Inspired by the work of Instacart shoppers over the last few years, a handful of workers at Target-owned Shipt, a grocery delivery service, are beginning to organize. With the help of two key Instacart shopper-activists, Vanessa Bain and Sarah Clarke, who goes by a pseudonym, Shipt workers are now demanding better wages and the elimination of what some describe as a culture of fear.
“We want to be the first responders,” Clarke tells TechCrunch. “Whenever gig workers find out there is a pay cut or some type of issue, they’ll feel comfortable coming to us.”
In January, Shipt started testing a new pay structure where, instead of basing it on cart size, Shipt takes into account the time it takes to complete and deliver an order. Shipt implemented these changes in Kalamazoo, Mich., San Antonio and Philadelphia. As Gizmodo reported earlier this month, there was some shopper backlash.
Prior to the changes, shoppers had received a $5 flat rate and 7.5% of the total store receipt, one shopper, who asked to remain anonymous, told TechCrunch.
“We are losing money as shoppers at a ridiculous rate,” a shopper from Kalamazoo tells TechCrunch. “A very good, close friend of mine told me in the three weeks since the new structure was implemented, she has lost the equivalent of a car payment. It is a lot of money. Our best guestimation is, we’re all losing about 30% or more. I did four orders this past weekend and I lost money on every single one.”
But Shipt says its goal is to maximize the earning potential for its shoppers and to make sure they get the most value for their time spent. That’s why Shipt is testing this new pay structure in certain markets to better account for time spent shopping and delivering orders, Shipt Director of Corporate Communications and Outreach Julie Coop told TechCrunch.
“In this structure, shoppers are guaranteed to make at least the minimum in the pay range shown at the time the order is offered to them,” Coop said. “That range is based on the estimated amount of time the order will take to complete. We’ve seen pay levels remain consistent overall, and in some markets slightly higher. As always, Shipt Shoppers receive 100% of their tips on top of order pay.”
Shipt connected me with Stacy Smith, who shops for Shipt in Kalamazoo, Mich. Smith tells TechCrunch she has no issue with the new policy, saying that she’s actually seen a slight increase in her pay. While it was more attractive and economical for her to get bigger orders in the old pay model, the size of the order now doesn’t matter.
“I’m now getting a little less pay in larger-size orders and a little bit increase in the middle or smaller orders, which is the abundance of them,” Smith says. “If we’re not getting paid a little bit more for those smaller to mid-sized orders, that makes sense to me. The big picture is we used to get upset because we had these small or mid-sized orders. But now we get paid a little more for those orders.”
At this point, it’s not clear how many of Shipt’s workers are for or against this new pay structure. Still, a number of workers reached out to Clarke and Bain once the pay structure started rolling out.
“Shipt has been pretty under the radar,” Clarke said. “No one is really paying attention to them — mostly because the workers are scared to speak out.”
Willy Solis, who shops for Shipt in the Dallas area, is one of the shoppers who reached out to Clarke.
“I’ve followed Sarah and Vanessa’s work and their efforts over on Instacart, because I’m on that platform as well,” Solis tells TechCrunch. “I’ve been seeing what they’ve been able to accomplish, so when Sarah asked in our group lounge if anyone is interested in talking, I jumped at it.”
Solis says he had been thinking about organizing for some time, but there had been no catalyst for him and other workers to do something. Now, Solis is working with Clarke and Bain through their Gig Workers Collective to figure out their strategy moving forward.
“While I am afraid of being deactivated due to speaking out, I am hopeful Shipt will hear the Shipt shopper community’s voice as a collective whole, rather than censoring and ignoring dissenting concerns,” he says.
There are two main Facebook groups where Shipt shoppers interact. One is Shipt Shoppers United, which one shopper from Iowa, who asked to remain anonymous, describes as being “a little more real.” The group strictly prohibits people from Shipt’s corporate team, but it’s much smaller in size. This group has just a little over 6,000 members.
The other group is the Shipt Shopper Lounge, which is administered by members from Shipt HQ. This group has more than 100,000 members. It’s in this group where Solis says Shipt has created a “cult-like environment” where the company deletes any negative comments in Facebook groups for shoppers and only lets shoppers see “feel-good stories in an attempt to keep up shopper moral.”
Solis said his comments have been deleted from the Shipt Shopper Lounge Facebook group and his local Shipt group. This culture of fear, Solis says, leaves some shoppers feeling like they have to take every order, or else they’ll be punished in some way, like getting sent low-paying orders or getting deactivated. Or, if they speak out against the company in Facebook groups, some say they fear they’ll be deactivated.
“Shopper feedback has been incredibly important to improving the experience we create for our shopper community, members and retail partners,” Coop said. “We encourage Shipt Shoppers to share their opinions and feedback about their journey with Shipt, and we offer multiple feedback channels where shoppers are encouraged to speak freely to Shipt about their shopper experience.”
But the Iowa-based shopper, for example, referred to the vibe of the group as brainwashing.
“It’s almost like it tries to brainwash you into thinking the company can’t do anything wrong,” the shopper from Iowa says. “They won’t let you post negative things about it. If you do there’s a good chance you’ll be deactivated.”
This Iowa shopper says she saw someone question the pay model Shipt is testing, only for that comment to be deleted. Shipt, however, says it only deactivates people based on things like performance issues.
“Shipt does not make deactivation decisions based on shopper feedback that may be critical of Shipt, but is respectful and falls within our guidelines of appropriate actions,” Coop said in a statement to TechCrunch. “We do have written agreements with all shoppers that outline possible causes for deactivation including consistent performance issues resulting in a poor customer experience or unlawful behavior.”
While the culture and pay practices at Shipt are concerning to Solis, he says what really gets at him is the amount of control he says Shipt tries to exert over him.
“I wake up in the middle of the night scared that I forgot an order and will get deactivated,” he said, “That’s the type of fear they instill into you. I like being an independent contractor but I am not an independent contractor with Shipt in any sense of the word. The exercise of control and them telling me how to do my work and deliveries — it is control.”
Shipt, for example, requires shoppers to take certain training classes, such as Late Delivery refresher, which is sent to shoppers who have been late 10% of the time on their last 50 orders. If shoppers don’t get a perfect score, they risk being disabled from the platform. Here’s what the course, which Shipt has designed to take about 15 to 20 minutes, looks like.
Smith, on the other hand, says she feels like she can truly be independent on Shipt. Smith pointed to how she can make her own schedule determine which orders she wants to take.
“I know people look into things quite a bit and come up with theories,” Smith says. “But at the end of the day, there’s no way to say Shipt is trying to control this, that and the other. I’ve never felt controlled by them at all.”
Shipt is the latest company in the gig economy to find itself at odds with its workers. Last year marked a turning point among gig workers who deliver for Instacart and DoorDash, as well as people who drive for Uber and Lyft. Between the passage of gig worker protections bill AB 5 and workers at Spin unionizing, gone are the days where workers for these big tech companies can be silenced.
“We do have some headwinds in organizing,” Solis says. “The company is active in our groups. We have a lot of resistance from that standpoint so we need different strategies to let people know they can be anonymous and speak out and be heard.”
The Business of Fashion, which first reported the news, said the transition follows a previously unreported capital injection from Outdoor Voices’ investors at a lower valuation than previous rounds. It says the company tried raising new funding late last year but “had difficulty.”
We reached out to Haney directly earlier today, as well as board members from the venture firms that have backed the company, including General Catalyst and Forerunner Ventures. We have yet to hear back from those investors, but the company sent us the following: “As we look to grow and to scale, Tyler Haney has transitioned from her role as Chief Executive of Outdoor Voices to a new position as Founder. We have raised another round of financing from our current investor group to support our growth and expansion moving forward. Tyler will remain a member of the Board of Directors and will assist with the search for a new CEO. Until we fill that role, Cliff Moskowitz will serve as the Company’s Interim CEO.”
Moskowitz comes from InterLuxe, an online auction platform for luxury homes, residential and real estate properties where, according to LinkedIn, he has served as president for the last six years.
BoF cites executive turnover as an earlier indicator that not all was well within the company, suggesting that mismanagement was one factor that Nike and Under Armour veteran Pamela Catlett joined the company a year ago as president but left months later.
Retail legend Mickey Drexler, formerly of J.Crew fame — who was named chairman of Outdoor Voices’ board in the summer of 2017 as part of a $9 million convertible debt round led by Drexler’s family office — also resigned his position last year, though he maintained a director’s seat.
Operational challenges aside, according to BoF, Outdoor Voices has had trouble replicating the kind of excitement that met its earliest offerings, including flattering, color-blocked athleisure wear, like leggings, sports bras, tees and tanks.
The company has since rolled out an exercise dress that has gained traction with some consumers, but newer offerings meant to extend the brand’s reach, including solidly colored hoodies and terrycloth jogging pants that are less distinguishable from other offerings in the market, have apparently failed to boost sales.
Indeed, according to the BoF report, the brand was losing up to $2 million per month last year on annual sales of around $40 million.
The BoF story doesn’t mention the company’s brick-and-mortar locations and how they factor into the company’s narrative. But certainly, as with a growing number of direct-to-consumer brands that have been encouraged by their backers to open real-world locations, they’ve become a major cost center for the outfit. Outdoor Voices now has 11 locations around the U.S., including in Austin, LA, Soho in New York, Boston, Nashville, Chicago and Washington, D.C.
Even with (at least) $64 million in funding that Outdoor Voices has raised from investors over the years, it’s also going head-to-head with very powerful, very entrenched and endurably popular brands, including Nike and Adidas. While Outdoor Voices is still in the fight, the shoe and apparel giants have vanquished plenty of upstarts over the years.
What happens next to Haney — a former track athlete from Boulder who first launched the business with a Parsons School of Design classmate — isn’t yet clear. Still, she isn’t going far, reportedly. BoF says she still owns 10% of Outdoor Voices and will remain engaged with the company in some capacity.
Featured above, left to right, Emily Weiss of Glossier and Tyler Haney of Outdoor Voices at a 2017 Disrupt event.
ChartHop, a startup that aims to modernize and automate the organizational chart, announced a $5 million seed investment today led by Andreessen Horowitz.
A big crowd of other investors also participated including Abstract Ventures, the a16z Cultural Leadership Fund, CoFound, Cowboy Ventures, Flybridge Capital, Shrug Capital, Work Life Ventures and a number of unnamed individual investors, as well.
Founder, CEO and CTO, Ian White says that at previous jobs including as CTO and co-founder at Sailthru, he found himself frustrated by the available tools for organizational planning, something that he says every company needs to get a grip on.
White did what any good entrepreneur would do. He left his previous job and spent the last couple of years building the kind of software he felt was missing in the market. “ChartHop is the first org management platform. It’s really a new type of HR software that brings all the different people data together in one place, so that companies can plan, analyze and visualize their organizations in a completely new way,” White told TechCrunch.
While he acknowledges that among his early customers, the Head of HR is a core user, White doesn’t see this as purely an HR issue. “It’s a problem for any executive, leader or manager in any organization that’s growing and trying to plan what the organization is going to look like more strategically,” he explained.
Lead investor at a16z David Ulevitch, also sees this kind of planning as essential to any organization. “How you structure and grow your organization has a tremendous amount of influence on how your company operates. This sounds so obvious, and yet most organizations don’t act thoughtfully when it comes to organizational planning and design,” Ulevitch wrote in a blog post announcing the investment.
The way it works is that out of the box it connects to 15 or 20 standard types of company systems like BambooHR, Carta, ADP and Workday, and based on this information it can build an organizational chart. The company can then slice and dice the data by department, open recs, gender, salary, geography and so forth. There is also a detailed reporting component that gives companies insight into the current makeup and future state of the organization.
The visual org chart itself is set up so that you can scrub through time to see how your company has changed. He says that while it is designed to hide sensitive information like salaries, he does see it as a way of helping employees across the organization understand where they fit and how they relate to other people they might not even know because the size of the company makes that impossible.
ChartHop org chart organized by gender. Screenshot: ChartHop
White says that he has dozens of customers already, who are paying ChartHop by the employee on a subscription basis. While his target market is companies with more than 100 employees, at some point he may offer a version for early-stage startups who could benefit from this type of planning, and could then have a complete history of the organization over the life of the company.
Today, the company has 9 employees, and he only began hiring in the fall when this seed money came through. He expects to double that number in the next year.
LinkedIn has cornered the market when it comes to putting your own professional profile online and using it to network for jobs, industry connections and professional development. But when it comes to looking at a chart of the people, and specifically the leadership teams, who make up organizations more holistically, the Microsoft-owned network comes up a little short: you can search by company names, but chances are that you get a list of people based on their connectivity to you, and otherwise in no particular order (including people who may no longer even be at the company). And pointedly, there is little in the way of verification to prove that someone who claims to be working for a company really is.
Now, a startup called The Org is hoping to take on LinkedIn and address that gap with an ambitious idea: to build a database (currently free to use) of organizational charts for every leading company, and potentially any company in the world, and then add on features after that, such as job advertising, for example organizations looking to hire people where there are obvious gaps in their org charts.
With 16,000 companies profiled so far on its platform, a total of 50,000 companies in its database and around 100,000 visitors per month, The Org is announcing $11 million in funding: a Series A of $8.5 million, and a previously unannounced seed round of $2.5 million.
Led by Founders Fund, the Series A also includes participation from Sequoia and Balderton, along with a number of angels. Sequoia is actually a repeat investor: it also led The Org’s $2.5 million seed round, which also had Founders Fund, Kevin Hartz, Elad Gil, Ryan Petersen, and SV Angel in it. Keith Rabois, who is now a partner at Founders Fund but once held the role of VP of business and corporate development at LinkedIn, is also joining the startup’s board of directors.
Co-headquartered in New York and Copenhagen, Denmark, The Org was co-founded by Christian Wylonis (CEO) and Andreas Jarbøl, partly inspired by a piece in online tech publication The Information, which provided an org chart for the top people at Airbnb (currently numbering 90 entries).
“This article went crazy viral,” Wylonis said in an interview. “I would understand why someone would be interested in this outside of Airbnb, but it turned out that people inside the company were fascinated by it, too. I started to think, when you take something like an org chart and made it publicly facing, I think it just becomes interesting.”
So The Org set out to build a bigger business based on the concept.
For now, The Org is aimed at two distinct markets: those outside the company who might most typically be interested in who is working where and doing what — for example, recruiters, those in human resources departments who are using the data to model their own organizational charts, or salespeople; and those inside the company (or again, outside) who are simply interested in seeing who does what.
The Org is aiming to have 100,000 org charts on its platform by the end of the year, with the longer-term goal being to cover 1 million. For now, the focus is on adding companies in the US before expanding to other markets.
But while the idea of building org charts for many companies sounds easy enough, there is also a reason why it hasn’t been done yet: it’s not nearly as simple as it looks. That is one reason why even trying to surmount this issue is of interest to top VCs — particularly those who have worked in startups and fast-growing tech companies themselves.
“Today, information about teams is unstructured, scattered, and unverified, making it hard for employees and recruiters to understand organizational structures,” said Roelof Botha, partner at Sequoia Capital, in a statement.
“Organizational charts were the secret weapon to forging partnerships during my 20 years as an entrepreneur in Silicon Valley and Europe. Yet, they are a carefully guarded secret, which have to be painstakingly put together by hand,” said Lars Fjeldsoe-Nielsen, general partner at Balderton Capital, in a statement. “The Org is surfacing this critical information, improving efficiency from the sales floor to the boardroom.”
“Up-to-date org charts can be useful for everything from recruiting to sales, but they are difficult and time consuming to piece together,” added Rabois in a statement. “The Org is making this valuable information easily accessible in a way we were never able to do at LinkedIn.”
The approach that The Org is taking to building these profiles so far has been a collaborative one. While The Org itself might establish some company names and seed and update them with information from publicly available sources, that approach leaves a lot of gaps.
This is where a crowdsourced, wiki-style approach comes in. As with other company-based networking services such as Slack, users from a particular company can use their work email addresses to sign into that organization’s profile, and from there they can add or modify entries as you might enter data in a wiki — the idea being that multiple people getting involved in the edits helps keep the company’s org chart more accurate.
While The Org’s idea holds a lot of promise and seems to fill a hole that other companies like LinkedIn — or, from another direction, Glassdoor — do not address in their own profiling of companies, I can see some challenges, too, that it might encounter as it grows.
Platforms that provide insights into a company landscape, such as LinkedIn or Glassdoor, are ultimately banked more around individuals and their own representations. That means that by their nature these platforms may not ever provide complete pictures of businesses themselves, just slices of it. The Org, on the other hand, starts from the point of view of presenting the company itself, which means that the resulting gaps that arise might be more apparent if they never get filled in, making The Org potentially less useful as a tool.
Similarly, if these charts are truly often closely guarded by companies (something I don’t doubt is true, since they could pose poaching risks, or copycats in the form of companies attempting to build org structures based on what their more successful competitors are doing), I could see how some companies might start to approach The Org with requests to remove their profiles and corresponding charts.
Wylonis said that “99%” of companies so far have been okay with what The Org is building. “The way that we see it is that transparency is of interest to the people who work there,” he said. “I think that everyone should strive for that. Why block it? The world is changing and if the only way to keep your talent is by hiding your org chart you have other problems at your company.”
He added that so far The Org has not had any official requests, “but we have had informal enquiries about how we get our information. And some companies email us about changes. And when an individual person gets in touch and says, ‘I don’t want to be here,’ we delete that. But it’s only happened a handful of times.” It’s not clear whether that proportion stays the same, or goes up or down, as The Org grows.
In the meantime, the other big question that The Org will grapple with is just how granular should it go?
“I hope that one day we can have an updated and complete org chart for every business, but that might prove difficult,” Wylonis said. Indeed, that could mean mapping out 1 million people at Walmart, for example. “For the biggest companies, it may be that it works to map out the top 500, with the top 30-40 for smaller companies. And people can always go in and make corrections to expand those if they want.”
Soylent, the once high-flying Los Angeles-based meal replacement startup that has raised $72.4 million in financing from investors including Google Ventures, Lerer Hippeau and Andreessen Horowitz, has shaken up its executive team.
This week, the company announced in a blog post that the company’s chief financial officer, Demir Vangelov, would be taking over the top spot at the company and current chief executive Bryan Crowley would be stepping down.
“We would like to thank Bryan Crowley for his immense contributions to the company,” wrote Soylent chairman and founder Rob Rhinehart, in a statement.
Vangelov, who’s taking over from Crowley, previously served as an executive at the milk alternative company Califia Foods and at Oberto Foods, so he knows consumer packaged brands.
Crowley came to the company with grand ambitions to revitalize the Soylent brand and product line. The company had introduced a line of snack bars to complement its line of powders and drinks, while updating its drink line with a nootropic beverage containing caffeine and supplements supposedly designed to boost cognitive performance in addition to providing a meal replacement.
Soylent also set up fancy digs in Los Angeles’ arts district and established a Food Innovation Lab, which only a year ago awarded $25,000 to a few food startups working there.
Now, only a year later, the Food Innovation Lab is shuttered and Soylent has moved to a smaller office space. The company declined to comment on the news or its new strategy.
In some ways, Soylent may suffer from being a progenitor of an investment thesis which has passed it by. When the company launched in 2013, it was a fairly novel idea to start a new food brand, as Rhinehart notes in the blog post announcing the executive change:
Soylent started as a movement. In 2013, there was scarcely any innovation or attention to one of the world’s most important product sectors: our food. Today, innovative food companies are performing record-breaking IPOs, new retailers are raising massive growth rounds, and food, agriculture, and ingredient technologies are some of the most disruptive startups in the ecosystem. But we still have a lot of work to do to fulfill Soylent’s mission of nutrition for all.
Today we are making some changes at the company. We are renewing our commitment to being transparent, authentic and science-driven, all while putting the customer first. To do this we are going to re-focus on our core products. We will be improving our current product line as well as bringing some truly innovative ideas off the shelf and into the market, and we will be improving our prices by focusing on quality over quantity when it comes to distribution and marketing.
Vanessa Bain (pictured above), a well-known gig worker-activist, has teamed up with fellow gig worker-activist Sarah Clarke (pseudonym) to form the Gig Workers Collective. It’s early days for the organization, which is a pending 501(c)(3) organization, but its ambitions are big.
“We want to be the first responders that, whenever gig workers find out there is a pay cut or some type of issue, they’ll feel comfortable coming to us,” Clarke told TechCrunch.
The plan is to continue fighting for fair pay and better treatment for gig workers, whether they shop for Instacart, drive for Uber or Lyft, or deliver for Postmates and DoorDash. Through the organization, Clarke hopes to be able to help other gig workers effectively organize, file grievances and advocate for themselves.
“Vanessa and I have been organizing for four years,” Clarke said. “We’ve been doing it on the side while also maintaining working 40 hours a week gig jobs. If we focus solely on organizing, we can accomplish so much more.”
Over the years, Bain and Clarke have led a number of campaigns. More recently, they led a nationwide campaign that entailed six days of action in protest of Instacart. Last year, they also went on strike for 72 hours in demand of a better tip and fee structure.
Right now, the organization has a board of five gig workers and six workers who are contributing to the organization.
“Assuming we get funding, we can pay for everything they do,” Clarke said. “Right now, everything we pay for is out of pocket. With proper funding, we can pay workers who are working on the campaign.”
The next steps for the young organization are to try to get funding. However, Clarke said they will be selective about who they take funding from in order to ensure those funders don’t try to exert too much control.
She said, “the workers will always need to come first.”
Major change ahead for LinkedIn, the social network for the working world, now with 675 million members. Jeff Weiner, who has been leading the company as CEO for the past 11 years, is stepping down on June 1, 2020. His new role will be executive chairman. Ryan Roslansky, who is currently head of product, will be stepping up to the new role of CEO, while Tomer Cohen, who had been under Roslansky, is stepping up to lead the team.
The changes are the company’s biggest — and actually, only — big executive shakeup since LinkedIn was acquired by Microsoft for $26.2 billion in 2016. It’s notable that both of the new appointments are of long-time LinkedIn executives: don’t rock the boat too much, don’t fix what isn’t broken, and all that.
As for what Weiner will be doing next, in a blog post announcing his departure, he notes that LinkedIn was his “dream job” and that he’s moving on to the next “dream job” as exec. chairman. I’m guessing we will start seeing his name floated around for other CEO roles in 3, 2, 1….
His tenure at LinkedIn followed a period of rapid growth at the company, where it doubled down on diversifying its revenues into advertising alongside subscriptions to its premium and recruitment businesses, a major refresh of the company’s mobile effort, a number of redesigns and experiments across the main platform to best leverage the position that it holds among its user base — based on some of the same social mechanics that underpin the likes of Facebook, but with a much more practical, professional, productivity bent — and most of all very torrid growth of its user base. Some love to poke it and lampoon its somewhat surprising ability to infer your connections and send countless attempts to your email to try to engage you more, but ultimately it’s a tool and platform that hasn’t really found a strong single competitor.
At the same time, it will be very interesting to see if the new leadership will be business as usual, or if the company will strike out and try to change things up, and if so, how. At a time when the likes of Facebook are finding a lot of criticism for its own take on social media, you can see an opportunity — and perhaps the right moment — for that change to come.
Fearing weak fundraising options in the wake of the WeWork implosion, late-stage startups are tightening their belts. The latest is another Softbank-funded company, joining Zume Pizza (80 percent of staff laid off), Wag (80 percent), Fair (40%), Getaround (25 percent), Rappi (6 percent), and Oyo (5 percent) that have all cut staff to slow their burn rate and reduce their funding needs. Now freight forwarding startup Flexport is laying off 3 percent of its global staff.
“We’re restructuring some parts of our organization to move faster and with greater clarity and purpose. With that came the difficult decision to part ways with around 50 employees” a Flexport spokesperson tells TechCrunch after we asked today if it had seen layoffs like its peers.
Flexport CEO Ryan Petersen
Flexport had raised a $1 billion Series D led by SoftBank at a $3.2 billion valuation a year ago, bringing it to $1.3 billion in funding. The company helps move shipping containers full of goods between manufacturers and retailers using digital tools unlike its old-school competitors.
“We underinvested in areas that help us serve clients efficiently, and we over-invested in scaling our existing process when we actually needed to be agile and adaptable to best serve our clients, especially in a year of unprecedented volatility in global trade,” the spokesperson explained.
Flexport still had a record year, working with 10,000 clients to finance and transport goods. The shipping industry is so huge that it’s still only the seventh largest freight forwarder on its top Trans-Pacific Eastbound leg. The massive headroom for growth plus its use of software to coordinate supply chains and optimize routing is what attracted SoftBank.
The Flexboard Platform dashboard offers maps, notifications, task lists, and chat for Flexport clients and their factory suppliers.
But many late-stage startups are worried about where they’ll get their next round after taking huge sums of cash from SoftBank at tall valuations. As of November, SoftBank had only managed to raise about $2 billion for its Vision Fund 2 despite plans for a total of $108 billion, Bloomberg reported. LPs were partially spooked by SoftBank’s reckless investment in WeWork. Further layoffs at its portfolio companies could further stoke concerns about entrusting it with more cash.
Unless growth-stage startups can cobble together enough institutional investors to build big rounds, or other huge capital sources like sovereign wealth funds materialize for them, these startups might not be able to raise enough to keep rapidly burning. Those that can’t reach profitability or find an exit may face down-rounds that can come with onerous terms, trigger talent exodus death spirals, or just not provide enough money.
Flexport has managed to escape with just 3 percent layoffs for now. Being proactive about cuts to reach sustainability may be smarter than gambling that one’s business or the funding climate with suddenly improve. But while other SoftBank startups had to spend tons to edge out direct competitors or make up for weak on-demand service margins, Flexport at least has a tried and true business where incumbents have been asleep at the wheel.
KKR, the multibillion-dollar multistrategy investment firm, is beefing up its technology practice with the appointment of Rob Salvagno as a co-head of its technology growth equity business in the U.S.
It’s a sign that KKR is taking the tech industry seriously as it looks for new acquisition and investment opportunities.
Salvagno, the former vice president of corporate development and head of Cisco Investments, was responsible for all mergers and acquisitions and venture capital investments at the company.
Over a twenty-year career Salvagno helped form and launch Decibel, the networking giant’s early stage, several hundred million dollar investment fund.
“Our business has evolved significantly since we first launched our technology growth equity strategy over five years ago with a small team of five. Since that time, the growth of our business and the number of compelling investments we’re seeing around the globe have allowed us to not only expand our team, but also our technology experience, network and geographic reach,” said Dave Welsh, KKR Partner and Head of Technology Growth Equity, in a statement. “With the addition of a tech industry veteran like Rob to our team, we’re excited to continue to build for the future and position ourselves well to capture the many investment opportunities we see ahead.”
To date, KKR has invested $2.7 billion in tech companies since 2014 and established itself as a player in late stage tech investment with a team of nineteen investment professionals. Earlier this month, the firm closed its $2.2 billion fund dedicated to growth technology investment in North America, Europe and Israel.
“Rob has an extensive background in security, [infrastructure] software and app dev and dev ops, a background which we believe will complement the existing teams’ skillset very well,” said Welsh in an email. “[And] our focus areas for our second firm will be similar to the prior fund, namely a heavy focus on software with some additional focus on consumer internet, fintech/insurtech and tech enabled services.”
Application development software and security technologies will also remain a core focus for the firm, according to Welsh.
“Additionally, we will be ramping up our time spent on infrastructure software (i.e. software used to run modern data center / cloud environments), application dev and development operations (i.e. app dev and dev ops solutions) as well as software solutions focused on certain vertical industries (such as real estate, legal, construction, hospitality),” the KKR co-head wrote in an email.
When Ginni Rometty steps down as CEO at IBM in April and her replacement Arvind Krishna takes the helm, more than eight years will have passed since she took the reins at Big Blue. The executive helped lead a massive transformation, but IBM has had a bumpy financial ride throughout her tenure — at one time recording an astonishing 22 straight quarters of declining revenue.
To be fair, Rometty took over at a tumultuous time when technology was shifting from on-prem software stacks to the cloud. She saw what was coming and used the company’s considerable cash position to buy what she needed to make that switch while taking advantage of IBM’s extensive R&D to build other pieces in-house. But the transition took time, which resulted in some financial missteps.
She deserves credit for trying to move the battleship in a new direction — culminating with the $34 billion purchase of Red Hat — even if the results were ultimately mixed.
Rometty was the first woman to lead IBM in an industry where female CEOs are scarce. When she came on board in 2012, there were just 21 women running Fortune 500 companies; last year, that number had risen to 33, still a paltry 6.6%. Along with Safra Catz at Oracle and Lisa Su of Advanced Micro Devices, Rometty has been part of a small group of female CEOs at large technology companies.
Facebook spying on teens, Twitter accounts hijacked by terrorists, and sexual abuse imagery found on Bing and Giphy were amongst the ugly truths revealed by TechCrunch’s investigating reporting in 2019. The tech industry needs more watchdogs than ever as its size enlargens the impact of safety failures and the abuse of power. Whether through malice, naivety, or greed, there was plenty of wrongdoing to sniff out.
Led by our security expert Zack Whittaker, TechCrunch undertook more long-form investigations this year to tackle these growing issues. Our coverage of fundraises, product launches, and glamorous exits only tell half the story. As perhaps the biggest and longest running news outlet dedicated to startups (and the giants they become), we’re responsible for keeping these companies honest and pushing for a more ethical and transparent approach to technology.
If you have a tip potentially worthy of an investigation, contact TechCrunch at email@example.com or by using our anonymous tip line’s form.
Image: Bryce Durbin/TechCrunch
Here are our top 10 investigations from 2019, and their impact:
Josh Constine’s landmark investigation discovered that Facebook was paying teens and adults $20 in gift cards per month to install a VPN that sent Facebook all their sensitive mobile data for market research purposes. The laundry list of problems with Facebook Research included not informing 187,000 users the data would go to Facebook until they signed up for “Project Atlas”, not receiving proper parental consent for over 4300 minors, and threatening legal action if a user spoke publicly about the program. The program also abused Apple’s enterprise certificate program designed only for distribution of employee-only apps within companies to avoid the App Store review process.
The fallout was enormous. Lawmakers wrote angry letters to Facebook. TechCrunch soon discovered a similar market research program from Google called Screenwise Meter that the company promptly shut down. Apple punished both Google and Facebook by shutting down all their employee-only apps for a day, causing office disruptions since Facebookers couldn’t access their shuttle schedule or lunch menu. Facebook tried to claim the program was above board, but finally succumbed to the backlash and shut down Facebook Research and all paid data collection programs for users under 18. Most importantly, the investigation led Facebook to shut down its Onavo app, which offered a VPN but in reality sucked in tons of mobile usage data to figure out which competitors to copy. Onavo helped Facebook realize it should acquire messaging rival WhatsApp for $19 billion, and it’s now at the center of anti-trust investigations into the company. TechCrunch’s reporting weakened Facebook’s exploitative market surveillance, pitted tech’s giants against each other, and raised the bar for transparency and ethics in data collection.
Zack Whittaker’s profile of the heroes who helped save the internet from the fast-spreading WannaCry ransomware reveals the precarious nature of cybersecurity. The gripping tale documenting Marcus Hutchins’ benevolent work establishing the WannaCry kill switch may have contributed to a judge’s decision to sentence him to just one year of supervised release instead of 10 years in prison for an unrelated charge of creating malware as a teenager.
TechCrunch contributor Mark Harris’ investigation discovered inadequate emergency exits and more problems with Elon Musk’s plan for his Boring Company to build a Washington D.C.-to-Baltimore tunnel. Consulting fire safety and tunnel engineering experts, Harris build a strong case for why state and local governments should be suspicious of technology disrupters cutting corners in public infrastructure.
Josh Constine’s investigation exposed how Bing’s image search results both showed child sexual abuse imagery, but also suggested search terms to innocent users that would surface this illegal material. A tip led Constine to commission a report by anti-abuse startup AntiToxin (now L1ght), forcing Microsoft to commit to UK regulators that it would make significant changes to stop this from happening. However, a follow-up investigation by the New York Times citing TechCrunch’s report revealed Bing had made little progress.
Zack Whittaker’s investigation surfaced contradictory evidence in a case of alleged grade tampering by Tufts student Tiffany Filler who was questionably expelled. The article casts significant doubt on the accusations, and that could help the student get a fair shot at future academic or professional endeavors.
Natasha Lomas’ chronicle of troubles at educational computer hardware startup pi-top, including a device malfunction that injured a U.S. student. An internal email revealed the student had suffered a “a very nasty finger burn” from a pi-top 3 laptop designed to be disassembled. Reliability issues swelled and layoffs ensued. The report highlights how startups operating in the physical world, especially around sensitive populations like students, must make safety a top priority.
Sarah Perez and Zack Whittaker teamed up with child protection startup L1ght to expose Giphy’s negligence in blocking sexual abuse imagery. The report revealed how criminals used the site to share illegal imagery, which was then accidentally indexed by search engines. TechCrunch’s investigation demonstrated that it’s not just public tech giants who need to be more vigilant about their content.
Megan Rose Dickey explored a botched case of discrimination policy enforcement by Airbnb when a blind and deaf traveler’s reservation was cancelled because they have a guide dog. Airbnb tried to just “educate” the host who was accused of discrimination instead of levying any real punishment until Dickey’s reporting pushed it to suspend them for a month. The investigation reveals the lengths Airbnb goes to in order to protect its money-generating hosts, and how policy problems could mar its IPO.
Zack Whittaker discovered that Islamic State propaganda was being spread through hijacked Twitter accounts. His investigation revealed that if the email address associated with a Twitter account expired, attackers could re-register it to gain access and then receive password resets sent from Twitter. The article revealed the savvy but not necessarily sophisticated ways terrorist groups are exploiting big tech’s security shortcomings, and identified a dangerous loophole for all sites to close.
Josh Constine found dozens of pornography and real-money gambling apps had broken Apple’s rules but avoided App Store review by abusing its enterprise certificate program — many based in China. The report revealed the weak and easily defrauded requirements to receive an enterprise certificate. Seven months later, Apple revealed a spike in porn and gambling app takedown requests from China. The investigation could push Apple to tighten its enterprise certificate policies, and proved the company has plenty of its own problems to handle despite CEO Tim Cook’s frequent jabs at the policies of other tech giants.
This Game Of Thrones-worthy tale was too intriguing to leave out, even if the impact was more of a warning to all startup executives. Josh Constine’s look inside gaming startup HQ Trivia revealed a saga of employee revolt in response to its CEO’s ineptitude and inaction as the company nose-dived. Employees who organized a petition to the board to remove the CEO were fired, leading to further talent departures and stagnation. The investigation served to remind startup executives that they are responsible to their employees, who can exert power through collective action or their exodus.
If you have a tip for Josh Constine, you can reach him via encrypted Signal or text at (585)750-5674, joshc at TechCrunch dot com, or through Twitter DMs
Mozilla laid off about 70 employees today, TechCrunch has learned.
In an internal memo, Mozilla chairwoman and interim CEO Mitchell Baker specifically mentions the slow rollout of the organization’s new revenue-generating products as the reason for why it needed to take this action. The overall number may still be higher, though, as Mozilla is still looking into how this decision will affect workers in the U.K. and France. In 2018, Mozilla Corporation (as opposed to the much smaller Mozilla Foundation) said it had about 1,000 employees worldwide.
“You may recall that we expected to be earning revenue in 2019 and 2020 from new subscription products as well as higher revenue from sources outside of search. This did not happen,” Baker writes in her memo. “Our 2019 plan underestimated how long it would take to build and ship new, revenue-generating products. Given that, and all we learned in 2019 about the pace of innovation, we decided to take a more conservative approach to projecting our revenue for 2020. We also agreed to a principle of living within our means, of not spending more than we earn for the foreseeable future.”
Mozilla has decided to lay some folks off and restructure things. All the leads in QA got let go. I haven’t been let go (so far). No idea what I will be working on or who I will be reporting to. Some good work friends let go :(
— Chris Hartjes (@grmpyprogrammer) January 15, 2020
Baker says laid-off employees will receive “generous exit packages” and outplacement support. She also notes that the leadership team looked into shutting down the Mozilla innovation fund but decided that it needed it in order to continue developing new products. In total, Mozilla is dedicating $43 million to building new products.
“As we look to the future, we know we must take bold steps to evolve and ensure the strength and longevity of our mission,” Baker writes. “Mozilla has a strong line of sight to future revenue generation, but we are taking a more conservative approach to our finances. This will enable us to pivot as needed to respond to market threats to internet health, and champion user privacy and agency.”
The organization last reported major layoffs in 2017.
Over the course of the last few months, Mozilla started testing a number of new products, most of which will be subscription-based once they launch. The marquee feature here is including its Firefox Private Network and a device-level VPN service that is yet to launch, but will cost around $4.99 per month.
All of this is part of the organization’s plans to become less reliant on income from search partnerships and to create more revenue channels. In 2018, the latest year for which Mozilla has published its financial records, about 91% of its royalty revenues came from search contracts.
We have reached out to Mozilla for comment and will update this post once we hear more.
Update (1pm PT): In a statement posted to the Mozilla blog, Mitchell Baker reiterates that Mozilla had to make these cuts in order to fund innovation. “Mozilla has a strong line of sight on future revenue generation from our core business,” she writes. “In some ways, this makes this action harder, and we are deeply distressed about the effect on our colleagues. However, to responsibly make additional investments in innovation to improve the internet, we can and must work within the limits of our core finances”
Here is the full memo:
Office of the CEO <firstname.lastname@example.org>
I have some difficult news to share. With the support of the entire Steering Committee and our Board, we have made an extremely tough decision: over the course of today, we plan to eliminate about 70 roles from across MoCo. This number may be slightly larger as we are still in a consultation process in the UK and France, as the law requires, on the exact roles that may be eliminated there. We are doing this with the utmost respect for each and every person who is impacted and will go to great lengths to take care of them by providing generous exit packages and outplacement support. Most will not join us in Berlin. I will send another note when we have been able to talk to the affected people wherever possible, so that you will know when the notifications/outreach are complete.
This news likely comes as a shock and I am sorry that we could not have been more transparent with you along the way. This is never my desire. Reducing our headcount was something the Steering Committee considered as part of our 2020 planning and budgeting exercise only after all other avenues were explored. The final decision was made just before the holiday break with the work to finalize the exact set of roles affected continuing into early January (there are exceptions in the UK and France where we are consulting on decisions.) I made the decision not to communicate about this until we had a near-final list of roles and individuals affected.
Even though I expect it will be difficult to digest right now, I would like to share more about what led to this decision. Perhaps you can come back to it later, if that’s easier.
You may recall that we expected to be earning revenue in 2019 and 2020 from new subscription products as well as higher revenue from sources outside of search. This did not happen. Our 2019 plan underestimated how long it would take to build and ship new, revenue-generating products. Given that, and all we learned in 2019 about the pace of innovation, we decided to take a more conservative approach to projecting our revenue for 2020. We also agreed to a principle of living within our means, of not spending more than we earn for the foreseeable future.
This approach is prudent certainly, but challenging practically. In our case, it required difficult decisions with painful results. Regular annual pay increases, bonuses and other costs which increase from year-to-year as well as a continuing need to maintain a separate, substantial innovation fund, meant that we had to look for considerable savings across Mozilla as part of our 2020 planning and budgeting process. This process ultimately led us to the decision to reduce our workforce.
At this point, you might ask if we considered foregoing the separate innovation fund, continuing as we did in 2019. The answer is yes but we ultimately decided we could not, in good faith, adopt this. Mozilla’s future depends on us excelling at our current work and developing new offerings to expand our impact. And creating the new products we need to change the future requires us to do things differently, including allocating funds, $43M to be specific, for this purpose. We will discuss our plans for making innovation robust and successful in increasing detail as we head into, and then again at, the All Hands, rather than trying to do so here.
As we look to the future, we know we must take bold steps to evolve and ensure the strength and longevity of our mission. Mozilla has a strong line of sight to future revenue generation, but we are taking a more conservative approach to our finances. This will enable us to pivot as needed to respond to market threats to internet health, and champion user privacy and agency.
I ask that we all do what we can to support each other through this difficult period.
Madrona Venture Group announced today that is has hired former Docker CEO Steve Singh as a managing director at the firm.
Singh stepped down as CEO of Docker last May and Seattle-based Madrona seems like logical landing spot. He is a long-time resident of Seattle, and has been working behind the scenes with Madrona for many years as a strategic director and angel investor, according to the firm.
Singh says that while there are a number of areas he’s interested in, he wants to concentrate on intelligent applications in the enterprise. “While there are a number of broad themes we are excited about, I am particularly passionate about the potential of intelligent applications to transform business and our lives. Next generation, cloud-native application companies such as Clari, HighSpot, and Amperity, have incredible opportunities to solve large scale business challenges and become multi-billion-dollar businesses,” he said in a statement.
He certainly has broad enterprise experience. Beyond Docker, he was chairman and CEO at Concur for more than 20 years, and oversaw the company’s sale to SAP in 2014 for a hefty $8.3 billion. In addition, he sits on a variety of boards including Clari, Talend, DocuSign and others.
Singh joins S. Somasegar, who was a former corporate vice president at Microsoft and Hope Cochran, who was a long time CFO and helped take a couple of companies public, as managing directors added at the firm in recent years.
Madrona is celebrating its 25th anniversary in business this year, and can boast that one of its earliest investments was a Series A for a little Seattle startup called Amazon.
Uber founder and former CEO Travis Kalanick is leaving the company’s board of directors, the ride-hailing company announced today. Kalanick will officially resign from the board as of December 31, to “focus on his new business and philanthropic endeavors,” according to a press release issued by Uber.
Kalanick, who was forced out as Uber CEO and eventually replaced by Dara Khosrowshahi through shareholder action, with support of the board, in 2017, has been in the process of selling off his considerable ownership stake in the company through successive sales of his shares. Just last week, Kalanick sold around $383 million in shares and reduced his overall stake to less than 10%, per an SEC filing.
UPDATE 7:35 AM PT: In fact, it looks like Kalanick has actually sold all his remaining stock, with the SEC filings to show up on the web likely after the Christmas holiday, per the FT.
The share sales started when Uber’s restriction on the sale of stock for private investors and employees expired six months after the company’s IPO. Kalanick at one time owned a total of 98 million shares in the company. Kalanick has since made a play in the on-demand food industry that his former company helped jump-start with CloudKitchens, a startup focused on picking up cheap properties and turning them into restaurant operations without a counter, seating or walk-in service designed exclusively to fill demand for courier-based restaurant delivery apps.
Andy Dunn, the founder of menswear site Bonobos which sold to Walmart in 2017 for $310 million, is now parting ways with the retail giant. The executive, who joined Walmart as SVP of digital consumer brands at the time of the acquisition, officially announced his departure in a LinkedIn post titled “A Love Letter to Walmart.”
In it, Dunn praises the time he spent with the company and the knowledge he gained while working there. Specifically, he references several of Walmart’s bigger initiatives, including its transformation into an omnichannel retail company serving customers online and offline, without distinction.
This is an area of Walmart’s business that’s been under pressure as the battle with Amazon heats up. A recent report by Bloomberg, for example, highlighted the internal corporate culture clash underway as Walmart’s e-commerce investments impacted stores and thinned margins.
Dunn also referenced Walmart’s growing grocery business, now helping to fuel its online sales, and the development of new Walmart brands like Allswell.
“I learned a lot more about retail transformation in the digital age at the world’s biggest company. I watched our strategy evolve as we uncorked our unique advantages on a new omni playing field – and began to identify where we aren’t just catching up, but where we are winning. The momentum with online grocery pickup opened my eyes: our thousands of supercenters are an asset nobody else has, so let’s use them,” wrote Dunn. “In our digital brands group, that led to development of a strategy built on omni, as we married our talent with the power of Walmart distribution to build brands like Allswell. With my departure, that incubator will now be plugged directly into the Walmart mothership,” he said.
Bonobos is one of several online brands that Walmart has now acquired to fill out its virtual shelves, along with Moosejaw ($51 million), ShoeBuy, Jet.com ($3 billion) and Hayneedle, in addition to Bonobos ($310 million) and ModCloth ($75 million). Dunn’s letter noted the more recent deal to buy plus-sized clothing brand ELOQUII ($100 million) — an example of Walmart’s desire to deliver a better life for its core customers.
Walmart’s acquisition streak has since slowed. It also sold off Modcloth just two years after buying it, to stem the losses from its e-commerce business. Bonobos saw layoffs in 2019, and Walmart’s biggest acquisition, Jet.com, has been folded into the rest of Walmart’s e-commerce operations.
Dunn’s letter also spoke to Walmart’s more controversial decision to fully exit the handgun and handgun ammunition businesses, and ban open-carry in its stores, following the mass shooting in its El Paso store.
“It’s a testament to what kind of company Walmart is that I entered thinking mostly about what I could offer, and ended up being the one who received so much,” said Dunn. “When it comes to making the world a better place, the world’s largest company is, 57 years later, just getting started. It’s a credit to the remarkable teamwork of 2.4 million of the hardest working people on planet Earth, all working together. As Sam said, the fact that we’re all in this together is the secret. At Walmart, it’s hidden in plain sight,” he concluded.
Vox previously reported on Dunn’s departure, citing a source, ahead of the official announcement.
Dunn’s departure will take place in 2020.
Salesforce announced today that it has named Bret Taylor as president and chief operating officer of the company. Prior to today’s promotion, Taylor held the position of president and chief product officer.
In his new position, Taylor will be responsible for a number of activities including leading Salesforce’s global product vision, engineering, security, marketing and communications. That’s a big job, and as such he will report directly to chairman Marc Benioff.
Taylor has had increasing responsibilities over the last couple of years, taking the lead on many of Salesforce’s biggest announcements at Dreamforce, the company’s massive yearly customer conference. In fact, Benioff said in a statement that Taylor has already been responsible for product vision, development and go-to-market strategy prior to today’s promotion.
“His expanded portfolio of responsibilities will enable us to drive even greater customer success and innovation as we experience rapid growth at scale,” Benioff said in the statement.
Brent Leary, founder at CRM Essentials, who has been watching the company since its earliest days, says it feels like this could be part of succession plan down the road. This promotion could be a signal that Taylor is being groomed to take over for Benioff and co-CEO Keith Block whenever they decide to move on.
“It’s been feeling like he’s being groomed for the big chair somewhere down the line. He’s a generation behind the current leadership, but his experiences at startups and creating iconic technologies at iconic companies uniquely positioned him for a move like this at a company like Salesforce,” Leary told TechCrunch.
Taylor came to Salesforce when the company purchased Quip in August 2016 for $750 million. He was promoted to president and chief product officer in November 2017. Prior to launching Quip he was chief technology officer at Facebook.
In June, PayPal announced its Chief Operating Officer Bill Ready would be departing the company at the end of this year. Now we know where he’s ending up: Google. Ready will join Google in January as the company’s new commerce chief, reporting directly to Prabhakar Raghavan, SVP, Ads, Commerce and Payments.
Ready’s role at Google will not involve payments, which means he won’t be directly involved with PayPal’s competitor, Google Pay. Instead, as Google’s new president of Commerce, Ready will focus on leading Google’s vision, strategy and delivery of its commerce products. However, the role will see Ready working in close partnership with both the advertising and payments operations.
Google’s prior head of ads, commerce and payments, Sridhar Ramaswamy, left the company in 2018 after more than 15 years, which is when Raghavan stepped in. But Ready’s role is a new one, as it will focus on commerce specifically.
“Bill’s exceptional track record building great experiences for consumers and deeply strategic partnerships makes him a powerful addition to our team. I couldn’t be more excited for the future of commerce at Google,” said Raghavan, in a statement.
Added Ready, “I’ve long admired how Google has enabled access to the digital economy for everyone. Google has been making world-class commerce capabilities universally accessible to partners of all sizes, and I look forward to furthering that mission,” he said.
Ready joined PayPal in 2013 when it acquired his startup, the payments gateway Braintree, for $800 million (he became CEO of Braintree and Venmo). Today, Braintree powers payments for businesses like Uber, Airbnb, Facebook and Jet.com, while Venmo sees more than $25 billion in transaction volume on a quarterly basis.
Once at PayPal, Ready moved up the ranks to become EVP and COO in 2016. In this role, he was responsible for product, technology and engineering at PayPal, as well as the end-to-end customer experiences for PayPal’s consumer, merchant, Braintree, Venmo, Paydiant and Xoom businesses. He was also co-chair of PayPal’s Operating Group, which focuses on delivering on revenue and profit goals for the company.
At PayPal, Ready was behind a number of the company’s biggest moves, including the introduction of its most-rapidly adopted product ever, PayPal One Touch, as well as Pay with Venmo, the redesign of the PayPal mobile app, PayPal Commerce and the expansion of Braintree’s global reach.
PayPal announced Ready’s plans for departure this summer, saying he was planning to engage in other entrepreneurial interests outside the company.
Heading up commerce at Google will be a big task for Ready, given commerce’s close proximity to parent company Alphabet’s main source of revenue, which is advertising. In Q3 2019, Google’s ad revenue was $33.92 billion out of total revenue of $40.5 billion.
Today, many consumers visit Google first to shop for products, which allows it to charge top dollar for its ads. But over the years, Amazon has been steadily chipping away at Google’s lead as more consumers go directly to its site to hunt for products.
To address this challenge, Google has begun to transform its Shopping business.
At Google Marketing Live this year, Google unveiled a new look and feel for its shopping properties, which included rebranding its Google Express app as the new Google Shopping app. The goal with the changes is to better serve the way consumers now shop online. Today, people often start “shopping” by doing things like browsing Pinterest for inspiration or seeing what influencers are posting on Instagram, for example. Instagram capitalized on this trend with the launch of Instagram Shopping in March, which allows users to checkout right in its app.
PayPal is also now moving in this direction. The company recently made its largest-ever acquisition with a $4 billion deal for shopping and awards platform Honey. With Honey’s integrations, PayPal will be able to target shoppers with personalized promotions and offers earlier on in their shopping journey, then direct them to PayPal’s checkout as the final step.
Google’s commerce plans are similar in that regard.
It envisions a universal cart and new ways to shop across its platform of services, including Search, Shopping, Images, and even YouTube and Gmail. This will allow Google to also capture shoppers’ attention as they engage with Google properties — like browsing images for product ideas or watching YouTube videos, for example.
As a part of the Google Shopping revamp, the dedicated Shopping homepage was updated to allow consumers to filter products by brands they love, features they want, as well as read product reviews and videos. Shoppers could add items to a universal cart where purchases were backed by a Google guarantee, as well as receive customer service and make easy returns, as before with Google Express.
Google’s travel business also falls under commerce, and similarly received new attention this year with updates designed to simplify the experience of trip planning on google.com/travel, and more features around tracking flight price drops and predictions.
On the advertising side, Google’s highly visual Showcase Shopping ads were expanded outside of Google Shopping. And Shopping Actions — customers’ ability to shop directly from Google surfaces, like Google Assistant — are making their way to new services, like YouTube.
Google is also ramping up its ability to serve smaller and local businesses with features aimed at driving in-store pickup traffic to brick-and-mortar stores.
Critical to making Google’s new Shopping platform successful is being able to forge retail partnerships — as, unlike Amazon, Google itself is not really in the business of selling directly to consumers, outside of its own hardware devices.
Ready’s experience will prove valuable here, too. At PayPal, he was able to build strategic partnerships with a number of unlikely players — including Visa, Mastercard, Apple, Walmart, Samsung, and even Google.
What Ready’s strategy and vision will more precisely entail for Google will have to wait until after he’s on board, however.
“I’m thrilled to welcome Bill to Google as we continue our work to create more helpful commerce experiences and build a thriving ecosystem for partners of all sizes,” said Sundar Pichai, CEO of Google and Alphabet.
Image Credits: Getty Images — Bloomberg/Contributor; Ready: Google