Author: Richard Dal Porto

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Wrapping the week here at Daily Crunch with a big thanks to Henry for taking over yesterday and a fist bump to everyone who has written in with notes on its format. We’re still tinkering, so your notes are read and (mostly) appreciated, even if we can’t respond to everyone.

Stick with us as we get this fully figured out. — Alex

TechCrunch Top 3

Coding school drama: The market for coding schools and bootcamps is not going to go away so long as there is an outsized market demand for developers that current educational methods can’t fulfill. But not every player in the market is doing well. Lambda School, for example, is in even more hot water this week.

VCs love edtech: While private investors are happily pouring capital into the edtech startup market, the share prices of many public edtech companies are under fire. That’s a sentiment gap that TechCrunch is keeping close tabs on. More here on the edtech venture market.

Apply to Startup Battlefield: There’s not a lot of time left to apply to the upcoming Disrupt Startup Battlefield. And we want to hear from you. Really. Many startups that have taken part in our free and fun and very public pitch-off have gone on to raise lots of capital or even go public. So hang out with us; we think you’re great!

Startups and VC

Stripe buys Bouncer: The progress of the yet-private Stripe as an online finance behemoth continued today with its purchase of Bouncer, a startup based in Brooklyn that TechCrunch reports has “built a platform to automatically run card authentications and detect fraud in card-based online transactions.” Fraud detection is a point of product differentiation among online payment companies, so this is a deal to watch.

Why aren’t more African startups going public? The SPAC boom is taking a host of American startups public, but not upstart tech companies from Africa. The real issue could simply be one of scale, it turns out. TechCrunch investigates.

SoftBank makes piles of money: Some of the bets that SoftBank has made on its own, and via its Vision Fund 1 and 2, have been clunkers. WeWork remains a byword for embarrassment. But the teleco and investing powerhouse has been on a heater lately, as TechCrunch’s Equity Podcast explored. How good were its results? Very, very well. More on its investing performance here.

Don’t leak customer account data: An exercise startup that competes with Peloton didn’t have its cybersecurity house in order. Echelon, TechCrunch reports, “had a leaky API that let virtually anyone access riders’ account information.” That’s all kinds of not good. And the news item explains why cybersecurity has been so hot lately. More tech everywhere means more potential vulnerabilities everywhere, as well.

5 ways to raise your startup’s PR game

By now, it’s widely understood that storytelling is the foundation for successful startup PR.

Tech journalists receive more pitches than we can count each day from very early-stage companies seeking to make a name for themselves, and, to be honest, most of them sound like they were written with language-prediction technology.

What most companies fail to grasp is that storytelling is everyone’s job, like product managers who write blog posts that give users real insights into the latest release. The same holds true for founders who take part in Reddit AMAs and engineers who join product Slack chats.

To make a splash and stay relevant, here are five actionable suggestions that won’t cost a dime to implement.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

Wrapping up news from the biggest tech companies this week, a short digest of earnings results from companies that you care about is in order.

Coinbase met its pre-released Q1 2020 earnings expectations, posting both huge revenue and profit gains. In short, the first quarter was a huge win for the crypto trading house. It had the same sort of quarter that likely led to Robinhood filing to go public.

DoorDash blew the, er, doors off its own quarter, leading to its shares spiking by around 25% in today’s trading. That’s one hell of a result. Sure, DoorDash is worth a lot less than it was at its peak, but the company had a great day all the same.

Airbnb managed a roughly 2.5% gain today after reporting its own earnings yesterday. It also got an analyst upgrade to boot. In short, the company managed year-over-year revenue growth, but also detailed larger-than-anticipated losses thanks to some one-time items. Worth around $85 billion, Airbnb remains richly valued.

And then there was Alibaba, which has lost around a quarter-trillion in value since it got into a scrap with its local administration and swung to a loss after it was served with a multibillion dollar fine by the Chinese government. But the e-commerce giant’s $28.6 billion in total revenue was up 64% compared to its year-ago result. Hot dang.

Now you are all caught up! Have a lovely weekend, and we’ll see you again Monday afternoon.

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Today as we dig deep into Expensify, its history and its current ramp toward the public markets after reaching $100 million in ARR, a quick note on where we are in the world of exits.

If you are bored of IPOs, consider it a luxury. For years, the unicorn market was all hype and no liquidity. But in the last year or so, the public market has been a welcome and lucrative exit path for a host of unicorns. The same excitement that has led to record venture capital results in the private sector has been at play amongst public investors, boosting the value of many a former unicorn as they left their startup days behind them.

But an April pause led to some concern that the IPO market was cooling. News out today details an IPO climate that is warming once again. For Expensify, and other unicorns on the sidelines like Robinhood, it’s good news.

For one company in particular, warm IPO markets could not have come back at a better time. Let’s talk about Expensify.

A deep dive into Expensify ahead of its IPO

TechCrunch’s continuing series of deep dives on the most interesting startup companies continues this week, with the kickoff of our look at Expensify. Unlike some other companies we’ve profiled as part of our EC-1 series, like Tonal, perhaps, you’ve probably used Expensify’s software.

So you know the company in question. What you might not have known is just what a wild ride Expensify has been on during its startup life. From the introduction to the Expensify series, I present the following paragraph:

Most interestingly, this is a story about just not giving a damn about what anyone goddamn thinks, an approach to life and business that led to more than $100 million in annual revenue, and an IPO incoming on what looks to be a very quick timetable. Prodigious revenues, 10 million users and only 130 employees running the whole shebang — that’s a hell of an achievement in only 13 years.

You can read the first main piece here. The rest will be coming out over the next few weeks. Get hype!

Startups and venture capital

We have a lot to get through, so please excuse the following list of bullets:

• This founder raised millions to build Fair, a neobank for immigrants — The core promise of fintech is that it should apply technology to an ossified, inequitable and often iniquitous financial system. Fair wants to do that for immigrants via a neobank. And it’s doing it with alternative capital. Super cool.
• Crypto asset manager Babel raises $40M from Tiger Global, Bertelsmann and others — By this point in the business cycle, we should not be shocked at $40 million Series A rounds. Especially if Tiger is involved. In this case Babel is the recipient of the outsized round, with the startup busy at work building “a suite of [crypto] asset management products and services tailored to enterprise clients around the world,” Rita reports.
• Blind raises $37M to double down on workplace gossip and career advice — If your friends don’t send you Blinds on what is going on at their workplace, are you really friends? Maybe. But Blind has found a big niche with its focus on providing verified-ish gossip on companies you can name. Also journalists love it. As do, Danny reports, investors.
• Indy VC firm Sixty8 Capital launches $20M fund aimed at underrepresented founders — According to Ron, Sixty8 Capital is launching a “new $20 million fund aimed at providing early-stage funding for underrepresented founders” from “smack dab in the middle of the United States.” It’s not alone in raising capital in the Midwest; TechCrunch reported that M25 recently raised a new fund as well.
• Snack, a ‘Tinder meets TikTok’ dating app, opens to Gen Z investors — What is more Gen Z than a Tinder-TikTok mobile app tie up? How about Snack allowing its young users to invest in its upcoming round? The kids are just fine, it turns out. This is great.

4 lessons I learned about getting into Y Combinator (after 13 applications)

Can you imagine making 13 attempts at something before attaining a successful outcome?

Alex Circei, CEO and co-founder of Git analytics tool Waydev, applied 13 times to Y Combinator before his team was accepted. Each year, the accelerator admits only about 5% of the startups that seek to join.

“Competition may be fierce, but it’s not impossible,” says Circei. “Jumping through some hoops is not only worth the potential payoff but is ultimately a valuable learning curve for any startup.”

In an exclusive exposé for TechCrunch, he shares four key lessons he learned while steering his startup through YC’s stringent selection process.

The first? “Put your business value before your personal vanity.”

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

The tech giants

Tech’s bigger players have been busy today, giving us quite a lot to chew on. Facebook, for example, is taking fire from state lawyers arguing that its idea of building an Instagram for kids is a bad idea. Not that the complaints will stop Facebook from doing whatever it wants, but the level of criticism is notable. Facebook doesn’t have a lot of political goodwill to spend, these days.

Facebook is also following in Twitter’s footsteps in asking users to read articles before they share them. Because the world going digital has not yet stopped humans from being in need of chronic correction.

In order of descending market capitalization, Spotify is next on our list. The company is improving its social sharing capabilities, in essence boosting the ability of its users to share podcasts intelligently. As Sarah reports, “Spotify will also now allow users to share a time-stamped link to a podcast, which allows users to tune into a particular moment of the podcast episode.”

Thank everything, and it’s about time. Even if everyone who listens to my show uses Apple Podcasts.

Finally, enterprise storage, security and collaboration company Box is in the middle of a very public fight with an activist investor. In short, Box’s growth is slowing. While the company’s leadership is confident that it can restart its growth engine, outside parties want more control. Yoof.

Community

The fun thing about setting up something new like our Discord server is that it’s new. The tough thing about setting up something new (like the Discord server) is that it needs folks like you to come make it great. Join us! (New this week, a room about fintech and one dedicated to space!)

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Our thanks to everyone who wrote in this week about the format changes to the newsletter! Feedback largely sorted into two themes: Some people really like the more narrative format, and some folks really want a more link-list styled missive. What follows is an attempt to balance both perspectives.

Starting today we’ll bold company names, so that you can more quickly pick out startups, add more bulleted points to sections, and, per a different piece of feedback, include more regular descriptors of companies that are not household names.

That said, we’re not going to abandon chatting with you every day, as TechCrunch is nothing if not full of things to say. So here’s a blend of what the new, updated Daily Crunch team had in mind, and your notes. A big thanks to everyone who wrote in!

Alex — @alex on Twitter

A mega-exit for American fintech

The news that public fintech company Bill.com will buy Divvy, a Utah-based startup that helps small and midsized businesses manage their spend, was perhaps the biggest startup story of the week. Breaking late Thursday, the $2.5 billion transaction was long expected. Divvy had raised more than $400 million from PayPal Ventures, New Enterprise Associates, Insight Partners and Pelion Venture Partners.

TechCrunch covered the impending sale, rumors of which sprung up before Bill.com reported its Q1 earnings. To see the company drop the news at the same time as its earnings was not a surprise. For the burgeoning corporate payment space (more here on startups in the space like Ramp, Airbase and Brex).

I got to noodle on the financial results that Bill.com detailed regarding Divvy — they are pretty key metrics to help us value the startups that are competing to go public or find a similarly feathered corporate nest. In short, the corporate spend startup cohort is doing great. It’s even spawning new startups like Latin American-focused Clara, which raised $3.5 million earlier this year.

Broadly, the fintech market had a huge Q1 and is blasting its way toward a record venture capital year, like AI startups and the rest of the VC world.

Startups and venture capital

• Startup employees should pay attention to Biden’s capital gains tax plans — Vieje Piauwasdy, a director at Secfi, a company working to help startup employees manage equity, has notes on the current political climate in a key startup market, the United States.
• Tiger Global is betting that more schools are going to share future student earnings — Tiger Global invested in Blair, a startup that wants to help universities offer income share agreements, or ISAs, to students. Natasha has the latest on the trend, and, of course, the recently ubiquitous Tiger investing group.
• SoftBank leads $15M round for China’s industrial robot maker Youibot — Well-known Japanese conglomerate SoftBank’s Asian venture group is putting $15 million into Youibot, a Chinese startup that builds “autonomous mobile robots,” Rita reports.
• GajiGesa, a fintech focused on Indonesian workers, adds strategic investors and launches new app for micro-SMEs — GajiGesa, a startup that provides “earned wage access,” or EWA in the Indonesian market, has raised an undisclosed amount of new capital, following its February venture round worth $2.5 billion that was backed by Defy.vc and Quest Ventures.

5 investors discuss the future of RPA after UiPath’s IPO

Much ink (erm, pixels) has been spilled about robotic process automation (RPA) recently, particularly in the wake of UiPath’s IPO last month.

But while some of the individuals Ron interviewed about the future of RPA believe the technology is in its “early infancy,” the pandemic increased attention toward things we can let robots handle for us. And it’s hard to argue that repetitive tasks like billing and spreadsheeting and paper-pushing should not be outsourced to robots.

“RPA allows companies to automate a group of highly mundane tasks and have a machine do the work instead of a human,” Ron writes. “Think of finding an invoice amount in an email, placing the figure in a spreadsheet and sending a Slack message to accounts payable. You could have humans do that, or you could do it more quickly and efficiently with a machine. We’re talking mind-numbing work that is well suited to automation.”

Although RPA is the fastest-growing category in enterprise software, the market remains surprisingly small. Ron spoke to five investors about where the sector is headed, where there are opportunities and the biggest threats to the RPA startup ecosystem.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

The tech giants

It was a quieter day from the tech giants, who made plenty of news earlier in the week. The good news is that their relative calm means we can take a look at news from other Big Tech companies, those that don’t quite crack the $1 trillion market cap threshold yet:

• Walmart’s Flipkart to cover insurance for all sellers in India and waive additional fees — Recall that American commerce giant Walmart owns Indian e-commerce giant Flipkart, which is “exempting storage and cancellation fees for sellers on its marketplace and also providing them with insurance coverage” in light of the COVID-19 surge in the country. A good move.
• Credit Karma reinvents cash-back rewards with instant payback — American consumer credit fintech Credit Karma, which sold to Intuit for more than $7 billion last year, is trying to reinvent the cash-back reward system popular among credit cards for its debit-card-using users, Matt reports.
• A conversation with Bison Trails, the AWS-like service inside of Coinbase — Now a public company, Coinbase, a cryptocurrency exchange with easy on-ramps to the more mainstream fiat banking world, has a secret little company helping power it from the inside called Bison Trails that it bought some time back. Connie digs in.
• Twitch UX teardown: The Anchor Effect and de-risking decisions — Finally, UX guru Peter Ramsey of Built For Mars tucks into Twitch, the popular streaming platform that Amazon bought years ago.

Community

Some of us are mourning the shutdown of Nuzzel, so we asked … would you pay for it (and why)? Let us know what you think!

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Hello friends, welcome to Daily Crunch, where we bring you the day’s most important startup, tech and venture capital news in a single package.

The fintech world is front and center today, with big news from Chime lighting up the analytics boards here at TechCrunch. But we also explored impressive earnings from fintech giants today, asking ourselves how much market the PayPals and Squares of the world will leave for startups as they build ever-broader product sets.

The answer could matter for more than just the buy-now-pay-later world, a hot startup category in recent quarters. We don’t buy into the idea of hard kill-zones around the biggest tech companies, but all the same, the competitive fintech landscape is changing. Especially in emerging markets, where startup activity has been blistering.

Finally, if you reply to this email I will receive the note directly in my inbox. Feel free to say hi!

Alex — @alex on Twitter

When is a neobank not a bank?

Fintech darling Chime has agreed to not refer to itself as a bank after running afoul of California regulators. As TechCrunch reported, Chime has mostly avoided calling itself a bank. In a televised interview, for example, as Connie wrote, its CEO, Chris Britt, said that his company is “more like a consumer software company than a bank.”

Sure. Anyway, we aren’t going to stop calling Chime a neobank, because that’s what it is. We’ll leave the linguistic nuance to the regulators.

The dustup with the Cali powers isn’t itself a huge deal, but it does underscore how Chime and its myriad global competitors are not in too much hot water with governments. Ask yourself: When was the last time you saw Chime in the news for misbehaving? Now, repeat the same experiment with, say, Robinhood? Totally different, right?

The neobank game is expensive, but potentially lucrative. Chime is generating positive EBITDA, for example. That’s a fancy way of saying that it no longer burns much, if any, cash. Something that Uber and Lyft are still struggling to do.

Startups and venture capital

We’ll get into a host of startup funding rounds shortly, but first I want to talk business models. Namely the evolution of SaaS. SaaS is just a fancy way of saying “modern software,” of course; the sort of stuff you pay a regular fee to use, and someone else hosts and delivers to your browser.

SaaS became the de facto startup business model some time ago. Why? It’s lucrative with strong revenue quality (high gross margins) and dependable (recurring) incomes. But in recent quarters, there’s been a shift toward more on-demand pricing (here’s the investor perspective). Which is like SaaS, but potentially even better.

And the trend away from SaaS toward on-demand is not slowing. For example, I chatted with Twilio’s CFO yesterday. Despite having bought some more SaaSy companies lately, he said that his company will keep its center of gravity in the on-demand world. We’re not surprised, but it was a data point worth sharing. (More on this below.)

Now, the day’s hottest funding rounds:

• Personal skin problems lead founder to launch skincare startup Nøie, raises $12M Series A — Mike’s coverage of Nøie is notable for two reasons. First, because it’s fun to write “ø,” and second, because the skin care market is massive.
• Bitski raises $19 million from a16z to become the ‘Shopify for NFTs’ — Either NFTs are going to be with us forever and venture bets like this one are brilliant, or NFTs won’t provide durable consumer value, and the current rage is merely a passing kerfuffle. Investors are placing their bets.
• From bootstrapped to a $2.1B valuation, ReCharge raises $227M for subscription management platform — Look, SaaS is evolving, but that doesn’t mean that it’s going away. As Mary Ann reports, the company’s software “is designed to give e-commerce merchants a way to offer and manage subscriptions for physical products.” Cool.
• Metafy adds $5.5M to its seed round as the market for games coaching grows — I wrote this one. Metafy is building a marketplace for game coaching. But don’t think that it’s just an esports play. Metafy has a much broader vision.
• Lightmatter’s photonic AI ambitions light up an $80M B round — This round is a bit outside my domain expertise (I have none), so I’ll let Devin explain: “Lightmatter plans to leapfrog Moore’s law with its ultrafast photonic chips specialized for AI work, and with a new $80 million round, the company is poised to take its light-powered computing to market.” If that works, bring on the future!

Freemium isn’t a trend — it’s the future of SaaS

While we adopted new pandemic habits like rearranging house plants to create pleasing Zoom backgrounds and having groceries delivered, top SaaS companies also tried something new — offering their products for free or at deep discounts.

Because many enterprises had to make snap decisions to digitize their operations, decision-makers were averse to making long-term plans. As a result, companies like Shopify, GoDaddy and GitHub roiled out free, free-trial and low-priced offerings aimed at end users.

Freemium conversion and expansion is here to stay, says Kyle Poyar, VP of Growth at VC firm OpenView. “The merits of launching a free plan should no longer need to be debated,” he says.

“Instead, more companies should be asking: Are we giving enough away for free?”

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

The tech giants 

Let’s talk about Google. Namely its Chromebook push. Anyone who recalls the UMPC boom, or even the ill-fated netbook phenom, could have been forgiven for dismissing Chromebooks. After all, they were nearly the same idea. But, unlike their predecessors, Chromebooks are kinda working? TechCrunch reported earlier this week that Chromebook sales were up 257% in Q1, for example. And today Google dropped some docks to try and get big companies to buy Chromebooks? For work? The latter bit makes no sense to me, though I will heartily admit that as far as couch computers go, Chromebooks are amazing.

Today, instead of another item or two from another Big Tech conglomerate, we’re turning to China. Recall that the Chinese Communist Party is in the process of cutting its fintech sector to a smaller size. The country’s tech industry seems to be in a general retreat as the government works to assert more control over its operations and influence.

We’ll see what impact that has on venture capital numbers over time. But there’s news from the country that matters to you and me. First, Chinese EV company Nio — which also has a Formula E team — is starting to sell cars in another country. A first. Norway, you win! And China is irked that India is not allowing Chinese companies to compete for a piece of its 5G hardware market. I am surprised that China is making noise about the matter, because after India banned apps from its companies, you would imagine that it would take a similar stance toward hardware that many countries eschew over security concerns.

Community

If you’re in the voting mood, give our podcast Equity a Webby vote. It’s the final voting day. So vote. Vote. Vote. Please vote. :)

Also, big shout out to our Extra Crunch #OG-EdTech community member Jomayra Herrera, who joined Reach Fund as their newest partner. Read more here and join us on Discord!

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Are startup valuations about to fall?

Hello, friends! Alex here to talk to you for a hot second about money. Then we’ll get into startups, venture capital, what Big Tech is up to and more. I promise. But hang with me for a moment.

Tech stocks got hammered today: The tech-heavy Nasdaq fell by more than 2%. Cloud stocks endured twice the damage. What happened? The U.S. government said that it might raise interest rates. So what? Well, when rates were low, lots of money that might have been invested elsewhere was instead funneled into tech stocks and VC funds that invest in startups.

Now, with the government saying that it might shake up the current state of affairs, investors are responding by selling tech stocks. Bessemer Venture Partners investor Byron Deeter noted the drop, tweeting that after a “brutal few days in the clouds,” with software stocks off “~5% today and ~10% on the week,” he was curious if valuations are “just taking a breather after a massive 2020” or starting “a broader reset.”

That’s a great question. More on the underlying economics of the situation here and here. Now, into startup-land.

Twitter doubles down on subscriptions

If you were curious about how Twitter was going to pursue its subscription strategy, the answer, to a degree, is buying startups. Today Big Tweet announced that it is buying Scroll, a startup that charges its users a fee, providing them with an ad-free experience on various media sites. Scroll then split its user fee with those sites.

A neat model, yeah? It’s a bit like the startup called Contenture that TechCrunch covered a few times back in 2009. Only Scroll made more progress than Contenture did. And your humble servant was not a co-founder at Scroll.

Regardless, the Scroll-Twitter deal matters because the social media company is busy rolling up startups and products into its ecosystem to better craft a set of services that may help it monetize more effectively over the long haul. Sarah reports:

[Scroll] will become a part of Twitter’s larger plans to invest in subscriptions, the company says, and will later be offered as one of the premium features Twitter will provide to subscribers. Premium subscribers will be able to use Scroll to easily read their articles from news outlets and from Twitter’s own newsletters product, Revue, another recent acquisition that’s already been integrated into Twitter’s service. When subscribers use Scroll through Twitter, a portion of their subscription revenue will go to support the publishers and the writers creating the content, explains Twitter in an announcement.

Twitter vs. Substack? Yep. Twitter vs. Clubhouse? Yep. And if Twitter can help media companies better monetize and thus not die? Well, then it’s Twitter versus the a16z media operation. I didn’t really expect a Jack versus Marc 2021 but am here for it all the same.

A typical day in today’s startup funding market

There was a cornucopia of startup news today on the site, so I’ve narrowed it a bit to get you what you need in a hurry. Also, shoutout to Mary Ann for covering half of it all by herself.

Here’s the rundown:

• HoneyBook raises $155M at $1B+ valuation to help SMBs, freelancers manage their businesses — Tiger participated in this particular Series D led by Durable Capital. Financial control software is hot!
• Persona lands $50M for identity verification after seeing 10x YoY revenue growth — You might recall that Persona raised $17.5 million last January. That’s one hell of a COVID-era growth cycle.
• WorkBoard raises $75M as the OKR-focused startup bets on a growing economy, changes to business culture — The great OKR startup software boom continues. More on the upstart cohort here.
• Acronis raises $250M at a $2.5B+ valuation to double down on cyber protection services — You might know Acronis as a Williams F1 sponsor, but it’s also now a multicorn with a quarter billion of capital on its books. Perhaps F1 is that expensive.

To round out our startup and venture capital notes, here are two more bits of news: Austin-based Multicoin Capital has raised a $100 million fund to “further capitalize on rampant excitement in the crypto world,” per our own reporting. Oh, and London-based seed investment fund Stride VC has raised a £100 million fund.

Advice and analysis from Extra Crunch

How to break into Silicon Valley as an outsider

There is no magic spell that will induce an investor to meet with you. As with most things in life, it all comes down to who you know and what you have to offer.

“Nothing beats building human networks,” says Domm Holland, CEO and co-founder of Fast. “That’s the way that you’re going to get this done in terms of fundraising.”

Since its founding in 2019, Fast has raised $124 million across three rounds as it lands new users and partners like Stripe for its one-click checkout product. In this interview, Holland, a native Australian, shares actionable advice for other outsiders with startup dreams.

“Raising money isn’t the only thing,” Holland says. “You’ve got to hire people, you’ve got to build a team, you’ve got to build customers and suppliers, and you’ve got to build entire ecosystems.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

The enterprise strikes back

Before we get into the enterprise news, here’s what you want to read about: Tesla spent $3 (not a typo) to purchase patents relating to battery tech that we think could really matter.

On the enterprise front, Ron has two stories today from tech giants that matter. The first is an interview with SAP CEO Christian Klein. SAP, you will recall, spun out Qualtrics a little bit ago. What’s ahead for the software giant? Ron is on the case!

From the same pen, Box’s time in the barrel continues as some of its largest public shareholders are agitating to “inject [Box’s] board with still more new blood, taking a swipe at the Box leadership team while it was at it.” This is a fight worth watching as it could encourage, or discourage, more unicorns from going public.

Finally from Big Tech, some good news. Namely that Instagram is working on improving its caption tech, which could help with accessibility. And our own Twitter-free Devin reports that Microsoft wants to help kids read.

Community

We asked everyone on Twitter about their experience trying to learn a foreign language, and you can weigh in here. Some of you have tried using Duolingo (with success!) and some shockingly got through German class in junior high without learning a single sentence of the language. Regardless of your personal experience, give the Duolingo EC-1 a read and learn about how the company started, how they figured out how to make money and what’s up next for them.

Speaking of starting a company … if you’re building your own, join us for this week’s Extra Crunch Live. Register here. It’s free! See you there.

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

TechCrunch’s new home

The original plan was to spend a minute today explaining that the Daily Crunch is now being put together by a new and expanded team. I, your friend Alex, will be writing and collecting the main sections from here on out. We’ll also have input from Walter and Annie on the Extra Crunch side of things (like today’s Exchange column!), along with community notes from Drew and more. It’s going to be great.

But with the news out today that TechCrunch’s parent company’s parent company is selling our parent company to a new parent company, we can’t do anything but admit that our newsletter shakeup is hardly the biggest news story of the day.

You can read more of TechCrunch’s coverage of the deal here. We will have more on the matter in the coming weeks. You’ll learn more about it as we do.

I am beyond excited about getting the chance to write to you every day. A big thank you to Anthony Ha, who ran this fine newsletter for so long. But there is a lot of startup and tech news to get through today, so let’s put aside private equity buyouts of legacy media assets for the moment and get into the stuff we care about the most.

The big story: The Duolingo EC-1

TechCrunch has covered the explosive edtech sector extensively over the last year (some examples here and here), largely thanks to Natasha’s work. She joined the TC team just before the pandemic, making her focus on education technology instantly prescient as the world went into lockdown. Remote education became the default, and several billion dollars in venture capital quickly chased the trend.

Now, on perhaps the other end of the COVID era, Natasha just published a deep dive into one of the most fascinating companies in the edtech arena: Duolingo. Per her reporting in her brand-new EC-1 investigating the company, Duolingo has scaled to 500 million users and $190 million in 2020 bookings.

Edtech is now big business, and after a history of being a place where venture capital goes to die, it’s instead a red-hot sector with a . I’m still chewing on the 10,000+ words that we just shipped on Duolingo, but it’s clear already that Natasha crushed this particular assignment.

Startups and venture capital: Either NFTs are the next big thing or a lot of people are very wrong

Let’s talk startups, yeah? Turning to the day’s news, I found a few gems for your delectation.

We’ll start with Zoomo, an Australian e-bike company (formerly Bolt Bikes) that wants delivery folks to snag a subscription to its two-wheeled zoomers. As TechCrunch recently reported, you may have heard of the company after it “made a name for itself through partnerships with Uber Eats and DoorDash to help delivery workers access e-bikes through weekly subscriptions at discounted rates.”

It has since expanded to 10,000 bikes internationally and wants to work with companies of all sorts on getting their workers kitted about with its hardware. And it just raised $12 million. Let’s see how far its new capital allows the company to, er, scoot ahead.

Next up is Gatheround, which just raised $3.5 million in a seed round. The company, formerly known as Icebreaker, helps remote teams conduct engaging video meetings. Which is not a bad idea, as sometimes you need a little help to break the damn ice.

Per our own Mary Ann Azevedo, “Homebrew and Bloomberg Beta co-led the company’s latest raise, which included participation from angel investors, such as Stripe COO Claire Hughes Johnson, Meetup co-founder Scott Heiferman, Li Jin and Lenny Rachitsky.”

Finally, it is impossible to cover startups in 2021 without NFTs cropping up somewhere, so let’s allow Lucas Matney to tap our brains into the cryptoverse:

The creators behind CryptoPunks, one of the most popular NFT projects on the web, just revealed their latest project called Meebits. The project boasts 20,000 procedurally generated 3D characters that are tradeable on the Ethereum blockchain.

I won’t lie, why not procedurally generate 200,000? Or 2,000,000? Or 20? A lot of my friends are tweeting about bored apes and breeding digital horses. Meanwhile, I sit around a stack of paper books feeling at once like a caveman and an oracle able to see what won’t last. Either way, it’s the year of non-fungible digital ownership of proof of digital ownership of fungible images.

Further reading:

• Hangry, an Indonesian cloud kitchen startup with plans to become a global F&B company, closes $13M Series A
• Avatar startup Genies scores $65 million in funding round led by Mary Meeker’s Bond

The tech giants: Twitter vs. Clubhouse

Turning to the Big Tech companies, there was a good chunk of news today, the most important of which is that Twitter’s push into live audio is no joke. Nor is it some sort of side project that never really gets the full attention of the social giant’s product team. Instead, Twitter announced today that “it’s making Twitter Spaces available to any account with 600 followers or more, including both iOS and Android users,” Sarah reports.

Even more, the company also “officially unveiled some of the features it’s preparing to launch, like Ticketed Spaces, scheduling features, reminders, support for co-hosting, accessibility improvements and more.” Get hype, kids; Twitter versus Clubhouse is now in its second round and we’re pretty hype about it.

Two more things for your reading pleasure: When it comes to the biggest tech companies, a key topic — and the current theme of a lawsuit between Team Fornite and Team Dongle — has been the cut of revenues that app stores of all stripes get to take. Long stuck at 30%, a rate that Apple is apparently determined to stick to regardless of how poorly it makes them look, there’s movement on the matter.

Today, Epic Games bought ArtStation and instantly cut its commission rate from the 30% that it was to the 12% that Epic now charges on its own games store. Microsoft previously reduced its cut to 12%. That sound you hear is Apple screaming as some of its record net income is slowly eroded by more creator-friendly business practices.

Finally, in the world of Big Tech, Dell is selling Boomi to help cover the debts it accrued by buying EMC. Ron Miller has the details.

Advice and analysis from Extra Crunch

Analytics as a service: Why more enterprises should consider outsourcing

As KPIs go, return on experience (RoX) ranks near the top of the list. Unfortunately, many startups have no way to measure RoX — doing so requires a holistic approach that exceeds the capacity of most growth-focused, early-stage companies.

Startups that need to develop a data strategy while conserving engineering resources are driving growth in the analytics-as-a-service (AaaS) market. If you’re looking for insights into winning customers over strategically, cutting technical costs and making better decisions faster, AaaS can help you set realistic expectations.

How to attract large investors to your direct investing platform

A changing regulatory environment and pandemic-fueled growth has created a lot of new wealth and increased interest in direct investing.

In a guest post for Extra Crunch, investor David Teten examined several online platforms that serve as market-makers to get a better sense of how they attract investors and increase engagement.

These companies play for high stakes, says Teten, because a competent direct-investing platform must be able to operate as seamlessly as a traditional fund.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

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