Oct
10

The emergence of datacenter-as-a-service

GoDaddy has reached an agreement to acquire Over, the startup behind an app that helps businesses create the photos and videos they need for social media.

Justin Tsai, GoDaddy’s vice president of growth and product, said this acquisition is about acknowledging “a world of entrepreneurs who may never have a website.”

He told me, “Over’s capabilities really target those set of people, who may have an Instagram profile where they need to post visually engaging content but have never gone to GoDaddy.”

This follows GoDaddy’s relaunch of its website-building tools last fall under the new name Websites+Marketing, with additional features around email marketing, search engine optimization and maintaining a presence beyond your website, whether that’s on Facebook or Yelp.

Tsai said Websites+Marketing now has 1 million paying customers, but as more business started using it, “We started noticing users really had trouble creating great content as they go to those platforms. They didn’t know what to post or how to make that post really sing.”

That’s where Over comes in, offering a variety of customizable templates and layouts that should make it faster and easier to create eye-catching visual content. The goal, according to co-founder and CEO Matt Winn, is to “build guitars, not violins” — in the same way that someone can pick up a guitar and “strum a few cords,” they should be able to download Over and quickly “start creating really great content.”

In fact, the startup says it has more than 1 million active users of its own, who are using it to create more than 220,000 projects every day.

Tsai said GoDaddy and Over were initially discussing a partnership, but as it became clear that there was an opportunity to integrate the products more deeply, those discussions led to acquisition talks.

Over will continue to operate as a standalone app, and he said the team will continue to develop new features for the app. At the same time, they’ll be building integrations with Websites+Marketing, for example by taking Over and connecting it “into our insights tool to understand how different elements of [online] presence layer in together, to look at templates and how those actually help different types of small business owners.”

The financial terms of the acquisition were not disclosed. Winn said Over had previously raised funding from True Ventures and angel investors, and that the entire 76-person team will be joining GoDaddy. Over will continue to operate out of its Cape Town, South Africa headquarters.

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Jan
29

Mobile messaging startup Attentive raises another $70M

Less than six months after it announced $40 million in funding, Attentive has raised another $70 million — this time in Series C funding.

The new round was led by Sequoia and IVP, two firms that were part of the Series B. Previous investors Eniac Ventures and NextView Ventures also participated.

CEO Brian Long (who, along with his Attentive co-founder Andrew Jones, sold his previous startup TapCommerce to Twitter) told me that he wasn’t planning to raise money again so soon, but things were going even better than expected, with a client list that has grown to more than 750 businesses, including Coach, Urban Outfitters, CB2, PacSun, Party City and Jack in the Box.

Long noted that it’s always smarter to raise money when things are going swimmingly, rather than dealing with the “not-so-fun process” of trying to raise “when you really need it.”

He added, “When you see that you’re doing that well, you think, ‘Hey, we should hire a lot more people to support this growth.’ And then the other piece is just being able to move faster into new areas.”

Long attributed the success Attentive has had thus far to the growing importance of text messages as a channel for businesses to reach consumers, particularly as those consumers are less inclined to open marketing emails or download retailers’ mobile apps. And in contrast to broader messaging platforms, Long said Attentive is “focused on just doing this channel right.”

He said the platform is designed to solve the main problems faced by retailers trying to build a mobile messaging strategy — first, by helping them create a text subscriber list in a way that complies with regulations, then by offering “the ability to send messages that frankly aren’t going to piss people off.”

“We want the messages to be relevant for the consumer, we want to send them things that they care about,” Long said. “The package is on the way, real-time customer service, a product that you were looking at recently is on-sale … there’s a lot of data that you can put to work in order to do it at scale.”

Looking ahead, he hopes to expand beyond the United States and Canada, and to move into industries beyond e-commerce — for example, into more traditional retail, and also to start working with colleges that are looking to attract more applicants.

“Attentive’s growth is a clear indication that people want to interact with brands in new ways, and brands are embracing messaging as an effective way to reach consumers,” said Sequoia partner Pat Grady in a statement. “We are thrilled to double down on our partnership with Attentive so they can continue to deliver fantastic results for their customers and valuable experiences for consumers.”

Attentive has now raised a total of $124 million.

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Oct
10

Gardyn uses IoT to help you grow greens indoors

According to an Allied Market Research report, the global autonomous vehicle market is expected to grow from $54.23 billion in 2019 at 40% CAGR to $556.67 billion by 2026. The autonomous vehicle...

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Original author: MitraSramana

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Jan
29

HeyMama, a premium social network for working moms, raises $2 million

As we spend more and more time on our phones, working busier and busier jobs, and leading more and more overwhelming lives, personal connection with others is harder and harder to come by. HeyMama wants to change that.

The premium social network is aimed squarely at working mothers, looking to give them a space to connect, communicate and learn from each other. The company has today announced the close of $2 million in seed funding, with investors that include Rebecca Minkoff, Kori Estrada, Kathryn Moos, Janna Meyrowitz Turner, Divya Gugnani, Alison Wyatt, Sari Azout, Kymberly Marciano and Karen Cahn, who were HeyMama members pre-investment. Keith Belling also invested in the round.

HeyMama has several moving pieces, but the biggest and most important is the platform itself. The premium network gives members the chance to post to forums, as well as join and communicate with groups like “Tech Moms,” “Single Moms” and “Moms Who Are Fundraising.” Perhaps most importantly, all members get access to the full HeyMama membership database, giving them the ability to learn more about other members and even email them directly.

Interestingly, HeyMama is a bit of a hybrid in terms of the value proposition. Moms can come in and ask about baby food recommendations and hunt for an engineer to join their company all in the same session. Founders Katya Libin and Amri Kibbler say that many members are looking for recommendations, whether they’re for professional or personal purposes.

Another piece of the business is HeyMama events. The company holds events in 11 cities across the country and earns revenue via brand partnerships. For example, Lincoln Motor Company is a sponsor for the 2020 mentorship event series.

Libin said that the offline component is a huge reason why many moms join, as there is no substitution for face-to-face connection.

As an added bonus, HeyMama negotiates membership perks for users, giving them a discount on interesting products and services.

The company says that 85% of its members come via word-of-mouth referrals to the network. When new users do submit an application, those applications are vetted by humans. The founders said that the acceptance rate is about 85%, with HeyMama primarily focused on bringing on new members that can also offer help, not just ask for it.

HeyMama membership costs $35/month or $349/year.

The company did not disclose specific numbers around membership, but did say that it has “thousands” of members on the platform.

HeyMama actually came onto the scene in 2014 in the form of a social media account and online magazine. After realizing that working moms weren’t being served in the best way possible, the company pivoted to a premium social network in 2017, and the rest is history.

“This community is for ambitious women who are coming together to support each other,” said Kibbler. “These women are so incredibly busy, and on HeyMama they can give and get vetted recommendations on everything and know that the responses are coming from women that are like them.”

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Jan
29

Distilled Moments: Poems By Dave Jilk

Dave Jilk was my first business partner (we co-founded Feld Technologies). The photo above is from Dave’s office at 155 Federal Street around 1991. We worked closely together for seven years before selling the company in 1993 to a public company called Sage Alerting Systems, which renamed itself Sage Technologies and then finally AmeriData Technologies. Well, at least the “Technologies” survived that naming transition …

Dave recently published a book of poetry titled Distilled Moments. I read it Sunday night and it’s delicious. If you are into poetry, a friend of Dave’s, or just want a taste of something different from your normal reading stuff, grab a copy.

If, when I met Dave in 1983, you had told me that he would become a poet later in his life, I would have spit out whatever food or drink was in my mouth at the time and rolled around on the ground laughing for a while. I think the only time I ever associated poetry and Dave in my mind is when he would use a phrase like “Physics for Poets” to describe a class at MIT I was considering taking.

Dave and I met on my second day in Cambridge in 1983. I spent my first day alone, feeling very confused and lonely as I wandered around MIT trying to figure out where I was. I crossed the Mass Ave bridge into Boston, had dinner by myself, and went to back to my assigned room in Baker House with three other guys, two of whom immediately got stoned and smoked pot for the rest of the evening (not my thing.)

The next afternoon was the MIT Freshman picnic. On a beautiful fall Cambridge day, Paul Gray (then president of MIT) gave a welcoming speech where, in typical MIT fashion, he said something like:

Look around. Your fellow freshmen are the best and brightest from around the world. Never forget that it is simple math that 50% of you will be in the bottom half of your class.

After talking for a few minutes, he ended by shouting “Let the Rush begin!”

Suddenly, hundreds of people descended on us with signs for their fraternities and living groups (there were no sororities at MIT in 1983.) Two guys I didn’t know – Mark Dodson and Ramanujam Manikkalingam – grabbed me and said, “Come with us.” I jumped in a van, was driven to ADP at 351 Mass Ave, and never left.

I met Dave that first night and we have been best friends ever since. He was a senior when I was a freshman, so we didn’t live together for that long, but we spent a lot of weekend time together. I became close with his first boss, Will Herman, and with Warren Katz (who we met through our seventh employee, Ilana Katz), continue to be extremely close friends.

Now that you’ve got the backstory, I’ll finish this post off with a few teasers from Distilled Moments that I loved.

Following is Twenty-Three, a poem about the morning after a night out together.

This one is my favorite business-related one, titled The Elephant in the Room.

I’ll end the teasers with the beginning of Take the Gloves Off, which is awesomely creative and full of business cliches.

There are many more. Support a friend, a Boulder-based poet, someone who I never expected would be a poet, or just a dear, dear friend by buying a copy of Distilled Moments.

Original author: Brad Feld

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Jan
29

Thought Leaders in Artificial Intelligence: Shantanu Nigam, CEO of Jvion (Part 3) - Sramana Mitra

Sramana Mitra: This 30 million patient data is all from your customer base or are you using any other kind of data? Shantanu Nigam: A lot of this data has been owned by our customer base. We’re...

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Original author: Sramana Mitra

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Jan
29

OpenPhone grabs $2 million for its business phone number app

Y Combinator graduate OpenPhone is raising a $2 million funding round led by Slow Ventures. The company is working on an app that lets you seamlessly get a business phone number without a second phone or a second SIM card.

Y Combinator, Kindred Ventures, Garage Capital, 122WEST Ventures and others are also participating in today’s funding round.

Compared to Aircall and other enterprise solutions, OpenPhone targets small and medium companies that want a mobile-first, easy-to-use solution to take advantage of a second phone number.

For instance, if you’re a freelancer and you hate handing out your personal phone number, OpenPhone lets you separate your personal and professional life more easily.

OpenPhone works on iPhone, iPad and Android. You also can use a web interface to interact with the app from your computer. It currently costs $10 per month per user. For that price, you get a local number, a toll-free number or you can port an existing phone number. Five thousand people are using OpenPhone right now.

You can then use that number for unlimited calls and texts in the U.S. and Canada. Behind the scene, OpenPhone uses your internet connection to establish voice-over-IP calls.

The startup has been working on collaborative features so you can use OpenPhone with multiple users. For instance, you can share a phone number with other users so your team can answer text messages faster and pick up the phone more often. The company has also launched a Slack integration that lets you receive a notification when somebody calls or texts your phone number.

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Jan
29

Bankin’ and Bridge launch payment API using bank transfers

French startup Bankin’ has introduced Bridge Pay this week, an API that lets you initiate payments using bank transfers from your app. Think about it as a sort of Stripe, but for bank transfers. The API currently covers 12 major French banks, which represent around 90% of retail bank accounts in France.

Bankin’ is both a B2B and B2C startup. It operates a popular consumer app that lets you aggregate all your bank accounts in a single app. The company has managed to attract 4 million customers with this app. Bankin’ also manages an API called Bridge. Developers can connect directly with bank accounts to fetch transactions and banking information.

With Bridge Pay, the company wants to go one step further and become a payment API as well. The company has been using Bridge Pay within Bankin’ already — customers can transfer money from one bank account to another in the Bankin’ app. Bankin’ users have transferred €1 billion so far.

Third-party companies will now be able to initiate bank transfers themselves. It could be useful for e-commerce companies that sell very expensive items, for instance. For example, if you want to buy expensive airplane tickets or a Mac Pro on Apple’s website, you might reach your card transaction limit.

It also opens up a ton of possibilities when it comes to automating B2B transactions without having to interact with your bank account. For instance, payroll services could integrate directly with your company’s bank account to transfer money to your employees.

Bridge Pay can be integrated directly in your app or service. When you select payment via bank transfers, you get a list of banks, you then connect to your bank account, choose an account and initiate a payment. Chances are your bank is going to ask you for a confirmation via a text message or a push notification. The company can add more banks in the future without any change in the app.

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Jan
29

Perdoo adds free tier to its OKR service, adding a fresh wrinkle to an accelerating market

Perdoo, a Berlin-based OKR-focused software startup, has decided to make its basic service free, potentially shaking up its growing, and somewhat crowded, market. “Objectives and Key Results,” a planning and management technique usually shortened to “OKRs,” is a hot space for software startups, with several raising in recent months.

WorkBoard and Gtmhub, for example, each raised capital for their OKR products in the last two months. WorkBoard raised $30 million, while Gtmhub added $9 million to its coffers. So many companies are operating in the space that TechCrunch created a compendium of sorts listing the players, simply to get our mind around who is active in the space as a partial, or pure participant.

Perdoo is a different animal than its rivals. The company, instead of tapping into an obviously interested venture capital pool, is a largely bootstrapped affair, it told TechCrunch. That makes its decision all the more curious. Why would a company with, theoretically, at least, less room to maneuver, make a portion of its product cost less than before? To understand, we got on the phone with Perdoo co-founder Henrik-Jan van der Pol to dig in.

Pricing

OKR software runs from cheap to expensive, with WorkBoard not listing prices on its website (that we could find while compiling this entry), to $1 per user per month for Gtmhub’s lowest-priced tier. Most providers in the space offer enterprise offerings that cost more. (Before offering a free tier, Perdoo only charged per user per month for its service, with sliding discounts for volume.)

During a call with TechCrunch, van der Pol explained his company’s move to undercut other companies’ lower-cost pricing, saying that the OKR market is “still new for a lot of organizations, meaning that they don’t have a budget available.” Those players, he said, “start with spreadsheets, which creates a lot of hassle and actually decreases their chances of success.” Those firms that need tooling but didn’t have ready budget open for the cost were why Perdoo “decided to make that switch to freemium, and give people a solid and free version that they can get started with that has very few limitations,” van der Pol continued.

Free Perdoo users can track as many goals as they’d like with as many users as they’d like. According to the co-founder, his company “looked at what functionality people currently use that build their own [OKR] tools” and decided to give those away.

Perdoo isn’t insane, mind. The company is still selling a paid version of its product with more features, and the company must hope that free users convert to its paid service over time.

In a sense, the freemium move is a gambit of sorts: By offering functionality for free, perhaps Perdoo can attract to itself users that might not have otherwise selected its service (perhaps choosing a provider with more available capital for marketing expenses) — users that might convert to paying customers later on, naturally.

Money

According to van der Pol, “in order to sustain a free offer, you need to be cash flow positive and profitable,” telling TechCrunch that his company is both.

Here we can see the power of not raising lots of money. Because Perdoo only raised angel money and has paid its own way since, the company can afford (literally) to offer a lot for nothing. It doesn’t have investors shouting over its shoulder about possible cannibalizing its own market, or anything similar.

So: Lots of venture dollars are powering several neat startups that are growing like mad, with WorkBoard and Gtmhub posting huge ARR gains in recent years to the tune of hundreds of percent. What impact Perdoo’s move might have on their growth, or product choices, won’t be clear for a while, if it has any at all. But Perdoo did just reprice basic OKR software to zero.

In the middle of a venture-capital powered growth war, that’s fascinating.

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Jan
29

Looking to new products, Bev adds strategic investors and redoubles focus on women entrepreneurs

Looking for fellow travelers to join in on its mission to transform the beverage business, the Los Angeles-based startup Bev has taken on fresh capital from a slew of strategic investors. 

The company has added Erin and Sara Foster, creative heads of Bumble BFF and Bumble Biz, to their investor and creative talent pool, along with other notable names like Rich Paul, Simon Tikhman, Keith Sheldon and Chief Zaruk.

The new capital will help support the launch of Bev’s new “Made By Chicks” media platform and podcast, which will be hosted by the Foster sisters in their first official partnership with any brand, according to a statement from the company.

In addition to the new media platform, Bev is also planning to launch two new beverages into its boozy stable of canned wines. Expect two white wines to join the company’s Rosé on store shelves within the year, according to company founder and chief executive, Alix Peabody.

“We’re partnering with Bev because we’re comfortable buying the product ourselves and telling our friends to buy it,” said Sarah Foster in a statement. “Our community trusts us to be authentic to ourselves and our brand, and we strive to do that. Bev’s female-oriented mission and movement align with our personal interests. We’re very inclusive, rather than alienating, and we’re thrilled to be a part of ‘Made By Chicks.’ ”

Peabody is one of several entrepreneurs in Los Angeles and beyond looking to upend the market for beverages worldwide — an industry that’s expected to hit $1.9 trillion, according to data provided by the company. Wine alone is expected to be a roughly $450.5 billion dollar business by 2024, according to Bev.

“Legacy brands tend to sexualize alcohol consumption, and objectify women on TV, billboards, and in print,” said Peabody, in a statement. “That’s what we’re changing. We want women to know that drinking can be fun, inclusive and safe.”

Together with Peabody, the Fosters will develop media like podcasts, videos and events that center on entrepreneurial women. It’s a format similar to the media property Girlboss, founded by Sophia Amoruso and now owned by Attention Capital.

Stories and advice columns from the new platform will range from topics like asking for a raise to managing a company while pregnant.

“When I first met Alix and her team, I immediately gravitated to her incredible founder story, ambition to challenge the alcohol industry’s outdated status quo, and sheer tenacity to spark a movement through an empowering brand like Bev,” shared Simon Tikhman, the CEO and co-founder of The Core Entertainment, a partner of Live Nation, and new Bev brand investor, in a statement. “I also knew by partnering with Bev that I wanted to assemble an unrivaled strategic group with expertise and business acumen in diverse sectors. Erin and Sara Foster, Rich Paul, Keith Sheldon, and Chief Zaruk bring so much to the table.”

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Jan
29

Kenyan logistics startup Sendy raises $20M round backed by Toyota

Africa’s logistics startup space has gained another multi-million-dollar round with global backing.

Kenyan company Sendy — with an on-demand platform that connects clients to drivers and vehicles for goods delivery — has raised a $20 million Series B led by Atlantica Ventures.

Toyota Tsusho Corporation, a trade and investment arm of Japanese automotive company Toyota, also joined the round.

Sendy’s raise comes within six months of Nigerian trucking logistics startup Kobo360’s $20 million Series A backed by Goldman Sachs. In November, East African on-demand delivery venture Lori Systems hauled in $30 million supported by Chinese investors.

Those companies have plotted Africa expansions into each other’s markets and broader Africa. With its latest round, Sendy ups its competitive stance in the continent’s startup logistics space. The company plans to expand to West Africa in 2020, CEO Mesh Alloys told TechCrunch on a call.

Alloys co-founded Sendy in 2015 with Kenyans Evanson Biwott and Don Okoth and American Malaika Judd. The startup currently has offices in Kenya, Tanzania and Uganda, with 5,000 vehicles on its platform that move all sorts of goods, according to Alloys.

Sendy offers services for e-commerce, enterprise, and freight delivery for a client list that includes Unilever, DHL, Maersk, Safaricom and African online retailer Jumia.

The company uses an asset-free model, with an app that coordinates contract drivers who own their own vehicles, while confirming deliveries, creating performance metrics and managing payment.

On Sendy’s business and revenue model, “We take a percentage of each transaction. We also facilitate services for drivers like insurance, health insurance, vehicle financing, vehicle servicing and fuel credits,” said Alloys.

The company plans to use its Series B funding for new hires and to upgrade its tech. “Getting better operational efficiency is super key, so we’ll invest…in engineering teams and data teams…and deploying talent to improve the services that we give our customers,” said Alloys.

Sendy’s $20 million round includes an R&D arrangement with Toyota Tsusho Corporation, whose investment comes from a venture arm the company established for Africa, called Mobility 54.

“We’ll look at optimizing the kind of trucks that perform well in this market… they’ll also look at setting up vehicle services centers in partnership with us,” said Alloys.

Asia Africa Investment, Sunu Capital, Enza Capital, Vested World and Kepple Capital joined lead investor Atlantica Ventures on the $20 million round — which brings Sendy’s total funding to $29 million, according to Alloys.

Formed in 2019, Atlantica Ventures is a relatively new Africa focused VC fund co-founded by Washington, DC based Aniko Szigetvari. She confirmed the fund’s lead on Sendy’s Series B and that Atlantica Ventures will take a board seat and work on strategic planning and execution with the company.

On how Sendy will outpace rivals such as Kobo360 and Lori Systems, Alloys points to the startup’s platform. “Our customer service is superior and that’s driven by our technology… I think we’re miles ahead of our competition today when it comes to tech,” he said.

Whoever surges ahead, Africa’s top business hubs — Nigeria, Kenya and Ghana — stand to gain from the innovation VC spending and startup rivalry bring to the on-demand goods delivery sector.

Though logistics services aren’t included in the World Bank’s ease of doing business country rankings, they’re known to be costlier in Africa than many parts of the world.

In the early days of online commerce development on the continent — due to a lack of viable 3PL options — pioneering e-commerce startups Jumia and Konga were forced to burn capital by forming their own delivery services.

Years later, after Jumia listed on the NYSE and expanded to multiple countries in Africa, fulfillment costs related to delivery remain one of the company’s largest expenses.

Lowering logistics expenses for businesses in Africa is central to Sendy’s mission, according to Alloys.

“We’re organizing a marketplace using technology so companies can efficiently deliver to their customers while reducing overall costs,” he said.

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Oct
10

AI lab DeepMind becomes profitable and bolsters relationship with Google

The team behind Product Hunt is launching a new social network called YourStack, a platform aiming to connect people that are passionate about products and help them discover what things their friends love.

“It’s super simple, you just search through and create a stack of products you love,” Product Hunt founder Ryan Hoover tells TechCrunch. “We wanted to make sure it wasn’t just software, but also games and books and beauty products, you name it.”

YourStack’s catalog doesn’t have every product under the sun, but if it’s a tech object, startup service, app or direct-to-consumer thing, chances are you can “stack” it. Once you add it to your profile, you can write a quick little descriptor and also share some tips and tricks you’ve learned about the product in question.

Product Hunt was acquired by AngelList just over three years ago, and since then Hoover and company have grown the platform into a go-to hub for makers looking to launch tech products. The team of 20 is now splitting their time between Product Hunt and YourStack, hoping that the new venture can lead to a platform that’s more centered on people and the products they use. While a social network based entirely around the multi-national brands that people love is something I’d love to hear Bernie Sanders’ thoughts on, it’s clear there’s an open opportunity here.

Social media platforms like Instagram have given influencers a huge platform for paid product endorsements, but because there’s so much schilling, consumers can’t put a ton of trust in the recommendations. Platforms like Twitter have been great for this inside the tech industry, but there’s no UI for it, so you sort of have to be at the right place at the right time, and, furthermore, the tech folks who have these great product insights are too busy being thought leaders.

If YourStack takes off, who knows what it could eventually become, but the goal seems to be to let users gain access to more personal product recommendations. On the product creator side, Hoover believes YourStack could give some great qualitative data that allows makers to understand how customers are using what they’ve built.

The product is in beta right now with a waitlist that’s already a few thousand users deep, but Hoover says the goal right now is to gather feedback.

“With a lot of social products, you don’t know how people are going to use them when they first start,” Hoover tells TechCrunch. “We actually had a very similar approach when we launched Product Hunt, where we let more and more people onto it each day and that was really effective in letting it slowly grow rather than leading people to a bad experience.”

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Jan
28

Essential advice for securing your small startup

Jeff Bezos’ phone was hacked. And if the richest person in the world is vulnerable, chances are good that your startup could get hacked, too.

The good news is that, as a tiny company, you’re not a big target. But as soon as you hire your first employee, it’s time to think about adopting basic security practices to ensure that you’re less vulnerable. Nothing is perfectly secure on the internet, but you can mitigate risk.

When you have fewer than 10 employees, you don’t want to use a single sign-on service like Okta. Solutions that work great for companies with tens of thousands of employees are not practical because they’re not designed for you.

As a basic rule, you want things to be simple by design. Relying on fewer services will reduce your attack surface, and if people can follow rules without even thinking about them, your organization will be less vulnerable. You might be great at spotting phishing attempts and securing your own accounts, but your startup is only as secure as your least-savvy employee. Most security issues come from human error.

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Oct
12

DeepMind is developing one algorithm to rule them all

Labor markets, particularly those in the tech industry, are incredibly lopsided against employees. Companies screen, interview, and negotiate with thousands of candidates per year, while employees may only go through recruiting a handful of times in their lives. Inevitably, they can select the wrong positions, pick the wrong managers to work with, and end up with a salary well below market rate.

New York City-based Free Agency wants to become the advocate of choice for this high-priced talent. Taking its cue from Hollywood and the sports world, the growing startup wants to identify great workers and offer them the career counseling, interview guidance, and salary negotiation prowess to let them do their best work — and at the right wage.

The company, which was founded last year by Sherveen Mashayekhi and Alex Rothberg, exclusively told TechCrunch that it has now reached 100 “Free Agents” on its platform, and it also announced that it has netted a combined $5.35 million in seed investments led by Resolute Ventures and Bloomberg Beta last year.

The way Free Agency works is simple. In exchange for the service’s help in finding and negotiating a career change, the startup takes 5-10% of its client’s first-year salary at their new company. As an example, given that median tech salaries at top companies have hovered around $200,000, that would be a fee of $10,000-$20,000.

That may sound exorbitant, but for the founders of Free Agency, it is anything but. They believe that many employees regularly fail to find the most ideal companies to work for and to negotiate the best salaries, which means that a significant amount of money is being left on the table by their potential clients.

Free Agency founders Alex Rothberg, COO, and Sherveen Mashayekhi, CEO. Photo via Free Agency.

“Our business model keeps us incentive-aligned with the candidate, driven by outcomes rather than upfront fees,” Mashayekhi, who is CEO, explained to me. “But it’s also important to note that Free Agency is, philosophically, also aligned with what employers want. Happy candidates who feel fairly paid will remain at their jobs longer and contribute more productivity. We help make happy candidates.”

Free Agency is in many ways a parallel to the rise of income-share agreements (ISAs) in the edtech world, which my colleague Eric Peckham has written about extensively in recent months. In lieu of tuition, some new education startups are using ISAs as a way to guarantee better employment outcomes for students while limiting their debt burden. Their growing popularity has spawned significant investor interest.

Today, Free Agency is barely one year old with just about 11 employees on the payroll. Longer term though, it wants to manage the budding careers of tech workers in much the way that Hollywood agents often do — finding new projects to work on, helping its talent develop their own skills, brands, and thought leadership, and helping them network with key decision-makers so they get called upon when great new opportunities arise.

“Today, we’re focused primarily on the job search inflection point, but Free Agency is really a career-long partner. You’ll see us continue to add ways to help our Free Agents succeed along 5 or 10 years of partnerships through intentional career management,” Mashayekhi said.

Talent agents exist in industries like Hollywood, book publishing, and sports because the talent themselves often don’t want to take on the burdens of managing their own careers. Film directors and baseball pitchers want to practice and hone their craft, not spend hours negotiating with studio execs and club owners. Agents also are more up-to-date on industry salary trends, and also where new opportunities are arising. Plus, they often work with talent managers to optimize all the ancillary revenues that comes from these careers (product endorsements, speaker engagements, etc.)

Furthermore, these industries have extremely strong superstar income patterns, where top talent can easily make tens of millions if not hundreds of millions of dollars over the course of a career.

While the tech industry has traditionally not had agents, tech talent is increasingly having similar superstar properties. Star engineers, product managers, and designers can make tens of millions of dollars across salary and equity packages, and often have a range of ancillary revenue sources from consulting engagements with VC firms to lecture circuit payments. Even better, new talent is often making six-figures, whereas the early years in an entertainment or sports career is often focused on securing any paying job.

What remains to be see is whether engineers will willingly give up a segment of their income in order to get better career help. Certainly Free Agency is not the first company that has tried to tackle this emerging field. 10x Management is a talent agency that has focused on vetting top freelance developers, and was profiled in The New Yorker a few years ago. Other startups have also entered the space over the past decade.

Free Agency believes it has the timing and service quality to win this market. While it is early days, much like the excitement around ISAs in education, I expect models like Free Agency to increasingly become popular as a way to manage our careers, and this is one startup worth paying attention to in the coming years.

In addition to Resolute and Bloomberg, Ludlow Ventures, Background Capital, Parker Thompson, Will Oberndorf, Amrit Saxena, Jenny Fielding, Greg Schroy, Gordon Wintrob, and Orrick LLP also joined the round as investors.

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Feb
14

Cloud Stocks: Qualys Counts on Google and Microsoft for Growth - Sramana Mitra

Amy and I driving to dinner with Ben Einstein and Grace Livingston a few months ago. Amy generally dislikes podcasts so she was annoyed with me as I fiddled with my iPhone and Carplay which kept opening my podcast app.

Ben said, “Have you listened to The Anthropocene Reviewed?”

I responded, “The what what?”

Amy said, “Put some music on.”

Ben tried again. “Put on The Anthropocene Reviewed Scratch ‘n’ Sniff Stickers and the Indianapolis 500.”

15 minutes later Amy said, “Not bad” and I was hooked.

Several of my favorites have been Notes App and Sports Rivalries, Hot Dog Eating Contest and Chemotherapy, Gray Aliens and Rock Paper Scissors, and Teddy Bears and Penalty Shootouts.

If you are looking for a new podcast, give The Anthropocene Reviewed a try.

Original author: Brad Feld

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Jan
28

1Mby1M Virtual Accelerator Investor Forum: With Jishnu Battacharjee of Nexus Venture Partners (Part 2) - Sramana Mitra

Sramana Mitra: When I think about Nexus, one company comes to mind immediately, which is one of the biggest and oldest success stories in India. It’s Druva. The company is maturing very well. I...

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Original author: Sramana Mitra

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Jan
28

January 30 – 470th 1Mby1M Mentoring Roundtable for Entrepreneurs - Sramana Mitra

Entrepreneurs are invited to the 470th FREE online 1Mby1M mentoring roundtable on Thursday, January 30, 2020, at 8 a.m. PST/11 a.m. EST/5 p.m. CET/9:30 p.m. India IST. If you are a serious...

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Original author: Maureen Kelly

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Oct
09

Your cybersecurity team will face burnout, and you need to help

According to an Allied Market Research report, the global AI market is expected to grow at CAGR 55% to $169.4 billion by the year 2025 from $4.1 billion in 2016. China-based Yitu Technology is an AI...

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Original author: MitraSramana

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Jan
28

Thought Leaders in Artificial Intelligence: Shantanu Nigam, CEO of Jvion (Part 2) - Sramana Mitra

Shantanu Nigam: Most of our nurses are in the profession because they care about the patient. When you have a probabilistic system, by design, it will have one patient slip through it and will not be...

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Original author: Sramana Mitra

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Jan
27

1Mby1M Virtual Accelerator Investor Forum: With Jishnu Battacharjee of Nexus Venture Partners (Part 1) - Sramana Mitra

Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Jishnu Battacharjee was recorded in November 2019....

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Original author: Sramana Mitra

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