UK-based startup HumanForest has suspended its nascent ‘free’ e-bike service in London this week, after experiencing “mechanical” issues and after a user had an accident on one of its bikes, TechCrunch has learned. The suspension has also seen the company make a number of layoffs with plans to re-launch next spring using a different e-bike.
The service suspension comes only a few months after HumanForest started the trial in North London — and just a couple of weeks after announcing a $2.3M seed round of funding backed by the founders of Cabify and others.
We were tipped to the closure by an anonymous source who said they were employed by the startup. They told us the company’s e-bike had been found to have a defect and there had been an accident involving a user, after which the service was suspended. They also told us HumanForest fired a bunch of staff this week with little warning and minimal severance.
Asked about the source’s allegations, HumanForest confirmed it had suspended its service in London following a “minor accident” on Sunday, saying also that it had identified “problems of a similar nature” prior to the accident but had put down those down to “tampering or minor mechanical issues”.
Here’s its statement in full: “We were not aware that the bike was defective. There had been problems of a similar nature which were suspected to be tampering or minor mechanical issues. We undertook extra mechanical checks which we believed had resolved the issue and informed the supplier. We immediately suspended operations following the minor accident on Sunday. The supplier is now investigating whether there is a more serious problem with the e-bike.”
In an earlier statement the startup also told us: “There was an accident last week. Fortunately, the customer was not hurt. We immediately withdrew all e-bikes from the street and we have informed the supplier who is investigating. Our customers’ safety is our priority. We have, therefore, decided to re-launch with a new e-bike in Spring 2021.”
HumanForest declined to offer any details about the nature of the defect that caused it to suspend service but a spokeswoman confirmed all its e-bikes were withdrawn from London streets the same day as the accident, raising questions as to why it did not do so sooner — having, by its own admission, already identified “similar problems”.
The spokeswoman also confirmed HumanForest made a number of job cuts in the wake of the service suspension.
“We are very sorry that we had to let people go at this difficult time but, with operations suspended, we could only continue as a business with a significantly reduced team,” she said. “We tried very hard to find a way to keep people on board and we looked at the possibility of alternative contractual arrangements or employment but unfortunately, there are no guarantees of when we can re-launch.”
“Employees who had been with the company for less than three months were on their probation period which, as outlined in their contract, had one week’s notice. We will be paying their salaries until the end of the month,” she said, reiterating that it’s a difficult time for the startup.
The e-bikes HumanForest was using for the service appear to be manufactured by the Chinese firm Hongji — but are supplied by a German startup, called Wunder Mobility, which offers both b2c and b2b mobility services.
We contacted both companies to ask about the e-bike defect reported by HumanForest.
At the time of writing only Wunder Mobility had responded — confirming it acts as “an intermediary” for HumanForest but not offering any details about the nature of the technical problem.
Instead, it sent us this statement, attributed to its CCO Lukas Loers: “HumanForest stands for reliable quality and works continuously to improve its services. In order to offer its customers the best possible range of services in the sharing business, HumanForest will use the winter break to evaluate its findings from the pilot project in order to provide the best and most sustainable solution for its customers together with Wunder Mobility in the spring.”
“Unfortunately, we cannot provide any information about specific defects on the vehicles, as we have only acted as an intermediary. Only the manufacturer or the operator HumanForest can comment on this,” it added.
In a further development this week, which points to the competitive and highly dynamic nature of the nascent micromobility market, another e-bike sharing startup, Bolt — which industry sources suggest uses the same model of e-bike as HumanForest (its e-bike is visually identical, just painted a more lurid shade of green) — closed its e-bike sharing service in Paris this week, a few months after launch.
When we contacted Bolt to ask whether it had withdrawn any e-bikes because of technical issues it flat denied doing so — saying the Paris closure was a business decision, and was not related to problems with its e-bike hardware.
“We understand some other companies have had issues with their providers. Bolt hasn’t withdrawn any electric bikes from suppliers due to defects,” a spokesperson told us, going on to note it has “recently” launched in Barcelona and trailing “more announcements about future expansion soon”.
In follow up emails the spokesperson further confirmed it hasn’t identified any defects with any e-bikes it’s tested, nor withdrawn any bikes from its supplier.
Bolt’s UK country manager, Matt Barrie, had a little more to say in a response to chatter about the various micromobility market moves on Twitter — tweeting the claim that: “Hardware at Bolt is fine, all good, the issues that HumanForest have had are with their bespoke components.”
“The Paris-Prague move is a commercial decision to support our wider business in Prague. Paris a good market and we hope to be back soon,” he added.
We asked HumanForest about Barrie’s claim that the technical issues with its hardware are related to “bespoke components” — but its spokeswoman declined to comment.
HumanForest’s twist on the e-bike sharing model is the idea of offering free trips with in-app ads subsidizing the rides. Its marketing has also been geared towards pushing a ‘greener commute’ message — touting that the e-bike batteries and service vehicles are charged with certified renewable energy sources.
E-bike startup VanMoof, has raised a $40 million investment from Norwest Venture Partners, Felix Capital and Balderton Capital. The Series B financing comes after a $13.5 million investment in May. The funding brings VanMoof’s total raised to $73 million and furthers the e-bike brand’s ultimate mission of getting the next billion on bikes.
The Series B funding will be used to meet the increased demand, shorten delivery times and build a suite of rider service solutions. It also aims to boost its share of the e-bike market in North America, Europe and Japan.
Partly driven by the switch of commuters away from public transport because of the COVID-19 pandemic, the e-bike craze is taking off.
Governments are now investing in cycling infrastructure and the e-bike market is set to surpass $46 billion in the next six years, according to reports.
Ties Carlier, co-founder VanMoof commented: “E-bike adoption was an inevitable global shift that was already taking place for many years now but COVID-19 put an absolute turbo on it to the point that we’re approaching a critical mass to transform cities for the better.”
VanMoof says it realized a 220% global revenue growth during the worldwide lockdown and sold more bikes in the first four months of 2020 than the previous two years combined.
Stew Campbell, Principal at Norwest said: “Taco, Ties and the VanMoof team have not only built an unparalleled brand and best-selling product, but they’re reshaping city mobility all over the world.”
Colin Hanna, Principal at Balderton: “As the COVID-19 crisis hit supply chains worldwide, VanMoof’s unique control over design and production was a key advantage that allowed the company to react nimbly and effectively. Moreover, VanMoof’s direct to consumer approach allows the company to build a close relationship to their riders, one that will be strengthened by new products and services in the years to come.”
Triller had been poised to benefit from a potential TikTok ban in the U.S. Though that may not happen now, given the apparent Oracle deal, the chaos around TikTok has increased the attention given to alternative apps such as Triller. As TikTok users sought a new home — or at least hedged their bets in the event of a full ban — Triller’s app shot up the app store charts. It even became the No. 1 across 80 different countries at some point, Triller CEO Mike Lu says.
At Techcrunch Disrupt 2020, Lu today spoke of Triller’s growing potential and what makes its app unique. He also touched on Triller’s involvement in several high-profile additions, including influencers and public figures like TikTok star Charli D’Amelio and family, and even Trump himself.
Lu also noted another top TikToker, Addison Rae, will make her way to Triller this week, as well.
Though Triller has often positioned itself as a different sort of app than TikTok, the company has steadily worked to onboard the same set of influencers that made TikTok so popular. TikTok star Josh Richards recently joined Triller as both an investor and chief strategy officer, despite being only 18, for example. Other TikTok stars Noah Beck and Griffin Johnson also joined Triller earlier this summer.
And just this week, Triller snagged TikTok’s queen herself, Charli D’Amelio, whose current TikTok account has 87 million followers.
Though Triller often benefits from influencers setting up their own accounts, Lu confirmed Triller reached out to D’Amelio to establish the relationship and to learn how the company could help her create a different type of presence on the Triller app.
Deal terms were not disclosed, but Lu said that, “up until a month ago, we had never paid anyone to make a video.”
follow my triller teehee
— charli d’amelio (@charlidamelio) September 15, 2020
TikTok stars aren’t the only notable new additions. Last month, Donald Trump launched his own official Triller account, as well, to promote his political campaign.
Lu said he welcomes all the new users, including Trump.
“We’re an open platform and what we really strive for is creativity. So, we welcome anyone — regardless of whether you’re on the left side or the right side of the fence — to express yourself on the Triller platform,” he said. “Seeing some of the world leaders and also some of the biggest influencers in the world join the platform is very exciting for Triller.”
Lu also explained how Triller differentiates itself from the broader social media app lineup, noting that much of the focus of older social networks had been on allowing users to post status updates, not creative content.
Triller’s identity, Lu added, “has always been around music, around content, and around creative discovery.”
“I think that we will always shine more than your traditional status updates — which I think that the world of Facebook, Instagram and Twitter has done really well,” he said. But today’s users “really don’t post creative content to those old platforms anymore,” he continued. “They’re actually posting them on platforms like ourselves, where they’re looking for an expressive and creative outlet.”
Lu claimed Triller also benefited from older social networks’ attempt to enter the short-form video space.
When Instagram launched its TikTok competitor, Reels, Triller saw a 20% spike in usage, Lu said.
“We realized that a lot of users who were waiting for Reels…they saw what it was. And they decided they’re sticking to Triller,” he said.
On the topic of business matters, Lu declined to speak about recent reports of its supposed billion-dollar valuation, but did confirm Triller is in the process of raising new funding. He also declined to speak about the status of Triller’s reported $20 billion bid with Centricus for TikTok assets, but said the company believed it would have been a good home for TikTok creator content from an infrastructure perspective.
Not surprisingly, given Triller’s potential growth in the midst of TikTok concerns, Lu also supported the idea that TikTok could be a security threat to U.S. users.
“Given the sensitivity of the data [and] the amount of data that they collect, it does pose a national risk,” Lu said of TikTok. “This is a Chinese-owned company. The data is sitting, probably, not here in the States…” he added, seemingly refuting TikTok’s claims that its U.S. data was on U.S. servers.
“We take that stuff very seriously. We are a U.S.- based company,” he said, noting how Triller was compliant with U.S. regulations, like COPPA. “Something we actually take very strong pride in is making sure that we uphold [Triller] to the right standards that we’re used to, and as well as the privacy of our users and our citizens,” Lu said.
Yubico, a maker of hardware security keys, has unveiled its newest YubiKey 5C NFC, which the company says offers the strongest defenses against some of the most common cyberattacks.
Security keys provide a physical security barrier to your online accounts. Hackers can steal usernames and passwords, and two-factor authentication codes sent to your phone spoofed or bypassed. But plugging in a physical security key to your computer or phone tells the online service that it’s really you logging in to your account.
In the age of working from home, security keys make it practically impossible for hackers on the other side of the world to break into your accounts.
Yubico’s latest YubiKey 5C NFC is the latest iteration of the company’s lineup of security keys, which comes with a dedicated USB-C connector that works across different computers and phones. And for devices that don’t, it also comes with an in-built NFC chip allowing users to wirelessly tap their key against their device to log in.
YubiKeys pack in a ton of open security and authentication standards, making it work on the “majority” of computers and phones — including Macs, iPhones, Linux machines, and Windows and Android devices, said Guido Appenzeller, Yubico’s chief product officer.
Its keys also work with many enterprise apps, as well as consumer services like Facebook, Google, Microsoft, and Twitter.
Yubico priced its newest YubiKey at $55.
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Hello and welcome back to The Station, a newsletter dedicated to all the present and future ways people and packages move from Point A to Point B.
As summer comes to an end, deals have lagged a skosh ahead of what promises to be a busy fall. And while the news cycle continues, there has been a slight dip in intensity. Sounds like a good time to take a break, no? Yup, it is. Next week, there will not be an issue of the newsletter. Don’t worry, it will return Sept. 19.
Alright let’s get to it. First up, deals!
Deals, we got em. And this week, a new SPAC stands out. Yup, you knew it. I knew it; we all knew another SPAC was coming. Some SPAC merger announcements feel like a desperate attempt by young unproven companies to access capital. That’s not the case this week.
QuantumScape, the solid-state battery company backed by Volkswagen Group, agreed to merge with a special purpose acquisition company Kensington Capital Acquisition Corp. The merger will give QuantumScape a post-deal market valuation of $3.3 billion.
QuantumScape is not a fledgling startup. It’s been around for decade, attracting attention and capital early on from high-profile venture firms like Kleiner Perkins and Khosla Ventures. Volkswagen entered the picture in 2012 and has invested a total of $300 million in QuantumScape, including $200 million this year.
QuantumScape is going after the capitally intensive goal of attempting to commercialize solid-state batteries for electric vehicles. Solid-state batteries use a solid electrolyte and not a liquid or gel-based electrolyte found in lithium-ion batteries. Developers claim that solid electrolytes have greater energy density, which translates into squeezing more range out of a smaller and lighter battery. Solid electrolytes also are supposed to be better at thermal management, reducing the risk of fire and the reliance on the kinds of cooling systems found in today’s EVs.
Other deals that got my attention … (seems a little light this week, no?)
Geely Automobile Holdings plans to raise 20 billion yuan ($2.93 billion) from a public share sale on Shanghai’s STAR Market, funds that will be used to invest in new car models and technologies, Reuters reported.
Zomato, the Indian food delivery startup, has raised $62 million from Temasek, resuming a financing round that it originally expected to close in January this year. Singapore’s state investment arm Temasek financed the capital through its unit MacRitchie Investments, a regulatory filing showed.
Coverage of automated vehicle technology companies tends to focus on U.S.-based efforts. Rest assured, there is action elsewhere. Yandex, the publicly traded Russian tech giant that started as a search engine, is one of those companies.
The company has expanded into a number of other, related areas (similar to U.S. counterpart Google) including automated vehicle technology. In January, I rode in their self-driving vehicle (with no human behind the wheel) during a demo on public streets of Las Vegas during CES. I’ve never been a huge fan of demos as it can help companies hide problems with their tech. Yandex’s demo was notable however. The vehicle moved confidently, maybe even aggressively, as it maneuvered around a bus that had stopped in the roadway, it handled left turns as well as a parking garage with ease. (this GIF from Yandex is of a drive in Moscow, fyi)
I mention all of this background because Yandex said this week it is spinning out its self-driving car unit from MLU BV — a ride-hailing and food delivery joint venture it operates in partnership with Uber. The move comes amid reports that Yandex and Uber were eyeing up an IPO for MLU last year. At the time, the JV was estimated to be valued at around $7.7 billion.
As part of the spin-out, Yandex is investing $150 million into the business, a sum that will include $100 million in equity, plus $50 million in the form of a convertible loan. Yandex is buying out some of Uber’s shares in this process and will now have a 73% stake in the spun-out business, with Uber owning 19%. The remaining 8% will be owned by Yandex self-driving group (SDG) management and employees. Yandex said it has invested some $65 million in the business up to now.
Spinning out the unit could help improve the unit economics and cost base of the MLU unit, as TechCrunch editor Ingrid Lunden noted in her report. But Yandex says that it’s being done to double down on a more focused investment in self-driving.
This isn’t an electric vehicle startup; it’s more like EV adjacent. And it’s an app!
A number of apps have popped over the past several years — in step with Tesla’s rising popularity. Most aim to let drivers track and plan their routes and often have a social component. Tezlab is a good example, and I’ve written about them before.
The one I want to introduce you to is called Nikola. The app launched in 2018 as a hobby project of David Hodge, who founded a mass transit app called Embark, which Apple acquired in 2013. Hodge stayed at Apple for several years and then went to Stripe. But the Nikola app compelled him to go out on his own again.
This week, Hodge launched Nikola 2.0. Here’s the gist: Nikola 2.0 is a subscription-based app that provides health monitoring of the owner’s Tesla (just Teslas for now, but Hodge aims to expand).
The app, which is only in iOS right now, gives the user information on battery level trends, efficiency, energy consumption, top and average speed as well as stats on weekly ghost drain and driving and charging history, which can be exported for tax or expense report purposes. Users can also check their battery level with the Nikola Apple Watch complication and compare their performance to other Tesla drivers with Nikola Fleet Stats.
What I am interested in is this other new feature called the Nikola report. It is like a Carfax report that an EV owner can share with prospective buyers when they go to sell their electric vehicle. The data collection for the Nikola report feature is just now getting started.
Welcome to the roundup section of the newsletter …
Bay Area Rapid Transit, or BART, is selling personal hand straps that can be quickly thrown onto poles in the train car for folks would rather not touch any surfaces.
GM and Ford have fulfilled their separate multi-million-dollar ventilator contracts — together delivering 80,000 of the devices to the U.S. government.
GM and Honda signed a non-binding memorandum of understanding to establish an automotive alliance in North America. The deal brings together two automakers that have a long established history of working together. The companies will share vehicle platforms, which will be sold under their respective and distinct brands, as well as cooperate in purchasing, research and development and connected services.
Ike, the automated trucking startup, had some big news this week. Ryder, DHL and NFI have chosen Ike as their automated driving technology provider. These fleets, and some others the company has not yet announced, have collectively reserved the first 1,000 trucks powered by its technology.
The startup also lifted the hood, so to speak, on their business model. Ike is taking a SaaS approach to automated vehicle technology. The company explained in a blog post this week that it will sell a Software as a Service subscription to fleets. Customers will buy trucks equipped with Ike’s validated automation system from its OEM manufacturing partners. Automated trucks will be owned and operated by fleets and “Powered by Ike,” the post read.
REMINDER! Nancy Sun, the co-founder and chief engineer of Ike, will be on our virtual stage for the TC Sessions: Mobility 2020 event October 6 and 7. If you’ve never heard of Sun, or listened to her, be prepared to be impressed. The event is shaping up to be pretty great and we have a few more speakers left to announce.
Lucid Motors, which is set to reveal the Air on September 9, keeps dropping bits of info on the luxury electric vehicle. This time, Lucid announced that the Air is capable of a 9.9-second quarter mile. That’s faster than a Tesla Model S and faster than most production cars on the market.
Metromile, a pay-per-mile insurance company, said it’s teaming up with Ford Motor to provide owners of Ford vehicles equipped with built-in connectivity with personalized car insurance.
Tesla didn’t make it into the S&P 500 as so many had predicted. Tesla fans took to Twitter on Friday to gripe about the decision that welcomed Etsy, Teradyne and Catalan into the S&P.
Torc Robotics and its parent company Daimler Trucks, announced plans to expand their joint self-driving truck on-road testing to New Mexico this month and establish a test center in the Albuquerque area.
The U.S. government rolled out a new online tool designed to give the public insight into where and who is testing automated vehicle technology throughout the country. The official name of the online tool is the Automated Vehicle Transparency and Engagement for Safe Testing Initiative tracking tool. While the design is simple and straightforward, it’s incomplete since it is based off of information that companies have volunteered. Let’s hope this is the beginning of what will become a comprehensive one-stop shop of all automated vehicle technology in the country.
VanMoof, the e-bike company is opening a store in Seattle — its third in the United States. The expansion illustrates the company’s growth, which has accelerated since March as sales of e-bikes in the U.S. popped 85% compared with the same month a year earlier.
Volkswagen released teaser images of its upcoming all-electric ID.4 compact SUV that shows what might just be a nice balance between tech and old timely toggles and buttons. Could this be the Goldilocks story of the EV world? I will find out later this month. Stay tuned.
Late last week we discussed how, this deep into the earnings cycle, it appeared that public SaaS and cloud companies had largely made it through the Q2 gauntlet unscathed. Sure, through last week there was a report or two that wasn’t stellar, but by and large the results had been good and SaaS valuations were happily near all-time highs.
That’s still the case today, albeit with some caveats. Yesterday, a few public SaaS and cloud companies were dinged sharply by investors after reporting their earnings and I want to talk about why.
My hunch: many SaaS companies that investors expected to accelerate during this period of more-rapid-than-anticipated digital transformation are not, or at least not enough to match market hopes. And that means that their results were not quite what investors expected. And, thus, down went their share prices.
The analogy for startups is pretty clear here, just slower. Public valuations are updated far more often than private valuations, so the stuff we’re seeing today in SaaS stocks won’t show up in SaaS startup valuations for a bit. But I wonder if the same expectation/reality gap that we can discern in a number of recent SaaS results could hit startups as well, with boards that were expecting more than will be delivered in time.
Overall, SaaS and cloud valuations are still strong. Zoom crushed the period. Salesforce did well, too. And with valuations high, revenue multiples remain historically stretched. So, I don’t think that today’s news changes the general market dynamic towards public SaaS companies, and thus SaaS startups. But yesterday’s results are a bit of a warning sign all the same.
Friend of the column Jamin Ball compiled a list of the SaaS companies reporting yesterday, including MongoDB, Guidewire, SmartSheet, CrowdStrike, PagerDuty and Zuora. Those are the companies whose results we are exploring today.
To keep this post from becoming interminably long, we’ll be brief and direct. So, in bullet points and with terse language:
Peer Medical has a big mission. After his father died of lung cancer, serial entrepreneur Ed Spiegel vowed to create a better way for lung cancer patients to deal with their disease. The startup has so far raised a $1.2M seed funding round for its ground-breaking approach and is onboarding patients at a rate of knots.
Peer Medical allows lung cancer patients to anonymously share their treatments with each other. This helps survivors find others like them and see which treatments and procedures work best. Users can search by biomarker, stage, age, or gender and review verified treatments and journeys of similar patients.
The funding round was led by Amsterdam-based ‘Partners in Equity’ (PiE), best known for investing seed capital into Adyen the Dutch payments unicorn; and London’s Seedcamp, alongside Angel investors. Peer Medical is now able to sign up patients’ electronic health records inside a minute. Its advisers include Dr. David Jablons, Head of Thoracic Oncology at UCSF, and Dr. Geoffrey Ginsburg, Head of Applied Genomics and Precision Medicine at Duke University .
Spiegel’s RentMineOnline was one of the first-ever ‘share economy’ startups to appear 10 years ago, and also Seedcamp’s first investment, and its first exit.
Indeed, the idea for Peer Medical came to Spiegel 10 years ago as the sole care-giver during his father’s three-year battle with lung cancer.
Spiegal told me he came up with the idea after meeting a buddy of his from his college who had also seen his father pass away from lung cancer. Comparing notes, Spiegal realized he could have had so much more information if they’ve been able to share treatment information.
“It’s like: ‘God I wish I would have known that back then!’. It’s just such a terrible experience. Unfortunately for me, I lived the experience, but I could have really used a sort of ‘electronic caregiver’ essentially to help my Dad through it.”
Participating in online forums, Spiegel found patients willing to help but realized the need for a centralized, searchable database that contained the knowledge these people possessed. There were over 1.7 million new cancer cases diagnosed in the US last year alone. The information for the patients is often disorganized, incomplete, or out of date. Medical record portability is growing in adoption and will be crucial in aiding treatments.
“It’s a little like you as a driver using Waze to crowdsource information from other drivers to get to the perfect route because you’re learning from all the other people,” commented Spiegal. “The future is certainly electronic health records, although it’s still kind of like using a credit card in 1999 online, it’s coming in a big way. You will have your records, and wonder ‘who else is just like me?’”
There are already big players making it happen such as Apple Health, and online hospital portal growth driven by companies like Epic and Cerner.
Peer Medical doesn’t really have ‘competitors’ in the traditional sense, other than Facebook support groups for patients, which are not anonymous and chaotic, and Google searches. PatientsLikeMe, founded in the early 2000s, doesn’t leverage the medical records aspect and sold in 2019 to United Health Care for 2017 after raising $100M.
Commenting, Reshma Sohoni, co-founder of Seedcamp said: “Ed was a part of Seedcamp’s first cohort of companies and returned our first successful exit. We’re thrilled to back Ed and his team for a second time and bring what we hope will be another successful venture to our portfolio. Unfortunately, I’ve also lost a parent to cancer and can relate to how important a tool like this can be to navigate such difficult times. We really like that the patient retains anonymity but is still able to learn from others.”
Carlos Eduardo Espinal, Seedcamp Managing Partner added: “At Seedcamp, this is exactly the type of community that we like to invest in. People, in this case, patients and caregivers, bound together by a common goal to fight cancer. We’re thrilled to help Ed and the Peer Medical team build this community that pools verified and anonymized medical records and uses them to optimize individual treatment paths.”
RentMineOnline, which did referrals for apartments on Facebook, was successfully sold to a publicly-traded property management software firm, Real Page (NASDAQ: RP).
Nearly eight years ago, Hamet Watt and Stacy Spikes launched MoviePass, the subscription-based movie ticketing service that captured the minds and dollars of investors and brought thousands of cinephiles a too-good-to-be-true deal for all-you-can watch movie passes.
Watt, who came to MoviePass as an entrepreneur in residence at True Ventures, previously founded the brand and product placement startup NextMedium and also spent time as a board partner at Upfront Ventures. Now, the serial entrepreneur and startup investor is combining his two career paths under the auspices of Share Ventures.
“It’s what I feel like I’ve been put here to do,” says Watt. “I love solving problems with design and entrepreneurship. I wasn’t fully scratching the itch as an investor by itself.”
With $10 million in financing from a slew of investors including Upfront Ventures, Alpha Edison, the general partners and founders of True Ventures, and a Korean family office, Share Ventures will look to launch between two and four companies per year.
Watt says that the new studio will focus on what he calls “human performance”. The businesses will use a blend of technology and human interaction to create services targeting fitness, nutrition, and mental health, according to Watt.
Share Ventures’ initial focus will be on two main areas, the future of living and the future of working. Within those two areas, the company will focus on developing businesses that enable the development of individual purpose, mental and physical enhancement, and personal and professional growth, according to Watt. And
Image Credit: Share Ventures
For Watt, the studio model represents the next iteration of startup investing. “We think the studio is going to lead the way,” he says.
Rather than invest in companies and management teams that are unknown quantities, Watt thinks the studio will be able to create discrete companies much faster in the same way that companies today iterate on new products and services.
“We have aggregated tools into a company building stack,” says Watt. “These are tools that are usable that third parties have developed and internal tool stacks.”
Image Credit: Share Ventures
Watt says Share Ventures will operate as a holding company with pooled equity shared across the employees at the company. “As we work on portfolio companies and build out dedicated teams, there’s a generous pool to incentivize talent.”
In some ways, the model isn’t that different from Bill Gross’ idealab, the Pasadena, Calif.-based incubator company that’s a few miles up the road from Share Ventures Los Angeles home base. Another inspiration is @Ventures, the dot-com era company that built a number of different portfolio companies. “Our investors are getting founders takes in all the companies that we build,” Watt says.
The company has ten people on staff to help build its first slate of companies.
Watt began talking to investors in 2018 about the idea and spent the bulk of 2019 trying to build out its first few companies.
“We run a lot of experiments, we generate a lot of ideas,” Watt says. “The number of shots on goal that we’re taking before we launch a company is significant.”
Cowboy has raised a $26 million (€23 million) Series B funding round from Exor Seeds, HCVC, Isomer Capital, Future Positive Capital and Index Ventures. The startup has been manufacturing premium electric bikes and selling them directly to consumers around Europe.
The company recently released the third generation of its flagship bike, which is all about refinements and iterating on its existing offering. If you haven’t seen one in a European city, it features an iconic triangle-shaped aluminum frame with integrated pill-shaped lights.
With a focus on simplicity, there are no gears or buttons to control motor assistance. The motor kicks in automatically when you start pedaling. Some of the key features of the Cowboy bike are the carbon belt, custom-made tires with a puncture protection layer and the detachable battery.
Cowboy bikes are also connected bikes thanks to some electronic components. For instance, you can lock your bike when you’re not using it. The company is currently testing auto-unlock, a feature that takes advantage of Bluetooth Low Energy to detect your phone.
By combining data from the accelerometer, the speed of the bike and your pedal power, Cowboy will also soon automatically detect crash and notify an emergency contact.
In addition to designing a bike, Cowboy is also a service company. It has built a network of repair partners and offers test rides to potential clients. It is now available in dozens of European cities.
The company also offers an insurance product thanks a partnership with Qover. For €8 per month, you can receive real-time notification whenever someone is trying to steal your bike and you’re insured against theft. For €10 per month, you’re also insured against damage.
With today’s funding round, the startup plans to hire over 30 people in the next six months, expand its network of test rides and scale production operations with Flex.
When big platforms have carved out large swaths of the delivery market, the best thing for an upstart company to do is to specialize.
For Chowbus, that meant building a food-delivery business that finds restaurants whose cuisines specialize in regional cuisines from Northern and Southern China, Japan, Korea, Taiwan, Thailand, and Vietnam.
It’s a strategy that has now netted the company $33 million in financing led by the Silicon Valley-based investment firm Altos Ventures and New York’s Left Lane Capital. Hyde Park Angels, Fika Ventures, FJ Labs and Silicon Valley Bank also participated in the round.
Founded four years ago in Chicago by Suyu Zhang and Linxin Wen, the company said that its goal was to connect people with authentic Asian food that’s not easy to find on delivery apps. Over the past year, the company touted significant growth in its business, a traction that can be reflected in its decision to bring on the former chief operating officer of Jump Bikes, Kenny Tsai, as its chief operating officer, and Jieying Zheng, a former Groupon product leader as its head of product.
“When we say we’re true partners to the restaurants we work with, we mean it. By eliminating hidden fees, helping them showcase their best dishes, and other efforts we make on their behalf, we really go the extra mile to help our restaurant partners succeed,” said Wen, Chowbus’ chief executive, in a statement. “We only succeed if they do.”
And seemingly, Chowbus is succeeding. The company raised $4 million in its first round of institutional funding just last year and its rise has been precipitous since then.
The Chicago-based company said it would use its new funding to expand to more cities across the US and add new products like a “dine-in” feature allowing diners to order and pay for their meals on their phone for a contactless experience at restaurants in cities that have flattened the curve of COVID-19 infections and are now reopening.
Chowbus pitches its lack of hidden fees and footprint across 20 cities in North America including New York, Boston, Philadelphia, Chicago, Atlanta, Los Angeles, the Bay Area, Seattle, and many other cities across North America. In Los Angeles, the company offers menus in Mandarin and Cantonese and allows its users to bundle dishes from multiple restaurants in a single delivery.
Other companies are experimenting with specialization as a way to differentiate from the major delivery services that are on the market. Black and Mobile, which launched in Philadelphia but is in the process of expanding across the country, is a delivery service focused on Black-owned restaurants and food stores.
Founded by David Cabello, Black and Mobile was started in 2017 by the 22 year-old college dropout. The company launched its first operations outside of Atlanta earlier this month and is available on iOS.
“The market is experiencing a permanent shift from offline to online ordering, a trend that Chowbus is actively driving,” said Harley Miller, Managing Partner at Left Lane Capital . “Focusing on this large and loyal constituency with a vertical-approach to supporting Asian restaurants and food purveyors has allowed Chowbus to differentiate itself on both sides of the marketplace. The capital efficiency with which they have operated, relative to the scale achieved, is extraordinarily impressive, and not something we often see.”
Frankie Bernstein, the Venice, Calif.-based serial entrepreneur, knows marketing.
At his last startup, Markett, Bernstein turned college students into brand ambassadors who were paid by the companies they repped for proselytizing about them on campuses.
Now he’s using that knowledge to launch Kickback on iOS and Android. It’s invite-only at this point, but the idea is that it uses company’s marketing budgets to create shopping rewards and incentives for app users. In the same way that Markett turned college students into advocates for apps like Uber and Lyft, Kickback will turn shoppers into brand ambassadors through its app.
In-app referrals and discounts for shopping are nothing new to the e-commerce world. In China, apps like Pinduoduo have turned into billion dollar businesses on the strength of referrals. Indeed, Pinduoduo recently raised $1.1 billion in funding to hit a valuation of nearly $100 billion.
It was only a matter of time before an American company tried to copy its success. Kickback — like most new apps these days — is invite-only.
Once past the waiting list, users get discounts on brands and can earn cash-back rewards when they shop or when they encourage their friends to buy something with the app.
So far brands on the app include Walmart, Sam’s Club, Nike, Alo Yoga, Reebok, Away, Planet Blue, Sonos, Winc, Postmates, Casper, Kate Somerville, Lacoste, Columbia. Users get discounts or cash rewards when they shop and earn “kickbacks” when they invite someone to shop using their discount code. Cash rewards can be withdrawn using PayPal, according to a statement.
“Our mission is to take the billions of dollars brands spend on advertising and put that money directly into the pockets of the people,” said Franky Bernstein, Founder and CEO of Kickback, in a statement. “Brands know the most powerful form of marketing is word of mouth. We like to say that people are 100% more likely to go on a first date, watch a movie or, in our case, try a new product or service if a friend tells them about it. People have always loved sharing their favorite products and services with their friends. Now with Kickback, they get paid for it.”
TC Early Stage is kicking off on July 21 & 22, which is just a few short days away, and we’re excited to be able to gather the most prominent experts in marketing, contract building, hiring and funding to help early-stage founders succeed. Consider it our version of a founder masterclass, where you can arm yourself with the tools and perspective to keep your business growing. We are going to hit capacity soon and many of our most popular sessions are filling up. Register today to secure your seat for this one-of-a-kind event.
Just one of the sessions you might be able to attend as an early-stage founder is the Sequoia AMA, where you’ll hear firsthand from some of Sequoia’s partners, who are on the front lines helping founders build legendary companies from idea to IPO and beyond. You’ll be able to ask partners Jess Lee, Konstantine Buhler, Mike Vernal and Stephanie Zhan your most pressing questions, from how to seek capital and create an enduring culture to how to develop a differentiated product and make your customers love you.
This session is only available to founders registered for TC Early Stage — once you register, you’ll be sent a link to apply to participate in this private session during the event. Session applications end this Friday, July 17 so don’t wait — Register now!
RealityEngines.AI, the machine learning startup co-founded by former AWS and Google exec Bindu Reddy, today announced that it is rebranding as Abacus.AI and launching its autonomous AI service into general availability.
In addition, the company also today disclosed that it has raised a $13 million Series A round led by Index Ventures’ Mike Volpi, who will also join the company’s board. Seed investors Eric Schmidt, Jerry Yang and Ram Shriram also participated in this oversubscribed round, with Shriram also joining the company’s board. New investors include Mariam Naficy, Erica Shultz, Neha Narkhede, Xuezhao Lan and Jeannette Furstenberg.
This new round brings the company’s total funding to $18.25 million.
Abacus.AI’s co-founders Bindu Reddy, Arvind Sundararajan and Siddartha Naidu (Image Credits: Abacus.AI)
At its core,
RealityEngines.AI’s Abacus.AI’s mission is to help businesses implement modern deep learning systems into their customer experience and business processes without having to do the heavy lifting of learning how to train models themselves. Instead, Abacus takes care of the data pipelines and model training for them.
The company worked with 1,200 beta testers and in recent months, the team mostly focused on not just helping businesses build their models but also put them into production. Current Abacus.AI customers include 1-800-Flowers, Flex, DailyLook and Prodege.
“My guess would be that out of the hundred projects which are started in ML, one percent succeeds because of so many moving parts,” Reddy told me. “You have to build the model, then you have to test it in production — and then you have to build data pipelines and have to put in training pipelines. So over the last few weeks even, we’ve added a whole bunch of features to enable putting these things to go into production more smoothly — and we continue to add to it.”
In recent months, the team also added new unsupervised learning tools to its lineup of pre-built solutions to help users build systems for anomaly detection around transaction fraud and account takeovers, for example.
The company also today released new tools for debiasing data sets that can be used on already trained algorithms. Automatically building training sets — even with relatively small data sets — is one of the areas on which the Abacus team has long focused, and it is now using some of these same techniques to tackle this problem. In its experiments, the company’s facial recognition algorithm was able to greatly improve its ability to detect whether a Black celebrity was smiling or not, for example, even though the training data set featured 22 times more white people.
With today’s launch, Abacus is also launching a new section on its website to showcase models from its community. “You can go build a model, tweak your model if you want, use your own data sets — and then you can actually share the model with the community,” Reddy explained, and noted that this is now possible because of Abacus’ new pricing model. The company has decided to only charge customers when they put models into production.
The next major item on the Abacus roadmap is to build more connectors to third-party systems so that users can easily import data from Salesforce and Segment, for example. In addition, Reddy notes that the team will build out more of its pre-built solutions, including more work on language understanding and vision use cases.
To do this, Abacus has already hired more research scientists to work on some of its fundamental research projects, something Reddy says its funders are quite comfortable with, and more engineers to put that work into practice. She expects the team will grow from 22 employees today to about 35 by the end of the year.
I have to admit, I was an e-bike virgin. Sure, I’d tried out Uber’s Jump bikes and similar e-bikes, but these are more like normal bikes “with a little extra help.” So when I was offered the chance to try out the new VanMoof S3, an e-bike that has literally been built from the ground up, I was excited at how different the experience might be.
Perhaps more significantly, I had a particular task in mind for it. In the current COVID-19 pandemic much has been made of cities being transformed into proverbial deserts, as traffic and pedestrians disappeared. Now, with many cities coming out of lockdown, governments have advised their citizens to go back to work, desperate to get their economies moving. And they are pushing cycling as a viable alternative to public transport, where the virus is more likely to be found. So what better time would there be to try out an e-bike as a viable alternative to commuting to and from the suburbs of a large city?
Indeed, the U.K. government has unleashed a £2 billion package to create a new era for cycling and walking.
In the U.S., New York City recently committed to adding protected bike lanes across Manhattan and Brooklyn. Berlin is extending some of its already extensive bike lanes. And Milan will introduce a five-mile cycle lane to cut car use after the lockdown. New York City has reported a 50% increase in cycling compared to this time last year, and cycling in Philadelphia has increased by more than 150% during the COVID-19 outbreak.
But much of the official advice is to avoid public transport where possible, due to the near-impossibility of social distancing.
So with cycling a viable option in many cities, but distance still the old adversary, many consumers are looking to e-bikes as a way to kill two birds with one stone. Not only can you socially distance, but you can also take the bikes on much longer commutes than is possible with traditional bikes and, dare I say it, traditional legs.
With London still on lockdown recently, I decided to try out the new VanMoof S3 on the deserted streets, cycling from the deep London suburbs right into the empty center of the city.
For starters, it’s worth saying that the VanMoof S3 is a handsome bike. As a significant upgrade to its previous version, it is similar in its good looks, but what’s “under the bonnet” is what counts.
The S3 is a full-size bike with 28-inch wheels. It has a 24-inch wheeled sister called the X3, which is more compact and it therefore technically “nippier” in the city; however, I found the S3 perfectly suited to London. In fact, its “chopper-like” handling felt very reassuring over London’s bumpy and often unkempt roads.
The S3 and X3 both cost $2,000. Both also come with four-speed automatic shifting and hydraulic brakes. They are cheaper than the previous S2 and X2 models, which only had two-speed automatic shifting and cable brakes. Although the frame construction is unchanged, VanMoof says it has achieved savings by making production more efficient. The bikes weigh about 41 pounds, which is very acceptable for an electric bike. You can get front and rear racks as accessories for pannier bags, cargo boxes or a child seat.
The range per charge varies somewhere between 37 and 93 miles, depending which power level you select on the smartphone app. Level 0 turns off the electric pedal assist, leaving the bike quite heavy to pedal, and level 4 boosts the bike continuously. For my jaunt around London I used Level 4 all the time and managed to get a full, and quick, 45 miles out of the bike without even breaking a sweat, showing that even the heaviest users would be well served by the S3. If you are concerned about your battery charge level, this is displayed on top of the cross-bar, which also shows you current speed. It takes four hours to charge the bike to 100%, but just under an hour and a half to get to 50%.
The VanMoof is driven by a front hub motor and in “European mode” gives a continuous power of 250 watts. But to get more speed you can select the U.S. setting, tick a disclaimer and get 350W of continuous power, with peak power-hitting 500W via the Boost button on the right handlebar. That means you can take off at the lights very easily and quickly get ahead of the traffic, while the normal pedal assist will suffice for most needs. The Boost is particularly useful when going up hills, which the S3 seemed to devour on my ride through London.
Thieves will find this bike frustrating. The rear brake locks when you tap the button near the rear hub. All parts apart from the handlebars and seat post require a special tool to undo. The headlight and taillight are integrated into the frame. The tires are large and puncture-resistant and covered by large metal fenders with integrated mud flaps.
If a thief tries to wheel away the bike when it’s locked it will immobilize the rear wheel and belt out a loud alarm. If the thief persists, a more shrill alarm will sound, the headlights and taillight will flash, a notification will appear on your phone and the bike will refuse to work at all. Only VanMoof can then re-enable the bike using the bike’s built-in cellular data connection and Bluetooth. The bike will sense the phone in your pocket as you approach, allowing you to unlock the rear wheel — and the app always shows the bike’s current location.
VanMoof’s three-year, $340 “Peace of Mind” plan means that it guarantees to find or replace your bike if it gets stolen (assuming it was locked). In the meantime, you will get a bike on loan, although this plan is only available in cities where VanMoof has a presence.
One possible drawback of having the battery welded inside the bike is the necessity of needing to be near a power outlet every time it needs charging. This drawback will be limited to those who are unable to take the bike up to an apartment, or fear for the bike’s safety if it has to charge outside a house. Yes, the hard-wired battery might well be a security “feature,” but this may well be a deal breaker for many, forcing them to look to other bikes which have removable batteries. That said, you are likely to pay more for the bike in the first place.
As for my test around London, to put the bike through its paces I cycled from the deep suburbs right into the heart of the West End. I’d like to say people asked me about the bike, but no one was around to impress! At the time of the test, London was in full lockdown and eerily quiet.
Hitting the Boost button felt like the “Punch it, Chewy” moment form Star Wars, as I pulled away from traffic. I unwittingly rode the bike at Level 4 all the way there and back, which meant that after about four hours and about 45 miles I ran out of charge on the last mile home. However, this was not a problem as I could cycle the last leg, despite it being a bit of a strain without any electrical assistance. Level 2 or 3 would probably have been a more ideal combination of power and range.
When you drive a Tesla you drive differently, zipping in and out of lanes. Similarly with this bike I realized I could overtake “normal” bikes effortlessly. Overall I’d say this is an excellent electric bike.
VanMoof, which was was founded in 2009 by Taco and Ties Carlier, two Dutch brothers, has now attracted a €12.5 million ($13.5 million) investment from London VC Balderton Capital and SINBON Electronics, the Taiwan-based electronics manufacturer which is VanMoof’s bike assembly partner. So expect to see this company ramp up its presence across Europe and the U.S.
Admittedly they are not the only VC-backed e-bike on the market. Brussels-based Cowboy is an e-bike startup which only appeared in 2017 but which has since raised $19.5 million from Tiger Global and London’s Index Ventures.
It looks like the e-bike wars have begun, they have.
[All pictures by Mike Butcher]
While many in Silicon Valley might prefer to forget about investor Mike Rothenberg roughly four years after his young venture firm began to implode, his story is still being written, and the latest chapter doesn’t bode well for the 36-year-old.
While Rothenberg earlier tangled with the Securities & Exchange Commission and lost, it was a civil matter, if one that could haunt him for the rest of his life.
Now, the U.S. Department of Justice has brought two criminal wire fraud charges against him, charges that he made two false statements to a bank, and money laundering charges, all of which could result in a very long time in prison depending on how things play out.
How long, exactly? The DOJ says the the two bank fraud charges and the two false statement to a bank charges “each carry a maximum of 30 years in prison, not more than five years supervised release, and a $1,000,000 fine,” while the money laundering charges “carry a penalty of imprisonment of not more than ten years, not more than three years of supervised release, and a fine of not more than twice the amount of the criminally derived property involved in the transaction at issue.”
The damage done in the brief life of his venture outfit — even while understood in broad strokes by industry watchers – is rather breathtaking. As laid out by the DOJ, Rothenberg raised and managed four funds between the inception of his firm, Rothenberg Ventures, in 2013 and 2016, and his criminal activities began almost immediately.
According to the DOJ’s charges, after closing that initial fund, he partially funded his own capital commitment to the second fund by making false statements about his wealth to his bank while refinancing his home mortgage and while obtaining a $300,000 personal loan, some of which he poured in the fund.
That’s bank fraud. Yet according to the DOJ, that was merely Rothenberg’s opening gambit.
The following year, in 2015, Rothenberg “took excess money in venture capital fees from one of the funds he was raising and managing” and because he then “faced a shortfall at the end of the year that he did not wish to report to his investors,” he found an illegal workaround. Specifically, alleges the DOJ, he “engaged in a scheme to defraud a bank by making false statements and misrepresentations to the bank in order to obtain a $4 million line of credit to pay back the fund from which he had taken excess fees.” The idea, says the DOJ, was to “deceive his investors into believing the fund was well-managed,” which apparently worked at the time.
Of course, in reality, Rothenberg was digging an ever bigger hole for himself, suggests the DOJ. Meanwhile, he seemingly had appearances to keep up. Which could be why in February 2016, according to the allegations laid out by the DOJ, he “engaged in a scheme to defraud an investor with respect to a $2 million investment that it believed it was making directly into a virtual reality content production company operating as River Studios that Rothenberg contended he wholly owned.”
The DOJ says that that instead, Rothenberg used most of it for purposes having nothing to do with that production company.
Rothenberg also — judging by the DOJ’s report — began to throw caution to the wind, perhaps because he thought he might get away with it or because he was increasingly desperate.
To wit, its complaint alleges that five months after defrauding that first investor, in July 2016, Rothenberg “engaged in a scheme to defraud as many as five separate investors when he induced them to wire a total of $1.35 million under the premise of investing in the untraded stock of a privately-held software company.” The complaint charges Rothenberg with “knowingly engaging in a scheme to defraud one investor by representing to that organization that its money would be used to purchase the software company’s shares. According to the complaint, on the same day the money was wired, Rothenberg took the money from the bank account designed to make the investment and sent it to RVMC’s main operating bank account, from which it was used for many purposes.”
No stock in the software company was ever purchased, according to the DOJ’s investigation. The agency says Rothenberg also “induced investments in his RVMC-managed funds under the premise he would use the money for investments in ‘frontier edge’ technologies and take only certain limited fees for the management of the funds.” Instead, he “took more fees than to which he was entitled and invested far less of the money he raised than the operating agreements disclosed to the investors contemplated.”
Altogether, says the DOJ, it has collected evidence that Rothenberg fraudulently obtained at least $18.8 million.
We’ve reached out to Rothenberg — who has consistently denied any wrongdoing — for comment. It isn’t the only bad news he has faced lately, in any case.
Just seven months ago, in December, Rothenberg was ordered to pay more than $31 million in connection with the misappropriation of investor money relating to an SEC complaint that alleged he misappropriated millions of dollars from his firm’s funds, then used the money to support personal business ventures.
In October 2018, Rothenberg also agreed to be barred from the securities industry with a right to reapply after five years.
All have been incredible developments in what was already a nearly unbelievable story of apparent hubris and its consequences. Rothenberg had entered the venture scene with a splash, landing a feature story in TechCrunch, in early 2013, and touting his connections and his youth — he was 27 at the time — as advantages he enjoyed over older VCs who might not have a shot at the same companies.
Two years later, BusinessWeek dubbed him Silicon Valley’s “party animal,” as his firm, Rothenberg Ventures, became well-known in the Bay Area for “throwing bashes for entrepreneurs,” including parties at San Francisco’s Oracle Park baseball field (known at the time as AT&T Park). Rothenberg, a self-described former math Olympian who attended Stanford before getting an MBA from Harvard Business School, said at the time, “The way we build a scalable network is by hosting a lot of events.”
He seemed to dismiss questions about how they were paid for, but he did tell BusinessWeek that he provided some of the earliest funding to Robinhood, the stock-trading app that was most recently valued at $7.6 billion and whose cofounders and CEOs attended Stanford at the same time as Rothenberg.
It was an auspicious start, in short. Alas, by the summer of 2016, the firm’s employees were scattering to the winds, and investigators were beginning to take notes.