of its office space. Despite plenty of hype, the company posts loss after loss, and according to Moody's, is unlikely to turn a profit anytime soon.

In August, Moody's took the unusual step of withdrawing a B3 rating on the New York-based company, citing a lack of information. For bond holders, the company's limited assets make it a riskier proposition in repayment terms if things go south.

Chasing yield is getting tougher

Tesla's high leverage and cash burning activities have given some investors cause for concern because the company will eventually need some way of paying it off, and it's not clear it will be that easy. The company took its first foray into the junk bond market in August 2017 with a $1.8 billion issue.

WeWork declined to comment for this story. Uber and Tesla didn't respond to requests for comment.

Bond investors chasing yield haven't had a lot of choice lately. But they have found a home in this part of the market. With high return comes more risk, though. A set of poor earnings could lead to declining confidence from lenders and greater scrutiny of the market. Throw in a US recession, and things could get very, very bad.

These companies and other unicorns tend to be "highly reliant on capital markets and have very pressing debt issues," McClain said.

And then there's Uber's. Its $2 billion bond deal last month was compared to deals by WeWork and Tesla, because of the company's rapid cash burn as competition heats up with rival ride hailer Lyft. Uber lost an eye-watering $4.5 billion in 2017. The company was able to issue its bonds via a private placement, allowing it to bypass the Securities and Exchange Commission's reporting requirements.

So-called "leveraged loans" have garnered a lot of negative attention lately, with former Federal Reserve Chair Janet Yellen and the Bank of England among those sounding the alarm on their potential risk. But the $1.6 trillion market is hot nonetheless: Responding to strong demand, Uber also raised a $1.5 billion leveraged loan directly from investors in March, a higher amount than the company had originally planned.

Leveraged loans differ from high-yield bonds in that they are secured, meaning creditors are paid before bondholders. Volumes have spiked in recent years with covenants protecting lenders from defaults deteriorating over this period, making the loans more akin to bonds.

McClain said that the high-yield market has been lucrative to tech stocks because financing has tended to be cheaper and more effective than selling more stock.

The message is clear: If you're a big-name tech company with even bigger ambitions, investors are lining up to lend to you.

Original author: Callum Burroughs

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Nov
12

Facebook denies firing Oculus founder Palmer Luckey for supporting Trump (FB)

Facebook has denied firing one of its former senior executives, Palmer Luckey, for his conservative views.

The Wall Street Journal reported Sunday that Luckey's departure came after The Daily Beast reported he donated $10,000 to an anti-Hillary Clinton group, and after longtime support of Donald Trump during the presidential campaign in 2016.

According to the Journal, citing leaked emails, Facebook CEO Mark Zuckerberg even pressured Luckey to switch his support from Trump to Libertarian candidate Gary Johnson. As the newspaper tells it, Luckey was put on leave after his donation and then fired in March 2017. He reportedly negotiated a $100 million payout after hiring an employment lawyer to argue Facebook had broken California law.

Read more: Facebook won't force employees to settle sexual harassment claims privately thanks to the Google walkout protests

Luckey believes that he was fired from Facebook due to his political views, the newspaper reported. Trump is largely unpopular in Silicon Valley, where most tech employees support liberal candidates, according to the non-profit Open Secrets.

But Facebook executive Andrew Bosworth, who now oversees the Oculus division, issued a strong statement denying that Luckey had been fired for his political leanings.

He wrote: "Any claims that his departure was do to his conservative beliefs are false."

When asked whether he thought Luckey himself may have been the source of the Journal's story, Bosworth wrote: "I honestly have no idea who their sources are, just that what was shared was not the truth and that the information provided appears to have been carefully selected to lead the reporters to one specific, and erroneous, conclusion."

Facebook likewise denied Luckey had been fired for supporting Trump. A spokeswoman told the Journal: "We can say unequivocally that Palmer's departure was not due to his political views. We're grateful for Palmer's contributions to Oculus, and we're glad he continues to actively support the VR industry."

And sources speaking to the Journal suggested the fact that Luckey hid his donation to a group which posted memes maligning Hillary Clinton, and his stepping back from Oculus were factors in his departure.

Luckey did not immediately respond to Business Insider's request for comment, but told the Wall Street Journal: "I believe the team that remains at Oculus is still the best in the VR industry, and I am rooting for them to succeed."

The Journal's story comes as conservative figures in California, such as Peter Thiel, argue that tech firms are dominated by liberals at executive and employee level and that different views are stifled. Google's firing of James Damore, who wrote a controversial memo about the firm's diversity practices, was seen as a watershed moment. Brian Amerige, a former Facebook engineer, likewise quit the firm and claimed an "intolerant" culture.

Original author: Shona Ghosh

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Jun
20

All of the companies no longer advertising on Facebook due to the platform's lack of hate speech moderation

Facebook is putting an end to required arbitration in cases of sexual harassment, allowing employees to pursue claims in court.

Facebook announced the policy change in an internal message to staff on Friday. It also changed its policy on office relationships — now executives at a director level or higher must disclose if they are dating somebody at the company.

The change came a day after Google changed its policy to end required arbitration, which was a demand made when 20,000 Google staff walked away from their desks to protest sexual harassment at the company.

The Google protest followed a New York Times report which revealed high-level executives were credibly accused of sexual misconduct and had been allowed to leave the company with huge exit packages.

Read more: Here's the memo Google CEO Sundar Pichai sent to employees on the changes to Google's sexual-harassment policy after the walkout

The organisers behind the Google protest hailed Facebook's decision on Twitter:

Required arbitration forces employees to settle disputes privately, precluding them from taking suits to court. The process has been criticised as being weighted against employees, and making it harder for people to band together in class actions. Facebook's move means its employees now have a choice between going to an arbitrator or making their claims public in court.

Other Silicon Valley companies have got rid of required arbitration in the past, including Uber in May and Microsoft in December 2017.

"There's no question that we're at a pivotal moment," Facebook's vice president of people Lori Goler told the Wall Street Journal.

"This is a time when we can be part of taking the next step," she added, and confirmed that while Facebook staff haven't staged protests like their counterparts at Google, sexual harassment has been a growing topic of discussion at the company.

Business Insider contacted Facebook for comment.

Original author: Isobel Asher Hamilton

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Nov
12

10 things in tech you need to know today

Troy Wolverton/Business Insider

Good morning! This is the tech news you need to know this Monday.

German enterprise software giant SAP is to buy feedback company Qualtrics for $8 billion, just days before its IPO. Qualtrics was on track for an IPO that would have valued the company at $4.8 billion in the middle of its price range. Facebook has followed Google and dropped forced arbitration for sexual harassment cases involving employees. The move follows an unprecedented global protest from Google employees earlier this month. Famed tech investor Mary Meeker is aiming to raise about $1.25 billion for her new growth fund. Meeker, a longtime partner at Kleiner Perkins Caufield & Byers, recently split off from the firm to create her own growth fund. Apttus is scrambling to calm employees and partners following accusations of sexual misconduct against its former CEO. David Murphy, the chairman and interim CEO, told staff on Monday that he had to address the concerns of people like Salesforce CEO Marc Benioff. Japan's SoftBank plans to take its mobile unit public at a $21 billion IPO. The unit will be listed on December 19. Roku's investors may not have been pleased with the company's third-quarter earnings report, but CEO Anthony Wood insists that everything's going just fine. Despite beating expectations, investors found the results disappointing, sending Roku's stock down 12% in after-hours exchanges Wednesday. Medium founder Ev Williams needs more money for the blogging service, which he says is still not profitable. He said: "We are coming out of this phase where it was assumed that the best quality journalism is free in unlimited quantities." Alibaba had the biggest online shopping day of all time, nearly tripling every company's 2017 Black Friday and Cyber Monday sales combined. Alibaba made e-commerce history on Sunday, with $30.8 billion in sales over the last 24 hours as part of the company's massiveSingles' Day celebration. After a victory on sexual harassment, the Google walkout protesters have turned their attention to racial discrimination. They say Google must address issues of "systemic racism and discrimination." Twitter is struggling to curb fake Elon Musk accounts promoting cryptocurrency scams. Cryptocurrency scammers are pretending to be Tesla CEO Elon Musk on Twitter, and some of their tweets are being promoted onto timelines through Twitter's ad service.

Have an Amazon Alexa device? Now you can hear 10 Things in Tech each morning. Just search for "Business Insider" in your Alexa's flash briefing settings.

Original author: Shona Ghosh

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Nov
12

SAP agrees to buy Qualtrics for $8B in cash, just before the survey software company’s IPO

Ryan Smith of Qualtrics speaks onstage during TechCrunch Disrupt SF 2015

Enterprise software giant SAP announced today that it has agreed to acquire Qualtrics for $8 billion in cash, just before the survey and research software company was set to go public. The deal is expected to be completed in the first half of 2019. Qualtrics last round of venture capital funding in 2016 raised $180 million at a $2.5 billion valuation.

This is the second-largest ever acquisition of a SaaS company, after Oracle’s purchase of Netsuite for $9.3 billion in 2016.

In a conference call, SAP CEO Bill McDermott said Qualtrics’ IPO was already oversubscribed and that the two companies began discussions a few months ago. SAP claims its software touches 77 percent of the world’s transaction revenue, while Qualtrics’ products include survey software that enables its 9,000 enterprise users to gauge things like customer sentiment and employee engagement.

McDermott compared the potential impact of combining SAP’s operational data with Qualtrics’ customer and user data to Facebook’s acquisition of Instagram. “The legacy players who carried their ‘90s technology into the 21st century just got clobbered. We have made existing participants in the market extinct,” he said. (SAP’s competitors include Oracle, Salesforce.com, Microsoft, and IBM.)

SAP, whose global headquarters is in Walldorf, Germany, said it has secured financing of €7 billion (about $7.93 billion) to cover acquisition-related costs and the purchase price, which will include unvested employee bonuses and cash on the balance sheet at close.

Ryan Smith, who co-founded Qualtrics in 2002, will continue to serve as its CEO. After the acquisition is finalized, the company will become part of SAP’s Cloud Business Group, but retain its dual headquarters in Provo, Utah and Seattle, as well as its own branding and personnel.

According to Crunchbase, the company raised a total of $400 million in VC funding from investors including Accel, Sequoia, and Insight Ventures. It had intended to sell 20.5 million shares in its debut for $18 to $21, which could have potentially grossed up to about $495 million. This would have put its valuation between $3.9 billion to $4.5 billion, according to CrunchBase’s Alex Wilhelm.

This year, Qualtrics’ revenue grew 8.5 percent from $97.1 million in the second-quarter to $105.4 million in the third-quarter, according to its IPO filing. It reported third-quarter GAAP net income of $4.9 million. That represented an increase from the $975,000 it reported in the previous quarter, as well as its net profit in the same period a year ago of $4.7 million. Qualtrics grew its operating cash flow to $52.5 million in the first nine months of 2018, compared to $36.1 million during the same period in 2017.

In today’s announcement, Qualtrics said it expects its full-year 2018 revenue to exceed $400 million and forecasts a forward growth rate of more than 40 percent, not counting the potential synergies of its acquisition by SAP.

Qualtrics’ main competitors include SurveyMonkey, which went public in September.

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Nov
12

A $2 trillion strategist warns that a trap has formed in the biggest tech stocks — and pinpoints where you should put your money instead

Past performance is not indicative of future results.

The principle is true across all markets, but investors in stocks would be wise to apply it to the large technology companies that have raked in huge returns during the historic bull run.

Companies like Facebook, Apple, Amazon, and Netflix earned their own acronym (FAANG) because of the outsized contribution their sector has made to investor returns during the more than nine-year rally. Their leadership was showcased prominently last year as the S&P 500 maintained a record streak of daily gains without a 5% drop.

But disappointing news from the past two earnings seasons has challenged their leadership status, from Facebook's miss on active users in Q2 to Apple's soft guidance for the all-important holiday quarter.

Now, as markets settle down after a tumultuous October, investors who've taken profits on tech stocks should look to invest them elsewhere, according to Alicia Levine, the chief market strategist at BNY Mellon Investment Management, which oversees $1.9 trillion in assets.

"I just don't see large-cap tech regaining its former leadership role, and it's sort of a trap now," Levine told Business Insider.

Levine is further advising investors to curb their enthusiasm about marketwide gains heading into the new year. 2019, she says, is going to be a more typical year, in which expectations for earnings growth peak early and decline in the following months. While she's bullish on market returns for the next six to nine months, Levine warns that painful losses may also lie ahead for investors.

She recommends healthcare stocks, including health maintenance organizations, or HMOs, which provide insurance for a fixed monthly fee.

This pick was informed by the widely expected outcome of the midterm elections: Democrats recaptured the House, and Republicans maintained their Senate majority. The implication of this result is that a repeal of the Affordable Care Act — also known as Obamacare — or big cuts to Medicaid are unlikely.

On Tuesday, voters in Idaho and Nebraska opted to expand access to their Medicaid programs for more low-income earners, in line with similar decisions taken by 34 other states and Washington, DC, under the Affordable Care Act. Pharmaceutical stocks will benefit as Obamacare becomes more institutionalized, Levine said.

The sector, along with biotech, has been battered in recent months. Their selloffs should limit their downside if lawmakers ramp up efforts to regulate drug pricing, Levine said.

These sector rotations that Levine recommends could be daunting for people who have profited from the boom of tech companies during this bull market. They include investors in the several growth mutual funds that own these stocks and the cohorts of workers who buy on autopilot through their retirement plans.

"People don't know what they own," Levine said. "And when the selling starts, it's indiscriminate."

These popular tech stocks have recently been plagued by data and privacy scandals, from Cambridge Analytica's use of Facebook to the Google+ data breach. Lawmakers on Capitol Hill have taken notice, and they pose another risk to the sector's unbridled growth.

"There's a sense that winter is coming, that there will be regulation, and there's an appetite both on the right and the left for this," Levine said. "You could see this being something that both a Democratic House and the administration would have an interest in."

Original author: Akin Oyedele

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Nov
12

Travel startups are taking off

The second wave of Internet-era travel companies has captured the attention of venture capitalists.

In the last five years, travel companies have raised more than $1 billion in venture capital funding. That includes short-term rental startups, travel and tourism apps, marketplaces for “experiences” and other travel or hospitality tech platforms. Airbnb, a $38 billion company and an anomaly in the category, has raised $3 billion in that same time frame, according to PitchBook.

In the last few months alone, aspiring Concur-competitor TripActions and travel activities platform Klook entered the “unicorn” club with large venture rounds that valued both of the businesses at more than $1 billion. Meanwhile, luggage maker Away raised $50 million at a $400 million valuation, TourRadar nabbed $50 million and TravelPerks brought in $44 million. Plus, smaller startups in the space like RocketripFreebirds, IfOnly, KKDayDuffel and RedDoorz all closed modest funding rounds.

“Something is really happening in the industry; something bigger than us,” TripActions co-founder Ariel Cohen said in a recent conversation with TechCrunch about his company’s $154 million Series C financing. “Different startups are identifying the opportunity here and the fact that companies want to make sure their employees are happy while they are on the go. That’s why you see investments in companies like Brex and like TripActions.”

Brex, though not classified as a travel startup, lets startup employees earn extra points on business travel with its corporate credit card for startups. It recently raised a $125 million Series C at a $1.1 billion valuation.

Global travel and tourism is one of the most valuable industries worth some $7 trillion. The online travel market, in particular, is expected to grow to $817 billion by 2020. VCs are hunting for tech-enabled startups poised to dominate that slice.

“You have a new wave of businesses where all of that digital infrastructure is set up, so the focus can be on things like efficiency, improved customer service, scale and growth — you have a ton of companies popping up catering to those needs,” Defy Partners co-founder Neil Sequeira told TechCrunch. Sequeira was a managing director at General Catalyst when the firm made its first investment in Airbnb.

On the other hand, you have a whole cohort of travel business founded amid the dot-com boom that are looking to technology startups for a much-needed infusion of innovation. Many of those larger companies have become active acquirers, fueling VC interest in the space. SAP Concur, for example, acquired the formerly VC-backed travel-booking startup Hipmunk in 2016. Before that, it bought travel planning company TripIt for $120 million, among others.

Expedia has gobbled up a number of travel brands too, like travel photography community Trover; Airbnb-competitor HomeAway, which it paid a whopping $3.9 billion for in 2015; and most recently, both Pillow and ApartmentJet.

Many of these acquisitions are for peanuts, which is far from ideal for a venture-funded company. And building a travel business is cash intensive, hence the $4.4 billion Airbnb has raised to date or even TripActions’ $236 million in total VC funding. To keep momentum in the space, companies need to be striking larger M&A deals.

It doesn’t help that many in and around the venture capital industry are predicting an imminent turn in the market. Travel companies, which are reliant upon a consumer’s tendency to spend excess cash, will be among the first sectors to be impacted by hostile economic conditions.

“If the market turns, people aren’t going to spend $10,000 on a trip to Zimbabwe,” Sequeira said, referencing companies like IfOnly, which sells curated experiences.

Travel startups should raise now while the market is hot. The conditions may not remain favorable for long.

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Jun
19

Twitter hid Trump's tweet that mocked CNN, citing copyright, after the social media platform marked it 'manipulated media'

SAP announced on Sunday that it plans to acquire IPO-bound startup Qualtrics for $8 billion cash.

Qualtrics was on the verge of its IPO — it was even on its roadshow with potential investors this past week. It had expected to raise about $495 million in its IPO and at the midpoint of its $18-to-$21 price range, it would have been valued at $4.8 billion.

And the roadshow was going well, said Qualtrics CEO Ryan Smith in a press conference with SAP CEO Bill McDermott on Sunday. All signs pointed to a very successful first day of trading and beyond, because Qualtrics had been cash-flow positive for most of its history even amid its rapid growth, and it was reporting a net profit, said Smith. It had earned $289.9 million in revenue in 2017, up 52% from its $190 million in revenue in 2016 and reported a net income of $2.5 million, up from $12 million in losses in 2016.

Qualtrics founder CEO Ryan Smith Qualtrics "Our IPO was going extremely well," Smith said on the call. "We were the only show on the road last week and it was going as well as any IPO of ... a cash positive high-growth company."

"We chose to be here," Smith said of the acquisition.

SAP Bill McDermott doubled down on the idea, saying, "Ryan is being modest. I happen to know this was going to be the most successful IPO of 2018. He's oversubscribed."

All of that helps to explain why SAP is paying quite a premium for Qualtrics, which was valued at $2.5 billion at the time of its last private fundraising.

The two said on the phone that SAP had been in talks with Qualtrics for "a few months," with Smith claiming that McDermott "really chased it down."

With Qualtrics, McDermott is buying growth in the oh-so-important cloud software market. SAP is best known for its financial software, known to the industry as enterprise resource planning (ERP). It is the world's largest supplier of ERP software, competing with the likes of Oracle.

But SAP is also going head-to-head with just about every other big cloud software player as well, including market and sales software. Qualtrics complements SAP's flagship offerings, the same way that LinkedIn complements Microsoft's customer relationship management (CRM) strategy.

Qualtrics is itself the leader in online market research software. And it has been repositioning itself into a new market that Smith has dubbed "experience management." By that, he means helping companies get a complete world of their perception and performance, as seen by customers, employees, partners, and anyone else whose opinion matters for your business.

McDermott says of the Qualtrics deal that "this is the No. 1 most transformative thing I've ever been involved in."

He explained the premium price tag in a more practical matter, too. "This is less of a multiple than others in the industry have done, but it's the largest as far as the growth that we could realize from it. We'd have to do a whole lot of tuck-ins to do what we have one in one move here."

He is, perhaps, referring to the surprise huge acquisition in the enterprise software world of IBM's blockbuster planned purchase of Red Hat for $34 billion. Pound-for-pound, it definitely seems that SAP is paying less than IBM did to achieve growth of its own.

Original author: Julie Bort

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Jun
19

The Racial Equity Ecosystem Pledge

SAP, the German database giant, has announced an $8 billion all-cash deal to acquire Utah-based Qualtrics, a startup last privately valued at $2.5 billion.

Notably, Qualtrics was scheduled to hold its IPO this week — an offering that could have valued the company at more than $5 billion right out of the gate, according to the company's most recent filings. The deal is expected to close in the first half of 2019.

Qualtrics specializes in what it calls experience management, or XM, providing tools to help companies gather feedback and optimize their products.

After the close of the deal, Qualtrics will maintain its existing headquarters in Seattle, Washington, and Provo, Utah. Qualtrics CEO Ryan Smith will continue in his role, as well.

Qualtrics is something of an anomaly in the world of high-flying tech startups: Founded in 2002 by Smith and his father — a professor of marketing at Brigham Young University — the company didn't accept any venture funding until it had been in business for a decade. Qualtrics had raised $400 million in total venture capital funding from investors including Accel and Sequoia Capital.

Over the years, the younger Smith has earned a reputation for an eccentric brand of generosity. At one point, Qualtrics paid to sponsor the Utah Jazz, its local NBA team, and had them wear a patch promoting its "5 for the Fight" cancer research charity. At another point, the company loaned a customer a Tesla Model X.

This deal comes shortly after IBM announced its intent to purchase open source software provider Red Hat for $34 billion. Microsoft, too, just closed its $7.5 billion acquisition of code sharing service GitHub, making this a banner year for M&A action in the business-to-business tech sector.

Original author: Matt Weinberger

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Nov
11

Amazon is now reportedly going to split its HQ2 into 2 locations after more than a year of intense speculation. Here’s everything that has happened in the saga up until now. (AMZN)

It's been 14 months since Amazon, the world's largest online retailer, declared its intention to build a second headquarters. Founded in Seattle some 23 years earlier, Amazon said it had gotten so big that it needed a second home base in another city.

The company's year-long selection process had a decidedly sweepstakes-like feel to it. Amazon laid out its expectations for what it wanted in a second hometown and promised a bonanza of 50,000 jobs and a $5 billion investment to whichever lucky city it picked.

City governments and officials scrambled to outdo each other and woo the online retailer, dangling tax breaks, exemptions of all types and even promises to change their names.

Now, Amazon has reportedly zeroed in on New York City and Virginia— and "HQ2" will likely actually be two separate offices. The move, which has yet to be confirmed by Amazon, has left a sour taste with some people who accuse Amazon of having deviously gamed the system.

Here's a look at the sequence of events during Amazon's controversial "HQ2" adventure, and the strange spectacle that Amazon whipped up in the process.

Original author: Sean Wolfe

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Sep
06

Sony pledges $3 million to USC Games Gerald A. Lawson Fund

The kids in Madrid’s El Retiro Park are loving their new on-demand joyriding toys. Lime launched its scooters in the Spanish capital this summer.

Spending a weekend in the city center last month the craze was impossible to miss. Scooters parked in clusters vying for pay-to-play time. Sometimes lined up tidily. All too often not.

The bright Lime rides really stood out, though it’s not the only brand in town. Scooter startups have been quick to hop on the international expansion bandwagon as they gun for growth.

Grandly proportioned El Retiro clearly makes a great spot for taking a scooter for a spin. Test rides beget joyrides, and so the kids were hopping on. Sometimes two to one.

The boulevard linking the Prado with the Reina Sofia was another popular route to scoot.

While a busy central bar district was a hot ride-ditching spot later on. Lines of scooters were vying for space with the vintage street bollards.

The appeal was obvious: Bowl up to the bar and drink! No worries about parking or how to get your ride home afterwards. But for Saturday night revellers there was suddenly a new piece of street furniture to lurch around, with slouching handlebars sticking up all over the place. Anyone trying to navigate the pavement in a wheelchair wouldn’t have had much fun.

In another of Spain’s big tourist cities the scooter story is a little different: Catalan capital Barcelona hasn’t had an invasion of on-demand scooter startups yet but scooters have crept in. In recent years locals have tapped in of their own accord — buying not renting.

Rides are a front-of-store sight in electronics shops, big and small — costing a few hundred euros. Even for a flashy Italian design…

Electronic scooters

Take a short walk in one of the more hipster barrios and chances are you’ll pass someone who’s bought into the craze for nipping around on two wheels. There’s lots of non-electric scooters too but e-scooters do seem to have carved out a growing niche for themselves with a certain type of Barcelona native.

Again, you can see the logic: Well-dressed professionals can zip around narrow streets that aren’t always great for finding a place to (safely) lock up a bike.

There’s actually a pretty wide variety of wheeled e-rides in play for locals with the guts to get on them. Some with seats and/or handles, others with almost nothing. (The hands-in-pockets hipsters on self-balancing unicycles are quite the sight.)

In both of these Spanish cities it’s clear people are falling for — and, well, sometimes off — the micro-mobility trend.

But the difference between the on-demand scooters being toyed with in Madrid vs Barcelona’s locally owned two wheelers is a level of purpose and intent.

The Lime rides in Madrid’s center seemed mostly a tourist novelty. At least for now, having only had a couple of months to bed in.

Whereas the organic growth of scooters in Barcelona barrios is about people who live there feeling a need.

Even the unicycling hipsters seem to be actually on their way somewhere.

Hop on

What does this mean for scooter startups? It’s another example of how technology’s utility and wider societal impacts can vary when you parachute a new thing into a market and hope people jump on board vs growth being organic and more gradual because it’s led by real-world demand.

And it’s essential to think about impacts where scooters and micro-mobility is concerned because all this stuff must piggyback on shared public spaces. No one has the luxury of being able to avoid what’s buzzing up and down their street.

That’s why lots of on-demand scooters have ended up trashed and vandalized — as residents make their feelings known (having not been asked about the alien invaders in the first place).

In Europe there’s a further twist because the spaces scooter startups are seeking to colonize are already well served with all sorts of public transport options. So there’s a clear and present danger that these new kids on the block won’t displace anything. And will just mean more traffic and extra congestion — as happened with ride-hailing.

In Madrid, the first tranche of on-demand scooters seems to be generating pretty superficial and additive use. Offering a novel alternative to walking between sights or bars on a trip to-do list. Just possibly they’re replacing a short taxi or metro hop.

In the park, they were being used 100% for fun. Perhaps takings are down at the boating lake.

Barcelona has plenty of electro-powered joyriding down at the beach front in summer — where shops rent all sorts of wheels to tourists by the hour. But away from the beach locals don’t seem to be wasting scooter charge riding in circles.

They’re stepping out for regular trips like commuting to and from work. In other words, scooters are useful.

Given all this activity and engagement micro-mobility does seem to offer genuine transformative potential in dense urban environments. At least where the climate doesn’t punish for most of the year.

This is why investors are so hot on scooters. But the additive nature of micro-mobility underlines a pressing need for the technology to be properly steered if cities, residents and societies are to get the best benefits.

Scooters could certainly replace some moped trips. Even some local car journeys. So they could play an important role in reducing pollution and noise by taking trips away from petrol- and diesel-powered vehicles.

Because they offer a convenient, low-barrier-to-entry alternative with populist pull.

Not being too high speed also means, in and of themselves, they’re fairly safe.

If you’re just barrio hopping or can map most of your social life across a few city blocks there’s no doubting their convenience. Novelty is not the only lure.

Hop off

Though, equally, the local-level journeys that scooters are best suited for could just as easily be completed on foot, by bike or via public transit options like a metro.

And Barcelona’s congested streets don’t look any less packed with petrol engines — yet.

Which means scooters are both an opportunity and a risk.

If policymakers get the regulations right, a smart city could leverage their fun factor to nudge commuters away from more powerful but less environmentally friendly vehicles — with, potentially, some very major gains up for grabs.

Subsidized scooters coupled with a framework of congestion zones that levy fees on petrol/diesel engines is one simple example.

A clever policy could open the possibility of excluding cars almost entirely from city centers — so that streets could be reclaimed for new leisure and retail opportunities that don’t demand masses of parking space on tap.

Pollution is a chronic problem in almost all large cities in the world. So reshaping city centers to be more people-centric and less toxic to human health by displacing cars would be an incredible win for micro-mobility.

Even as the hop on, hop off ease of scooters offers a suggestive glimpse of what’s possible if we dare to rethink urban architecture to put people rather than four-wheeled vehicles first.

Yet get the policy wrong and scooters could end up — at very best — a frivolous irrelevance. A joyride that disrupts going nowhere. Yet another nuisance on already choked streets. An optional extra that feels disposable and gets rudely discarded because no one feels invested.

In this scenario the technology is not socially transformative. It’s more likely an antisocial nuisance. And a pointless drain on resources because it’s doing no more than disrupting walking.

Scooter startups have already run into some of these issues. And that’s not surprising given how fast they’ve been trying to grow. Their early expansionist playbook does also risk looking like Uber all over again.

Yet Uber could have pioneered micro-mobility itself. But being ‘laser focused on growth’ seemingly gave the company tunnel vision. Only now, under a new CEO, it’s all change. Now Uber wants to be a one-stop platform for all sorts of transport options.

But how many years did it waste missing the disruptive potential of micro-mobility coming down the road because it was too busy trying to fit more cars into cities — and ignoring how residents felt about that?

An obsession with growth at all costs may well be a side effect of major VC dollars flooding in. But for startups it really does pay to stay self-aware, perhaps especially when you’re rolling in money. Else you might find your investors funding your biggest blind spot — if you end up missing the next even more transformative disruption.

The really clever trick to pull off is not ‘scale fast or die trying’; it’s smart growth that’s predicated upon applying innovative technologies in ways that bring whole communities along with them. That’s true transformation.

For scooters that means not just dumping them on cities without any thought beyond creaming a profit off of anything that moves. But getting residents and communities engaged with the direction of travel. Partnering with people and policymakers on the right incentives to steer innovation onto its best track.

Move people around cities, yes, and shift them out of their cars.

There’s little doubt that Uber’s old ‘growth at any cost’ playbook was hugely wasteful and damaging (not least to the company’s own reputation). And now it’s having to retrofit a more inclusive approach at the same time as unpicking an ‘environmentally insensitive’ legacy that original playbook really doesn’t look so smart.

Scooter startups are still young and have made some of their own mistakes trying to chase early scale. But there are reasons to be cheerful about this new crop of mobility startups too.

Signs they see value and opportunities in being pro-actively engaged with the environments they’re operating in. Having also learnt some hard early lessons about the need to be very sensitive to shared spaces.

Bird announced a program this summer offering discounted rides to people on low incomes, for example. Lime has a similar program.

These are small but interesting steps. Here’s hoping we’re going to see a lot more.

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