Sramana Mitra: What about sector? You said you only do enterprise software. Could you elaborate on what you like to invest? What trends are you following and are excited about? Miriam Rivera: A lot...
___
Augmented reality is a very buzzy space, but the fundamental technologies underpinning it are pushing boundaries across a lot of other verticals. Machine learning, object recognition and visual mapping tech are the pillars of plenty of new ventures, enabling there to be companies that thrive in the overlap.
Phiar (pronounced fire) is building an augmented reality navigation app for drivers, but the same tech it’s built to help drivers easily pinpoint where they need to make their next turn also helps them build up rich mapping data that can give partners like autonomous car startups the high-quality data they so deeply need.
The SF-based company has just closed a $3 million seed deal led by Norwest Venture Partners and The Venture Reality Fund. Other investors include Anorak Ventures, Mayfield Fund, Zeno Ventures, Cross Culture Ventures, GFR Fund, Y Combinator, Innolinks Ventures and Half Court Ventures.
While phone and headset-based AR have received a lot of the broader media attention, the automotive industry is a central focus for a lot of augmented reality startups attracted by the proposition of a mobile environment that can showcase and integrate bulky tech. There certainly have been quite a few heads-up display startups looking to take advantage of a car’s windshield real estate, and prior to joining Y Combinator, Phiar was actually looking to build some of this hardware themselves before deciding on a more software-focused route for the company.
Unlike a lot of phone AR apps built on top of Apple or Google’s developer platforms, Phiar’s use case doesn’t quite work with the limitations of these systems, which understandably weren’t built with the idea a user would be moving at 60 miles per hour. As a result, the company has had to build tech to greater understand the geometry of a quickly updating world through a single camera while ensuring that it’s not just some ugly directional overlay, using techniques like real-time occlusion to ensure that the digital and physical worlds interact nicely.
While the startup’s big consumer-facing play is the free AR mobile app, Phiar is really just an augmented reality company on the surface; its real sell is what it can do with the data and insights gathered from an always-on dash camera. The same object recognition tech that will allow the app to seamlessly toss AR animations onto the scene in front of you is also analyzing that environment and uploading metadata to build up its mapping insights.
In addition, the app saves up to 30 minutes of footage from each ride, offering users the utility of a free dash cam in case they get in an accident and need video for an insurance claim, while providing some rich anonymized data for the company to build up high-quality mapping data it can sell to partners.
This kind of data is incredibly useful to companies building autonomous car tech, ridesharing companies and a lot of entities that are interested in access to quickly updating map data. The challenge for Phiar will be building up enough users so their map data is as rich as their partners will demand.
CEO Chen-Ping Yu says that the startup is in talks with partners in the automotive space to integrate their tech and is also working to bring what they’ve built to companies in the ridesharing space. Yu says the company plans to release their consumer app in mid-2019.
According to IDC, the global enterprise storage systems market increased 21.3% over the year to $13.2 billion during the second quarter of 2018. The market is dominated by bigger established players...
___
Sramana Mitra: How big is the work force? Sanjay Jupudi: We just touched 250 people. Sramana Mitra: How many customers are you servicing? Sanjay Jupudi: About 30 customers. The good part of what we...
___
Thirty European tech CEOs of big startups signed a letter about stock options in Europe. Other tech CEOs can join the group and sign the letter before it is sent to policymakers on January 7.
As you can read in the letter below, these CEOs think Silicon Valley isn’t the only region suffering from talent crunch. It could be a “serious bottleneck to growth.”
“Over the next twelve months, Europe’s startups will need to hire more than 100,000 employees,” the letter says. “Without delay, we call on legislators to fix the patchy, inconsistent and often punitive rules that govern employee ownership—the practice of giving staff options to acquire a slice of the company they’re working for.”
Here’s the current list of signatories: Johannes Reck (GetYourGuide), Alice Zagury (The Family), Christian Reber (Pitch), Johannes Schildt (KRY / LIVI), Peter Mühlmann (Trustpilot), Ilkka Paanenen (Supercell), Taavet Hinrikus (TransferWise), Lucas Carne (Privalia), Jean-Charles Samuelian (Alan), Alex Saint (Secret Escapes), Dr. Tamaz Georgadze (Raisin), Patrick Collison (Stripe), Nikolay Storonsky (Revolut), Samir Desai (Funding Circle), Markus Villig (Taxify), Jean-Baptise Rudelle (Criteo), Nicolas Brusson (BlaBlaCar), Jacob de Geer (iZettle), David Okuniev (Typeform), José Neves (Farfetch), Felix Van de Maele (Collibra), Joris Van Der Gucht (Silverfin), Daniel Dines (UiPath), Rohan Silva (Second Home), Niklas Östberg (Delivery Hero), Dominik Richter (Hello Fresh), Dr. Raoul Scherwitzl (NaturalCycles), Alex Depledge (RESI), Juan de Antonio (Cabify).
Here’s the letter:
OPEN LETTER TO EUROPE’S POLICYMAKERS
Not Optional: Europe must attract more talent to startups
This following letter will be sent to Europe's policymakers on 7 January 2019.
Policymakers, entrepreneurs and investors must work together to bring more talent to Europe’s startups. Here’s why.
The European tech sector has never been stronger. From London to Lisbon, Paris to Prague, Europe is now nurturing some of the world’s most dynamic and creative companies. And not all are fledgling young startups: many are already substantial, high-growth enterprises set to succeed in the global market.
The days of living in Silicon Valley’s shadow are over. We no longer lack ambition and capital. Now, Europe is a shining powerhouse of bold, new business models that drive economic growth, generate jobs and improve people’s lives.
We’d all like to see this fair weather continue, but storm clouds are gathering on the horizon.
Europe could be the world’s most entrepreneurial continent but the limited availability of talent to nurture and fuel its blossoming start-up ecosystem is a serious bottleneck to growth. That’s why we, the founders and executives of Europe’s leading tech businesses, now urge policymakers to put talent at the top of their agenda.
Over the next twelve months, Europe’s startups will need to hire more than 100,000 employees. Add to that the number of employees that start-ups yet to be born will need to get their ideas off the ground. Reaching that goal will be hard, but hard things are what we do and we’re ready to rise to the challenge.
Without delay, we call on legislators to fix the patchy, inconsistent and often punitive rules that govern employee ownership—the practice of giving staff options to acquire a slice of the company they’re working for.
This isn’t just a perk on top of a salary: universally, stock options reward employees for taking the risk of joining a young, unproven business, and give them a real stake in their company’s future success. Stock options are one of the main levers that startups use to recruit the talent they need; these companies simply can’t afford to pay the higher wages of more established businesses.
But policies that currently govern employee ownership across Europe are often archaic and highly ineffective. Some are so punishing that they put our startups at a major disadvantage to their peers in Silicon Valley and elsewhere, with whom we’re competing for the best designers, developers, product managers, and more.
If we fail to take action, we could see a brain drain of Europe’s best and brightest, leading to fewer jobs created and slower growth. That’s why we need to create startup-friendly employee share ownership schemes, to help Europe’s tech sector—its greatest engine of growth, innovation and employment—to succeed and thrive in the global labour market.
If we don’t eliminate the talent bottleneck, we risk squandering the incredible momentum that European tech has built up in recent years. The next Google, Amazon or Netflix could well come from Europe, but for that to happen, reforming the rules of employee ownership is definitely not optional.
According to Index Ventures, the company that is coordinating this effort, some countries already have startup-friendly policies while others lag behind:
The VC firm recommends overhauling policies in some countries and harmonizing policies across Europe. New rules should follow those six principles:
Create a stock option scheme that is open to as many startups and employees as possible, offering favourable treatment in terms of regulation and taxation. Design a scheme based on existing models in the UK, Estonia or France to avoid further fragmentation and complexity.Allow startups to issue stock options with non-voting rights, to avoid the burden of having to consult large numbers of minority shareholders.Defer employee taxation to the point of sale of shares, when employees receive cash benefit for the first time.Allow startups to issue stock options based on an accepted ‘fair market valuation’, which removes tax uncertainty.Apply capital gains (or better) tax rates to employee share sales.Reduce or remove corporate taxes associated with the use of stock options.
A new app called Playlist aims to make music a more social experience than what’s offered today by the major music platforms like Apple Music, Pandora or Spotify, for example. In Playlist, you can find others who share your musical tastes and join group chats where you listen to playlists together in real time. You can collaborate on playlists, too.
The app, backed by investment from Stanford’s StartX fund, was founded by Karen Katz and Steve Petersen, both Stanford engineers and serial entrepreneurs. Katz previously co-founded AdSpace Networks and another social music platform, Jam Music. She also was a founding executive team member at Photobucket, and founded a company called Project Playlist, which was like a Google search for music back in the Myspace era.
Peterson, meanwhile, has 35 patents and more than a decade of experience in digital music. In the early 2000s he created the software architecture and ran the team at PortalPlayer Inc., which powered the iPod’s music player and was later sold to Nvidia for $357 million. Afterwards, he was CTO at Concert Technology, a technology incubator and intellectual property company with a focus on mobile, social and digital music services.
“The world has gone social, but music has been largely left behind. That’s a real gap,” explains Katz, as to why the founders wanted to build Playlist in the first place.
“Ever since we started listening to music from our mobile phones, it’s become an isolated experience. And music is the number one thing we do on our phones,” she says.
The idea they came up with was to unite music and messaging by synchronizing streams, so people could listen to songs together at the same time and chat while they do so.
During last year’s beta testing period, Playlist (which was listed under a different name on the App Store), saw a huge number of engagements as a result of its real-time nature.
“Out of the gate, we saw 10 times the engagement of Pandora. People have, on average, 60 interactions per hour — like chats, likes, follows, joins, adds and creates,” Katz says.
Under the hood, the app uses a lot of technology beyond just its synchronized streaming. It also leverages machine learning for its social recommendations, as well as collaborative playlists, large-scale group chat, and behavior-based music programming, and has “Music Match” algorithms to help you find people who listen to the same sort of things you do.
The social aspects of the app involves a following/follower model, and presents playlists from the people you follow in your home feed, much like a music-focused version of Instagram. A separate Discover section lets you find more people to follow or join in other popular listening and chat sessions.
At launch, the app has a catalog of more than 45 million songs and has a music license for the U.S. It plans to monetize through advertising.
The core idea here — real-time music listening and chat — is interesting. It’s like a Turntable.fm for the Instagram age. But the app sometimes overcomplicates things, it seems. For example, importing a playlist from another music app involves switching over to that app, finding the playlist and copying its sharing URL, then switching back to Playlist to paste it in a pop-up box. It then offers a way for you to add your own custom photo to the playlist, which feels a little unnecessary as the default is album art.
Another odd choice is that it’s difficult to figure out how to leave a group chat once you’ve joined. You can mute the playlist that’s streaming or you can minimize the player, but the option to “leave” is tucked away under another menu, making it harder to find.
The player interface also offers a heart, a plus (+), a share button, a mute button and a skip button all on the bottom row. It’s… well… it’s a lot.
But Katz says that the design choices they’ve made here are based on extensive user testing and feedback. Plus, the app’s younger users — often high schoolers, and not much older than 21 — are the ones demanding all the buttons and options.
It’s hard to argue with the results. The beta app acquired more than 500,000 users during last year’s test period, and those users are being switched over to the now publicly available Playlist app, which has some 80K installs as of last week, according to Sensor Tower data.
The company also plans to leverage the assets it acquired from the old Project Playlist, which includes some 30 million emails, 21 million Facebook IDs and 14 million Twitter IDs. A “Throwback Thursday” marketing campaign will reach out to those users to offer them a way to listen to their old playlists.
The startup has raised $5 million in funding (convertible notes) from Stanford StartX Fund, Garage Technology Ventures, Miramar Ventures, IT-Farm, Dixon Doll (DCM founder), Stanford Farmers & Angels, Zapis Capital and Amino Capital.
The Palo Alto-based company is a team of six full-time.
Playlist is a free download for iOS. An Android version is in the works.
Bird announced today that it will sell its electric scooters to entrepreneurs and small business owners, who can then rent them out as part of a new service called Bird Platform.
The company will provide the independent operators with scooters, which they are given free rein to brand as they please, as well as access to the company’s marketplace of chargers and mechanics, in exchange for 20 percent of the cost of each ride. Bird says fleet managers, which may be independent entrepreneurs or local mom and pop bike rental shops, for example, can also collect and charge the scooters themselves.
There’s no minimum or maximum number of scooters independent operators can purchase, though they have to keep in mind local regulations that, in certain cities, limit the number of scooters permitted on the streets. Bird says the company will initially begin rolling out Bird Platform in December, targeting markets where scooters are already actively used and where regulations are a bit more relaxed. Bird Platform will be irrelevant in San Francisco, for example, where the San Francisco Municipal Transportation Agency has put a cap on the number of e-scooters available and has refused to grant Bird a permit to operate at all.
The company hopes Bird Platform will be a helpful tool as it continues to work its way into new markets around the world.
Bird chief executive officer Travis VanderZanden said they’ve been quietly working on this product for a while and have 300 interested parties waiting to get started with the service.
“In the last year of operating, we kept getting these inbound requests from entrepreneurs that really wanted to take Bird to their cities,” VanderZanden told TechCrunch. “I think there’s been a lot of people passionate about the electric scooter movement and taking cars off the road. There are a lot of entrepreneurs who want to bring Bird to their city.”
Goat, a scooter startup located in Austin, similarly began renting its scooters to micro mobility enthusiasts in the Texas capital. Goat CEO Michael Schramm explained the launch in a company announcement at the time, according to Mashable: “The way we look at it is, why would someone want to be a charger and make $5 a scooter, when they can manage their own fleet and keep all the earnings doing the same task they’re already doing?”
Bird, valued at $2 billion, has raised $415 million in venture capital funding from Greycroft, Sequoia, Accel and others. Since launching about a year ago, it’s clocked in more than 10 million rides and expanded to some 100 cities.
Sramana Mitra: I’ve known George Zachary for a long time. When I started One Million by One Million, he was one of the people who wanted to invest. I’ve had interactions with CRV for many years. What...
___
The mainstream will never adopt blockchain-powered decentralized apps (dApps) if it’s a struggle to log in. They’re either forced to manage complex security keys themselves, or rely on a clunky wallet-equipped browser like MetaMask. What users need is for signing in to blockchain apps to be as easy as Login with Facebook. So that’s what Bitski built. The startup emerges from stealth today with an exclusive on TechCrunch about the release of the developer beta of its single sign-on cryptocurrency wallet platform.
Ten projects, including 7 game developers, are lined up to pay a fee to integrate Bitski’s SDK. Then, whenever they need a user’s identity or to transact a payment, their app pops open a Bitski authorization screen, where users can grant permissions to access their ID, send money or receive items. Users sign up just once with Bitski, and then there’s no more punching in long private keys or other friction. Using blockchain apps becomes simple enough for novices. Given the recent price plunge, the mainstream has been spooked about speculating on cryptocurrencies. But Bitski could unlock the utility of dApps that blockchain developers have been promising but haven’t delivered.
“One of the great challenges for protocol teams and product companies in crypto today is the poor UX in dApps, specifically onboarding, transactions, and sign-in/password recovery,” says co-founder and CEO Donnie Dinch. “We interviewed a ton of dApp developers. The minute they used a wallet, there was a huge drop-off of folks. Bitski’s vision is to solve user onboarding and wallet usability for developers, so that they can in-turn focus on creating unique and useful dapps.”
The scrappy Bitski team raised $1.5 million in pre-seed capital from Steve Jang’s Kindred Ventures, Signia, Founders Fund, Village Global and Social Capital. They were betting on Dinch, a designer-as-CEO who’d built concert discovery app WillCall that he sold to Ticketfly, which was eventually bought by Pandora. After 18 months of rebranding Ticketfly and overhauling its consumer experience, Dinch left and eventually recruited engineer Julian Tescher to come with him to found Bitski.
Bitski co-founder and CEO Donnie Dinch
After Riff failed to hit scale, the team hung up its social ambitions in late 2017 and “started kicking around ideas for dApps. We mocked up a Venmo one, a remittance app…but found the hurdle to get someone to use one of these products is enormous,” Dinch recalls. “Onboarding was a dealbreaker for anyone building dApps. Even if we made the best crypto Venmo, to get normal people on it would be extremely difficult. It’s already hard enough to get people to install apps from the App Store.” They came up with Bitski to let any developer ski jump over that hurdle.
Looking across the crypto industry, the companies like Coinbase and Binance with their own hosted wallets that permitted smooth UX were the ones winning. Bitski would bring that same experience to any app. “Our hosted wallet SDK lets developers drop the Bitski wallet into their apps and onboard users with standards web 2.0 users have grown to know and love,” Dinch explains.
Imagine an iOS game wants to reward users with a digital sword or token. Users would have to set up a whole new wallet, struggle with their credentials or use another clumsy solution. They’d have to own Ethereum already to pay the Ethereum “gas” price to power the transaction, and the developer would have to manually approve sending the gift. With Bitski, users can approve receiving tokens from a developer from then on, and developers can pay the gas on users’ behalf while triggering transactions programmatically.
Magik is an AR content platform that’s one of Bitski’s first developers. Magik’s founders tell me, “We’re building towards reaching millions of mainstream consumers, and Bitski is the only wallet solution that understands what we need to reach users at that scale. They provide a dead-simple, secure and familiar interface that addresses every pain point along the user-onboarding journey.”
Bitski will offer a free tier, priced tiers based on transaction volume or a monthly fee and an enterprise version. In the future, the company is considering doubling-down on premium developer services to help them build more on top of the blockchain. “We will never, ever monetize user data. We’ve never had any intent at looking at it,” Dinch vows. The startup hopes developers will seize on the network effects of a cross-app wallet, as once someone sets up Bitski to use one product, all future sign-ins just require a few clicks.
In August, Coinbase acquired a startup called Distributed Systems that was building a similar crypto identity platform called the Clear Protocol. A “login with Coinbase” feature could be popular if launched, but the company’s focus is to spread a ton of blockchain projects. “If [login with Coinbase] launched tomorrow, they wouldn’t be able to support games or anything with a unique token. We’re a lockbox, they’re a bank,” Dinch claims.
The spectre of single sign-on’s biggest player, Facebook, looms, as well. In May it announced the formation of a blockchain team we suspect might be working on a crypto login platform or other ways to make the decentralized world more accessible for mom and pop. Dinch suspects that fears about how Facebook uses data would dissuade developers and users from adopting such a product. Still, Bitski’s haste in getting its developer platform into beta just a year after forming shows it’s eager to beat them to market.
Building a centralized wallet in a decentralized ecosystem comes with its own security risks. But Dinch assures me Bitski is using all its own hardware with air-gapped computers that have been stripped of their Wi-Fi cards, and it’s taking other secret precautions to prevent anyone from snatching its wallets. He believes cross-app wallets will also deliver a future where users actually own their virtual goods instead of just relying on the good will of developers not to pull them away or shut them down.” The idea of we’ve never been able to provably own unique digital assets is crazy to me,” Dinch notes. “Whether it’s a skin in Fortnite or a movie on iTunes that you purchase, you don’t have liquidity to resell those things. We think we’ll look back in 5 to 10 years and think it’s nuts that no one owned their digital items.”
While the crypto prices might be cratering and dApps like Cryptokitties have cooled off, Dinch is convinced the blockchain startups won’t fade away. “There is a thriving developer ecosystem hellbent on bringing the decentralized web to reality; regardless of token price. It’s a safe assumption that prices will dip a bit more, but will eventually rise whenever we see real use cases for a lot of these tokens. Most will die. The ones that succeed will be outcome-oriented, building useful products that people want.” Bitski’s a big step in that direction.
Robinhood, the zero-fee stock trading app and cryptocurrency exchange, is bringing on a former Amazon finance exec to help the company prepare for an eventual public debut.
Warnick
The startup has hired Jason Warnick, a former exec at Amazon who was with the company for nearly 20 years, most recently serving as the commerce giant’s VP of Finance. Warnick has worn many hats inside the Seattle company’s finance departments, with positions touching operations, internal audit, investor relations and risk management. In his most recent role, Warnick also served as the chief of staff to Amazon CFO Brian Olsavsky.
At TechCrunch Disrupt SF earlier this fall, Robinhood CEO Baiju Bhatt told us that the startup was eyeing a public offering but wouldn’t be doing so in the “immediate term.” At the event, Bhatt also revealed that the company was searching for a CFO to help the highly valued startup prep for an IPO.
Warnick’s wide range of financial admin expertise will undoubtedly be helpful to the five-year-old Robinhood, which has grown to be one of the most valuable venture-backed startups. The fast-growing startup has raised more than half a billion dollars and earned a $5.6 billion valuation in its latest fundraise.
“We’re incredibly lucky to have Jason join our leadership team,” Robinhood co-CEO Vlad Tenev said in a statement. “We look forward to working with Jason to build out our operational and financial infrastructure and continuing to deliver the best possible financial products to our customers at the best possible prices.”
Warnick is just the latest in a line of Amazon execs fleeing the company for CFO roles at highly valued startups. Yesterday, Airbnb hired Dave Stephenson as its new chief financial officer. A few weeks ago, Zillow hired Allen Parker — another Amazon finance VP — to its CFO role.
Red Hat is in the process of being acquired by IBM for a massive $34 billion, but that deal hasn’t closed yet and, in the meantime, Red Hat is still running independently and making its own acquisitions, too. As the company today announced, it has acquired Tel Aviv-based NooBaa, an early-stage startup that helps enterprises manage their data more easily and access their various data providers through a single API.
NooBaa’s technology makes it a good fit for Red Hat, which has recently emphasized its ability to help enterprise more effectively manage their hybrid and multicloud deployments. At its core, NooBaa is all about bringing together various data silos, which should make it a good fit in Red Hat’s portfolio. With OpenShift and the OpenShift Container Platform, as well as its Ceph Storage service, Red Hat already offers a range of hybrid cloud tools, after all.
“NooBaa’s technologies will augment our portfolio and strengthen our ability to meet the needs of developers in today’s hybrid and multicloud world,” writes Ranga Rangachari, the VP and general manager for storage and hyperconverged infrastructure at Red Hat, in today’s announcement. “We are thrilled to welcome a technical team of nine to the Red Hat family as we work together to further solidify Red Hat as a leading provider of open hybrid cloud technologies.”
While virtually all of Red Hat’s technology is open source, NooBaa’s code is not. The company says that it plans to open source NooBaa’s technology in due time, though the exact timeline has yet to be determined.
NooBaa was founded in 2013. The company has raised some venture funding from the likes of Jerusalem Venture Partners and OurCrowd, with a strategic investment from Akamai Capital thrown in for good measure. The company never disclosed the size of that round, though, and neither Red Hat nor NooBaa are disclosing the financial terms of the acquisition.
Sramana Mitra: What you said about diversity is music to our ears because that’s our community. We’re very happy to see that that’s what you are doing and that people are paying attention to this...
___
According to a recent report published by Market Research Future, the global server virtualization market is estimated to grow 7% annually through to the year 2023. Another report published by...
___
Arka Venture Labs and the One Million by One Million (1Mby1M) global virtual accelerator announce a partnership to benefit Indian B-to-B cloud startups by together offering access to deeper...
___
Quip, the dental care startup that got its start selling electric toothbrushes directly to consumers, has raised $40 million. The money comes in the form of equity and debt financing, with about half of the funding coming in an equity deal lead by Sherpa Capital and the other half in debt financing from Triplepoint Capital.
“I think the mix of debt and equity is a great thing for us,” Quip CEO Simon Enever told TechCrunch. “It’s more attractive than ever to get alternative types of financing.”
Alternative types of financing, for example, enable founders to potentially avoid terms that are not founder-friendly, as well as raise additional funds that they were unable to secure from traditional investors.
This comes a couple of months after Quip partnered with Target to sell its products, and about six months after Quip raised $10 million from Silicon Valley Bank and acquired Afora, a New York-based startup that offers an alternative to traditional dental insurance.
“It’s been another big year of growth in general for us,” Enever said. “We recently passed a big milestone — our one-millionth brusher.”
With the new funding in hand, Quip has a lot of product and services launches ahead of it, Enever said. He wouldn’t get into details, but Enever said now that the company has executed on phase one — electric toothbrushes and toothpaste — it’s time to expand into additional offerings.
“We’re excited to start offering members more products and services, and in the new year, you’ll see a few new physical products that expand daily at-home care,” he said.
Again, details are limited, but one could envision products like floss, teeth whiteners, mouthwash and chewing gum. Given Quip’s relationships with dental providers, Enever says customers have also asked for cheaper dental visits.
“For patients, we want to help them with everything — that full-service oral hygiene routine,” Enever said. “On the flip side, for providers, the attraction to Quip is we’ve built this large digital platform full of eager patients. We started Quip because people were not invested in their oral health, or were only visiting the dentist when a tooth was falling out or in pain.”
This week, Quip is launching a practice program for dental service providers to offer a low-cost way to offer Quip’s products to their patients. Quip also plans to use the funding to expand its headcount and grow its subscriber base.
Sramana Mitra: Tell me a little bit about this process of brainstorming about what you were going to focus on in the next company. What was the process with coming up with where you were going to...
___
Lime launched in the United Kingdom today, starting with a group of dockless electric-assist bikes in a Milton Keynes shopping center. The San Francisco-based startup says it plans to expand into more U.K. cities over the next few weeks.
As in other markets, users in Milton Keynes find and unlock Lime’s bikes, which use battery-powered motors to reduce pedaling and travel further distances, through a mobile app. Bike rides cost £1 (about $1.28) to unlock and an additional 15 pence per minute of riding time and will be available first at intu Milton Keynes Shopping Centre.
Backed by investors like Uber, GV and Andreessen Horowitz with $467 million in funding so far, Lime recently said it had hit a milestone of 11.5 million rides, only 14 months after its bikes first became available to riders. The company already operates in 100 markets throughout the United States and Europe and plans to launch in 50 new cities by the end of this year.
But Lime’s rapid growth hasn’t come without bumps. Along with competitors Bird and Spin, Lime was one of the companies involved in San Francisco’s war on electric scooters when they ran afoul of the city’s Municipal Transportation Agency (SFMTA). The SFMTA said e-scooters created obstacles and potentially safety hazards. This ultimately resulted in Lime being denied an e-scooter permit in August, a decision it appealed.
By choosing Milton Keynes as its first U.K. city, however, Lime is intent on preventing conflicts by working with a city that is more receptive to transportation startups. Milton Keynes was the site of an initiative called MK: Smart to integrate more Internet of Things hardware. The project was followed by CityLABS, a program that supports data and IoT startups. In its announcement, Lime said it “will be working closely with city leaders and stakeholders to ensure the fair and respectful distribution of the service across the area.”
After focusing on Asian markets, particularly in Southeast Asia, Bangkok-based Eko Communications is getting ready to take on Slack, Microsoft Teams and other enterprise messaging apps in Europe. The startup announced today that it has raised a Series B of $20 million and opened offices in London (which will serve as its new commercial headquarters), Amsterdam and Berlin.
The funding, led by SMD Ventures, with participation from AirAsia’s digital investment arm Redbeat Ventures, Gobi Partners, East Ventures and returning investors, brings Eko Communication’s total raised to $28.7 million. The company’s Series A was announced in 2015, followed by $2 million in strategic funding from Japanese conglomerate Itochu last year. Eko Communications (not to be confused with Eko, an interactive video startup) has already served clients like Thai mobile operator True, Radisson and 7-Eleven.
Eko Communications’ Series B is earmarked for its ambitious global expansion plans in the first quarter of 2019. Korawad Chearavanont, the company’s CEO and co-founder, told TechCrunch in an email that it has already localized products for target markets, including the U.K., Ireland, Benelux and the DACH region (Germany, Austria and Switzerland).
Eko Communications wants to expand in the European Union and the United States because their economies are both significantly larger than Southeast Asia’s, said Chearavanont. This, plus the fact that both have larger enterprise IT markets thanks to higher spending on software by companies, means that “for Eko to achieve the necessary scale to become a global player in the mobile enterprise market, continued growth in these markets is critical,” he added.
The company claims that its revenues have more than tripled in the past year and that it now has more than 500,000 recurring paid users. Of course, any enterprise messaging startup has to contend with the specter of Slack and Microsoft Teams. Positioning Eko Communications as a rival to those services, however, isn’t totally accurate, because they are aimed at different customers.
Slack and Microsoft Teams are “primarily utilized by ‘knowledge workers’ and these systems are priced for these types of users,” Chearavanont said. “Being a mobile-first company, we target companies that have a large presence of mobile-first staff traditionally in industries like retail and hospitality (the services sector in general).” Many employees in those sectors still rely on messaging apps like WhatsApp or email to communicate, so Eko Communications seeks to make it easy for companies to transition from their ad hoc communication methods to a more secure and efficient system with tools like APIs to help them integrate legacy systems.
Wildfires are consuming our forests and grasslands faster than we can replace them. It’s a vicious cycle of destruction and inadequate restoration rooted, so to speak, in decades of neglect of the institutions and technologies needed to keep these environments healthy.
DroneSeed is a Seattle-based startup that aims to combat this growing problem with a modern toolkit that scales: drones, artificial intelligence and biological engineering. And it’s even more complicated than it sounds.
A bit of background first. The problem of disappearing forests is a complex one, but it boils down to a few major factors: climate change, outdated methods and shrinking budgets (and as you can imagine, all three are related).
Forest fires are a natural occurrence, of course. And they’re necessary, as you’ve likely read, to sort of clear the deck for new growth to take hold. But climate change, monoculture growth, population increases, lack of control burns and other factors have led to these events taking place not just more often, but more extensively and to more permanent effect.
On average, the U.S. is losing 7 million acres a year. That’s not easy to replace to begin with — and as budgets for the likes of national and state forest upkeep have shrunk continually over the last half century, there have been fewer and fewer resources with which to combat this trend.
The most effective and common reforestation technique for a recently burned woodland is human planters carrying sacks of seedlings and manually selecting and placing them across miles of landscapes. This back-breaking work is rarely done by anyone for more than a year or two, so labor is scarce and turnover is intense.
Even if the labor was available on tap, the trees might not be. Seedlings take time to grow in nurseries and a major wildfire might necessitate the purchase and planting of millions of new trees. It’s impossible for nurseries to anticipate this demand, and the risk associated with growing such numbers on speculation is more than many can afford. One missed guess could put the whole operation underwater.
Meanwhile, if nothing gets planted, invasive weeds move in with a vengeance, claiming huge areas that were once old growth forests. Lacking the labor and tree inventory to stem this possibility, forest keepers resort to a stopgap measure: use helicopters to drench the area in herbicides to kill weeds, then saturate it with fast-growing cheatgrass or the like. (The alternative to spraying is, again, the manual approach: machetes.)
At least then, in a year, instead of a weedy wasteland, you have a grassy monoculture — not a forest, but it’ll do until the forest gets here.
One final complication: helicopter spraying is a horrendously dangerous profession. These pilots are flying at sub-100-foot elevations, performing high-speed maneuvers so that their sprays reach the very edge of burn zones but they don’t crash head-on into the trees. This is an extremely dangerous occupation: 80 to 100 crashes occur every year in the U.S. alone.
In short, there are more and worse fires and we have fewer resources — and dated ones at that — with which to restore forests after them.
These are facts anyone in forest ecology and logging are familiar with, but perhaps not as well known among technologists. We do tend to stay in areas with cell coverage. But it turns out that a boost from the cloistered knowledge workers of the tech world — specifically those in the Emerald City — may be exactly what the industry and ecosystem require.
So what’s the solution to all this? Automation, right?
Automation, especially via robotics, is proverbially suited for jobs that are “dull, dirty, and dangerous.” Restoring a forest is dirty and dangerous to be sure. But dull isn’t quite right. It turns out that the process requires far more intelligence than anyone was willing, it seems, to apply to the problem — with the exception of those planters. That’s changing.
Earlier this year, DroneSeed was awarded the first multi-craft, over-55-pounds unmanned aerial vehicle license ever issued by the FAA. Its custom UAV platforms, equipped with multispectral camera arrays, high-end lidar, six-gallon tanks of herbicide and proprietary seed dispersal mechanisms have been hired by several major forest management companies, with government entities eyeing the service as well.
These drones scout a burned area, mapping it down to as high as centimeter accuracy, including objects and plant species, fumigate it efficiently and autonomously, identify where trees would grow best, then deploy painstakingly designed seed-nutrient packages to those locations. It’s cheaper than people, less wasteful and dangerous than helicopters and smart enough to scale to national forests currently at risk of permanent damage.
I met with the company’s team at their headquarters near Ballard, where complete and half-finished drones sat on top of their cases and the air was thick with capsaicin (we’ll get to that).
The idea for the company began when founder and CEO Grant Canary burned through a few sustainable startup ideas after his last company was acquired, and was told, in his despondency, that he might have to just go plant trees. Canary took his friend’s suggestion literally.
“I started looking into how it’s done today,” he told me. “It’s incredibly outdated. Even at the most sophisticated companies in the world, planters are superheroes that use bags and a shovel to plant trees. They’re being paid to move material over mountainous terrain and be a simple AI and determine where to plant trees where they will grow — microsites. We are now able to do both these functions with drones. This allows those same workers to address much larger areas faster without the caloric wear and tear.”
(Video: Ryan Warner/DroneSeed)
It may not surprise you to hear that investors are not especially hot on forest restoration (I joked that it was a “growth industry” but really because of the reasons above it’s in dire straits).
But investors are interested in automation, machine learning, drones and especially government contracts. So the pitch took that form. With the money DroneSeed secured, it has built its modestly sized but highly accomplished team and produced the prototype drones with which is has captured several significant contracts before even announcing that it exists.
“We definitely don’t fit the mold or metrics most startups are judged on. The nice thing about not fitting the mold is people double take and then get curious,” Canary said. “Once they see we can actually execute and have been with 3 of the 5 largest timber companies in the U.S. for years, they get excited and really start advocating hard for us.”
The company went through Techstars, and Social Capital helped them get on their feet, with Spero Ventures joining up after the company got some groundwork done.
If things go as DroneSeed hopes, these drones could be deployed all over the world by trained teams, allowing spraying and planting efforts in nurseries and natural forests to take place exponentially faster and more efficiently than they are today. It’s genuine change-the-world-from-your-garage stuff, which is why this article is so long.
The job at hand isn’t simple or even straightforward. Every landscape differs from every other, not just in the shape and size of the area to be treated but the ecology, native species, soil type and acidity, type of fire or logging that cleared it and so on. So the first and most important task is to gather information.
For this, DroneSeed has a special craft equipped with a sophisticated imaging stack. This first pass is done using waypoints set on satellite imagery.
The information collected at this point is really far more detailed than what’s actually needed. The lidar, for instance, collects spatial information at a resolution much beyond what’s needed to understand the shape of the terrain and major obstacles. It produces a 3D map of the vegetation as well as the terrain, allowing the system to identify stumps, roots, bushes, new trees, erosion and other important features.
This works hand in hand with the multispectral camera, which collects imagery not just in the visible bands — useful for identifying things — but also in those outside the human range, which allows for in-depth analysis of the soil and plant life.
The resulting map of the area is not just useful for drone navigation, but for the surgical strikes that are necessary to make this kind of drone-based operation worth doing in the first place. No doubt there are researchers who would love to have this data as well.
Now, spraying and planting are very different tasks. The first tends to be done indiscriminately using helicopters, and the second by laborers who burn out after a couple of years — as mentioned above, it’s incredibly difficult work. The challenge in the first case is to improve efficiency and efficacy, while in the second case is to automate something that requires considerable intelligence.
Spraying is in many ways simpler. Identifying invasive plants isn’t easy, exactly, but it can be done with imagery like that the drones are collecting. Having identified patches of a plant to be eliminated, the drones can calculate a path and expend only as much herbicide is necessary to kill them, instead of dumping hundreds of gallons indiscriminately on the entire area. It’s cheaper and more environmentally friendly. Naturally, the opposite approach could be used for distributing fertilizer or some other agent.
I’m making it sound easy again. This isn’t a plug and play situation — you can’t buy a DJI drone and hit the “weedkiller” option in its control software. A big part of this operation was the creation not only of the drones themselves, but the infrastructure with which to deploy them.
The drones themselves are unique, but not alarmingly so. They’re heavy-duty craft, capable of lifting well over the 57 pounds of payload they carry (the FAA limits them to 115 pounds).
“We buy and gut aircraft, then retrofit them,” Canary explained simply. Their head of hardware, would probably like to think there’s a bit more to it than that, but really the problem they’re solving isn’t “make a drone” but “make drones plant trees.” To that end, Canary explained, “the most unique engineering challenge was building a planting module for the drone that functions with the software.” We’ll get to that later.
DroneSeed deploys drones in swarms, which means as many as five drones in the air at once — which in turn means they need two trucks and trailers with their boxes, power supplies, ground stations and so on. The company’s VP of operations comes from a military background where managing multiple aircraft onsite was part of the job, and she’s brought her rigorous command of multi-aircraft environments to the company.
The drones take off and fly autonomously, but always under direct observation by the crew. If anything goes wrong, they’re there to take over, though of course there are plenty of autonomous behaviors for what to do in case of, say, a lost positioning signal or bird strike.
They fly in patterns calculated ahead of time to be the most efficient, spraying at problem areas when they’re over them, and returning to the ground stations to have power supplies swapped out before returning to the pattern. It’s key to get this process down pat, since efficiency is a major selling point. If a helicopter does it in a day, why shouldn’t a drone swarm? It would be sad if they had to truck the craft back to a hangar and recharge them every hour or two. It also increases logistics costs like gas and lodging if it takes more time and driving.
This means the team involves several people, as well as several drones. Qualified pilots and observers are needed, as well as people familiar with the hardware and software that can maintain and troubleshoot on site — usually with no cell signal or other support. Like many other forms of automation, this one brings its own new job opportunities to the table.
The actual planting process is deceptively complex.
The idea of loading up a drone with seeds and setting it free on a blasted landscape is easy enough to picture. Hell, it’s been done. There are efforts going back decades to essentially load seeds or seedlings into guns and fire them out into the landscape at speeds high enough to bury them in the dirt: in theory this combines the benefits of manual planting with the scale of carpeting the place with seeds.
But whether it was slapdash placement or the shock of being fired out of a seed gun, this approach never seemed to work.
Forestry researchers have shown the effectiveness of finding the right “microsite” for a seed or seedling; in fact, it’s why manual planting works as well as it does. Trained humans find perfect spots to put seedlings: in the lee of a log; near but not too near the edge of a stream; on the flattest part of a slope, and so on. If you really want a forest to grow, you need optimal placement, perfect conditions and preventative surgical strikes with pesticides.
Although it’s difficult, it’s also the kind of thing that a machine learning model can become good at. Sorting through messy, complex imagery and finding local minima and maxima is a specialty of today’s ML systems, and the aerial imagery from the drones is rich in relevant data.
The company’s CTO led the creation of an ML model that determines the best locations to put trees at a site — though this task can be highly variable depending on the needs of the forest. A logging company might want a tree every couple of feet, even if that means putting them in sub-optimal conditions — but a few inches to the left or right may make all the difference. On the other hand, national forests may want more sparse deployments or specific species in certain locations to curb erosion or establish sustainable firebreaks.
Once the data has been crunched, the map is loaded into the drones’ hive mind and the convoy goes to the location, where the craft are loaded with seeds instead of herbicides.
But not just any old seeds! You see, that’s one more wrinkle. If you just throw a sagebrush seed on the ground, even if it’s in the best spot in the world, it could easily be snatched up by an animal, roll or wash down to a nearby crevasse, or simply fail to find the right nutrients in time despite the planter’s best efforts.
That’s why DroneSeed’s head of Planting and his team have been working on a proprietary seed packet that they were unbelievably reticent to detail.
From what I could gather, they’ve put a ton of work into packaging the seeds into nutrient-packed little pucks held together with a biodegradable fiber. The outside is dusted with capsaicin, the chemical that makes spicy food spicy (and also what makes bear spray do what it does). If they hadn’t told me, I might have guessed, since the workshop area was hazy with it, leading us all to cough and tear up a little. If I were a marmot, I’d learn to avoid these things real fast.
The pucks, or “seed vessels,” can and must be customized for the location and purpose — you have to match the content and acidity of the soil, things like that. DroneSeed will have to make millions of these things, but it doesn’t plan to be the manufacturer.
Finally these pucks are loaded in a special puck-dispenser which, closely coordinating with the drone, spits one out at the exact moment and speed needed to put it within a few centimeters of the microsite.
All these factors should improve the survival rate of seedlings substantially. That means that the company’s methods will not only be more efficient, but more effective. Reforestation is a numbers game played at scale, and even slight improvements — and DroneSeed is promising more than that — are measured in square miles and millions of tons of biomass.
DroneSeed has already signed several big contracts for spraying, and planting is next. Unfortunately, the timing on their side meant they missed this year’s planting season, though by doing a few small sites and showing off the results, they’ll be in pole position for next year.
After demonstrating the effectiveness of the planting technique, the company expects to expand its business substantially. That’s the scaling part — again, not easy, but easier than hiring another couple thousand planters every year.
Ideally the hardware can be assigned to local teams that do the on-site work, producing loci of activity around major forests from which jobs can be deployed at large or small scales. A set of five or six drones does the work of one helicopter, roughly speaking, so depending on the volume requested by a company or forestry organization, you may need dozens on demand.
That’s all yet to be explored, but DroneSeed is confident that the industry will see the writing on the wall when it comes to the old methods, and identify them as a solution that fits the future.
If it sounds like I’m cheerleading for this company, that’s because I am. It’s not often in the world of tech startups that you find a group of people not just attempting to solve a serious problem — it’s common enough to find companies hitting this or that issue — but who have spent the time, gathered the expertise and really done the dirty, boots-on-the-ground work that needs to happen so it goes from great idea to real company.
That’s what I felt was the case with DroneSeed, and here’s hoping their work pays off — for their sake, sure, but mainly for ours.
Responding to a popular request, we are now sharing transcripts of our investor podcast interviews in this new series. The following interview with Devdutt Yellurkar was recorded in July 2018....
___
Copyright © 2020 iStart Valley.
