Fresh EBT (the EBT stands for the Electronics Transfer Benefit card, which is how food stamp participants receive their benefits) allows users to check their food stamp/SNAP balance and find stores that accept food stamps. Users can also track their spending. The app is free for consumers and government agencies — the company makes money through digital coupons and a job board.
Propel says Fresh EBT is now used by more than 1.5 million Americans each month, and that more than 30,000 people have applied for jobs this year that they discovered through the app. For example, the announcement quotes one user, Tracy B. from Fairland, Virginia — she described Fresh EBT as her “personal financial adviser,” and also said she used it to find discount zoo tickets, and even her current job.
When Propel raised its $4 million seed round last year, founder and CEO Jimmy Chen described his mission as building “a more user-friendly safety net.” He argued that there’s no conflict between Propel’s social mission and its structure as a for-profit business, a position he reiterated in today’s announcement.
“Our investors are world-class experts in their respective fields,” he said. “They share an understanding of the challenges of low-income Americans and a belief that Propel can build a massive business by fighting poverty.”
Those investors include Nyca Partners, which led the round. Andreessen Horowitz, Kleiner Perkins Caufield & Byers, Omidyar Network, Alexa von Tobel and Kevin Durant’s Thirty Five Ventures also participated.
“It’s not hard to see the huge opportunity in building better financial services for low-income people,” said Nyca Managing Partner Hans Morris in a statement. “We just haven’t seen many companies in this space that have an opportunity to have such a large impact at massive scale. That’s why we’re so excited to invest in Propel.”
Propel raises $12.8M for its free app to manage government benefitshttps://techcrunch.com/?p=1759346
Propel, maker of the Fresh EBT app for managing food stamps and other benefits, announced today that it has raised $12.8 million in Series A funding. Fresh EBT (the EBT stands for the Electronics Transfer Benefit card, which is how food stamp participants receive their benefits) allows users to check their food stamp/SNAP balance and […]
Fri, 14 Dec 2018 23:03:31 +0000
Pokémon GO creator Niantic is raising a $200 million Series C at a valuation of $3.9 billion, according to a report from Katie Roof at the WSJ. The round is expected to be led by IVP with participation from Samsung and aXiomatic Gaming.
The upcoming raise would bring the company’s total funding to $425 million, according to Crunchbase. Niantic’s last round was raised at a $3 billion valuation.
TechCrunch has reached out to Niantic for comment.
The gaming startup, which has invested significantly in augmented reality technologies, is also behind titles such as its recently updated Ingress title and an upcoming Harry Potter mobile game. The company was founded as a startup within Google in 2010 and was spun out as its own entity in 2015, releasing its hit title Pokémon GO the next year.
The company is currently working on its next big augmented reality mobile title, Harry Potter: Wizards Unite, aiming to create a proper follow-up hit that can capture the excitement of its Pokémon title. The app’s success will likely be crucial to perceptions that Pokémon GO was more than a fluke breakout success. A release date has not yet been set for the title.
Niantic reportedly raising $200M at $3.9B valuationhttps://techcrunch.com/?p=1759259
Pokémon GO creator Niantic is raising a $200 million Series C at a valuation of $3.9 billion, according to a report from Katie Roof at the WSJ. The round is expected to be led by IVP with participation from Samsung and aXiomatic Gaming. The upcoming raise would bring the company’s total funding to $425 million, according to […]
Fri, 14 Dec 2018 19:07:58 +0000
Robinhood will rename and revamp its upcoming checking and banking features after encountering problems with its insurance. The company published a blog post this evening explaining “We plan to work closely with regulators as we prepare to launch our cash management program, and we’re revamping our marketing materials, including the name . . . Stay tuned for updates.”
Robinhood’s new high-interest, zero-fee checking and savings feature seemed too good to be true. Users’ money wasn’t slated to fully protected. The CEO of the Securities Investor Protection Corporation, a nonprofit membership corporation that insures stock brokerages, tells TechCrunch its insurance would not apply to checking and savings accounts the way Robinhood originally claimed. “Robinhood would be buying securities for its account and sharing a portion of the proceeds with their customers, and that’s not what we cover,” says SIPC CEO Stephen Harbeck. “I’ve never seen a single document on this. I haven’t been consulted on this.”
That info directly conflicts with comments from Robinhood’s comms team, which told me yesterday users would be protected because the SIPC insures brokerages and the checking/savings feature is offered via Robinhood’s brokerage that is a member of the SIPC.
If Robinhood checking and savings is indeed ineligible for insurance coverage from the SIPC, and since it doesn’t qualify for FDIC protection like a standard bank, users’ funds would have been at risk. Robinhood co-CEO Baiju Bhatt told me that “Robinhood invests users’ checking and savings money into government-grade assets like U.S. treasuries and we collect yield from those assets and pay that back to customers in the form of 3 percent interest.” But Harbeck tells me that means users would effectively be loaning Robinhood their money, and the SIPC doesn’t cover loans. If a market downturn caused the values of those securities to decline and Robinhood couldn’t cover the losses, the SIPC wouldn’t necessarily help users get their money back.
Robinhood’s team insisted yesterday that customers would not lose their money in the event that the treasuries in which it invests decline, and that only what users gamble on the stock market would be unprotected, as is standard. But now it appears that because Robinhood is misusing its brokerage classification to operate checking and savings accounts where it says users don’t have to invest in stocks and other securities, SIPC insurance wouldn’t apply. “I have an issue with some of the things on their website about whether these checking and savings accounts would be protected. I referred the issue to the SEC,” Harbeck tells me. TechCrunch got in touch with the SEC, but it declined to comment.
Robinhood planned to start shipping its Mastercard debit cards to customers on December 18th with users being added off the waitlist in January. That may now be delayed due to the insurance problem and it’s announcement that it will change how it works and is positioned.
Robinhood touted how its checking and savings features have no minimum account balance, overdraft fees, foreign transaction fees or card replacement fees. It also has 75,000 free-to-use ATMs in its network, which Bhatt claims is more than the top five U.S. banks combined. And its 3 percent interest rate users earn is much higher than the 0.09 percent average interest rate for traditional savings, and beats most name-brand banks outside of some credit unions.
But for those perks, users must sacrifice brick-and-mortar bank branches that can help them with troubles, and instead rely on a 24/7 live chat customer support feature from Robinhood. The debit card has Mastercard’s zero-liability protection against fraud, and Robinhood partners with Sutton Bank to issue the card. But it’s unclear how the checking and savings accounts would have been protected against other types of attacks or scams.
Robinhood was likely hoping to build a larger user base on top of its existing 6 million accounts by leveraging software scalability to provide such competitive rates. It planned to be profitable from its margin on the interest from investing users’ money and a revenue-sharing agreement with Mastercard on interchange fees charged to merchants when you swipe your card. But long term, Robinhood may use checking and savings as a wedge into the larger financial services market from which it can launch more lucrative products like loans.
That could fall apart if users are scared to move their checking and savings money to Robinhood. Startups can suddenly fold or make too risky of decisions while chasing growth. Robinhood’s valuation went from $1.3 billion last year to $5.6 billion when it raised $363 million this year. That puts intense pressure on the company to grow to justify that massive valuation. In its rush to break into banking, it may have cut corners on becoming properly insured. It’s wise for the company to be rethinking the plan to ensure it doesn’t leave users exposed or hurt its reputation by launching without adequate protection.
[Update 12/14/2018 9:30pm pacific: This article has been significantly updated to include information about Robinhood planning to change its checking and savings feature before launch to ensure users aren’t in danger or losing their money.]
[DIsclosure: The author of this article knows Robinhood co-founders Baiju Bhatt and Vlad Tenev from college 10 years ago.]
Robinhood lacked proper insurance so will change checking & savings featurehttps://techcrunch.com/?p=1759154
Robinhood will rename and revamp its upcoming checking and banking features after encountering problems with its insurance. The company published a blog post this evening explaining “We plan to work closely with regulators as we prepare to launch our cash management program, and we’re revamping our marketing materials, including the name . . . Stay […]
Fri, 14 Dec 2018 17:47:45 +0000
I’m heading back to Europe to hang out in Wroclaw and Warsaw so it’s last call for pitch-off applications.
I’ll be at a Wroclaw event, called In-Ference, which is happening on December 17; you can submit to pitch here. The team will notify you if you have been chosen. The winner will receive a table at TC Disrupt in San Francisco.
Special thanks to WeWork Labs in Warsaw for supplying some beer and pizza for the event and, as always, special thanks to Dermot Corr and Ahmad Piraiee for putting these things together. See you soon!
Last call for Polish pitch-offshttps://techcrunch.com/?p=1759173
I’m heading back to Europe to hang out in Wroclaw and Warsaw so it’s last call for pitch-off applications. I’ll be at a Wroclaw event, called In-Ference, which is happening on December 17; you can submit to pitch here. The team will notify you if you have been chosen. The winner will receive a table at TC […]
Fri, 14 Dec 2018 15:56:48 +0000
TransferGo, the London-based international money transfer startup, has raised just over $17.6 million in Series B funding, including an earlier tranche of funding closed in May. The round is led by Vostok Emerging Finance and Silicon Valley’s Hard Yaka, with participation from Revo Capital, U-Start Club and Practica Capital. The figure also includes around $830,000 in equity crowdfunding via Seedrs.
Founded in 2012, TransferGo currently operates in 47 countries around the world, with offices in London, Vilnius, Berlin, Warsaw and Istanbul. It claims a customer base of 833,000 users, adding more than 1,000 new customers per day, and positions itself as offering one of the fastest international money transfer services on the market. This sees it able to provide international “cross-network” transfers in 30 minutes.
The fintech company also recently launched a free international money transfer service, with what it says is a a zero transaction fee and with no mark-up on exchange rates, allowing customers to transfer money globally at no cost. Essentially, if you aren’t time-sensitive or perhaps are transferring larger amounts, you can elect to use the free tier. If you need a guaranteed arrival time for the money you are sending, you can use the paid tier, which still looks pretty competitive.
In a call and over follow-up emails, TransferGo co-founder and CEO Daumantas Dvilinskas explained that the fintech has built out its own “proprietary technology and infrastructure” to enable it to do 30-minute transfers on the corridors it offers and at a cost that remains low. This means having partner bank accounts as close to the final destination as possible, and re-routing the money being transferred to avoid unnecessary charges and to enough volume to afford economies of scale at the point of conversation.
“We cross-sell our customers different delivery options based on how quickly they want to receive the money,” Dvilinskas tells me. “The TransferGo Now product, where customers can get a 30-minute guarantee, together with other speedy delivery options, effectively pays for the TransferGo Free product… At the same time, economies of scale have been decreasing our direct cost of transactions to a point when we can offer the free product in a sustainable fashion.”
Dvilinskas says TransferGo’s typical customer is “a global citizen” who receives a salary abroad and sends around $500 back home every month. “Before using us they would have been using a cash bureau, bank or PayPal. In addition to this core segment, we see a growing larger transaction segment who are leveraging our competitive currency conversion rate for larger transactions to pay bills or buy goods abroad,” he adds.
Historically, TransferGo launched to enable people in the U.K. to send money to Central and Eastern Europe, a corridor where it claims 20 percent market share (based on the World Bank data). However, the fastest growing corridors today are Continental Europe to Ukraine, Turkey, India and other emerging market destinations.
“Specifically, Poland, Germany and Turkey are emerging as important send markets, which is where we opened up offices last year,” says Dvilinskas.
International money transfer company TransferGo scores $17.6M Series Bhttps://techcrunch.com/?p=1758389
TransferGo, the London-based international money transfer startup, has raised just over $17.6 million in Series B funding, including an earlier tranche of funding closed in May. The round is led by Vostok Emerging Finance and Silicon Valley’s Hard Yaka, with participation from Revo Capital, U-Start Club and Practica Capital. The figure also includes around $830,000 […]
Fri, 14 Dec 2018 09:00:25 +0000
The funding extravaganza may be approaching its end for scooter “unicorns” Lime and Bird, but smaller startups in the micro-mobility space have continued to close venture capital rounds at a consistent pace. See Grin, Tier and Yellow for examples.
The latest is Dott, a European scooter startup founded by Maxim Romain, Ofo’s former head of Europe, the Middle East and Africa. Romain joined Ofo, a Chinese bike- and scooter-sharing company that raised more than $1 billion in venture capital funding but has struggled to scale overseas, in 2018 to help it expand. He only lasted seven months before realizing he could do it better himself.
“Why work for a Chinese company when we can do it ourselves in Europe where we better understand the market?” Romain told TechCrunch.
Dott, headquartered in Amsterdam, has raised €20 million in a round co-led by EQT Ventures and Naspers. Axel Springer Digital Ventures, DN Capital, Felix Capital and others also joined. Dott is using the capital to launch in several cities across Europe, beginning with an early 2019 e-scooter pilot at Station F, a startup campus located in Paris. Additional launches are in the pipeline, as are electric bikes.
As a result of its learnings from Ofo, Bird and Lime, all of which have struggled to keep their equipment out of disadvantageous spots, like trees, lakes and garbage cans, Dott says it’s built sturdier scooters. They have 10” wheels, wider decks, a double brake system for safety, a speed cap at 20km/h and apparently are able to hold a charge longer than competing scooters — though we couldn’t independently verify this.
Dott says it’s taking a friendlier approach to launching in new cities, again, unlike some of its predecessors. If you remember, Bird showed up in a number of cities without permission — a move that resulted in it being denied a permit to operate in San Francisco. Dott will hire local teams to collaborate with city officials to develop pilot plans tailored to each market and it won’t rely on gig economy workers to recharge, clean and maintain scooters. Instead, it will hire and train a team of Dott employees dedicated to maintenance in each city.
“I think a lot of the companies grow too fast in the sense that they don’t necessarily have the product that can enable them to be profitable but because they want to win the race,” Romain said. “They want to raise as much money as possible as quick as possible and to deploy scooters as quick as possible. This creates an environment for them where their unit economics are extremely bad.”
“That’s exactly what we saw with bike-sharing in China. In the end, the reality of the unit economics came back to bite them. It’s a risk. Lime and Bird are doing a lot to improve their hardware but it’s a risk for the industry. For us, we are taking the view that we really need to focus on the product so we have the right unit economics and we can be sustainable. If you want to make it happen, you have to make it happen in a sustainable way.”
A former Ofo exec is launching his own scooter startuphttps://techcrunch.com/?p=1758843
With €20 million in VC backing, Dott plans to release a fleet of multi-colored e-scooters in Paris in early-2019.
Fri, 14 Dec 2018 05:00:11 +0000
LemonBox, a Chinese e-commerce startup that imports vitamins and health products from the U.S., has raised $2 million to develop its business.
The company graduated from Y Combinator’s most recent program in the U.S. and, fueled by the demo day, has pulled in the new capital from 10 investors, which include Partech, Tekton Ventures, Cathexis Ventures, Scrum Ventures and 122 West Ventures.
LemonBox started when co-founder and CEO Derek Weng, a former employee at Walmart in the U.S., saw an opportunity to organize the common practice of bringing health products back in China. Any Mainland Chinese person who has lived in, or even just visited, the U.S. will be familiar with such requests from family and friends, and LemonBox aims to make it possible for anyone in China to get U.S.-quality products without relying on a mule.
The service is primarily a WeChat app — which taps into China’s ubiquitous messaging platform — and a website, although Weng told TechCrunch in an interview this week that the company is contemplating a standalone app of its own. The benefit of that, beyond a potentially more engaging customer experience, could be to broaden LemonBox’s product selection and use data to offer a more customized selection of products. Related to that, LemonBox said it hopes to work with health and fitness-related services in the future to gather data, with permission, to help refine the personal approach.
LemonBox’s team has now grown to 20 people, with 12 full-time staff and 8 interns, and Weng said that the new funding will also go toward increased marketing, improvements to the WeChat app and upgrading the company’s supply chain. Business, he added, is growing at 35 percent per week as LemonBox has adopted a personal approach to its packaging, much like Amazon-owned PillPack.
“This is the first time people in China have ever seen this level of customization for their vitamins,” Weng told TechCrunch.
“What LemonBox offers resonates with me and is serving a clear China market needs. Personally, I travel a lot between China and the U.S., and I often was asked by my relatives to help purchase and carry them similar products like vitamins,” he said in a prepared statement.
“More importantly, what LemonBox can do is to build an initial core user base and a growing brand. Over time, by serving their users well, it can reach and engage more users who want to better take care of their broader nutrition needs, use more data and take advantage of increasingly stronger AI technologies to customers and personalize, and become an essential service for more and more users and customers in China,” Lu added.
LemonBox, which brings US vitamins to Chinese consumers, raises $2Mhttps://techcrunch.com/?p=1759017
LemonBox, a Chinese e-commerce startup that imports vitamins and health products from the U.S., has raised $2 million to develop its business. The company graduated from Y Combinator’s most recent program in the U.S. and, fueled by the demo day, has pulled in the new capital from 10 investors, which include Partech, Tekton Ventures, Cathexis […]
Fri, 14 Dec 2018 04:00:59 +0000
A slew of venture capitalists known for high-profile exits — Kirsten Green of Forerunner Ventures, Keith Rabois of Khosla Ventures, Alfred Lin of Sequoia Capital and Alex Taussig of Lightspeed Venture Partners — have invested in Faire (formerly known as Indigo Fair), a 2-year-old wholesale marketplace for artisanal products.
A quick glance at Faire suggests it’s a combination of Pinterest and Etsy, complete with trendy, pastel stationery, soap, baby products and more, all made by independent artisans and sold to retailers. Faire has today announced a $100 million fundraise across two financing rounds: a $40 million Series B led by Taussig at Lightspeed and a $60 million Series C led by Y Combinator’s Continuity fund. New investors Founders Fund, the venture firm founded by Peter Thiel, and DST Global also participated. The business has previously brought in a total of $16 million.
The latest financing values Faire at $535 million, according to a source familiar with the deal.
If you’re feeling a little bit of déjà vu, that’s because a similar startup also raised a sizeable round of venture capital funding, announced today. That’s Minted . The 10-year-old company, best known for its wide assortment of wedding invitations and stationery, raised $208 million led by Permira, with participation from T. Rowe Price. Though Minted is first and foremost a consumer-facing marketplace, it plans to double down on its wholesale business with its latest infusion of capital, setting it up to be among Faire’s biggest competitors.
Like Minted, Faire leverages artificial intelligence and predictive analytics to forecast which products will fly off its virtual shelves in order to to source and manage inventory as efficiently as possible. The approach appears to be working; Faire says it has 15,000 retailers actively purchasing from its platform — a 3,140 percent year-over-year increase. It’s garnered $100 million in run rate sales and has expanded its community of artists 445 percent YoY, to 2,000.
The company, headquartered in San Francisco, with offices in Ontario and Waterloo, was founded by three former Square employees: chief executive officer Max Rhodes, who was product manager on a variety of strategic initiatives, including Square Capital and Square Cash; chief data officer Daniele Perito, who led risk and security for Square Cash; and chief technology officer Marcelo Cortes, a former engineering lead for Square Cash.
“Our mission at Faire is to empower entrepreneurs to chase their dreams,” Rhodes wrote in a blog post this morning. “We believe entrepreneurship is a calling. Starting a business provides a level of autonomy and fulfillment that’s become difficult to find for many elsewhere in the economy. With this in mind, we built Faire to help entrepreneurs on both sides of our marketplace succeed.”
Distinguished VCs back wholesale marketplace Faire with $100M at a $535M valuationhttps://techcrunch.com/?p=1758963
Kirsten Green of Forerunner Ventures, Keith Rabois of Khosla, Alfred Lin of Sequoia and Alex Taussig of Lightspeed are backers of Faire.
Fri, 14 Dec 2018 00:14:32 +0000
A new study from Versus Systems and the MEMES (Management of Enterprise in Media, Entertainment & Sports) Center at UCLA’s Anderson School of Management examines how gaming and advertising are evolving, and how one influences the other.
As Versus Systems CEO Matthew Pierce put it, the goal was to study, “What is the impact on advertising as interactive media grows, and as more people consume interactive media?”
The individual findings — People like rewards! Not everyone who plays games calls themselves a gamer! — may not be that shocking to TechCrunch readers. And because Versus Systems has built a white-label platform for publishers to offer in-game rewards, the study might also seem a bit self-serving.
But again, this was conducted with UCLA’s Anderson School of Management, and both Pierce (who’s a lecturer at the school) and UCLA MEMES head Jay Tucker pointed to the size of the study, with 88,000 (U.S.-based) participants across a broad range of demographic groups.
Of those respondents, 50 percent said they’ve played a video game (on any platform) in the past week, while 41 percent said they’ve played a game in the past 24 hours. However, only 13 percent of respondents described themselves as gamers. That “identification gap” is even larger among women, where 56 percent played a game in the past week but only 11 percent identified themselves as gamers.
Why does that matter? Well, the MEMES Center and Versus Systems argue in the study press release that “advertisers that are recognizing the value in advertising in-game may be underestimating how large and how diverse the gaming audience really is today.”
The study also suggests that traditional advertising may be facing more resistance from consumers, with 46 percent of respondents saying they frequently or always avoid ads by “clicking the X” to close windows or changing channels or closing apps. Only 3.6 percent of respondents said they always watch ads all the way through.
When asked what would make them play games more, the most popular answer was “winning real things that I want when I achieve things in-game” — it was the number one result for 30 percent of respondents, and among millennials, it did even better. (In comparison, 18 percent put “if the games were less expensive” as their top answer and 11 percent said “my friends playing the same game(s).”) This attitude even extended to TV, where 77 percent of respondents listed rewards as one of the things (not necessarily the top reason) that would make them watch more television.
Meanwhile, 24 percent of respondents listed “if more games/more shows were made for people like me” as the number one thing that would convince them to play or watch more.
Tucker suggested that these seemingly scattershot answers are actually connected. On the advertising side, “We’ve got folks who are used to being part of a community all day, every day, whether that’s social media or massively multiplayer games. We see users are increasingly connected and are not really interested in getting pulled out of an experience. Rewards, if done properly, can reinforce being part of a community … you can amplify that sense of connection.”
“The introduction of choice seems to make a big difference,” Pierce added. “We need new models where we can foster choice, foster community, foster more aspirational relationships between viewers and brands that ultimately allows content developers to have a relationship with the brands that isn’t so adversarial.”
Meanwhile, when it comes to content and storytelling, Tucker said we’re entering an “age of personalization.” Among other things, that means more diversity, in what he described as “a generational shift away from stories that assume everybody’s looking at life from the same perspective.”
Pierce and Tucker suggested that they’ll be taking an even closer look at the data in the coming months (“needs further study” was repeated several times during the interview), particularly by examining responses within smaller demographic groups.
Online ads and games would benefit from more rewards, according to UCLA surveyhttps://techcrunch.com/?p=1758878
A new study from Versus Systems and the MEMES (Management of Enterprise in Media, Entertainment & Sports) Center at UCLA’s Anderson School of Management examines how gaming and advertising are evolving, and how one influences the other. As Versus Systems CEO Matthew Pierce put it, the goal was to study, “What is the impact on […]
Thu, 13 Dec 2018 22:18:41 +0000
PornHub, a popular site that features people in various stages of undress, saw 33.5 billion visits in 2018. There are currently 7.53 billion people on Earth.
Y’all have been busy.
The company, which owns most of the major porn sites online, produces a yearly report that aggregates user behavior on the site. Of particular interest, aside from the fact that all of us are horndogs, is that the U.S., Germany and India are in the top spots for porn browsing and that the company transferred 4,000 petabytes of data, or about 500 MB, per person on the planet.[gallery ids="1758849,1758848,1758846,1758495"]
We ignore this data at our peril. While it doesn’t seem important at first glance, the fact that these porn sites are doing more traffic than most major news organizations is deeply telling. Further, like the meme worlds of Twitter and Facebook, Stormy Daniels and Fortnite made the top searches, which points to the spread of politics and culture into the heart of our desires. TV manufacturers should note that 4K searchers are rising in popularity, which suggests that consumer electronics manufacturers should start getting read for a shift (although it should be noted that there is sadly little free 4K content on these sites, a discovery I just made while researching this brief.)
Need more frightening/enlightening data? Here you go.
Just as ‘1080p’ searches had been a defining term in 2017, now ‘4k’ ultra-hd has seen a significant increase in popularity through-out 2018. The popularity of ‘Romantic’ videos more than doubled, and remained twice as popular with female visitors when compared to men.
Searches referring to the dating app ‘Tinder’ grew by 161% among women, 113% among men and 131% by visitors aged 35 to 44. It was also a top trending term in many countries including the United Kingdom and Australia. The number of Tinder themed fantasy date videos on the site is now more than 3500.
Life imitates art, and eventually porn imitates everything, so perhaps it’s no surprise to see that ‘Bowsette’ also made our list of searches that defined 2018. After the original Nintendo fan-art went viral, searches for Bowsette exceeded 3 million in just one week and resulted in the release of a live-action Bowsette themed porn parody (NSFW) with more than 720,000 views.
The Bible Belt represented well in the showings, with Mississippi, South Carolina and Arkansas spending the most time looking at porn. Kansas spent the least. Phones got the most use as porn distribution devices and iOS and Android nearly tied in terms of platform popularity.
Windows traffic fell considerably this year, while Chrome OS became decidedly more popular in 2018. Chrome was popular when it came to browsers used, while the PlayStation was the biggest deliverer of flicks to the console user.
Porn is a the canary in the tech coal mine, and where it goes the rest of tech follows. All of these data points, taken together, paint a fascinating picture of a world on the cusp of a fairly unique shift from desktop to mobile and from HD to 4K video. Further, given that these sites are delivering so much data on a daily basis, it’s clear that all of us are sneaking a peek now and again… even if we refuse to admit it.
The annual PornHub year in review tells us what we’re really looking at onlinehttps://techcrunch.com/?p=1758476
PornHub, a popular site that features people in various stages of undress, saw 33.5 billion visits in 2018. There are currently 7.53 billion people on Earth. Y’all have been busy. The company, which owns most of the major porn sites online, produces a yearly report that aggregates user behavior on the site. Of particular interest, […]
Thu, 13 Dec 2018 20:46:09 +0000
When the former CTOs of YouTube, Facebook and Dropbox seed fund a database startup, you know there’s something special going on under the hood. Jiten Vaidya and Sugu Sougoumarane saved YouTube from a scalability nightmare by inventing and open-sourcing Vitess, a brilliant relational data storage system. But in the decade since working there, the pair have been inundated with requests from tech companies desperate for help building the operational scaffolding needed to actually integrate Vitess.
So today the pair are revealing their new startup PlanetScale that makes it easy to build multi-cloud databases that handle enormous amounts of information without locking customers into Amazon, Google or Microsoft’s infrastructure. Battle-tested at YouTube, the technology could allow startups to fret less about their backend and focus more on their unique value proposition. “Now they don’t have to reinvent the wheel” Vaidya tells me. “A lot of companies facing this scaling problem end up solving it badly in-house and now there’s a way to solve that problem by using us to help.”
PlanetScale quietly raised a $3 million seed round in April, led by SignalFire and joined by a who’s who of engineering luminaries. They include YouTube co-founder and CTO Steve Chen, Quora CEO and former Facebook CTO Adam D’Angelo, former Dropbox CTO Aditya Agarwal, PayPal and Affirm co-founder Max Levchin, MuleSoft co-founder and CTO Ross Mason, Google director of engineering Parisa Tabriz and Facebook’s first female engineer and South Park Commons founder Ruchi Sanghvi. If anyone could foresee the need for Vitess implementation services, it’s these leaders, who’ve dealt with scaling headaches at tech’s top companies.
But how can a scrappy startup challenge the tech juggernauts for cloud supremacy? First, by actually working with them. The PlanetScale beta that’s now launching lets companies spin up Vitess clusters on its database-as-a-service, their own through a licensing deal, or on AWS with Google Cloud and Microsoft Azure coming shortly. Once these integrations with the tech giants are established, PlanetScale clients can use it as an interface for a multi-cloud setup where they could keep their data master copies on AWS US-West with replicas on Google Cloud in Ireland and elsewhere. That protects companies from becoming dependent on one provider and then getting stuck with price hikes or service problems.
PlanetScale also promises to uphold the principles that undergirded Vitess. “It’s our value that we will keep everything in the query pack completely open source so none of our customers ever have to worry about lock-in” Vaidya says.
He and Sougoumarane met 25 years ago while at Indian Institute of Technology Bombay. Back in 1993 they worked at pioneering database company Informix together before it flamed out. Sougoumarane was eventually hired by Elon Musk as an early engineer for X.com before it got acquired by PayPal, and then left for YouTube. Vaidya was working at Google and the pair were reunited when it bought YouTube and Sougoumarane pulled him on to the team.
“YouTube was growing really quickly and the relationship database they were using with MySQL was sort of falling apart at the seams,” Vaidya recalls. Adding more CPU and memory to the database infra wasn’t cutting it, so the team created Vitess. The horizontal scaling sharding middleware for MySQL let users segment their database to reduce memory usage while still being able to rapidly run operations. YouTube has smoothly ridden that infrastructure to 1.8 billion users ever since.
“Sugu and Mike Solomon invented and made Vitess open source right from the beginning since 2010 because they knew the scaling problem wasn’t just for YouTube, and they’ll be at other companies five or 10 years later trying to solve the same problem,” Vaidya explains. That proved true, and now top apps like Square and HubSpot run entirely on Vitess, with Slack now 30 percent onboard.
Vaidya left YouTube in 2012 and became the lead engineer at Endorse, which got acquired by Dropbox, where he worked for four years. But in the meantime, the engineering community strayed toward MongoDB-style non-relational databases, which Vaidya considers inferior. He sees indexing issues and says that if the system hiccups during an operation, data can become inconsistent — a big problem for banking and commerce apps. “We think horizontally scaled relationship databases are more elegant and are something enterprises really need.
Database legends reunite
Fed up with the engineering heresy, a year ago Vaidya committed to creating PlanetScale. It’s composed of four core offerings: professional training in Vitess, on-demand support for open-source Vitess users, Vitess database-as-a-service on PlanetScale’s servers and software licensing for clients that want to run Vitess on premises or through other cloud providers. It lets companies re-shard their databases on the fly to relocate user data to comply with regulations like GDPR, safely migrate from other systems without major codebase changes, make on-demand changes and run on Kubernetes.
PlanetScale’s customers now include Indonesian e-commerce giant Bukalapak, and it’s helping Booking.com, GitHub and New Relic migrate to open-source Vitess. Growth is suddenly ramping up due to inbound inquiries. Last month around when Square Cash became the No. 1 app, its engineering team published a blog post extolling the virtues of Vitess. Now everyone’s seeking help with Vitess sharding, and PlanetScale is waiting with open arms. “Jiten and Sugu are legends and know firsthand what companies require to be successful in this booming data landscape,” says Ilya Kirnos, founding partner and CTO of SignalFire.
The big cloud providers are trying to adapt to the relational database trend, with Google’s Cloud Spanner and Cloud SQL, and Amazon’s AWS SQL and AWS Aurora. Their huge networks and marketing war chests could pose a threat. But Vaidya insists that while it might be easy to get data into these systems, it can be a pain to get it out. PlanetScale is designed to give them freedom of optionality through its multi-cloud functionality so their eggs aren’t all in one basket.
Finding product market fit is tough enough. Trying to suddenly scale a popular app while also dealing with all the other challenges of growing a company can drive founders crazy. But if it’s good enough for YouTube, startups can trust PlanetScale to make databases one less thing they have to worry about.
They scaled YouTube — now they’ll shard everyone with PlanetScalehttps://techcrunch.com/?p=1758636
When the former CTOs of YouTube, Facebook and Dropbox seed fund a database startup, you know there’s something special going on under the hood. Jiten Vaidya and Sugu Sougoumarane saved YouTube from a scalability nightmare by inventing and open-sourcing Vitess, a brilliant relational data storage system. But in the decade since working there, the pair have […]
Thu, 13 Dec 2018 18:50:17 +0000
The simplest needs are often the most vital: power and clean water will get you a long way. But in rural areas of developing countries they can both be hard to come by. OffGridBox is attempting to provide both, sustainably and profitably, while meeting humanitarian and ecological goals at the same time. The company just raised $1.6 million to pursue its lofty agenda.
The idea is fairly simple, though naturally rather difficult to engineer: Use solar power to provide to a small community both electricity (in the form of charged batteries) and potable water. It’s not easy, and it’s not autonomous — but that’s by design.
I met two of the OffGridBox crew, founder and CEO Emiliano Cecchini and U.S. director Troy Billett, much earlier this year at CES in Las Vegas, where they were being honored by Not Impossible, alongside the brilliant BecDot braille learning toy. The team had a lot of irons in the fire, but now are ready to announce their seed round and progress in deploying what could be a life-saving innovation.
They’ve installed 38 boxes so far, some at their own expense and others with the help of backers. Each is about the size of a small shed — a section of a shipping container, with a scaffold on top to attach the solar cells. Inside are the necessary components for storing electricity and distributing it to dozens of rechargeable batteries and lights at a time, plus a water reservoir and purifier.
Water from a nearby unsafe natural (or municipal, really) source is trucked or piped in and replenishes the reservoir. The solar cells run the purifier, providing clean water for cheap — around a third of what a family would normally pay, by the team’s estimate — and potentially with a much shorter trek. Simultaneously, charged batteries and lights are rented out at similarly low rates to people otherwise without electricity. Each box can generate as much as 12 kWh per day, which is split between the two tasks.
The alternatives for these communities would generally be small dedicated solar installations, the upfront cost of which can be unrealistic for them. The average household spend for electricity, Billett told me, is around 43 cents per day; OffGridBox will be offering it for less than half that, about 18 cents.
It doesn’t run itself: The box is administrated by a local merchant, who handles payments and communication with OffGridBox itself. Young women are targeted for this role, as they are more likely to be long-term residents of the area and members of the community. The box acts as a small business for them, essentially drawing money out of the air.
OffGridBox works with local nonprofits to find likely candidates; the women pictured above were recommended by Women for Women. They in turn will support others who, for example, deliver or resell the water or run side businesses that rely on the electricity provided. There’s even an associated local bottled water brand now — “Amaziyateke,” named after a big leaf that collects rainwater, but in Rwanda is also slang for a beautiful woman.
Some boxes are being set up to offer Wi-Fi as well via a cellular or satellite connection, which has its own obvious benefits. And recently people have been asking for the ability to play music at home, so the company started including portable speakers. This was unexpected, but an easy demand to meet, said Billett — “It is critical to listen!”
The company does do some work to keep the tech running efficiently and safely, remotely monitoring for problems and scheduling maintenance calls. So these things aren’t just set down and forgotten. That said, they can and have run for hundreds of thousands of hours — years — without major work being done.
Each box costs about $15,000 to build, plus roughly another $10,000 to deliver and install. The business model has an investor or investors cover this initial cost, then receive a share of the revenue for the life of the box. At capacity usage this might take around two years, after which the revenue split shifts (from a negotiable initial split to 50/50); it’s a small, safe source of income for years to come. At around $10,000 of revenue per year per box with full utilization, the IRR is estimated at 15 percent.
What OffGridBox believes is that this model is better than any other for quick deployment of these boxes. Grants are an option, of course, and they can also be brought in for disaster relief purposes. Originally the idea was to sell these to rich folks who wanted to live off the grid or have a more self-sufficient mountain cabin, but this is definitely better — for a lot of reasons. (You could probably still get one for yourself if you really wanted.)
OffGridBox has been through the Techstars accelerator as part of a 2017 group, and worked through 2018, as I mentioned earlier, to secure funding from a variety of sources. This seed round totaling $1.6 million was led by the Doen and Good Energies Foundations; the Banque Populaire du Rwanda is also a partner.
Along with a series A planned for 2019, this money will support the deployment of a total of 42 box installations in Rwandan communities.
“This will help us become a major player in the energy and water markets in Rwanda while empowering women entrepreneurs, fighting biocontamination for improved health, and introducing lighting in rural homes,” said Cecchini in the press release announcing the funding.
Alternative or complementary sources of power, such as wind, are being looked into, and desalination of water (as opposed to just sterilization) is being actively researched. This would increase the range and reliability of the boxes, naturally, and make island communities much more realistic.
Those 42 boxes are just the beginning: The company hopes to deploy as many as 1,000 throughout Rwanda, and even then that would only reach a fifth of the country’s off-grid market. By partnering with local energy concerns and banks, OffGridBox hopes to deploy as many as 100 boxes a year, potentially bringing water and power to as many as 100,000 more people.
OffGridBox raises $1.6M to charge and hydrate rural Africa with its all-in-one installationshttps://techcrunch.com/?p=1756859
The simplest needs are often the most vital: power and clean water will get you a long way. But in rural areas of developing countries they can both be hard to come by. OffGridBox is attempting to provide both, sustainably and profitably, while meeting humanitarian and ecological goals at the same time. The company just raised $1.6 million to pursue its lofty agenda.
Thu, 13 Dec 2018 18:15:37 +0000
French startup Tempow has been working on software solutions to improve the Bluetooth protocol. The company just unveiled the Tempow True Wireless Bluetooth profile so that anybody can create AirPods clones.
Many companies have tried creating a pair of earbuds with absolutely no wire. But none of them are as good as Apple’s AirPods. Manufacturers can’t quite recreate the same experience because Apple has developed its own chip and software solution.
Putting aside the magical Bluetooth pairing process, AirPods leverage normal Bluetooth audio (A2DP) to communicate with your device. That’s why they work with iPhones, Android phones, old Windows laptops, etc.
But A2DP normally only lets you connect one device with one headphone. And that’s also what’s happening with AirPods. Your phone establishes a link with one of the earbuds. The second earbud then sniffs the first link.
Other manufacturers have tried to create wireless earbuds by establishing a second connection between the second earbud and the main earbud. They often use Near Field Magnetic Induction. This uses a lot of battery and creates latency issues.
Tempow has been rewriting the Bluetooth stack so that manufacturers can use normal Bluetooth chipsets and pair a single device with multiple speakers. Using this solution for wireless earbuds seems like a natural fit.
Tempow’s new Bluetooth profile lets you create AirPods clones more easilyhttps://techcrunch.com/?p=1758580
French startup Tempow has been working on software solutions to improve the Bluetooth protocol. The company just unveiled the Tempow True Wireless Bluetooth profile so that anybody can create AirPods clones. Many companies have tried creating a pair of earbuds with absolutely no wire. But none of them are as good as Apple’s AirPods. Manufacturers […]
Thu, 13 Dec 2018 16:12:55 +0000
Yesterday TechCrunch held its first-ever event in Nigeria — our second in Sub-Saharan Africa. The day was packed with Battlefield presentations from 15 startups from across the region, along with panels featuring some of Africa’s best-known tech entrepreneurs and executives.
It was an incredible day and offered a fascinating peek into an absolutely vibrant tech community. For those unable to make the trek through the standstill Lagos traffic, have no fear. We’ve included footage from the day’s event below. And for those who were lucky enough to join, you can relive the highlights right here.[gallery ids="1757752,1757761,1757760,1757758,1757757,1757756,1757754"]
Expats, Repats and Africans
Kwame Acheampong (Mall for Africa), Eleni Gabre-Madhin (blueMoon) and Lexi Novitske (Singularity Investments) discuss the ups and downs of the influence repatriates and outside investors exert on the African startup community.
Fireside Chat with Funke Opeke
Main Street Technologies founder and Main One Cable Company CEO Funke Opeke has led the charge to bring broadband internet to West Africa. She discusses the role of entrepreneurship in helping to scale business.
Investing in African Startups
Kola Aina and other area investors discuss the lessons that can be learned from Silicon Valley VC, and which aspects of the model don’t apply to the African tech ecosystem.
Blockchain’s Potential in Africa
Olugbenga Agboola (Flutterwave), Omolara Awoyemi (SureGroup) and Nichole Yembra (Greenhouse Capital) and Olaoluwa Samuel-Biyi (SureRemit) discuss the impact crypto has had on the African tech community and the different ways blockchain technology can help build a broad cross-section of different categories.
The Winner of Startup Battlefield
The winner of the event was M-SCAN from Uganda, which develops portable mobile ultrasound devices (Ultrasonic probes) that are laptop, tablet and mobile phone compatible. The judges were impressed with its scalability potential to make many other medical access devices affordable for Africa, where mother and infant mortality is unforgivably high.
Here’s what you missed at Startup Battlefield Lagoshttps://techcrunch.com/?p=1757732
Yesterday TechCrunch held its first-ever event in Nigeria — our second in Sub-Saharan Africa. The day was packed with Battlefield presentations from 15 startups from across the region, along with panels featuring some of Africa’s best-known tech entrepreneurs and executives. It was an incredible day and offered a fascinating peek into an absolutely vibrant tech […]
Thu, 13 Dec 2018 16:04:55 +0000
The new funding shows just how completely software has eaten the world. Once considered an industry that was too analog to ever reap the benefits of technology’s management tools, software and services for the construction industry have seen some big exits and big money come in over the past three years.
Unicorns abound among the companies that are trying to serve various aspects of the construction industry. SoftBank kicked off 2018 by investing $865 million in Katerra — one of many early mega-deals from the firm’s giant Vision Fund — which touts itself as a one-stop shop for everything from planning to permitting to filling new building construction. In November, another software developer that was contending for the construction market, PlanGrid, was acquired by Autodesk in an $875 million transaction.
Taking new money from Tiger Global to expand makes sense, given the competitive advantage that PlanGrid gained in the market by tying up with a $30 billion powerhouse in software development for the architecture, design and construction industry. Autodesk is the maker of AutoCAD — one of the fundamental tools that architects, designers and construction companies use for two and three-dimensional renderings of buildings. By integrating the design management and construction planning toolkits, Autodesk created a more integrated offering for customers.
Indeed, Procore said it would use the cash to ramp up its partner expansion and to continue to invest in new products and services and hiring new talent.
Based in Carpinteria, Calif., Procore already has more than 1,300 employees working in 12 offices around the world and is working with more than 5,000 different customers on projects.
Additional investors in Procore include Bessemer Venture Partners, Iconiq Capital and Lumia Partners.
Construction management software developer Procore raises $75 million at a $3 billion valuationhttps://techcrunch.com/?p=1758272
Procore Technologies, a provider of software to manage construction projects, is now worth $3 billion thanks to a new $75 million round of funding led by Tiger Global Management. The new funding shows just how completely software has eaten the world. Once considered an industry that was too analog to ever reap the benefits of […]
Thu, 13 Dec 2018 16:01:17 +0000
Social media has lately been linked to mental health issues, with a recent study showing a causal relationship between the use of social media and depression and loneliness. Wisdo, which just raised $11 million in seed funding from a handful of angel investors, aims to connect and support people in some of their toughest moments.
Communities on Wisdo focus on topics around physical health, mental health, self-growth, sexuality, identity and family. The app works by connecting people seeking help with those who can offer help — often those who have been through similar experiences.
“Wisdo grew out of my own personal experience when my father was diagnosed with cancer – I had no experience with cancer and there was no ‘map’ for what I should do next, no one to give me direction,” Wisdo CEO Boaz Gaon said in a statement. “I also understood that this could not possibly be true: there had to be many millions of people who had lived through this exact situation and who could help guide me – I just needed to find them. This was the seed of Wisdo – connecting people around these experiences, finding the everyday wisdom that we all need, sharing the earned wisdom that we all have, building a map for life’s emotional challenges, and giving people insight into what happens next.”
Wisdo’s timeline feature enables people to lay out their experiences in the form of steps. Based on those steps, Wisdo develops an outline for each life experience. From there, users can engage with each other in one-on-one conversations. In beta, Wisdo grew to 500,000 users.
“Social networks are based on generalized groups of friends and acquaintances where you can’t share openly and honestly about anything,” Richard Klausner, an investor in Wisdo and founder of Juno Therapeutics, said. “Social networks can be a force for good by rewarding empathy and helpfulness, which is why we believe so much in Wisdo’s mission. We want users to not only be open and honest, but move from that to creating human connections, which can improve users’ lives in the long run.”
*An earlier version of this story said Intel Capital invested. The press release sent over was inaccurate.
Mental wellness startup Wisdo launches with $11 million in fundinghttps://techcrunch.com/?p=1758155
Social media has lately been linked to mental health issues, with a recent study showing a causal relationship between the use of social media and depression and loneliness. Wisdo, which just raised $11 million in seed funding from a handful of angel investors, aims to connect and support people in some of their toughest moments. Communities […]
Thu, 13 Dec 2018 16:00:44 +0000
Ever wonder how much of your personal information is accessible to marketers? Well, there’s a new service called My Number Lookup that makes it easy (and free) for you to check the data that’s publicly available and tied to your mobile phone number.
The service was created by Keepsafe, maker of privacy-centric products. While there is a My Number Lookup website, the service actually operates over SMS — you just text HELLO to (855) 228-4539 and it will start sending you a report.
Keepsafe co-founder and CEO Zouhair Belkoura said that while marketers are able to access this information with relative ease, it’s difficult for consumers to check.
“We said, ‘Why don’t we make it super easy?'” he said. “Here’s a number you can text that tells you what information is publicly available.”
Specifically, My Number Lookup will tell you whether it was able to find a name, home address, age, gender, mobile carrier and associated people tied to your mobile number. It will even show you the data (several of the data points about me were missing, out-of-date or flat-out wrong), then point you toward Keepsafe Unlisted, a service for creating “burner” phone numbers (so you don’t have to share your real number widely), and also toward a Keepsafe blog post that outlines how someone can try to remove their personal information from various data brokers.
Belkoura admitted that even though you’ve got the report, you won’t necessarily be able to scrub the data from the internet. Instead, he sees it as more of “a wake-up call” that people need to be more careful about giving out their phone numbers. And if it leads them to use Keepsafe Unlisted, even better.
“Once information is out there, it’s very difficult to delete,” he said. “The internet is a place that just doesn’t forget.”
As for why the service operates over SMS, Belkoura said My Number Lookup will only provide data about the number you’re texting from. Hopefully that means users will only check on their own data, not someone else’s: “We don’t actually want to create a service where people who don’t have a legitimate interest can pay to look up information.”
Keepsafe launches My Number Lookup so you can see the public data tied to your mobile numberhttps://techcrunch.com/?p=1758469
Ever wonder how much of your personal information is accessible to marketers? Well, there’s a new service called My Number Lookup that makes it easy (and free) for you to check the data that’s publicly available and tied to your mobile phone number. The service was created by Keepsafe, maker of privacy-centric products. While there […]
Thu, 13 Dec 2018 15:17:40 +0000
Sovrn recently raised $25 million in new funding with the goal of expanding beyond the adtech business through acquisitions. Now it’s announcing the first of those deals: It’s acquiring affiliate marketing company VigLink.
Sovrn first launched in 2014 — made up, as CEO Walter Knapp put it, from “bits and pieces of different companies.” (It emerged from Federated Media and its roots go back to Lijit, which FM acquired in 2011.) Knapp said the company’s vision is to “enable a professional class of storytellers to do more of what they want to do” by providing tools around content creation, distribution, monetization, operations and capital.
As for VigLink, it was founded in 2009 to help publishers monetize by automatically inserting affiliate links (where merchants share revenue with publishers when those publishers drive sales). Knapp said he’s been interested in the intersection of publishing and commerce because publishers are often the ones influencing consumer purchase decisions, but “they don’t really capture the commerce value of what they’ve created.”
VigLink already plays a big role in that process — Knapp said its links are driving nearly $1 billion in annual sales. But he also noted that there’s less than 10 percent overlap between the domains working with Sovrn and VigLink, so he sees plenty of opportunity to grow.
“We can take what is a really interesting product that has appealed more to high-volume publishers and take it into content publishers,” Knapp said. “Now what’s required there is a pretty deep understanding of the editorial process.”
Knapp intends to bring the entire 35-person VigLink team over to Sovrn, bringing the company’s headcount to 220. He also said that with the addition of VigLink to Sovrn’s business, “transactional adtech” will make up less than half of the company’s total revenue.
And he promised that the VigLink product will continue to evolve, for example by giving publishers more data about the entire customer journey.
The financial terms of the acquisition were not disclosed. According to Crunchbase, VigLink raised more than $27 million from investors, including GV, Emergence Capital, First Round Capital, RRE Ventures, Correlation Ventures, Foundry Group, Costanoa Ventures and Silicon Valley Bank.
Sovrn acquires VigLink to expand its publisher monetization platformhttps://techcrunch.com/?p=1758424
Sovrn recently raised $25 million in new funding with the goal of expanding beyond the adtech business through acquisitions. Now it’s announcing the first of those deals: It’s acquiring affiliate marketing company VigLink. Sovrn first launched in 2014 — made up, as CEO Walter Knapp put it, from “bits and pieces of different companies.” (It […]
Thu, 13 Dec 2018 15:00:12 +0000
Robinhood is undercutting the big banks by forgoing brick-and-mortar branches with its new zero-fee checking and savings account features. With no overdraft or monthly fees, a juicy 3 percent interest rate and a claim of more U.S. ATMs than the five biggest banks combined, Robinhood is using the scalability of software to pass impressive perks on to customers. The free stock trading app already used that approach to attack brokers like E*Trade and Charles Schwab that charge a per-trade fee. Now it’s breaking into the larger financial services market with a model that could put the squeeze on Wells Fargo, Chase and Bank of America. However, Robinhood may not be properly insured to do so.
Today Robinhood launches checking and savings accounts in the U.S. with a Mastercard debit card issued through Sutton Bank that starts shipping December 18th. Users earn 3 percent on all the dough they keep with Robinhood, yet there’s no minimum balance or fees for monthly membership, overdrafts, foreign transactions or card replacements. That’s a pretty sweet deal compared to the other leading banks that all charge for some of that or offer much lower interest rates. The trade-off is that while customers get 24/7 live text chat support, they won’t be able to walk into a local bank branch. Users who want early access can sign up here.
Robinhood expects to turn a profit thanks to a lean 300-employee operation, earning a margin on investing your money in U.S. treasuries and a revenue share with Mastercard on interchange fees charged to merchants when you swipe. The launch could be critical to keeping Robinhood worthy of its $5.6 billion valuation from when it took a $363 million Series D in March just a year after raising at a $1.3 billion valuation. The 6 million-user app invested in launching a free cryptocurrency trading exchange early this year only to see coin prices plummet and mainstream interest fall off. But with banks hammering users with surprise fees and mediocre user experience, there’s a huge opportunity for a mobile-first startup to disrupt how we store money.
“Brick-and-mortar locations are costly. Our goal with this product was to build a completely digital experience so we can reduce our overhead so we can pass more of the value back to customers,” Robinhood co-CEO Baiju Bhatt tells me. [Disclosure: I know Bhatt and co-CEO Vlad Tenev from college.] “Saving accounts in the U.S. pay on average 0.09 percent and we all know the banks are making far more than that from the deposits. With Robinhood you earn 3 percent off all of your money. Mental math is hard, so if you look at the median U.S. household that has about $8,000 in liquid savings, they’d earn $240 a year.”
Robinhood will be sending invites to users in January for the new feature that they can use exclusively or alongside their existing bank. Anyone approved to use Robinhood’s stock brokerage is eligible, but users can also sign up directly for checking and savings with no obligation to trade stocks. Robinhood claims signing up won’t impact your credit score. Users get to customize a Robinhood-branded debit card that’s accepted wherever Mastercard is. Because the feature is run within Robinhood’s brokerage, it’s ensured by the SIPC instead of the FDIC.
[Update 12/14/2018: It’s increasingly unclear whether the SIPC’s insurance would cover Robinhood’s checking and savings feature to protect users in the event that Robinhood loses their money investing it in treasury securities if there was a market downturn. It’s also unclear if Robinhood or its partner Sutton Bank had explicit approval from the SIPC to use its insurance for checking/savings instead of as a brokerage. Robinhood initially told TechCrunch users would be fully protected by the SIPC. However, SIPC CEO Stephen Harbeck tells me the SIPC would not cover checking and savings, and that Robinhood did not get explicit permission for this. He’s referred the issue to the SEC. Read our full story on the risks of Robinhood checking and savings here.]
One of the most appealing features of Robinhood checking and savings is getting access to 75,000 free-to-use ATMs in places like Target, Walgreens and 7-Eleven. Users won’t be able to tell just by looking at an ATM whether it’s in the network, but the Robinhood app features a map for finding the nearest one. You can deposit checks via Robinhood’s app too, and if you need to send a check, you can just tell the startup how much to deliver to whom and it will mail the check for you.
“These fees like overdraft fees — they’re not fees millionaires are paying. It’s ordinary folks paying. It’s actually more expensive for those that have less money and it’s cheaper for those that have more money. We think that isn’t right and we think that’s bad business,” Bhatt gripes. Because Robinhood built its own clearing house for moving money, and it lacks the overhead of traditional banks, it’s able to save enough money to make its no-fee structure work. “We want to build a financial services company that democratizes America’s financial system.”
Robinhood will have to convince users it’s worthy of their trust, as a security breach could be disastrous. There’s also the question of whether people are ready to ditch their bank branch. “Behaviors about and going into a branch are definitely changing,” says Bhatt. My biggest concern was not having any consistency in who I talk to when I need banking help. Bhatt tells me the company plans to roll out more personalized customer service features in the coming months, but there may always be edge cases that make the lack of in-person support annoying.
Getting into banking could open a lucrative revenue stream for Robinhood as it charts its path to IPO. The startup recently hired Jason Warnick, a 20-year veteran of Amazon, to be its CFO and get it prepped to go public. Wall Street will want to see a more robust business that’s not as vulnerable to foes like stock brokerage Charles Schwab, which is already lowering fees to stay competitive with Robinhood. Not only will checking and savings see users move more money into their Robinhood accounts that it can invest to earn a profit, but it also poises the startup to tackle more financial services in the future. More lucrative products like loans could make paying 3 percent much easier for Robinhood to handle. But for now it must get insurance sorted out and guarantee users are protected before they should consider signing up.
Robinhood launches no-fee checking/savings with Mastercard & the most ATMshttps://techcrunch.com/?p=1758231
Robinhood is undercutting the big banks by forgoing brick-and-mortar branches with its new zero-fee checking and savings account features. With no overdraft or monthly fees, a juicy 3 percent interest rate and a claim of more U.S. ATMs than the five biggest banks combined, Robinhood is using the scalability of software to pass impressive perks […]
Thu, 13 Dec 2018 14:59:59 +0000
The new investment comes from London-based investment fund Odey Asset Management, and it is an extension to a $52 million round that closed back in September. The deal takes Jumo, which recently moved its headquarters to Singapore, to $103 million raised from investors. Its backers include Goldman Sachs, Proparco — which is attached to the French Development Agency — and Finnfund, and it was part of Google’s Launchpad accelerator last year.
Founded in 2014, Jumo specializes in social impact financial products, such as microloans, savings and insurance. It started in Tanzania, and today claims to have originated more than $1 billion in loans. Since September, when it announced a first expansion into Asia via Pakistan, it claims it has grown to 10 million people saving or borrowing from its platform (from a previous nine million). The company has some 350 staff across 10 offices in Africa, Europe and Asia.
Over the last year, the company said it has doubled the number of financial service providers and telcos on its platform. Of those deals, one of its highest profile is a digital finance product for Uber drivers that’s live in Kenya. That collaboration is likely to expand in Africa and potentially beyond, Jumo said.
Expansion is very much the name of the game all round for the company. Jumo CEO Andrew Watkins-Ball told TechCrunch in September that there are plans to expand to more Asian markets next year but, for now, the company isn’t saying which ones.
African fintech startup Jumo raises $12.5M more to fund Asia expansionhttps://techcrunch.com/?p=1758340
Months after a big round, African fintech startup Jumo has pulled in a fresh $12.5 million to add more fuel for its expansion into Asia Pacific. The new investment comes from London-based investment fund Odey Asset Management, and it is an extension to a $52 million round that closed back in September. The deal takes Jumo, […]
Thu, 13 Dec 2018 14:09:54 +0000