Jun
20

Read the letter 100 Microsoft staff reportedly sent to Satya Nadella protesting the firm’s $19 million deal with ICE

Microsoft CEO Satya Nadella with US President Donald Trump. Getty

More than 100 Microsoft staff have reportedly written to CEO Satya Nadella protesting the company's work for the US's Immigration, Customs and Enforcement (ICE) agency.

The letter was posted on the internal message board on Tuesday and was obtained by The New York Times.

It calls on Microsoft to ditch its $19.4 million (£14.7 million) contract with ICE in light of President Donald Trump's "zero-tolerance" immigration policy, in which families and children are separated after crossing the US-Mexico border illegally.

"We believe that Microsoft must take an ethical stand, and put children and families above profits," staff wrote, adding that the firm should immediately cancel its contracts with the "inhumane and cruel" agency.

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The letter also called on Microsoft to draft a policy stating that the firm will not take on work for clients who "violate international human rights law." It added that Microsoft should be transparent about its work for the government.

You can read the letter, published by The New York Times, in full below:

The Times said the letter was posted before Nadella wrote to staff calling for Trump's "abhorrent" policy to end. He also downplayed the nature of the company's work with ICE, saying it was mostly just email, calendars, and other office software.

"This new policy implemented on the border is simply cruel and abusive, and we are standing for change," Nadella said, saying that as a parent and an immigrant "this issue touches me personally."

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But he stressed: "I want to be clear: Microsoft is not working with the U.S. government on any projects related to separating children from their families at the border."

Original author: Jake Kanter

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May
09

Facebook's reorganization is little more than chair-shuffling — and a missed opportunity for Mark Zuckerberg and company (FB)

Supermercato24, an Italian same-day grocery delivery service, has raised €13 million in Series B funding. Leading the round is FII Tech Growth, with participation from new investor Endeavor Catalyst, and current investors 360 Capital Partners, and Innogest.

Similar to Instacart in the U.S. and claiming to be the leader in Italy, Supermercato24 lets customers order from local supermarkets for delivery. The startup uses gig economy-styled personal shoppers who go into the store and ‘pick’ the products ordered and then deliver them same-day, or for an added cost within an hour.

The company charges a delivery fee to consumers, but also generates revenue from fees charged to partnering merchants, and, notably, through advertising. Supermercato24 says it has more than 15 partnerships with merchants, and has more than 50 consumer packaged goods customers (CPGs) advertising on its platform.

“Our customers represent that increasing share of the population that would love to spend their time differently rather than doing grocery shopping,” says Supermercato24 CEO Federico Sargenti, who was previously an Amazon Executive and launched the Amazon FMCG Business in Italy and Spain.

“Going to the store, pushing a cart through the alleys, queuing up, checking out and lifting heavy grocery shopping bags from the store’s register all the way up to your apartment can take lots of energy and up to 3 hours every week. Plenty of people would prefer to do all of that in a few minutes”.

Specifically, Sargenti says that Supermercato24’s customers span “hip youngsters to elderly people, single professionals to parents and working couples,” and that more than 65 percent of customers are women. “Customers have high expectations on their groceries, because they are used to choosing from a wide product range at supermarkets, with competitive prices and qualitative fresh products. Plus, they expect a comfortable, convenient and same-day delivery. And that’s what we offer them,” he adds.

The company’s grocery ordering and delivery service is active in more than 23 Italian cities, and Supermercato24 says a number of cities are already profitable at contribution margin level. That said, Sargenti concedes it is still early days in terms of the switch from offline grocery shopping to online. He also says that Southern Europe has been historically limited by a lack of supply and that the way to address this is a collaboration between traditional grocery retailers and tech companies like Supermercato24, a model that he insists can scale in both large and small cities.

The Italian grocery market is particularly fragmented, too, with the top 5 retailers owning less than 40 percent of the national grocery market, apparently. This arguably makes it more ripe for a marketplace rather than traditional e-grocery delivery model. One challenge is that the majority of people in Italy don’t live in large cities or other high population density areas of the country. It is Supermercato24’s ability to scale in low density areas — or so it claims — that gives it an edge.

Meanwhile, I’m told the new funding will be used to improve operations and product both for customers and for merchants, as well as to expand the service to new markets. “In Europe, Supermercato24 is already the biggest on-demand e-grocery marketplace in terms of revenues and it’s already in discussion with current and prospect retailers to expand the service across Europe to successfully replicate Instacart’s case,” says the company, unashamedly.

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Jun
20

Feed raises $17.4 million for its Soylent-like food products

French startup Feed is raising a $17.4 million funding round (€15 million) from Alven and Otium Brands. Feed has been selling meal replacement products in Europe and now plans to expand to other countries.

There are multiple variations of Feed. The company started with a powder-based product that represents the equivalent of one meal. You add some water, shake it a bit and drink it. You can now also buy the equivalent of a cereal bar with everything you need to stay alive.

It sounds a bit like Soylent, which itself sounds a bit like SlimFast and all those products from the 1980s and 1990s. It’s worth noting that Soylent only sells in the U.S. and Canada. Feed products are vegan, gluten-free, lactose-free, GMO-free and made in France.

A few months ago, I bought a bottle of Feed powder to give it a try — I wasn’t particularly convinced. But it sounds like many people like it — the company has sold 1 million kilograms of powder, which represents over 6.5 million bottles in total. In 2018, Feed plans to generate $11.6 million in revenue.

Feed doesn’t think you should replace all your meals with a Feed product. But if you’re in a rush or you want to lose some weight, you could swap your lunch for a Feed product every now and then. Feed competes with Huel, Jimmy Joy and another French startup selling meal replacement products, So Shape (only tangentially as So Shape is focused on losing weight).

Beyond the product itself, Feed is the perfect example of a strong online brand. The company has built an online community with hundreds of thousands of followers. There are dozens of videos of people testing Feed on YouTube. And the company knows how to target online customers using the right channel.

While you can find Feed products in many French supermarkets, the company also sells its products on its website and delivers in 30 countries. By building a strong brand and attracting online customers, the company can generate bigger margins than in selling through your local supermarket.

And the brand is the reason why Feed is valuable and can attract funding. Now, Feed can launch its product in new countries and could sign new partnerships with supermarkets across Europe.

Update: I added more competitors and more details about So Shape.

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Jun
20

10 things in tech you need to know today

Elizabeth Holmes. Skye Gould/Tech Insider

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

1. An increasing number of tech CEOs are speaking out against the Trump administration's policy of separating immigrant families at the border between the US and Mexico. The condemnations come days after Microsoft employees also protested the company providing cloud services to ICE.

2. Facebook is taking on the massively popular HQ Trivia app. The social media giant announced on Tuesday that it will let pages host their own live quiz shows. At launch, partners BuzzFeed, Fresno, and Insider will all launch game shows on Facebook Live.

3. Snap was in discussions to buy buzzy augmented reality startup Blippar, but the deal fell through and Blippar quit Silicon Valley. Snap has acquired European startups before, buying game engine PlayCanvas and French map startup Zenly.

4. Tim Draper, an eccentric Silicon Valley investor, publicly defended Theranos founder Elizabeth Holmes after she was indicted on charges of wire fraud last week. Draper said he believed that Holmes was "innocent until proven guilty" and that he was still close to the disgraced entrepreneur.

5. Security software company Symantec revealed Tuesday that a hacking campaign based in China had burrowed into satellite operators, defense contractors and telecom companies in the US and southeast Asia. The company said the hackers were driven by national espionage goals, which include intercepting military and civilian communications.

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6. Twitter CEO Jack Dorsey shared at least 17 tweets from a confirmed Russian troll. According to an analysis from The Wall Street Journal, Dorsey shared tweets from an account linked to the now-infamous Internet Research Agency between late-2016 and mid-2017.

7. Apple was fined $6.6 million by Australia's consumer rights watchdog for misleading iPhone and iPad users about third-party repairs. Apple had said users were not entitled to get their devices fixed because they had been previously repaired by a third party, but this is against Australian consumer law.

8. Popular battle royale game Fortnite has racked up $100 million in revenue, according to Sensor Tower data. That's in the game's first 90 days on iOS alone.

9. A South Korean cryptocurrency exchange, Bithumb, halted trades amid a $31 million hack, according to CoinDesk. Bithumb hasn't said which currency was under attack, but said it would cover the losses.

10.Food apps such as Uber Eats and Deliveroo might kill the kitchen, according to UBS. In a note to investors, the bank predicted that millennials could end up eating mostly takeout or preparing food with meal delivery kits.

Original author: Rachel Sandler and Shona Ghosh

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May
08

The number of messages sent via WhatsApp each day has tripled since Facebook bought it four years ago (FB)

Peter Smith, CEO of Blockchain. Blockchain

For some, blockchain is the advertising messiah, a savior that will fix all the digital ad world's messes.

For others, blockchain is, at worst, the latest version of ad tech snake oil, or, at best, the equivalent of using the Hubble telescope to look across the street.

Indeed, as the hype over blockchain technology's potential for the ad business reaches a crescendo (including more than half a dozen panels on the docket at Cannes), most insiders appear to fall into two camps: Some have an almost religious belief in blockchain's power to revolutionize everything, while others see it has having next to no application in adland.

There are other theories doing the rounds, including that it's become popular to bash blockchain because some would like it to go away. As the theory goes, some fear that blockchain's technology could expose loads of inefficiencies and opaqueness in digital advertising, which ad tech companies and ad agencies thrive on.

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Another reason for foot dragging? Blockchain will take away marketers' excuses for not paying their agencies and media partners faster, a longstanding, bitter complaint in the business.

Hype or not, startups are launching, and brands are jumping on board the blockchain, even as doubters take their shots.

What's 'blockchain' again? And how can it help the ad business?

There are lots of great explainers that go into great detail on what blockchain is and how it works.

In a nutshell, the idea is that blockchain, as a digital database, could serve as an immutable ledger — digital records nobody can change. There are public blockchains (like the one where bitcoins are mined), private ones, and ones involving consortiums.

There are numerous theoretical ways that blockchain technology could help improve advertising, such as:

Making contracts faster and smarter. Making payments faster. Unifying measurement so that every single ad campaign isn't tracked by five different data sources with five different sets of numbers, which is not uncommon. Exposing what all the different ad tech middlemen get paid in programmatic ad deals. Perhaps, eventually, blockchain could augment or replace a lot of digital advertising infrastructure. Ads could be bought or sold using blockchain technology automatically. Again, theoretically.

IBM and Mediaocean are announcing a big deal in Cannes that includes major advertisers

IBM has been a huge proponent of blockchain. This year it began running limited tests with Unilever designed at bringing more transparency to its ad buys.

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Now, IBM is looking to taking things up several notches. It's announcing a deal with Mediaocean, which supplies the invoicing software and other tools to the majority of major ad agencies along with ad tech companies and publishers.

Starting this fall, Kellogg, Kimberly-Clark, and Unilever will start testing having their ad invoicing funneled through this private blockchain network. The hope is that they'll get much greater insight into where their ad budgets are going.

If that goes well, the plan is to expand this initiative beyond billing toward measurement and other digital ad pain points.

"With programmatic advertising, there are multiple players in the middle, and multiple data sources, and it's hard to know who is even in the middle," said Babs Rangaiah, executive partner, global marketing, IBM iX, and a former Unilever marketing executive. "It became more and more of a headache. This could potentially solve the issues."

There are lots of other blockchain startups peddling solutions

IBM is not alone. The startup Amino Payments is working with brands such as AT&T, T-Mobile, Bayer, and Nestlé on using blockchain technology to facilitate payments. Similarly, a venture called NYIAX has just raised $5.6 million in additional funding to build "the world's first guaranteed advertising contract marketplace."

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And a few weeks ago, the ad tech firm Mediamath and the venture firm MathCapital announced investment in Underscore CLT. "Digital marketing remains plagued by fundamental challenges," wrote Mediamath CEO Joe Zawadzki as part of the announcement.

Underscore CLT president Isaac Lidsky sees blockchain making digital ad buying more efficient, and even saving advertisers money by helping eliminate processing fees and transfers.

"I live in the camp that it is going to totally revolutionize our business," Lidsky said. "But it's going to take some time."

Shutterstock

Boy are there lots of blockchain naysayers

Marc Guldimann, CEO of the ad tech firm Parsec, is on a quest to call BS on blockchain and advertising. He's not against the technology per se; he just believes that it has very few worthwhile applications to the business beyond settling up payments. Moreover, he thinks lots of startups are peddling vaporware.

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"Blockchain is really just a dumb, slow database," he said. "People are trying to use it to solve problems it's not suitable for. There all these qualities people ascribe to it."

One thing that irks Guldimann is this narrative that blockchain will clean up the murky ad tech supply chain by exposing who's adding value and who isn't, because he believes that people can put whatever information into blockchain tech, accurate or not.

"It doesn't make it more true if you write it to the blockchain," he said. "It's crazy. People have created entire companies around this. People are spending a lot of time with an absolute f---ing misunderstanding of what blockchain is."

Guldimann has even produced a Blockchain Decoder document for Cannes.

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Guldimann is not alone. "Blockchain is not going to fix any problems," said one ad tech CEO.

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A major argument against blockchain in the ad business is that programmatic involves billions of transactions. If you look at how slow and expensive it is to mine bitcoins, how can this help advertising?

Mike Laven, CEO of the payment company Currencycloud, works outside the ad industry. So he's got no horse in the race. As he explained it, "new business models revolutionize industries, not technology."

And blockchain is "not optimized for high transaction systems," he told Business Insider. "If there's a business model where people make money from not being transparent, it won't change."

Ed Montes, president of solutions and chief revenue officer at the ad tech firm DataXu, said he could see blockchain helping clean up the often murky digital ad supply chain and exposing hidden fees. And it might help control the flow of data.

But is that a big enough business to motivate a market? "I think that the challenge is creating a model where you can make significant money," he said. "Who pays for this? What's the business model?"

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That's not stopping companies from co-opting the blockchain concept. One ad tech executive said he was growing so frustrated with blockchain startups getting meetings with top marketers that he thought about changing the name of one of his products to include the word "blockchain." "It's f---ing catnip for brands," he said.

Some ad companies may not want things to change

One ad industry veteran put it this way: Marketers may see a value in using blockchain. But do they really want tech that enables near instantaneous payments when they get away with not paying agencies and vendors for months?

And what about procurement officers, whose whole job (and maybe bonuses) depends on being able to extract better terms from partners? Does this make them less relevant?

Do ad tech companies that collect fees for opaque algorithms and mysterious black boxes want things to change Probably not.

"There have been a lot of ways for folks to hide in our supply chain," said Alanna Gombert, Global CRO at MetaX, a startup that's urging consumers to purchase digital tokens to evaluate whether sites should carry ads.

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Plus, this industry is also known for moving slowly, despite its digital reputation. "It took us three years to get viewability right," said one publishing executive.

So unless the industry gets aligned, it will be hard to change.

Because LaborX is based on blockchain, it features a tokenized reputation system that factors in dozens of candidate data points stored on an immutable ledger, ensuring job-seekers earn their best market rate, while eliminating payment delays and disputes. BII

It's becoming popular to pound on blockchain

"In any revolution there is resistance," Gombert said. When asked about people who say that blockchain has no real application in digital ads, she added: "They don't know what they're talking about; they don't know how it works."

Will Luttrell, CEO of Amino Payments, said he's almost gotten in fights with people on industry panels about blockchain's promise, or lack thereof.

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"Its easy to pooh-pooh things when there is lot of garbage out there," he said. "And too many startups take the approach of, 'All you need to implement is change every single thing you do.' That's not going to work."

Carolina Abenante, founder of NYIAX, said her company is garnering serious interest from brands, though she couldn't say which just yet. When people cast doubt on blockchain's potential, she tells them: "Blockchain has been used by Nasdaq since 2015. Why are we the only industry not doing this?"

Still, some people think the blockchain discussion has been too focused on tactics and incremental change to existing systems. Former Washington Post executive Jarrod Dicker, now the CEO at the blockchain firm Po.et, said blockchain could provide the ad industry with an opportunity to fully reimagine how it operates.

He likened it to how The Washington Post in recent years started building and licensing its own ad tech, something that a newspaper firm would never have contemplated in the past.

"The conversations shouldn't be, 'How to do something we do today better?' It should be, 'How do change the way we think about things?'"

Original author: Mike Shields

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Jun
20

The CMO of HP Inc is calling time on the traditional ad agency model: 'The disruption is real' (HPQ)

There has been much consternation in the ad business about the threat of consulting firms like Accenture, Deloitte, and IBM encroaching on agencies' turf. And these companies are hardly being shy about their ambitions, as each has a noticeable presence on the French Riviera at the Cannes advertising festival.

The consulting threat is significant, according to Antonio Lucio, global chief marketing & communications officer at HP Inc. And traditional ad agencies should be worried.

"The disruption is real," he told Business Insider.

Over a lunch at the Martinez Hotel in Cannes, Lucio said as a marketer he now has five priorities when it comes to choosing partners. They need to bring data expertise to the table, and they need strong analytical capabilities. They also need to be able to produce meaningful content.

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In addition, partners need to legitimate programmatic ad buying capabilities. And they need to be able to track how advertising impacts business (i.e. 'attribution.')

For consulting firms, four out of the five skills "are right in their wheelhouse," he said.

IBM has a cabana at Cannes Business Insider

Of course, consulting firms have been making inroads into the ad industry for several years. They bring a reputation for having a results-driven business approach, technological expertise and often direct connections with their clients' CEOs.

Meanwhile, ad agencies are seen as increasingly vulnerable as some marketers move programmatic ad buying and even creative in-house, or turning to publishers like BuzzFeed to produce content on their behalf.

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If traditional agencies can hold onto anything, it's creative - i.e. the making of ads, said Lucio. That means increasingly, marketers won't need full service agencies that handle every aspects of their ad campaign executions. He sees brands working with consultants or doing a lot more of this work themselves.

And when it comes to getting ads made, brands can increasingly shop around without making a big agency commitment. "It is so friggin' easy to get it from anywhere," he said. "This reality will fundamentally disrupt the agency of record as we know it."

Accenture's Cannes yacht Business Insider

Anatoly Roytman is one of those disruptors. He serves as managing director of Accenture Interactive's‎ Europe, Africa and Latin America operations. His team was comprised of 10 people just eight years ago. Last year Accenture Interactive pulled in $6.5 billion. It has acquired 22 companies over that time.

"It was actually our clients who led us [to advertising]," he added. "We were fast followers."

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He said traditional ad companies are suffering because they for too long focused solely on making ads, and less about how products actually work in the real world.

Consulting firms are focused on managing customers' experiences, he says."This is what makes or breaks a brand right now," he told Business Insider. "It's not enough to attract people, you need to retain them. And you need to provide them services."

Roytman argued that the way traditional ad agencies are structured makes it difficult for them to connect creative work with tech and data. That structure leads to turf wars, he said.

"The agencies are led by big egos," he said. "We need teamwork. This is the biggest difference between us and those guys," he said. "Ego is not bad. But when ego is more important than outcome, those people are not good for us."

Original author: Mike Shields

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Jun
20

11 rising cinematographers taking over Hollywood

"Moonlight." A24 If the director is the most important crew member on set, in most cases the cinematographer is the second-most important.

A skilled director of photography can turn a mediocre movie suddenly into a critical darling or a good movie into an Oscar contender. But unlike directors, who can have a breakout indie and suddenly get snatched up to do the next Hollywood blockbuster, cinematographers are in it for the long game.

Many have to work a decade or two on independent films, shorts, TV shows, and commercials before scoring a studio feature. And even at that point you still have to compete for work with the legends in the field like Emmanuel Lubezi, Robert Richardson, and Roger Deakins to land a job.

Here are 11 cinematographers who are beginning to make their mark in Hollywood — including the visionaries behind "Moonlight" and "The Last Jedi."

Original author: Jason Guerrasio

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Jun
20

Read the memo Microsoft CEO Satya Nadella sent to employees about the company's work for ICE and Trump's 'zero-tolerance' policy (MSFT)

Microsoft CEO Satya Nadella is under pressure.

This week, the $769 billion tech giant faced sharp criticism in Silicon Valley and beyond for its work with Immigrations and Customers Enforcement (ICE), the immigration control agency involved in carrying out President Donald Trump's "zero-tolerance" policy, in which children are separated from their families after they've crossed the US-Mexico border illegally.

On Tuesday, the problem came home, as The New York Times reported that over 100 Microsoft employees signed an open letter to CEO Satya Nadella urging the company to terminate the $19.4 million contract and stop working with ICE altogether, the Times reported.

On Tuesday evening, Nadella responded with a memo to employees, which he also shared on his personal LinkedIn page. In that memo, he said that as a father and an immigrant to the United States himself, he is "appalled at the abhorrent policy of separating immigrant children from their families." He reiterated the company's advocacy for the policy to end, and linked to a post from Microsoft President Brad Smith calling for immigration reform.

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"This new policy implemented on the border is simply cruel and abusive, and we are standing for change," Nadella said.

The memo also downplays Microsoft's deal with ICE, saying that it has nothing to do with current policy:

I want to be clear: Microsoft is not working with the U.S. government on any projects related to separating children from their families at the border. Our current cloud engagement with U.S. Immigration and Customs Enforcement (ICE) is supporting legacy mail, calendar, messaging and document management workloads.

Nadella is just one of many tech leaders to call for the end of the family separation policy, including the founders of Airbnb, Box CEO Aaron Levie, and Twitter CEO Jack Dorsey. For Nadella, though, standing against this policy presents a unique dilemma of its own.

Microsoft declined to comment.

"Team,

Like many of you, I am appalled at the abhorrent policy of separating immigrant children from their families at the southern border of the U.S. As both a parent and an immigrant, this issue touches me personally.

I consider myself a product of two amazing and uniquely American things — American technology reaching me where I was growing up that allowed me to dream the dream and an enlightened immigration policy that then allowed me to live that dream. My story would not have been possible anywhere else.

This new policy implemented on the border is simply cruel and abusive, and we are standing for change. Today Brad detailed our company's position on this issue, as well as the immigration legislation currently being considered in Congress, and I encourage you to read his blog post.

I want to be clear: Microsoft is not working with the U.S. government on any projects related to separating children from their families at the border. Our current cloud engagement with U.S. Immigration and Customs Enforcement (ICE) is supporting legacy mail, calendar, messaging and document management workloads.

Microsoft has a long history of taking a principled approach to how we live up to our mission of empowering every person and every organization on the planet to achieve more with technology platforms and tools, while also standing up for our enduring values and ethics. Any engagement with any government has been and will be guided by our ethics and principles. We will continue to have this dialogue both within our company and with our stakeholders outside.

The immigration policy of this country is one of our greatest competitive advantages, and this is something we must preserve and promote. America is a nation of immigrants, and we're able to attract people from around the world to contribute to our economy, our communities and our companies. We are also a beacon of hope for those who need it the most. This is what makes America stronger. We will always stand for immigration policies that preserve every person's dignity and human rights. That means standing with every immigrant who works at Microsoft and standing for change in the inhumane treatment of children at the U.S. border today.

Satya"

Original author: Matt Weinberger

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May
08

Russia is about to put on a massive military show of force — here's what to watch for

Chris Concannon, the president of Cboe Global Markets, is one of Wall Street's biggest crypto advocates. But the trading veteran thinks investors should lay awake at night worrying about the uncertainty hanging over the market for initial coin offerings, the popular crypto crowdfunding method.

"The reckoning will come in two waves," Concannon said in an interview with Business Insider. First, the SEC will go after ICO market participants. Then, class-action lawsuits against the teams behind ICO projects will surge.

Crypto investors cheered when William Hinman, the SEC's director of corporate finance, said last week that ether transactions would not fall under the agency's regulatory purview. Still, Hinman's remarks did not give the greenlight for companies to run an ICO, which enables a company to issue its own token in exchange for ether or bitcoin (which ideally would go towards building a product or business).

The market, which is known for its fair share of both fraud and big dreams, has allowed some tech startups to raise billions of dollars from a wide-spectrum of investors. In total, more than $7 billion has been raised via the fundraising method in 2018, according to data from Token Report. ICOs are traded on dozens of exchanges across the world and are popular investments among the more than 200 crypto hedge funds. Pantera Capital, one of the largest crypto investors, has two ICO funds, for instance.

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If the SEC ultimately decides that the lion share of ICOs are unregistered securities, then many players in the market could find themselves in a legal quagmire.

"The actual party that offered the unregistered coin, they could have been involved in issuing an unregistered security," Concannon said. "Anyone who sold that off could be deemed an unregistered underwriter."

To be clear, the SEC could come up with an entirely new designation for ICOs. And it's not clear to some market observers whether the agency would retroactively go after all market participants. Robert Hockett, a professor of financial regulation at Cornell University, said you would likely only see the SEC take legal action in certain circumstances.

"I don't think it is the case that people involved in the business are going to be prosecuted against as if they have been violating the law," Hockett said. "But there is a little bit of a room for exception with something particularly egregious."

That could mean a company misled investors about a certain offering or claimed that it would never fall under the auspices of the SEC.

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Either way, the story doesn't change for investors. If the SEC deems ICOs as unregistered securities, then their holdings would be rendered valueless. This, according to Concannon, would trigger the second wave of reckoning.

"If you sold someone an unregistered security you are liable to them if they decide to take them to court," Concannon said.

The market has seen a number of class-action lawsuits. Business litigation firm Silver Miller in late 2017 filed a class-action suit against Monkey Capital, a crypto hedge fund. The firm alleges the fund promoted its ICO that violated US securities law. Silver Miller also has pending cases against crypto exchanges Kraken and Coinbase.

Law firm Polsinelli, which is advising clients to approach the ICO market cautiously, said it has "only likely begun to see the beginning of class action lawsuits filed relating to blockchain-related companies or companies that participated in ICOs."

Some of those suits could have merit, said Cornell's Hockett.

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"If they can prove investors were defrauded and misled by people who were better suited to understand the regulatory framework, but still instilled in investors a — no pun intended — false sense of security, then some suits would have merit."

For Hockett, the move indicates a shift in the market that is not without historical precedent. Crypto, he says, is moving out of the "Wild West" phase into a "regulatory scrutiny phase," which in the short term will see the rise of funds to launch class-actions and increased litigation. But in the long term, it will see a cleansing of the market.

"It is a legal life cycle of every new asset that becomes highly popular," he said. "It was true for tulips, junk bonds, and mortgage-backed securities, and now crypto."

Original author: Frank Chaparro

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Jun
20

UBS says Uber Eats-obsessed millennials could kill the kitchen

The future. Getty

Millennials are, famously, responsible for killing off lots of established industries thanks to their love of smartphones and avocados. Their next victim might be a domestic chore: Home cooking.

According to a UBS note to investors, titled "Is the kitchen dead?", the rise of food delivery apps such as Uber Eats and Deliveroo might kill the kitchen.

Here's what UBS analysts wrote:

"There could be a scenario where by 2030 most meals currently cooked at home are instead ordered online and delivered from either restaurants or central kitchens. The ramifications for the food retail, food producer and restaurant industries could be material, as well as the impact on property markets, home appliances and robotics."

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The endgame for this particular scenario, the bank predicted, would see people ordering multiple meals a week from food delivery startups like Deliveroo or Uber Eats. That food would be much cheaper to make and deliver, thanks to robots and delivery drones putting human chefs and drivers out of a job.

Reuters/Stringer

Mealkit delivery services such as Blue Apron or HelloFresh would fill any gaps, but still require minimal preparation. The food delivery market would be worth as much as $365 billion, UBS said, and services like JustEat and Deliveroo would be the major winners.

In the same scenario, the bank predicted people might go to supermarkets and buy less fresh food. They would also go out to eat in restaurants less, meaning lots of restaurants and supermarkets might shut down or consolidate.

Instead, the bulk of food people eat would come from "Dark kitchens," a model already pioneered by Deliveroo. This is where staff (or, in UBS' vision, robots) prepare different types of takeaway meals in grouped kitchens.

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Deliveroo runs pop-up kitchens in shipping crates, where different restaurant brands prepare food from the same site — often from car parks. The thinking is that this is much cheaper than doing takeaway from a restaurant located on prime real estate.

People will also buy fewer pots, pans, and other kitchen accessories. These graphs show just how possible this kitchen-free future is:

UBS

While food delivery services are still pretty niche, per figure 8, people are getting more used to on-demand services and food delivery apps are only becoming more popular.

Still, the dead kitchen scenario isn't inevitable. UBS has hedged its bets for any gourmands horrified by the prospect of always eating pre-prepared food at home.

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As UBS references, Deliveroo relies on an army of low-paid, self-employed delivery riders who forgo the benefits of full-time employment for flexibility.

In the case of Deliveroo, riders are fighting for better rights, which may lead to government regulation and greater expense for food delivery startups. In the worst case scenario, strict regulation could end Deliveroo's business.

Given that obesity is a health crisis in the UK, the government might also step up public health campaigning against takeaway food and portion sizes, encouraging more people to cook at home.

Finally, cheap kitchen robots and drones might take years to arrive.

All of these factors would contribute to a rise, rather than decline in home cooking.

Original author: Shona Ghosh

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Dec
18

Feld.com Automagically Upgraded To HTTPS By Pantheon

Coinbase CEO Brian Armstrong shared this graphic to demonstrate major price ebbs and flows in bitcoin's history.Brian Armstrong via TwitterJust six months after bitcoin mania sent prices soaring up toward $20,000, the popular cryptocurrency is now worth about $6,700 — just a third of its all time high.

But the CEO of Coinbase, a cryptocurrency exchange valued at $1.6 billion last August, has a message for newer employees: Don't panic.

In a Twitter thread Tuesday, CEO Brian Armstrong shared the motivational message that he sent to his employees earlier in the day to reassure them to stay strong during the cryptocurrency down cycle.

"It can be scary the first time you see it, but to us who have been in the industry for many years, it feels like old news," Armstrong said.

"When there is hype, people are irrationally exuberant. When there is despair, people are irrationally pessimistic. Neither is true," he continued. "Reality is always somewhere in the middle, more correlated with real usage (transactions per day) than the price."

Founded in 2012, Coinbase became a household name in the second half of 2017, as an upturn in the price of bitcoin sent new traders to the easy-to-use exchange.

Longtime bitcoin investors, including the Winklevoss twins, became overnight billionaires thanks to early investments in the once valueless digital currency. The hype grew on the promise that anyone could earn their own Lamborghini with the right investments.

The price of bitcoin steeply rose and fell in the past year.Markets Insider

Coinbase grew its userbase and revenue as interest grew from the general public.

The company put in action a plan to double its headcount from around 250 to 500 people. So there are a lot of new people at Coinbase, many of whom left careers at big-name tech companies to join the wild west of crypto.

But it also suffered under the strain of its newfound popularity, particularly in terms of customer service and system outages.

It's for that reason that Armstrong told employees that he's "come to enjoy the down cycles in crypto prices more." "It gets rid of the people who are in it for the wrong reasons, and it gives us an opportunity to keep making progress while everyone else gets distracted," he said.

Read Coinbase CEO Brian Armstrong's full Twitter thread here.

Original author: Becky Peterson

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Jun
20

There's a 'dumb reason' why PlayStation and Xbox gamers can't play online together, according to a former Sony insider

Sony's decision to restrict PlayStation 4 owners from playing Epic Games's smash-hit "Fortnite" with players on the Nintendo Switch and Xbox sparked an uproar. Worse yet, if you started playing "Fortnite" on the PlayStation 4, you couldn't bring your purchased items with you to those other consoles.

According to a former Sony developer, the company's stance on this matter isn't all that surprising.

"When I was at Sony, the stated reason internally for this was money," John Smedley, the former Sony Online Entertainment president and general manager of Amazon Game Studios, said in a tweet on Monday. "They didn't like someone buying something on an Xbox and it being used on a PlayStation."

"Simple as that," Smedley added. "Dumb reason, but there it is."

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Sony did not immediately respond to a request for comment.

Although Fortnite players on the PlayStation are able to play with other PC, Mac, iOS, and Android players, they are still restricted from using their accounts on the Xbox and Switch. PlayStation owners playing the game are also walled off from Xbox and Switch players.

Meanwhile, players on the Xbox and Switch — the latter of which recently amassed more than 2 million downloads in the first 24 hours of its release on June 12 — are playing the game without restrictions.

The lack of Fortnite cross-play between the PlayStation and other consoles was met with backlash from players. Players who linked their Epic Games account to their PlayStation 4 were faced with a message saying that their account "does not allow it to operate on Switch."

Sony's subsequent response, which said it was "open to hearing what the PlayStation community is interested in," was also slammed by critics and rallied the PlayStation community.

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"If we keep the pressure up this problem goes away," Smedley said in response to the controversy.

Fortnite, which gained a cult-like following after its release in 2017, became one of the biggest hits in gaming with an estimated 125 million players. The free-to-play game capitalizes on the widely-popular "Battle Royale" gameplay, which pits players against each other until one is left standing.

Original author: David Choi

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Dec
19

Book: Am I Being Too Subtle?

Dara Khosrowshahi, CEO of Uber, speaks at the 2018 NOAH conference on June 6, 2018 in Berlin, Germany. Michele Tantussi/Getty Images

Uber is exploring how its legal team can assist migrant families affected by President Trump's hardline immigration policies, and has donated $100,000 to a non-profit supporting migrant children, according to an internal company memo.

The memo, provided to Business Insider by a company spokesperson, condemns the Trump administration's policy of separating migrant families as "unfathomable to imagine and heartbreaking to see."

Written by Uber deputy general counsel Tammy Albarrán and SVP of communications and policy Jill Hazelbaker, it says Uber is "better and stronger because we are made up of and serve people from all over the world."

On providing legal aid to affected families, they wrote: "Our Legal team is also reaching out to law firms with a strong commitment to pro bono work to explore immediate opportunities for Uber Legal to partner with them to help parents and children affected by these policies in any way we can."

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Uber joins a growing list of tech companies and high-profile industry figures who have spoken out against Trump's immigration policies, which have sparked widespread outrage in recent days following reports of migrant children being detained in cages without their parents.

And it comes as Uber attempts to resuscitate its public image following months of ugly scandals around everything from sexism to evading local governments, culminating in the ousting of founder and then-CEO Travis Kalanick.

Kalanick's replacement, Dara Khosrowshahi, condemned the Trump policy publicly on Twitter on Tuesday. He wrote: "As a father, a citizen and an immigrant myself, the stories coming from our border break my heart. Families are the backbone of society. A policy that pulls them apart rather than building them up is immoral and just plain wrong. #KeepFamiliesTogether"

Also on Tuesday, Facebook CEO Mark Zuckerberg called on Facebook users to donate to non-profits providing assistance to migrants, and Apple CEO Tim Cook called the measures "inhumane."

Team -

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As you heard us discuss at the All Hands today, we are horrified by what is happening at the southern border, where more than 2,000 children have been separated from their families. It's unfathomable to imagine and heartbreaking to see, and we want you to know what we are doing as a company and what you can do as an individual.

We continue to directly advocate for necessary changes to our nation's broken immigration system, which includes seeking permanent status for DREAMers, protections to other visa categories, and opposition to country of origin travel bans. The Policy team is working closely with partners including FWD.US, The National Immigration Forum, and the U.S. Chamber of Commerce, and asking legislators and regulators to put an end to this crisis. Our Legal team is also reaching out to law firms with a strong commitment to pro bono work to explore immediate opportunities for Uber Legal to partner with them to help parents and children affected by these policies in any way we can. We are also taking a stand as a company—Uber committed $100,000 to KIND today.

Many of you are asking what you can do personally. Here are are a few options:

Uber is better and stronger because we are made up of and serve people from all over the world. We strongly support immigration policies that help people and families who want to build a better life, achieve their dreams, or seek protection from dangerous governments and situations.

Thanks to everyone for all you're doing to call attention to this issue.

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-Jill and Tammy

Original author: Rob Price

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Jun
19

YouTube has blocked MIT's educational video clips for 4 days because of updated 'partner agreements' and it's left the university frustrated (GOOG, GOOGL)

Late last week, videos from MIT OpenCourseWare posted to YouTube mysteriously became inaccessible on the Google-owned site.

OpenCourseWare is in charge of sharing teachings from MIT, one of the country's most respected research universities, with the rest of the world. The school's most popular videos on YouTube are typically recordings of lectures on computer science and mathematics. It's not the kind of thing that might be considered unsavory, controversial or a violation of YouTube's policies.

And yet, YouTube decided to block these educational videos from public view. The school wasn't informed of the reasons and hasn't a clue about how to get them back up. As of Tuesday afternoon, the videos were still inaccessible.

"We're quite frustrated by it," said Curt Newton, the MIT OpenCourseWare's director, in an interview Tuesday with Business Insider.

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He said the program's YouTube videos generate millions of views from across the globe. Teachers use them in their classrooms. Students study them.

Also late last week, the same thing happened to clips from the Blender Foundation, the nonprofit that oversees the Blender open-source 3D content-creation program, according to a Blender blog post.

YouTube hasn't said much about why the videos were blocked to the site operators or journalists.

"Videos on a limited number of sites have been blocked as we updated our partner agreements," the company told Business Insider in a statement. "We are working with MIT OpenCourseWare and Blender Foundation to get their videos back online."

The only problem with that is MIT and Blender say they're completely in the dark as to why their videos were blocked or when they might return.

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The leading theory among tech-news sites is that the cause of the trouble must be a glitch with YouTube's content filtering system. The filter is supposed to scan videos and flag those that violate the site's policies. In practice, disturbing and graphic video clips sometimes get through the filter while benign videos that adhere to YouTube's rules are removed.

YouTube's statement that the problem lies with the company's partner agreements seems to indicate that the problem might simply be an administrative, paperwork issue.

Whatever the reason, the incident shows our dependence on YouTube as a fundamental part of a modern infrastructure, in which entities from news publishers to universities depend on it to distribute videos.

In the past few years YouTube has appeared to struggle to maintain control of a site that sees more than 400 hours of video posted to it every minute and 1.8 billion viewers every month. All that growth appears to have made YouTube enormously valuable.

But the flip side is that one of the nation's premiere universities had its videos removed, wasn't informed of the reasons and was prevented from resolving the issue after four days.

Original author: Greg Sandoval

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May
08

Reddit cofounder Alexis Ohanian has a dead rabbit to thank for his romance with Serena Williams

BuildGroup is supposed to be the anti-Silicon Valley capital firm, only investing for the long term and not cashing out of its companies for 15 years or longer, if ever, its cofounder Lanham Napier tells Business Insider.

Napier, who earned his fame and fortune as the 14-year CEO of Rackspace, a job he left in 2014, calls his new investment firm a "company, not a fund." It has a board of directors and partners that have experience running companies. And they have all contributed their personal cash to the $330 million fund it finished raising on May 31.

"At BuildGroup, we are trying to do for other founders and senior teams what wasn't done for us," Napier says. "We raised $330 million, I put in $30 million myself. I'm the largest individual investor. We need alignment [with founders], with people with skin in game. We may make 1 or 2 investments a year and that's it. You can't be on 15 boards and know what's going on."

All the folks at BuildGroup have also agreed to long-term ownership of every company they back, he says.

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It didn't take long for this model to face its first real-world test: Right out of the gate with his first investment, he faced a moral dilemma with Anaconda, a data science startup.

"The first investment we made was in Anaconda. We sign the LOI [letter of intent] and then the company gets a call from 'giganticorp' kind of saying, 'we want to buy you,'" he said.

The founders were flummoxed. It was a week before Christmas, and Napier flew out to the West Coast to help the founders meet this prospective buyer.

Napier wouldn't confirm which Seattle company was making the offer, but Anaconda had just signed a partnership agreement with Microsoft about that time, and it was also known to the folks at Amazon Web Services, Napier's former bitter rival when he was at Rackspace. Napier had plenty of experience dealing with both of those giants.

"I said, look dudes, if you want to sell to Darth Vader that's fine. We will rip up the LOI and we'll do the right thing ...

"I said, look dudes, if you want to sell to Darth Vader that's fine. We will rip up the LOI and we'll do the right thing here because an entrepreneurial journey has it's highs and lows. You've got to be all in or it's not going to work," he said —meaning he wasn't going to elbow his way into the deal at the last minute, or sweet talk them into staying separate and giving him favorable terms for buying in.

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"I believe karma is real. How we treat people matters," he said.

The Seattle company wouldn't let Napier join the meeting, he remembers. When it was over, they told him they weren't going to sell.

"They said, 'We're going to build,'" Napier remembers.

Thus began Napier's investment company. It officially came out of stealth this month, in the hopes it will help turn the traditional VC model on its head.

BuildGroup's other founders include Rackspace alumni Jim Curry and Klee Kleber, as well as Pete Freeland from General Catalyst.

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Napier says that BuildGroup is different because it's ready to keep its stakes in its startups for decades or longer, with the option of kicking in extra money as needed, too.

Anaconda cofounder Travis OliphantYouTube/AnacondaCON 2017"We are a company, not a fund. The capital we invest can go forever," he says, which is a very anti-Silicon Valley venture investment point of view. Most VCs want to cash out and realize their returns in five to 10 years.

Napier says the key to success is being selective, rather than going for volume in the hope of getting a hit.

In its first two years, for example, BuildGroup has invested $57 million of that $330 million in just four companies. Besides Anaconda, it's backed CDSC, Fiix, and Valkyrie Labs.

Another key for success: helping companies prioritize profitable operations over growth. He wants these companies to have "unit economics that function" rather than burning through cash, needing to continually raise more money from investors to survive.

That's also a very anti-Silicon Valley point of view.

One more thing he's doing: looking to invest mostly outside of Silicon Valley, targeting startups in the Texas and Rocky Mountain region, home of BuildGroup's investors.

"From a structure point of view, we are a company not a fund, that is a big difference, we don't have to exit anything. We will build these companies as long as you [the founders] want to build," he says.

Original author: Julie Bort

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Jun
19

Startup Grind founders raise $6.4M for community event platform Bevy

The founders of entrepreneurial community Startup Grind have a startup of their own — Bevy, which announced today that it has raised $6.4 million in Series A funding.

The funding comes from Upfront Ventures, author Steve Blank, Qualtrics founders Ryan Smith and Jared Smith, and Pluralsight CEO Aaron Skonnard.

CEO Derek Andersen (who founded and runs both Bevy and Startup Grind with CTO Joel Fernandes) said that the product was created to deal with Startup Grind’s challenges as the team tried to organize events using a mix of Eventbrite, Meetup and MailChimp,

“It worked fine at first, but a few years later, we looked up and we had hundreds of cities, and we had maybe 500 people that were working on it, and it was too much,” Andersen said. “For the first time in many years, we started to get smaller instead of bigger. We were spending all of this time just running triage and maintenance on the platform.”

So in early 2016, the team built its own event management software, with what Andersen said was “no intention of anyone else using it.” But eventually, he realized that other companies were facing similar problems, so he launched Bevy as a separate startup to further develop and commercialize the product.

“We really focus on the smaller, community events,” Andersen added. “If you just do a conference, Eventbrite is great — I’ve hosted thousands of events on Eventbrite. But if you want to host five or 10 events a month or jack that number up anywhere above that, and you don’t want to hire 10 people, then that’s really what we’re perfect to do.”

Usually, these are events where community members play a big role, or are even doing most of the organizing themselves. So beyond supporting tasks like creating event listings, sending out promotional emails and managing sponsorships, Andersen said one of Bevy’s big differentiators is the ability to precisely control which users are authorized to perform different roles at different events.

In addition, Andersen said that with Bevy, companies can create fully branded experiences and get full access to the customer data around their events. Customers include Atlassian, Duolingo, Docker, Evernote and Asana.

Andersen also suggested that the company is taking advantage of a broader shift in marketing, where companies are relying more on their own customers and communities.

“All the best companies do it today,” he said. He predicted that in the future, “Every company will have a customer-to-customer marketing strategy. Now we’ve made it affordable and turnkey.”

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Jun
19

Keepsafe launches a privacy-focused mobile browser

Keepsafe, the company behind the private photo app of the same name, is expanding its product lineup today with the release of a mobile web browser.

Co-founder and CEO Zouhair Belkoura argued that all of Keepsafe’s products (which also include a VPN app and a private phone number generator) are united not just by a focus on privacy, but by a determination to make those features simple and easy-to-understand — in contrast to what Belkoura described as “how security is designed in techland,” with lots of jargon and complicated settings.

Plus, when it comes to your online activity, Belkoura said there are different levels of privacy. There’s the question of the government and large tech companies accessing our personal data, which he argued people care about intellectually, but “they don’t really care about it emotionally.”

Then there’s “the nosy neighbor problem,” which Belkoura suggested is something people feel more strongly about: “A billion people are using Gmail and it’s scanning all their email [for advertising], but if I were to walk up to you and say, ‘Hey, can I read your email?’ you’d be like, ‘No, that’s kind of weird, go away.’ ”

It looks like Keepsafe is trying to tackle both kinds of privacy with its browser. For one thing, you can lock the browser with a PIN (it also supports Touch ID, Face ID and Android Fingerprint).

Then once you’re actually browsing, you can either do it in normal tabs, where social, advertising and analytics trackers are blocked (you can toggle which kinds of trackers are affected), but cookies and caching are still allowed — so you stay logged in to websites, and other session data is retained. But if you want an additional layer of privacy, you can open a private tab, where everything gets forgotten as soon as you close it.

While you can get some of these protections just by turning on private/incognito mode in a regular browser, Belkoura said there’s a clarity for consumers when an app is designed specifically for privacy, and the app is part of a broader suite of privacy-focused products. In addition, he said he’s hoping to build meaningful integrations between the different Keepsafe products.

Keepsafe Browser is available for free on iOS and Android.

When asked about monetization, Belkoura said, “I don’t think that the private browser per se is a good place to directly monetize … I’m more interested in saying this is part of the Keepsafe suite and there are other parts of the Keepsafe Suite that we’ll charge you money for.”

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May
08

Meet the new team leading Facebook after the company's biggest shakeup in history (FB)

Venture-backed companies must walk the line between fast growth and efficient growth. Even as VCs value high-quality revenue, companies are still held to a minimum growth rate. We think of this threshold as the “Mendoza Line,” a baseball term we’ve adapted to track the minimum growth needed to get access to venture funding. Above this line, startups are generally attractive to investors and even have a good chance for a strong exit.

To achieve sustainable growth, maximizing customer lifetime value is an important component and one that is often underestimated, particularly for SaaS and other subscription-based businesses that generate recurring revenue. It is estimated to cost somewhere between five to 25 times more to acquire a new customer than to keep one you already have. Additionally, Bain research has shown that a five percent increase in retention rates can increase profits by 25 to 95 percent. Even by conservative estimates, retention is a powerful mechanism for growth.

As companies face greater pressure to grow both quickly and responsibly, we are placing more value on customer retention as a barometer for long-term success. And we are seeing smart startups invest in measuring customer happiness in more sophisticated and consistent ways.

In looking at SaaS deals over the past 10 years, we’ve found that a few key metrics and best practices are predictive of healthy business fundamentals. Here’s the advice I give startups looking to achieve smart growth through customer retention.

Create a system for measuring customer happiness

First, measurement must be an executive priority. Ensure you have a system in place to measure retention on a quarterly basis (at least) and meet as an executive team to diagnose potential problems. While benchmarking against similar businesses can be helpful, trending your own metrics is the best way to see how your performance is improving or deteriorating.

You’ll need to identify the specific metrics that work best for your business. I recommend looking at how efficiently you’re putting resources toward customer retention, which gives you insight into customer happiness and predicts the profitability of your growth.

The percent of ARR spent on retention tells you how much you’re spending to keep your customers happy; let’s call it your Retention Efficiency. You can measure this with a simple calculation:

(Quarterly cost of customer retention) x 4
Ending annual recurring revenue (ARR) base

The ability to keep this number low means you’re retaining your customers without burning money. This means you can invest sales resources toward acquiring net new customers rather than replacing revenue from those that have left.

I’d also recommend looking at the Customer Retention Cost (CRC), which measures how much on average you’re spending to retain each customer:

(Quarterly cost of customer retention) x 4
Total # of customers in your base

Note, this number may increase over time if you’re moving upmarket — enterprise customers generally require more resources to retain than small to mid-sized companies. If your retention costs are going up, this per-customer number can help you explain why in the context of your go-to-market strategy.

Don’t just measure churn rate

Most startups measure retention in terms of churn rate: dollars that left in a given quarter divided by total ARR. In my experience, churn is a vanity metric and not particularly accurate because it combines customers that are eligible to leave and those that are not (e.g. contracts that were signed in the past month).

Renewal rate is harder to benchmark, but tells you more about your customer happiness and health of the business overall. Gross Renewal Rate shows you the dollars that renewed as a percentage of all dollars that were eligible to be renewed. Calculate this metric (Gross Renewal Rate) by summing all renewed contracts and dividing that total by the dollars that were up for renewal:

Dollars renewed
Dollars eligible to renew

Net Renewal Rate is a measurement of the growth of your existing customer base, net of any churn, as a percentage of all dollars that were eligible to renew. Include any expansion dollars with your renewed dollars in your calculation to get Net Renewal Rate:

(Dollars renewed + dollars expanded)
Dollars eligible to renew

Calculating renewal rate by segment is even more helpful in diagnosing issues of customer dissatisfaction. For instance, if your renewal rates are trending down in the SMB segment but not at the enterprise level, you might identify a problem with product-segment fit. Perhaps the product is too complex for SMB customers, while enterprise customers need those features.

Don’t look to customer success as the fix-all solution

If you’re looking to improve retention, the answer isn’t necessarily to pour resources into your customer success organization. Retention is one area that can be impacted by several functions. Look into the factors that play into customer lifetime value, including:

Product: Increases in churn or retention costs could signal that you’re drifting from product-market fit or that your product faces increased competitive pressure.Marketing and sales: Ask yourself the following: Does your marketing accurately message your value proposition? How much is your sales team promising above and beyond what the product can do?Customer success: Make sure you’re engaging with customers beyond the first three months of their deployment; the next six to nine months are critical for success. Measure customer success throughout the life cycle to ensure users are getting the most out of the product and understand how to use it.

Define a product engagement metric

Understanding how much your customers actually use and depend on your product is the best indicator of happiness. Engaged customers are more likely to renew their contract — which helps to keep your retention numbers steady. They’re also more likely to tell others about their experience with your product, which improves top-line growth.

Experiment with an engagement metric that works for your business: for DocuSign, it’s the number of envelopes sent; for JFrog, it’s the volume of binaries distributed; for Textio, it’s the number of job requisitions written in the platform.

Your ability to keep customers happy without spending a ton of resources speaks to the value you’re delivering. And if you retain customers efficiently, you can spend more on acquiring new customers. In evaluating a portfolio company, I’d much rather see a business with good growth and high-quality customer retention than one with explosive growth but low retention. VCs will hold you to these metrics — make sure you’re accountable for them.

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Apr
20

481st 1Mby1M Entrepreneurship Podcast With Joshua Posamentier, Congruent Ventures - Sramana Mitra

Healthcare delivery is an incredibly complex topic, but one that has a simple truth: health security is key to living a good life, and, ultimately, for developing a strong economy. Unfortunately, billions worldwide suffer from lack of access to even the most basic of medical diagnostics and treatments, since doctors often aren’t available and the costs when they are can be exorbitant.

That’s the world that Thomaz Srougi grew up with in his native Brazil. Brazil has made health security a major priority, offering comprehensive and free medical coverage to every citizen, a right enshrined in its constitution. That simple right though is riven with challenges, from a lack of public funding, to long queues for services, to geographic disparities between urban cores and rural areas.

Those with the means use private medical services, but those costs are far outside the reach of the majority of Brazil’s inhabitants. The country may have made a commitment in words, but it has in many ways failed to fulfill that commitment with actions.

Srougi wanted to bridge that gap. He had medicine in his DNA: his father was a urologist, and so saw first hand the challenges of the public health system. He spent years as an investment banker and financier, and also netted two masters degrees from the University of Chicago in business and public policy. But he yearned to return to Brazil and work on ameliorating the massive health disparities that he saw in his youth.

His solution would eventually become Dr Consulta. The concept was simple: offer the sort of universal access of the public health system, but with the quality and timeliness of the private health market. Srougi and his team opened their first clinic in 2011 in a São Paulo favela, the irregular slums that spread like an archipelago through Brazil’s cities.

Since that humble beginning, Dr Consulta has spread rapidly throughout the country, becoming the largest private medical service provider in Brazil, according to the company. It now boasts more than 2,000 doctors, and has served more than a million patients in a country of 208 million. In São Paulo alone, the company has 44 medical centers. That growth has certainly caught the attention of venture capitalists, who have plowed $100 million into the company since its inception.

The company started off with just the brick-and-mortar of clinics. They were bare bones, but functional. A doctor is always on call, and they are located in the hearts of neighborhoods to guarantee accessibility. Patient records are stored digitally, and perhaps most importantly, prices are — relatively — reasonable, with basic procedures costing only around $20. Those savings come from vertical integration — the clinics are one-stop shops for medical treatments, allowing doctors to save time and money on tests and other procedures.

Dr Consulta’s app allows patients to get results and feedback faster

Over time, the company has increasingly focused on its digital practice. With its large number of patients, the company is building out its data science practice. With its patient records, Dr Consulta hopes to move beyond just basic app workflow tools to predictively analyzing patient trends and finding new and robust treatments. The hope is that the careful application of machine learning algorithms will allow the company to simultaneously improve its patient outcomes while continuing to drive down costs.

That data could also be valuable for medical researchers. The company is exploring partnerships with universities and others who might be able to use patient data in a confidential way in order to investigate new therapeutics. That data could be particularly valuable since Dr Consulta’s data could add significant diversity to existing datasets from Western countries.

With the clinics in place, the company is now branching out into new product lines to continue expanding its footprint. One initiative is to offer a sort of rewards card that can be used with retail partners. The idea is to build upon the brand that Dr Consulta has built and create a community of retailers that might offer complementary goods and services. The company is also building out a subscription program that would allow customers to pay a flat monthly fee for unlimited medical care.

In short, Dr Consulta wants to be the hub for health and wellness for each of its patients. The company offers a unique example of how concentrating on underserved markets with services priced effectively can be a massive startup opportunity, while also helping people find the health security they need to build better lives.

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Jun
19

Patriot Boot Camp wants to turn soldiers into entrepreneurs

From the earliest moments of boot camp, budding soldiers learn about entrepreneurship. They learn how to operate in unknown terrain, how to listen to signals and, perhaps most importantly, how to make things happen with extremely limited time and resources.

Yet, when soldiers return home following a deployment, the transition to civilian life can be jarring. Even with those valuable soft skills, there aren’t many obvious jobs in the private sector for a combat engineer or a fire support specialist. Perhaps even more challenging, according to Josh Carter, is their lack of connections. “The biggest thing that veterans are facing is network — they don’t have a big network,” he said.

Carter is working to change that situation through Patriot Boot Camp, a series of programs under the Techstars banner that gives veterans the tools and connections they need in order to launch a startup. The nonprofit, which was founded by Taylor McLemore, Congressman Jared Polis and Techstars founder David Cohen, hosts multi-day “boot camps” in cities across the country that are designed to quickly immerse participants into the life and thinking of startups. Since its founding in 2012, the program has held nine boot camps in cities like San Antonio, DC and Austin, with its next program in Denver later this year.

Carter’s own experience making the transition from the navy to the private sector is telling. He joined the service when he was 17 in the mid-90s, and over the following three years, traveled to 30 countries. The experience matured him, he explained, and on his return, he joined the telecom industry, starting his career climbing poles and eventually joining Twilio as an escalation manager and early employee. Twilio changed Carter’s life, encouraging him to pursue startups as his own career. “During that time I really got the bug to create something,” he said.

He tried to build his own startup called Brightwork, which was a developer microservices API founded in 2015. The company went through Techstars Chicago, and Carter was hoping to build the kind of company he had seen at Twilio. But growth challenges early on proved insurmountable. “We were really struggling to figure out our target market and struggling to find investors, so it just sort of died,” he told me.

During this period, Carter had been participating in Patriot Boot Camp’s programs, and liked what he saw. Following the dissolution of Brightwork, he eventually joined the program as an executive, first as chief operating officer last November, and then as interim CEO earlier this year when his predecessor, Charlotte Creech, stepped down to join USAA.

Carter has big ambitions for the program. While today the boot camp has been focused on one-two multi-day events per year, he wants to build the program into a full-fledged growth accelerator that would target startups in addition to budding entrepreneurs. He also hopes to increase the number of boot camps per year to three. He’s also investigating raising a fund, now that there is a cohort of more than 750 entrepreneurs who have gone through the program. Ultimately, his goal is to “build better founders” and give them the resources they need for victory.

One aspect of the program that I found interesting is that it isn’t just limited to veterans, but includes military spouses as well. Networks are incredibly important for founders, and Carter points out that spouses have “this special tenacity about them” and need to know “how to build a network quickly in a town where she knows nobody.” They often face just as much challenge in returning to life outside the base as the veteran themselves, and startups could prove to be an important avenue to make that transition.

As its numbers and successes swell, Patriot Boot Camp hopes that it can serve as a beacon for soldiers returning home, telling them that startups aren’t the sort of crazy risk that they first appear. Indeed, after what many of these men and women have just been through, it may not be all that daunting of a next mission after all.

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