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Playbyte’s new app aims to become the ‘TikTok for games’

By Sarah Perez

A startup called Playbyte wants to become the TikTok for games. The company’s newly launched iOS app offers tools that allow users to make and share simple games on their phone, as well as a vertically scrollable, fullscreen feed where you can play the games created by others. Also like TikTok, the feed becomes more personalized over time to serve up more of the kinds of games you like to play.

While typically, game creation involves some aspect of coding, Playbyte’s games are created using simple building blocks, emoji and even images from your Camera Roll on your iPhone. The idea is to make building games just another form of self-expression, rather than some introductory, educational experience that’s trying to teach users the basics of coding.

At its core, Playbyte’s game creation is powered by its lightweight 2D game engine built on web frameworks, which lets users create games that can be quickly loaded and played even on slow connections and older devices. After you play a game, you can like and comment using buttons on the right-side of the screen, which also greatly resembles the TikTok look-and-feel. Over time, Playbyte’s feed shows you more of the games you enjoyed as the app leverages its understanding of in-game imagery, tags and descriptions, and other engagement analytics to serve up more games it believes you’ll find compelling.

At launch, users have already made a variety of games using Playbyte’s tools — including simulators, tower defense games, combat challenges, obbys, murder mystery games, and more.

We made an app called Playbyte that lets you make games on your phone, discover games made by other users, and challenge your friends https://t.co/FFnMbKG1ls pic.twitter.com/eqhabN3kM1

— Playbyte (@PlaybyteInc) May 25, 2021

According to Playbyte founder and CEO Kyle Russell — previously of Skydio, Andreessen Horowitz, and (disclosure!) TechCrunch — Playbyte is meant to be a social media app, not just a games app.

“We have this model in our minds for what is required to build a new social media platform,” he says.

What Twitter did for text, Instagram did for photos and TikTok did for video was to combine a constraint with a personalized feed, Russell explains. “Typically. [they started] with a focus on making these experiences really brief…So a short, constrained format and dedicated tools that set you up for success to work within that constrained format,” he adds.

Similarly, Playbyte games have their own set of limitations. In addition to their simplistic nature, the games are limited to five scenes. Thanks to this constraint, a format has emerged where people are making games that have an intro screen where you hit “play,” a story intro, a challenging gameplay section, and then a story outro.

In addition to its easy-to-use game building tools, Playbyte also allows game assets to be reused by other game creators. That means if someone who has more expertise makes a game asset using custom logic or which pieced together multiple components, the rest of the user base can benefit from that work.

“Basically, we want to make it really easy for people who aren’t as ambitious to still feel like productive, creative game makers,” says Russell. “The key to that is going to be if you have an idea — like an image of a game in your mind — you should be able to very quickly search for new assets or piece together other ones you’ve previously saved. And then just drop them in and mix-and-match — almost like Legos — and construct something that’s 90% of what you imagined, without any further configuration on your part,” he says.

In time, Playbyte plans to monetize its feed with brand advertising, perhaps by allowing creators to drop sponsored assets into their games, for instance. It also wants to establish some sort of patronage model at a later point. This could involve either subscriptions or even NFTs of the games, but this would be further down the road.

The cutest lil sprite blob I’ve ever seen 😭#pixelart #gamedev pic.twitter.com/7uBRzs6ix0

— Playbyte (@PlaybyteInc) August 21, 2021

The startup had originally began as a web app in 2019, but at the end of last year, the team scrapped that plan and rewrote everything as a native iOS app with its own game engine. That app launched on the App Store this week, after previously maxing out TestFlight’s cap of 10,000 users.

Currently, it’s finding traction with younger teenagers who are active on TikTok and other collaborative games, like Roblox, Minecraft, or Fortnite.

“These are young people who feel inspired to build their own games but have been intimidated by the need to learn to code or use other advanced tools, or who simply don’t have a computer at home that would let them access those tools,” notes Russell.

Playbyte is backed by $4 million in pre-seed and seed funding from investors including FirstMark (Rick Heitzmann), Ludlow Ventures (Jonathon Triest and Blake Robbins), Dream Machine (former Editor-in-Chief at TechCrunch, Alexia Bonatsos), and angels such as Fred Ehrsam, co-founder of Coinbase; Nate Mitchell, co-founder of Oculus; Ashita Achuthan, previously of Twitter; and others.

The app is a free download on the App Store.

UK now expects compliance with children’s privacy design code

By Natasha Lomas

In the UK, a 12-month grace period for compliance with a design code aimed at protecting children online expires today — meaning app makers offering digital services in the market which are “likely” to be accessed by children (defined in this context as users under 18 years old) are expected to comply with a set of standards intended to safeguard kids from being tracked and profiled.

The age appropriate design code came into force on September 2 last year however the UK’s data protection watchdog, the ICO, allowed the maximum grace period for hitting compliance to give organizations time to adapt their services.

But from today it expects the standards of the code to be met.

Services where the code applies can include connected toys and games and edtech but also online retail and for-profit online services such as social media and video sharing platforms which have a strong pull for minors.

Among the code’s stipulations are that a level of ‘high privacy’ should be applied to settings by default if the user is (or is suspected to be) a child — including specific provisions that geolocation and profiling should be off by default (unless there’s a compelling justification for such privacy hostile defaults).

The code also instructs app makers to provide parental controls while also providing the child with age-appropriate information about such tools — warning against parental tracking tools that could be used to silently/invisibly monitor a child without them being made aware of the active tracking.

Another standard takes aim at dark pattern design — with a warning to app makers against using “nudge techniques” to push children to provide “unnecessary personal data or weaken or turn off their privacy protections”.

The full code contains 15 standards but is not itself baked into legislation — rather it’s a set of design recommendations the ICO wants app makers to follow.

The regulatory stick to make them do so is that the watchdog is explicitly linking compliance with its children’s privacy standards to passing muster with wider data protection requirements that are baked into UK law.

The risk for apps that ignore the standards is thus that they draw the attention of the watchdog — either through a complaint or proactive investigation — with the potential of a wider ICO audit delving into their whole approach to privacy and data protection.

“We will monitor conformance to this code through a series of proactive audits, will consider complaints, and take appropriate action to enforce the underlying data protection standards, subject to applicable law and in line with our Regulatory Action Policy,” the ICO writes in guidance on its website. “To ensure proportionate and effective regulation we will target our most significant powers, focusing on organisations and individuals suspected of repeated or wilful misconduct or serious failure to comply with the law.”

It goes on to warn it would view a lack of compliance with the kids’ privacy code as a potential black mark against (enforceable) UK data protection laws, adding: “If you do not follow this code, you may find it difficult to demonstrate that your processing is fair and complies with the GDPR [General Data Protection Regulation] or PECR [Privacy and Electronics Communications Regulation].”

Tn a blog post last week, Stephen Bonner, the ICO’s executive director of regulatory futures and innovation, also warned app makers: “We will be proactive in requiring social media platforms, video and music streaming sites and the gaming industry to tell us how their services are designed in line with the code. We will identify areas where we may need to provide support or, should the circumstances require, we have powers to investigate or audit organisations.”

“We have identified that currently, some of the biggest risks come from social media platforms, video and music streaming sites and video gaming platforms,” he went on. “In these sectors, children’s personal data is being used and shared, to bombard them with content and personalised service features. This may include inappropriate adverts; unsolicited messages and friend requests; and privacy-eroding nudges urging children to stay online. We’re concerned with a number of harms that could be created as a consequence of this data use, which are physical, emotional and psychological and financial.”

“Children’s rights must be respected and we expect organisations to prove that children’s best interests are a primary concern. The code gives clarity on how organisations can use children’s data in line with the law, and we want to see organisations committed to protecting children through the development of designs and services in accordance with the code,” Bonner added.

The ICO’s enforcement powers — at least on paper — are fairly extensive, with GDPR, for example, giving it the ability to fine infringers up to £17.5M or 4% of their annual worldwide turnover, whichever is higher.

The watchdog can also issue orders banning data processing or otherwise requiring changes to services it deems non-compliant. So apps that chose to flout the children’s design code risk setting themselves up for regulatory bumps or worse.

In recent months there have been signs some major platforms have been paying mind to the ICO’s compliance deadline — with Instagram, YouTube and TikTok all announcing changes to how they handle minors’ data and account settings ahead of the September 2 date.

In July, Instagram said it would default teens to private accounts — doing so for under 18s in certain countries which the platform confirmed to us includes the UK — among a number of other child-safety focused tweaks. Then in August, Google announced similar changes for accounts on its video charing platform, YouTube.

A few days later TikTok also said it would add more privacy protections for teens. Though it had also made earlier changes limiting privacy defaults for under 18s.

Apple also recently got itself into hot water with the digital rights community following the announcement of child safety-focused features — including a child sexual abuse material (CSAM) detection tool which scans photo uploads to iCloud; and an opt in parental safety feature that lets iCloud Family account users turn on alerts related to the viewing of explicit images by minors using its Messages app.

The unifying theme underpinning all these mainstream platform product tweaks is clearly ‘child protection’.

And while there’s been growing attention in the US to online child safety and the nefarious ways in which some apps exploit kids’ data — as well as a number of open probes in Europe (such as this Commission investigation of TikTok, acting on complaints) — the UK may be having an outsized impact here given its concerted push to pioneer age-focused design standards.

The code also combines with incoming UK legislate which is set to apply a ‘duty of care’ on platforms to take a rboad-brush safety-first stance toward users, also with a big focus on kids (and there it’s also being broadly targeted to cover all children; rather than just applying to kids under 13s as with the US’ COPPA, for example).

In the blog post ahead of the compliance deadline expiring, the ICO’s Bonner sought to take credit for what he described as “significant changes” made in recent months by platforms like Facebook, Google, Instagram and TikTok, writing: “As the first-of-its kind, it’s also having an influence globally. Members of the US Senate and Congress have called on major US tech and gaming companies to voluntarily adopt the standards in the ICO’s code for children in America.”

“The Data Protection Commission in Ireland is preparing to introduce the Children’s Fundamentals to protect children online, which links closely to the code and follows similar core principles,” he also noted.

And there are other examples in the EU: France’s data watchdog, the CNIL, looks to have been inspired by the ICO’s approach — issuing its own set of right child-protection focused recommendations this June (which also, for example, encourage app makers to add parental controls with the clear caveat that such tools must “respect the child’s privacy and best interests”).

The UK’s focus on online child safety is not just making waves overseas but sparking growth in a domestic compliance services industry.

Last month, for example, the ICO announced the first clutch of GDPR certification scheme criteria — including two schemes which focus on the age appropriate design code. Expect plenty more.

Bonner’s blog post also notes that the watchdog will formally set out its position on age assurance this autumn — so it will be providing further steerage to organizations which are in scope of the code on how to tackle that tricky piece, although it’s still not clear how hard a requirement the ICO will support, with Bonner suggesting it could be actually “verifying ages or age estimation”. Watch that space. Whatever the recommendations are, age assurance services are set to spring up with compliance-focused sales pitches.

Children’s safety online has been a huge focus for UK policymakers in recent years, although the wider (and long in train) Online Safety (neé Harms) Bill remains at the draft law stage.

An earlier attempt by UK lawmakers to bring in mandatory age checks to prevent kids from accessing adult content websites — dating back to 2017’s Digital Economy Act — was dropped in 2019 after widespread criticism that it would be both unworkable and a massive privacy risk for adult users of porn.

But the government did not drop its determination to find a way to regulate online services in the name of child safety. And online age verification checks look set to be — if not a blanket, hardened requirement for all digital services — increasingly brought in by the backdoor, through a sort of ‘recommended feature’ creep (as the ORG has warned). 

The current recommendation in the age appropriate design code is that app makers “take a risk-based approach to recognising the age of individual users and ensure you effectively apply the standards in this code to child users”, suggesting they: “Either establish age with a level of certainty that is appropriate to the risks to the rights and freedoms of children that arise from your data processing, or apply the standards in this code to all your users instead.” 

At the same time, the government’s broader push on online safety risks conflicting with some of the laudable aims of the ICO’s non-legally binding children’s privacy design code.

For instance, while the code includes the (welcome) suggestion that digital services gather as little information about children as possible, in an announcement earlier this summer UK lawmakers put out guidance for social media platforms and messaging services — ahead of the planned Online Safety legislation — that recommends they prevent children from being able to use end-to-end encryption.

That’s right; the government’s advice to data-mining platforms — which it suggests will help prepare them for requirements in the incoming legislation — is not to use ‘gold standard’ security and privacy (e2e encryption) for kids.

So the official UK government messaging to app makers appears to be that, in short order, the law will require commercial services to access more of kids’ information, not less — in the name of keeping them ‘safe’. Which is quite a contradiction vs the data minimization push on the design code.

The risk is that a tightening spotlight on kids privacy ends up being fuzzed and complicated by ill-thought through policies that push platforms to monitor kids to demonstrate ‘protection’ from a smorgasbord of online harms — be it adult content or pro-suicide postings, or cyber bullying and CSAM.

The law looks set to encourage platforms to ‘show their workings’ to prove compliance — which risks resulting in ever closer tracking of children’s activity, retention of data — and maybe risk profiling and age verification checks (that could even end up being applied to all users; think sledgehammer to crack a nut). In short, a privacy dystopia.

Such mixed messages and disjointed policymaking seem set to pile increasingly confusing — and even conflicting — requirements on digital services operating in the UK, making tech businesses legally responsible for divining clarity amid the policy mess — with the simultaneous risk of huge fines if they get the balance wrong.

Complying with the ICO’s design standards may therefore actually be the easy bit.

 

How a Vungle-owned mobile marketer sent Fontmaker to the top of the App Store

By Sarah Perez

Does this sound familiar? An app goes viral on social media, often including TikTok, then immediately climbs to the top of the App Store where it gains even more new installs thanks to the heightened exposure. That’s what happened with the recent No. 1 on the U.S. App Store, Fontmaker, a subscription-based fonts app which appeared to benefit from word-of-mouth growth thanks to TikTok videos and other social posts. But what we’re actually seeing here is a new form of App Store marketing — and one which now involves one of the oldest players in the space: Vungle.

Fontmaker, at first glance, seems to be just another indie app that hit it big.

The app, published by an entity called Mango Labs, promises users a way to create fonts using their own handwriting which they can then access from a custom keyboard for a fairly steep price of $4.99 per week. The app first launched on July 26. Nearly a month later, it was the No. 2 app on the U.S. App Store, according to Sensor Tower data. By August 26, it climbed up one more position to reach No. 1. before slowly dropping down in the top overall free app rankings in the days that followed.

By Aug. 27, it was No. 15, before briefly surging again to No. 4 the following day, then declining once more. Today, the app is No. 54 overall and No. 4 in the competitive Photo & Video category — still, a solid position for a brand-new and somewhat niche product targeting mainly younger users. To date, it’s generated $68,000 in revenue, Sensor Tower reports.

But Fontmaker may not be a true organic success story, despite its Top Charts success driven by a boost in downloads coming from real users, not bots. Instead, it’s an example of how mobile marketers have figured out how to tap into the influencer community to drive app installs. It’s also an example of how it’s hard to differentiate between apps driven by influencer marketing and those that hit the top of the App Store because of true demand — like walkie-talkie app Zello, whose recent trip to No. 1 can be attributed to Hurricane Ida

As it turns out, Fontmaker is not your typical “indie app.” In fact, it’s unclear who’s really behind it. Its publisher, Mango Labs, LLC, is actually an iTunes developer account owned by the mobile growth company JetFuel, which was recently acquired by the mobile ad and monetization firm Vungle — a longtime and sometimes controversial player in this space, itself acquired by Blackstone in 2019.

Vungle was primarily interested in JetFuel’s main product, an app called The Plug, aimed at influencers.

Through The Plug, mobile app developers and advertisers can connect to JetFuel’s network of over 15,000 verified influencers who have a combined 4 billion Instagram followers, 1.5 billion TikTok followers, and 100 million daily Snapchat views.

While marketers could use the built-in advertising tools on each of these networks to try to reach their target audience, JetFuel’s technology allows marketers to quickly scale their campaigns to reach high-value users in the Gen Z demographic, the company claims. This system can be less labor-intensive than traditional influencer marketing, in some cases. Advertisers pay on a cost-per-action (CPA) basis for app installs. Meanwhile, all influencers have to do is scroll through The Plug to find an app to promote, then post it to their social accounts to start making money.

Image Credits: The Plug’s website, showing influencers how the platform works

So while yes, a lot of influencers may have made TikTok videos about Fontmaker, which prompted consumers to download the app, the influencers were paid to do so. (And often, from what we saw browsing the Fontmaker hashtag, without disclosing that financial relationship in any way — an increasingly common problem on TikTok, and area of concern for the FTC.)

Where things get tricky is in trying to sort out Mango Labs’ relationship with JetFuel/Vungle. As a consumer browsing the App Store, it looks like Mango Labs makes a lot of fun consumer apps of which Fontmaker is simply the latest.

JetFuel’s website helps to promote this image, too.

It had showcased its influencer marketing system using a case study from an “indie developer” called Mango Labs and one of its earlier apps, Caption Pro. Caption Pro launched in Jan. 2018. (App Annie data indicates it was removed from the App Store on Aug. 31, 2021…yes, yesterday).

Image Credits: App Annie

Vungle, however, told TechCrunch “The Caption Pro app no longer exists and has not been live on the App Store or Google Play for a long time.” (We can’t find an App Annie record of the app on Google Play).

They also told us that “Caption Pro was developed by Mango Labs before the entity became JetFuel,” and that the case study was used to highlight JetFuel’s advertising capabilities. (But without clearly disclosing their connection.)

“Prior to JetFuel becoming the influencer marketing platform that it is today, the company developed apps for the App Store. After the company pivoted to become a marketing platform, in February 2018, it stopped creating apps but continued to use the Mango Labs account on occasion to publish apps that it had third-party monetization partnerships with,” the Vungle spokesperson explained.

In other words, the claim being made here is that while Mango Labs, originally, were the same folks who have long since pivoted to become JetFuel, and the makers of Caption Pro, all the newer apps published under “Mango Labs, LLC” were not created by JetFuel’s team itself.

“Any apps that appear under the Mango Labs LLC name on the App Store or Google Play were in fact developed by other companies, and Mango Labs has only acted as a publisher,” the spokesperson said.

Image Credits: JetFuel’s website describing Mango Labs as an “indie developer”

There are reasons why this statement doesn’t quite sit right — and not only because JetFuel’s partners seem happy to hide themselves behind Mango Labs’ name, nor because Mango Labs was a project from the JetFuel team in the past. It’s also odd that Mango Labs and another entity, Takeoff Labs, claim the same set of apps. And like Mango Labs, Takeoff Labs is associated with JetFuel too.

Breaking this down, as of the time of writing, Mango Labs has published several consumer apps on both the App Store and Google Play.

On iOS, this includes the recent No. 1 app Fontmaker, as well as FontKey, Color Meme, Litstick, Vibe, Celebs, FITme Fitness, CopyPaste, and Part 2. On Google Play, it has two more: Stickered and Mango.

Image Credits: Mango Labs

Most of Mango Labs’ App Store listings point to JetFuel’s website as the app’s “developer website,” which would be in line with what Vungle says about JetFuel acting as the apps’ publisher.

What’s odd, however, is that the Mango Labs’ app Part2, links to Takeoff Labs’ website from its App Store listing.

The Vungle spokesperson initially told us that Takeoff Labs is “an independent app developer.”

And yet, the Takeoff Labs’ website shows a team which consists of JetFuel’s leadership, including JetFuel co-founder and CEO Tim Lenardo and JetFuel co-founder and CRO JJ Maxwell. Takeoff Labs’ LLC application was also signed by Lenardo.

Meanwhile, Takeoff Labs’ co-founder and CEO Rhai Goburdhun, per his LinkedIn and the Takeoff Labs website, still works there. Asked about this connection, Vungle told us they did not realize the website had not been updated, and neither JetFuel nor Vungle have an ownership stake in Takeoff Labs with this acquisition.

Image Credits: Takeoff Labs’ website showing its team, including JetFuel’s co-founders.

Takeoff Labs’ website also shows off its “portfolio” of apps, which includes Celeb, Litstick, and FontKey — three apps that are published by Mango Labs on the App Store.

On Google Play, Takeoff Labs is the developer credited with Celebs, as well as two other apps, Vibe and Teal, a neobank. But on the App Store, Vibe is published by Mango Labs.

Image Credits: Takeoff Labs’ website, showing its app portfolio.

(Not to complicate things further, but there’s also an entity called RealLabs which hosts JetFuel, The Plug and other consumer apps, including Mango — the app published by Mango Labs on Google Play. Someone sure likes naming things “Labs!”)

Vungle claims the confusion here has to do with how it now uses the Mango Labs iTunes account to publish apps for its partners, which is a “common practice” on the App Store. It says it intends to transfer the apps published under Mango Labs to the developers’ accounts, because it agrees this is confusing.

Vungle also claims that JetFuel “does not make nor own any consumer apps that are currently live on the app stores. Any of the apps made by the entity when it was known as Mango Labs have long since been taken down from the app stores.”

JetFuel’s system is messy and confusing, but so far successful in its goals. Fontmaker did make it to No. 1, essentially growth hacked to the top by influencer marketing.

Congrats to @Rhai_Gb & the @Takeoff_Labs team- it's great to be back at #1 overall 🙌

Also a huge accomplishment for @jetfuel_it as the only user acquisition source. The first time we've single-handedly moved an app to #1 Top Free! https://t.co/Cl8ahj8Owo

— Tim L (@telenardo) August 25, 2021

But as a consumer, what this all means is that you’ll never know who actually built the app you’re downloading or whether you were “influenced” to try it through what were, essentially, undisclosed ads.

Fontmaker isn’t the first to growth hack its way to the top through influencer promotions. Summertime hit Poparrazzi also hyped itself to the top of the App Store in a similar way, as have many others. But Poparazzi has since sunk to No. 89 in Photo & Video, which shows influence can only take you so far.

As for Fontmaker, paid influence got it to No. 1, but its Top Chart moment was brief.

Facebook enters the fantasy gaming market

By Sarah Perez

Facebook is getting into fantasy sports and other types of fantasy games. The company this morning announced the launch of Facebook Fantasy Games in the U.S. and Canada on the Facebook app for iOS and Android. Some games are described as “simpler” versions of the traditional fantasy sports games already on the market, while others allow users to make predictions associated with popular TV series, like “Survivor” or “The Bachelorette.”

The first game to launch is Pick & Play Sports, in partnership with Whistle Sports, where fans get points for correctly predicting the winner of a big game, the points scored by a top player, or other events that unfold during the match. Players can also earn bonus points for building a streak of correct predictions over several days. This game is arriving today.

Image Credits: Facebook

In the months ahead, it will be followed by other games in sports, TV, and pop culture, including Fantasy Survivor, where players choose a set of Castaways from the popular CBS TV show to join their fantasy team and Fantasy “The Bachelorette,” where fans will pick a group of men from the suitors vying for the Bachelorette’s heart and get points based on their actions and events that take place during the show. Other upcoming sports-focused games include MLB Home Run Picks, where players pick the team that they think will hit the most home runs, and LaLiga Winning Streak, where fans predict the team that will win that day.

In addition to top players being featured on leaderboards, games have a social component for those who want to play with friends.

Image Credits: Facebook

Players can create their own fantasy league with friends to compete with one another or against other fans, either publicly or privately. League members can compare scores with each other and will have a place where they can share picks, reactions and comments. This league area resembles a private group on Facebook, as it offers its own compose box for posting only to members and its own dedicated feed. However, the page is designed to support groups with specific buttons to “play” or view the “leaderboard,” among others.

The addition of fantasy games could help Facebook increase the time users spent on its app at a time when the company is facing significant competition in social, namely from TikTok. According to App Annie, the average monthly time spent per user in TikTok grew faster than other top social apps in 2020, including by 70% in the U.S., surpassing Facebook.

Facebook had dabbled in the idea of becoming a second screen companion for live events in the past, but in a different way than fantasy sports and games. Instead, its R&D division tested Venue, which worked as a way for fans to comment on live events which were hosted in the app by well-known personalities.

The new league games will be available from the bookmark menu on the mobile app and in News Feed through notifications.

TikTok adds educational resources for parents as part of its Family Pairing feature

By Sarah Perez

TikTok is expanding its in-app parental controls feature, Family Pairing, with educational resources designed to help parents better support their teenage users, the company announced morning. The pairing feature, which launched to global users last year, allows parents of teens aged 13 and older to connect their accounts with the child’s so the parent can set controls related to screen time use, who the teen can direct message, and more. But the company heard from teens that they also want their voices to be heard when it comes to parents’ involvement in their digital life.

To create the new educational content, TikTok partnered with the online safety nonprofit, Internet Matters. The organization developed a set of resources in collaboration with teens that aim to offer parents tips about navigating the TikTok landscape and teenage social media usage in general.

Teens said they want parents to understand the rules they’re setting when they use features like Family Pairing and they want them to be open to having discussions about the time teens spend online. And while teens don’t mind when parents set boundaries, they also want to feel they’ve earned some level of trust from the adults in their life.

The older teens get, the more autonomy they want to have on their own device and social networks, as well. They may even tell mom or dad that they don’t want them to follow them on a given platform.

This doesn’t necessarily mean the teen is up to no good, the new resources explain to parents. The teens just want to feel like they can hang out with their friends online without being so closely monitored. This has become an important part of the online experience today, in the pandemic era, where many younger people are spending more time at home instead of socializing with friends in real-life or participating in other in-person group activities.

Image Credits: TikTok

Teens said they also want to be able to come to parents when something goes wrong, without fearing that they’ll be harshly punished or that the parent will panic about the situation. The teens know they’ll be consequences if they break the rules, but they want parents to work through other tough situations with them and devise solutions together, not just react in anger.

All this sounds like straightforward, common sense advice, but parents on TikTok often have varying degrees of comfort with their teens’ digital life and use of social networks. Some basic guidelines that explain what teens want and feel makes sense to include. That said, the parents who are technically savvy enough to enable a parental control feature like Family Pairing may already be clued into best practices.

Image Credits: TikTok

In addition, this sort of teen-focused privacy and safety content is also designed to help TikTok better establish itself as a platform working to protect its younger users — an increasingly necessary stance in light of the potential regulation which big tech has been trying to ahead of, as of late. TikTok, for instance, announced in August it would roll out more privacy protections for younger teens aimed to make the app safer. Facebook, Google and YouTube also did the same.

TikTok says parents or guardians who have currently linked their account to a teen’s account via the Family Pairing feature will receive a notification that prompts them to find out more about the teens’ suggestions and how to approach those conversations about digital literacy and online safety. Parents who sign up and enable Family Pairing for the first time, will also be guided to the resources.

Reframe your Metaphors, and other lessons from Y Combinator S21 Day 1

By Natasha Mascarenhas

After a 17-hour marathon through nearly 200 startup pitches, the Equity team was fired up to get back on Twitter and chat through some early trends and favorites from the first day of Y Combinator’s demo party. We’ll be back on the air tomorrow, so make sure you’re following the show on Twitter so you don’t miss out.

What did Natasha and Alex chat about? The following:

  • First impressions: We started by going through top-line numbers, geographic breakdown, and how the accelerator is doing when it comes to the representation of diverse founders. The last bit had a tiny bit of progress, but diversity continues to be an issue in YC’s batches — even as cohort size grows. We also chatted about what startups pitching can work on: like better mics, which are cheap and good.
  • Our early favorites: Metaphor, Lumify, Alex’s favorite duo Indian real estate plays, Akudo, Reframe and Playhouse.
  • And some hmmm moments, including our thoughts on Writesonic, which Natasha has a potentially paranoid theory on.

TechCrunch has extensive coverage of the day on the site, so there’s lots to dig into if you are in the mood. More tomorrow!

Equity drops every Monday at 7:00 a.m. PDT, Wednesday, and Friday at 6:00 a.m. PDT, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts!

TikTok’s new Creator Marketplace API lets influencer marketing companies tap into first-party data

By Sarah Perez

TikTok is making it easier for brands and agencies to work with the influencers using its service. The company is rolling out a new “TikTok Creator Marketplace API,” which allows marketing companies to integrate more directly with TikTok’s Creator Marketplace, the video app’s in-house influencer marketing platform.

On the Creator Marketplace website, launched in late 2019, marketers have been able to discover top TikTok personalities for their brand campaigns, then create and manage those campaigns and track their performance.

The new API, meanwhile, allows partnered marketing companies to access TikTok’s first-party data about audience demographics, growth trends, best-performing videos and real-time campaign reporting (e.g. views, likes, shares, comments, engagement, etc.) for the first time.

They can then bring this data back into their own platforms, to augment the insights they’re already providing to their own customer base.

TikTok is not officially announcing the API until later in September, but it is allowing its alpha partners to discuss their early work.

One such partner is Captiv8, which tested the API with an NRF top 50 retailer on one of their first TikTok campaigns. The retailer wanted to discover a diverse and inclusive group of TikTok creators to partner with on a new collaboration and wanted help with launching its own TikTok channel. Captiv8 says the branded content received nearly 10 million views, and the campaign resulted in a “significant increase” in several key metrics, which performed above the Nielsen average. This included familiarity (+4% above average), affinity (+6%), purchase intent (+7%) and recommendation intent (+9%).

Image Credits: TikTok Creator Marketplace website

Capitv8 is now working with TikTok’s API to pull in audience demographics, to centralize influencer offers and activations, and to provide tools to boost branded content and monitor campaign performance. On that last front, the API allows the company to pull in real-time metrics from the TikTok Creator Marketplace API — which means Capitv8 is now one of only a handful of third-party companies with access to TikTok first-party data.

Another early alpha partner is Influential, which shared it’s also leveraging the API to access first-party insights on audience demographics, growth trends, best-performing videos and more, to help its customer base of Fortune 1000 brands to identify the right creators for both native and paid advertising campaigns.

One partner it worked with was DoorDash, which launched multiple campaigns on TikTok with Influential’s help. It’s also planning to work with McDonald’s USA on several new campaigns that will run this year, including those focused on the chain’s new Crispy Chicken Sandwich and the return of Spicy McNuggets.

Other early alpha partners include Whalar and INCA. The latter’s integration stems from the larger TikTok global partnership with WPP, announced in February. That deal provided WPP agencies with early access to new advertising products marketing API integrations, and new AR offerings, among other things.

Creator marketplaces are now common to social media platforms with large influencer communities as this has become a standard way to advertise to online consumers, particularly the younger generation. Facebook today offers its Brands Collabs Manager, for both Facebook and Instagram; YouTube has BrandConnect; while Snapchat recently announced a marketplace to connect brands with Lens creators. These type of in-house platforms make it easier for marketers to work with the wider influencer community by offering trusted data on metrics that matter to brands’ own ROI, rather than relying on self-reported data from influencers or on data they have to manually collect themselves. And as campaigns run, marketers can compare how well their partnered creators are able to drive results to inform their future collaborations.

TikTok isn’t making a formal announcement about its new API at this time, telling TechCrunch the technology is still in pilot testing phases for the time being.

“Creators are the lifeblood of our platform, and we’re constantly thinking of new ways to make it easy for them to connect and collaborate with brands. We’re thrilled to be integrating with an elite group of trusted partners to help brands discover and work with diverse creators who can share their message in an authentic way,” said Melissa Yang, TikTok’s head of Ecosystem Partnerships, in a statement provided to select marketing company partners.

Update, 8/31/21, 3:22 PM ET: INCA is currently using the API in the U.S. and U.K. An earlier version said it was U.K. only, based on information provided by TikTok. We’ve since corrected. 

TikTok bans viral ‘milk crate challenge’ over safety concerns

By Aisha Malik

TikTok has banned the popular “milk crate challenge” from its platform due to concerns that users participating in the trend could be seriously injured. The challenge saw TikTok users stacking milk crates into a pyramid and then attempting to climb across the unstable structure.

A spokesperson from the company told TechCrunch in an email that “TikTok prohibits content that promotes or glorifies dangerous acts, and we remove videos and redirect searches to our Community Guidelines to discourage such content. We encourage everyone to exercise caution in their behavior whether online or off.”

In most videos depicting the trend, TikTok users are seen tumbling to the ground as they try to climb up one side of the makeshift pyramid and down the other. The ban comes after several healthcare workers took to social media to voice their concerns about the trend and the danger it poses to those participating in it.

Searching for the trend’s hashtag on the app now brings up a “no results found” notice. The search results page notifies users that “this phrase may be associated with behavior or content that violates our guidelines. Promoting a safe and positive experience is TikTok’s top priority.” However, some videos depicting the trend are still visible on the app if users search for incorrect spellings of keywords associated with the challenge, such as “milk craate” or “milk cratee.” It’s worth noting that although these videos don’t have a significant amount of views, they’ve still managed to slip through the cracks of the ban and remain on the app.

TikTok’s rise to popularity has seen numerous dangerous challenges go viral on the platform over the past few years. In 2019, a popular “throw it in the air” trend involved TikTok users forming a circle where nobody is allowed to move and then putting a phone on the floor to record them throwing an item up in the air on top of themselves to see who the object hits on its way down. Last year, a popular “skull-breaker” trend that went viral on the app prompted criminal charges after a teen was hospitalized as a result of the challenge. The trend involved tricking a person to fall backward on their head.

Dangerous trends like these, including the most recent milk crate challenge, have forced TikTok to take action to prevent its users from putting themselves in harmful situations.

TikTok is building its own AR development platform, TikTok Effect Studio

By Sarah Perez

Both Facebook and Snap offer tools that allow developers to build out augmented reality (AR) experiences and features for their own respective family of apps. Now, TikTok is looking to do the same. The company recently launched a new creative toolset called TikTok Effect Studio, currently in private beta testing, which will allow its own developer community to build AR effects for TikTok’s short-form video app.

On a new website titled “Effect House,” TikTok asks interested developers to sign up for early access to Effect Studio.

On the form provided, developers fill out their name, email, TikTok account info, company, and level of experience with building for AR, as well as examples of their work. The website also asks if they’re using a Mac or PC (presumably to gauge which desktop platform to prioritize), and whether they would test Effect House for work or for personal use.

The project was first spotted by social media consultant Matt Navarra, via a tip from Sam Schmir.

TikTok is launching an Effects Studio in beta

h/t @Sam_Schmir pic.twitter.com/K3LS5S2Yoq

— Matt Navarra (@MattNavarra) August 14, 2021

TikTok confirmed to TechCrunch the website launched earlier in August, but the project itself is still in the early stages of testing in only a few select markets, one of which is the U.S.

The company couldn’t offer a timeframe as to when these tools would become more broadly available. Instead, TikTok characterized Effect Studio as an early “experiment,” adding that some of its experiments don’t always make it to launch. Plus, other experiments may undergo significant changes between their early beta phases and what later becomes a public product.

That said, the launch of an AR toolset would make TikTok more competitive with industry rivals, who today rely on creative communities to expand their apps’ features sets with new features and experiences. Snap, for example, launched a $3.5 million fund last year directed toward Snapchat AR Lens creation. Meanwhile, at Facebook’s F8 developer conference in June, the company announced it had grown its Spark AR platform to over 600,000 creators across 190 countries, making it the largest mobile AR platform worldwide.

Image Credits: screenshot of TikTok website

TikTok, too, has been increasing its investment in developer tools over the past couple of years. However, its focus as of late has been on toolkits aimed at third-party developers who want to integrate more closely with TikTok in their own apps. Today, TikTok’s developer website provides access to tools that allow app makers to add TikTok features to their apps like user authentication flows, sound sharing, and others that allow users to publish videos from a third-party editing app out to TikTok.

The new TikTok Effect Studio isn’t meant to be used with third-party apps, however.

Instead, it’s about building AR experiences (and possibly, other creative effects), that would be provided to TikTok users directly in the consumer-facing video app.

Though willing to confirm its broader goals for TikTok Effect Studio, the company declined to share specific details about the exact tools may be included, citing the project’s early days.

“We’re always thinking about new ways to bring value to our community and enrich the TikTok experience,” a TikTok spokesperson told TechCrunch. “Currently, we’re experimenting with ways to give creators additional tools to bring their creative ideas to life for the TikTok community,” they added.

This Week in Apps: OnlyFans bans sexual content, SharePlay delayed, TikTok questioned over biometric data collection

By Sarah Perez

Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Top Stories

OnlyFans to ban sexually explicit content

OnlyFans logo displayed on a phone screen and a website

(Photo Illustration by Jakub Porzycki/NurPhoto via Getty Images)

Creator platform OnlyFans is getting out of the porn business. The company announced this week it will begin to prohibit any “sexually explicit” content starting on October 1, 2021 — a decision it claimed would ensure the long-term sustainability of the platform. The news angered a number of impacted creators who weren’t notified ahead of time and who’ve come to rely on OnlyFans as their main source of income.

However, word is that OnlyFans was struggling to find outside investors, despite its sizable user base, due to the adult content it hosts. Some VC firms are prohibited from investing in adult content businesses, while others may be concerned over other matters — like how NSFW content could have limited interest from advertisers and brand partners. They may have also worried about OnlyFans’ ability to successfully restrict minors from using the app, in light of what appears to be soon-to-come increased regulations for online businesses. Plus, porn companies face a number of other issues, too. They have to continually ensure they’re not hosting illegal content like child sex abuse material, revenge porn or content from sex trafficking victims — the latter which has led to lawsuits at other large porn companies.

The news followed a big marketing push for OnlyFans’ porn-free (SFW) app, OFTV, which circulated alongside reports that the company was looking to raise funds at a $1 billion+ valuation. OnlyFans may not have technically needed the funding to operate its current business — it handled more than $2 billion in sales in 2020 and keeps 20%. Rather, the company may have seen there’s more opportunity to cater to the “SFW” creator community, now that it has big names like Bella Thorne, Cardi B, Tyga, Tyler Posey, Blac Chyna, Bhad Bhabie and others on board.

U.S. lawmakers demand info on TikTok’s plans for biometric data collection

The TikTok logo is seen on an iPhone 11 Pro max

The TikTok logo is seen on an iPhone 11 Pro max. Image Credits: Nur Photo/Getty Images

U.S. lawmakers are challenging TikTok on its plans to collect biometric data from its users. TechCrunch first reported on TikTok’s updated privacy policy in June, where the company gave itself permission to collect biometric data in the U.S., including users’ “faceprints and voiceprints.” When reached for comment, TikTok could not confirm what product developments necessitated the addition of biometric data to its list of disclosures about the information it automatically collects from users, but said it would ask for consent in the case such data collection practices began.

Earlier this month, Senators Amy Klobuchar (D-MN) and John Thune (R-SD) sent a letter to TikTok CEO Shou Zi Chew, which said they were “alarmed” by the change, and demanded to know what information TikTok will be collecting and what it plans to do with the data. This wouldn’t be the first time TikTok got in trouble for excessive data collection. Earlier this year, the company paid out $92 million to settle a class-action lawsuit that claimed TikTok had unlawfully collected users’ biometric data and shared it with third parties.

Weekly News

Platforms: Apple

Image Credits: Apple

  • ⭐ Apple told developers that some of the features it announced as coming in iOS 15 won’t be available at launch. This includes one of the highlights of the new OS, SharePlay, a feature that lets people share music, videos and their screen over FaceTime calls. Other features that will come in later releases include Wallet’s support for ID cards, the App Privacy report and others that have yet to make it to beta releases.
  • Apple walked back its controversial Safari changes with the iOS 15 beta 6 update. Apple’s original redesign had shown the address bar at the bottom of the screen, floating atop the page’s content. Now the tab bar will appear below the page’s content, offering access to its usual set of buttons as when it was at the top. Users can also turn off the bottom tab bar now and revert to the old, Single Tab option that puts the address bar back at the top as before.
  • In response to criticism over its new CSAM detection technology, Apple said the version of NeuralHash that was reverse-engineered by a developer, Asuhariet Ygvar, was a generic version, and not the complete version that will roll out later this year.
  • The Verge dug through over 800 documents from the Apple-Epic trial to find the best emails, which included dirt on a number of other companies like Netflix, Hulu, Sony, Google, Nintendo, Valve, Microsoft, Amazon and more. These offered details on things like Netflix’s secret arrangement to pay only 15% of revenue, how Microsoft also quietly offers a way for some companies to bypass its full cut, how Apple initially saw the Amazon Appstore as a threat and more.

Platforms: Google

  • A beta version of the Android Accessibility Suite app (12.0.0) which rolled out with the fourth Android beta release added something called “Camera Switches” to Switch Access, a toolset that lets you interact with your device without using the touchscreen. Camera Switches allows users to navigate their phone and use its features by making face gestures, like a smile, open mouth, raised eyebrows and more.
  • Google announced its Pixel 5a with 5G, the latest A-series Pixel phone, will arrive on August 27, offering IP67 water resistance, long-lasting Adaptive Battery, Pixel’s dual-camera system and more, for $449. The phone makes Google’s default Android experience available at a lower price point than the soon to arrive Pixel 6.
  • An unredacted complaint from the Apple-Epic trial revealed that Google had quietly paid developers hundreds of millions of dollars via a program known as “Project Hug,” (later “Apps and Games Velocity Program”) to keep their games on the Play Store. Epic alleges Google launched the program to keep developers from following its lead by moving their games outside the store.

Augmented Reality

  • Snap on Thursday announced it hired its first VP of Platform Partnerships to lead AR, Konstantinos Papamiltiadis (“KP”). The new exec will lead Snap’s efforts to onboard partners, including individual AR creators building via Lens Studio as well as large companies that incorporate Snapchat’s camera and AR technology (Camera Kit) into their apps. KP will join in September, and report to Ben Schwerin, SVP of Content and Partnerships.

Fintech

  • Crypto exchange Coinbase will enter the Japanese market through a new partnership with Japanese financial giant Mitsubishi UFJ Financial Group (MUFG). The company said it plans to launch other localized versions of its existing global services in the future.

Social

Image Credits: Facebook

  • Facebook launched a “test” of Facebook Reels in the U.S. on iOS and Android. The new feature brings the Reels experience to Facebook, allowing users to create and share short-form video content directly within the News Feed or within Facebook Groups. Instagram Reels creators can also now opt in to have their Reels featured on users’ News Feed. The company is heavily investing its its battle with TikTok, even pledging that some portion of its $1 billion creator fund will go toward Facebook Reels.
  • Twitter’s redesign of its website and app was met with a lot of backlash from users and accessibility experts alike. The company choices add more visual contrast between various elements and may have helped those with low vision. But for others, the contrast is causing strain and headaches. Experts believe accessibility isn’t a one-size fits all situation, and Twitter should have introduced tools that allowed people to adjust their settings to their own needs.
  • The pro-Trump Twitter alternative Gettr’s lack of moderation has allowed users to share child exploitation images, according to research from the Stanford Internet Observatory’s Cyber Policy Center.
  • Pinterest rolled out a new set of more inclusive search filters that allow people to find styles for different types of hair textures — like coily, curly, wavy, straight, as well as shaved or bald and protective styles. 

Photos

  • Photoshop for iPad gained new image correction tools, including the Healing Brush and Magic Wand, and added support for connecting an iPad to external monitors via HDMI or USB-C. The company also launched a Photoshop Beta program on the desktop.

Messaging

  • WhatsApp is being adopted by the Taliban to spread its message across Afghanistan, despite being on Facebook’s list of banned organizations. The company says it’s proactively removing Taliban content — but that may be difficult to do since WhatsApp’s E2E encryption means it can’t read people’s texts. This week, Facebook shut down a Taliban helpline in Kabul, which allowed civilians to report violence and looting, but some critics said this wasn’t actually helping local Afghans, as the group was now in effect governing the region.
  • WhatsApp is also testing a new feature that will show a large preview when sharing links, which some suspect may launch around the time when the app adds the ability to have the same account running on multiple devices.

Streaming & Entertainment

  • Netflix announced it’s adding spatial audio support on iPhone and iPad on iOS 14, joining other streamers like HBO Max, Disney+ and Peacock that have already pledged to support the new technology. The feature will be available to toggle on and off in the Control Center, when it arrives.
  • Blockchain-powered streaming music service Audius partnered with TikTok to allow artists to upload their songs using TikTok’s new SoundKit in just one click.
  • YouTube’s mobile app added new functionality that allows users to browse a video’s chapters, and jump into the chapter they want directly from the search page.
  • Spotify’s Anchor app now allows users in global markets to record “Music + Talk” podcasts, where users can combine spoken word recordings with any track from Spotify’s library of 70 million songs for a radio DJ-like experience.
  • Podcasters are complaining that Apple’s revamped Podcasts platform is not working well, reports The Verge. Podcasts Connect has been buggy, and sports a confusing interface that has led to serious user errors (like entire shows being archived). And listeners have complained about syncing problems and podcasts they already heard flooding their libraries.

Dating

  • Tinder announced a new feature that will allow users to voluntarily verify their identity on the platform, which will allow the company to cross-reference sex offender registry data. Previously, Tinder would only check this database when a user signed up for a paid subscription with a credit card.

Gaming

Image Source: The Pokémon Company

  • Pokémon Unite will come to iOS and Android on September 22, The Pokémon Company announced during a livestream this week. The strategic battle game first launched on Nintendo Switch in late July.
  • Developer Konami announced a new game, Castlevania: Grimoire of Souls, which will come exclusively to Apple Arcade. The game is described as a “full-fledged side-scrolling action game,” featuring a roster of iconic characters from the classic game series. The company last year released another version of Castelvania on the App Store and Google Play.
  • Dragon Ball Z: Dokkan Battle has now surpassed $3 billion in player spending since its 2015 debut, reported Sensor Tower. The game from Bandai Namco took 20 months to reach the figure after hitting the $2 billion milestone in 2019. The new landmark sees the game joining other top-grossers, including Clash Royale, Lineage M and others.
  • Sensor Tower’s mobile gaming advertising report revealed data on top ad networks in the mobile gaming market, and their market share. It also found puzzle games were among the top advertisers on gaming-focused networks like Chartboost, Unity, IronSource and Vungle. On less game-focused networks, mid-core games were top titles, like Call of Duty: Mobile and Top War. 

Image Credits: Sensor Tower

Health & Fitness

  • Apple is reportedly scaling back HealthHabit, an internal app for Apple employees that allowed them to track fitness goals, talk to clinicians and coaches at AC Wellness (a doctors’ group Apple works with) and manage hypertension. According to Insider, 50 employees had been tasked to work on the project.
  • Samsung launched a new product for Galaxy smartphones in partnership with healthcare nonprofit The Commons Project, that allows U.S. users to save a verifiable copy of their vaccination card in the Samsung Pay digital wallet.

Image Credits: Samsung

Adtech

Government & Policy

  • China cited 43 apps, including Tencent’s WeChat and an e-reader from Alibaba, for illegally transferring user data. The regulator said the apps had transferred users location data and contact list and harassed them with pop-up windows. The apps have until August 25 to make changes before being punished.

Security & Privacy

  • A VICE report reveals a fascinating story about a jailbreaking community member who had served as a double agent by spying for Apple’s security team. Andrey Shumeyko, whose online handles included JVHResearch and YRH04E, would advertise leaked apps, manuals and stolen devices on Twitter and Discord. He would then tell Apple things like which Apple employees were leaking confidential info, which reporters would talk to leakers, who sold stolen iPhone prototypes and more. Shumeyko decided to share his story because he felt Apple took advantage of him and didn’t compensate him for the work.

Funding and M&A

💰 South Korea’s GS Retail Co. Ltd will buy Delivery Hero’s food delivery app Yogiyo in a deal valued at 800 billion won ($685 million USD). Yogiyo is the second-largest food delivery app in South Korea, with a 25% market share.

💰 Gaming platform Roblox acquired a Discord rival, Guilded, which allows users to have text and voice conversations, organize communities around events and calendars and more. Deal terms were not disclosed. Guilded raised $10.2 million in venture funding. Roblox’s stock fell by 7% after the company reported earnings this week, after failing to meet Wall Street expectations.

💰 Travel app Hopper raised $175 million in a Series G round of funding led by GPI Capital, valuing the business at over $3.5 billion. The company raised a similar amount just last year, but is now benefiting from renewed growth in travel following COVID-19 vaccinations and lifting restrictions.

💰 Indian quiz app maker Zupee raised $30 million in a Series B round of funding led by Silicon Valley-based WestCap Group and Tomales Bay Capital. The round values the company at $500 million, up 5x from last year.

💰 Danggeun Market, the publisher of South Korea’s hyperlocal community app Karrot, raised $162 million in a Series D round of funding led by DST Global. The round values the business at $2.7 billion and will be used to help the company launch its own payments platform, Karrot Pay.

💰 Bangalore-based fintech app Smallcase raised $40 million in Series C funding round led by Faering Capital and Premji Invest, with participation from existing investors, as well as Amazon. The Robinhood-like app has over 3 million users who are transacting about $2.5 billion per year.

💰 Social listening app Earbuds raised $3 million in Series A funding led by Ecliptic Capital. Founded by NFL star Jason Fox, the app lets anyone share their favorite playlists, livestream music like a DJ or comment on others’ music picks.

💰 U.S. neobank app One raised $40 million in Series B funding led by Progressive Investment Company (the insurance giant’s investment arm), bringing its total raise to date to $66 million. The app offers all-in-one banking services and budgeting tools aimed at middle-income households who manage their finances on a weekly basis.

Public Markets

📈Indian travel booking app ixigo is looking to raise Rs 1,600 crore in its initial public offering, The Economic Times reported this week.

📉Trading app Robinhood disappointed in its first quarterly earnings as a publicly traded company, when it posted a net loss of $502 million, or $2.16 per share, larger than Wall Street forecasts. This overshadowed its beat on revenue ($565 million versus $521.8 million expected) and its more than doubling of MAUs to 21.3 million in Q2.  Also of note, the company said dogecoin made up 62% of its crypto revenue in Q2.

Downloads

Polycam (update)

Image Credits: Polycam

3D scanning software maker Polycam launched a new 3D capture tool, Photo Mode, that allows iPhone and iPad users to capture professional-quality 3D models with just an iPhone. While the app’s scanner before had required the use of the lidar sensor built into newer devices like the iPhone 12 Pro and iPad Pro models, the new Photo Mode feature uses just an iPhone’s camera. The resulting 3D assets are ready to use in a variety of applications, including 3D art, gaming, AR/VR and e-commerce. Data export is available in over a dozen file formats, including .obj, .gtlf, .usdz and others. The app is a free download on the App Store, with in-app purchases available.

Jiobit (update)

Jiobit, the tracking dongle acquired by family safety and communication app Life360, this week partnered with emergency response service Noonlight to offer Jiobit Protect, a premium add-on that offers Jiobit users access to an SOS Mode and Alert Button that work with the Jiobit mobile app. SOS Mode can be triggered by a child’s caregiver when they detect — through notifications from the Jiobit app — that a loved one may be in danger. They can then reach Noonlight’s dispatcher who can facilitate a call to 911 and provide the exact location of the person wearing the Jiobit device, as well as share other details, like allergies or special needs, for example.

Tweets

When your app redesign goes wrong…

Image Credits: Twitter.com

Prominent App Store critic Kosta Eleftheriou shut down his FlickType iOS app this week after too many frustrations with App Review. He cited rejections that incorrectly argued that his app required more access than it did — something he had successfully appealed and overturned years ago. Attempted follow-ups with Apple were ignored, he said. 

Image Credits: Twitter.com

Anyone have app ideas?

China roundup: Beijing takes stake in ByteDance, Amazon continues China crackdown

By Rita Liao

Hello and welcome back to TechCrunch’s China roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

This week, investors’ concerns mount as news came that the Chinese government has taken a stake ByteDance, TikTok’s parent and one of the world’s largest private internet firms. Meanwhile, Amazon’s crackdown on Chinese sellers continues and is forcing many traders in southern China out of business, and the government passed a sweeping data protection law that will take effect in November.

A state stake

The Chinese government’s grand plan to assert more control over the country’s internet behemoths continues. This week, The Information reported that a domestic entity of ByteDance sold a 1% stake to a government affiliate in April. The deal was also recorded on Tianyancha, a database of publicly available corporate information, as well as the official enterprise registration index.

The move didn’t come abruptly. Beijing was mulling over small shares in private tech firms as early as 2017. The Wall Street Journal reported at the time that internet regulators discussed taking 1% stakes in companies including WeChat operator Tencent, Twitter-like Weibo and YouTube-like Youku.

In April 2020, WangTouTongDa, a subsidiary of China Internet Investment Fund, which is in turn controlled by China’s top internet watchdog, acquired a 1% stake in Weibo for 10 million yuan, according to Weibo’s filing to the U.S. securities regulator. Weibo did not mention WangTouTongDa’s relationship with the state in its filing.

Similarly, ByteDance sold a 1% stake to three entities set up by top regulatory bodies: China Internet Investment Fund; China Media Group, controlled by the Communist Party’s propaganda department; and the Beijing municipal government’s investment arm.

In response to Beijing’s move on ByteDance, Republican senator Marco Rubio urged President Joe Biden this week to block TikTok in the U.S.

Exactly how much power Beijing gains over ByteDance from taking the small stake remains fuzzy, but Weibo’s disclosure to investors offers some clues.

It’s critical to note that the government holds stakes in the domestic operating entity of both Weibo and ByteDance. Internet companies in China often set up offshore entities that are entitled to the financial benefits of their mainland Chinese operations through contractual agreements. The framework is called a variable interest entity or VIE. While the structure allows Chinese firms to seek overseas funding due to China’s restrictions on foreign investments, it has come under increasing scrutiny by Beijing.

Weibo said in the filing that WangTouTongda, its state-owned investor, will be able to appoint a director to the three-member board of its Chinese entity and veto certain matters related to content and future financings.

ByteDance likely has a similar arrangement with its state investor. The government did not obtain a stake in TikTok, which is a subsidiary of a separate offshore entity incorporated in the Cayman Islands, The Information pointed out. This should provide some reassurance to U.S. regulators, though concerns about Beijing’s sway in Chinese companies abroad probably won’t go away.

Indeed, the Biden administration in June replaced the Trump-era orders to ban ByteDance and WeChat with a more measured policy requiring the Commerce Department to review apps with ties to “jurisdiction of foreign adversaries” that may pose national security risks.

TikTok has been fighting accusations that it hands over user data to Beijing. ByteDance is the fourth-largest lobbying spender in the U.S. so far this year, just after Amazon, Facebook and Alphabet. Beijing’s investment is going to cost it more campaign efforts.

Beleaguered Amazon sellers

In May, I reported that Amazon shuttered some of its largest sellers from China over violations of platform rules, including using fake reviews and incentives to solicit positive reviews from customers. The crackdown drove China’s online exporters into a panic, and as it turned out, it wasn’t a one-off ambush from Amazon but a prolonged war. While the exact number of Chinese stores affected is not disclosed, industry observers such as Marketplace Pulse said “hundreds of” top Chinese sellers had been suspended as of early July.

Punished accounts are suspended, with their goods withheld and deposits frozen by Amazon. Companies in Shenzhen, home to the majority of the world’s Amazon sellers, laid off thousands of staff in recent months. The owner of a sizable seller in Shenzhen recently died by suicide due to the debacle, according to an acquaintance of the owner.

To sellers that have survived the crackdown, the attack by Amazon “would have happened sooner or later.” Most of the exporters I talked to came to the same conclusion: The Seattle-based titan now wants quality and design over generic products that compete solely on price and manipulation of ranking.

The Chinese government has taken note of the incidents. An official from the Ministry of Commerce compared the wave of store closures as Chinese exporters being “fish out of water” during a press conference in July.

“Due to differences in laws, culture and business practices around the world, [Chinese] companies are facing risks and challenges as they go overseas,” said Li Xingqian, director of foreign trade at the Commerce Ministry.

“We will help companies improve their risk control and comply with international trade standards.” Meanwhile, the official called for “the platform/platforms to cherish the important contribution from various companies and fully respect different trade entities.”

Data protection

And finally, China passed a sweeping data protection law this week that will strictly limit how tech companies collect user information, but the rules won’t likely have an impact on state surveillance. The regulation, which was proposed last year, will take effect on November 1. Read more about the rules here:

SiriusXM launches ‘TikTok Radio,’ a music channel featuring viral hits hosted by TikTok stars

By Amanda Silberling

If viral TikTok songs like Dr. Dog’s “Where’d All the Time Go?” or Bo Burnham’s “Bezos I” weren’t already stuck in your head on loop, now they could be. Today SiriusXM launched a TikTok Radio channel, which features TikTok creators as channel hosts. The station is designed to sound like a “radio version of the platform’s ‘For You’ feed,” Sirius XM said.

SiriusXM, parent company to Pandora, announced this music channel in May, teasing the launch with curated Pandora playlists from influencers like Bella Poarch, whose lipsync video of Millie B’s “Soph Aspin Send [M to the B]” is the most liked video on TikTok.

With its TikTok partnership, SiriusXM is looking to capture a younger audience — on the TikTok app itself, DJ Habibeats (@djhabibeats) and DJ CONST (@erinconstantineofficial) will each go live on TikTok each week while DJing on TikTok Radio. Other creator hosts on TikTok Radio — like Billy (@8illy), Cat Haley (@itscathaley), HINDZ (@hindzsight), Lamar Dawson (@dirrtykingofpop), and Taylor Cassidy (@taylorcassidyj) — will deliver “The TikTok Radio Trending Ten,” a weekly countdown of songs trending on TikTok. To promote the station during its first week, artists like Ed Sheeran, Lil Nas X, and Normani will appear on air.

Music has such a strong footing in TikTok culture that it regularly influences the Billboard charts — Fleetwood Mac’s “Rumours,” originally released in 1978,” appeared in the top 10 Billboard albums again in 2020 after it was featured in a viral TikTok. Even a Fortnite-themed parody of Estelle’s “American Boy” — originally uploaded in 2018 to YouTube  — had a beautiful moment on TikTok. 

“We’re so excited to launch TikTok Radio on SiriusXM, which opens up artists and creators like this amazing group of hosts to new audiences,” said Ole Obermann, TikTok’s Global Head of Music, in a statement. “Now SiriusXM subscribers will have a new road to discover the latest trends in music and get a first listen to tomorrow’s musical superstars. The channel captures song-breaking music culture that creates so much joy and entertainment on TikTok through video in an all-audio format.”

Though SiriusXM’s subscriber base continues to expand — it saw a 34% year-over-year growth from last year to now — it still dwarfs in comparison to streaming giants like Spotify, which has 165 million paid users. SiriusXM reported a total of 34.5 million subscribers as of Q2 this year, the most it’s ever had, but even Apple Music and Amazon Music have reported nearly double the subscribers. Pandora has 6.5 million paid subscribers. Over the last few years, SiriusXM and Pandora have struck deals with companies like SoundCloud, Simplecast and Stitcher to become more competitive in both music and podcast streaming. 

Still, other streaming companies have also shown interest in the market of Gen Z-ers on TikTok who want to listen to full versions of the catchy songs they hear in short videos. Apple Music and Spotify both host curated “viral hits” playlists. But a full-time satellite music channel is taking the trend a step further.

In growing battle with TikTok, Facebook to test ‘Facebook Reels’ in the US

By Sarah Perez

Reels are coming to Facebook in the U.S. The company this morning announced it will begin testing a new feature, Facebook Reels, which will give Facebook users the ability to create and share short-form video content directly within the News Feed or within Facebook Groups. The addition is an expansion of tests launched earlier this year in India, Mexico and Canada, which had focused on bringing short-form videos to Facebook users, including by sharing existing Instagram Reels to Facebook, as had been reported.

In addition, Facebook today says it will also test a new feature that will give Instagram creators in the U.S. the option to have their Instagram Reels shown as recommended content on Facebook. If the creators opt in, their videos will appear in the “Reels” section in users’ News Feed, alongside other Reels created on Facebook.

There will be many places where users can create Reels from Facebook, as the new feature launches.

Initially, you’ll be able to tap a “Create” button from the Reels’ section that appears as you scroll the News Feed, while you’re watching Reels, or by tapping on “Reels” at the top of your News Feed. From here, users will gain access to a standard set of creation tools, including those for video capture, music selection, camera roll import, timed text, and more — much like you would have access to on Instagram.

For audio, you can either choose a song from Facebook’s music library, record your own original audio, or even use someone else’s audio, if their Reels are set to “public.” There are also a variety of effects and editing tools to choose from, including a timer for recording Reels hands-free, tools to speed up or slow down a part of the video or your original audio, and a number of augmented reality effects created either by Facebook or third-party developers.

Facebook told us that, for the time being, “most” of Instagram Reels’ features will also be available on Facebook Reels. But other features — like Remix (its take on TikTok’s side-by-side videos called Duets) — will be added over time as the test scales to more people. The user interface for Reels may also evolve over time to look somewhat different from Reels on Instagram, depending on user feedback.

After a Reel has been created, you can choose who to share it with — such as “Friends,” a specific audience like “Friends except…”, or the general public. The latter is the default setting.

The feature will be made available within Facebook Groups, where Reels can be created then shared with members of the community who have similar interests.

Users can also choose to tap into “My Reels,” to view past creations. And you can browse Reels created by others in the News Feed, and in select Groups and Pages — where you can like, comment or share them, just as you could with any other type of post. Reels will now be surfaced in Search results, too, Facebook told us.

Like much of what appears on Facebook, Reels will be recommended to users based on what people are interested in, what they engage with, and what’s broadly popular. This will apply to both the shared Instagram Reels and the Facebook Reels.

Image Credits: Facebook (Reels in Groups)

The company explained the decision to replicate the Reels product inside Facebook is a result of consumers’ growing interest in video, and particularly short-form video. Today, video accounts for almost half of all time spent on Facebook, in fact. On Facebook’s latest earnings call, CEO Mark Zuckerberg remarked that Reels was “already the largest contributor to engagement growth on Instagram,” given the popularity of short-form video.

“We’re very focused on making it easy for anyone to create video, and then for those videos to be viewed across all of our different services, starting with Facebook and Instagram first,” he had told investors.

But Facebook also understands that people have different communities and audiences on Instagram and Facebook, so simply offering a cross-posting option may not have sufficed.

However, for existing Reels creators who do want to tap into Facebook’s large audience, a new option will allow them to opt-in to have their Reels shared to Facebook. This could be useful for those producing more general-interest Reels content.

These shared Reels will display the creator’s Instagram username, as well, which could help them to build a following. Creators’ Reels can also be remixed, with the creator’s permission, and their original audio can be re-used in other people’s Reels — again, much like on TikTok.

This feature will also be first introduced as a “test,” Facebook said.

While Instagram is already beginning to monetize Reels through ads, Facebook told us that Reels on Facebook don’t currently include ads. But: “we plan to roll out ads in the future,” a Facebook spokesperson added.

Image Credits: Facebook (sharing Instagram Reels to Facebook opt-in flow)

Reels, which is Facebook’s answer to the growing threat of TikTok, first launched to global audiences a year ago. This launch alone was not enough to win Instagram the top spot as the world’s most downloaded mobile app. In 2020, that win went to TikTok, after years where Facebook-owned apps dominated the top charts. And TikTok today continues to sit at the top of App Store charts in terms of both app installs and consumer spending, according to multiple third-party reports. 

For Facebook, TikTok represents an existential threat to its business. If users’ time and attention are being spent elsewhere, Facebook’s advertisers could then follow, impacting Facebook’s bottom line. So instead of competing with TikTok in just one app, Facebook is now using two. And it’s leveraging its apps’ interoperability to ensure the best content can easily flow to both places.

The company is also directly investing in the creator community in hopes of tipping the scales back in its direction.

In July, the company announced a plan to invest over $1 billion in creators across both Facebook and Instagram through 2022. This fund will reward more than just Reels’ creators, to be clear, as it will also pay out bonuses for videos with in-stream ads enabled or for enabling IGTV ads, among other things. It will also bonus top creators who have invited fans to send them tips in the form of a virtual currency, “stars.” But Instagram Reels, and now Facebook Reels, will be looped into that initiative.

Today, Facebook said it will announce additional bonus programs and seed funding in the months ahead that will pay out bonuses for Reels on Facebook. These will be funded from that $1 billion commitment. The company declined to share details on this front, but this news alone indicates Facebook Reels is far more than just “a test” in Facebook’s eyes.

The new Facebook Reels features will begin to roll out starting today, Aug. 19, in the U.S. It will first be available to a “small percentage” of U.S. users on iOS and Android.

The feature will continue to operate in India, Mexico and Canada, as well.

Senators challenge TikTok’s ‘alarming’ plan to collect users’ voice and face biometrics

By Carly Page

TikTok’s plans to collect biometric identifiers from its users has prompted concern among U.S. lawmakers, who are demanding the company reveal exactly what information it collects and what it plans to do with that data.

In a letter sent earlier this month addressed to TikTok CEO Shou Zi Chew, Sens. Amy Klobuchar (D-MN) and John Thune, (R-SD) say they are “alarmed” by the recent change to TikTok’s privacy policy, which allows the company to “automatically collect biometric data, including certain physical and behavioral characteristics from video content posted by its users.”

TechCrunch first reported details of the new privacy policy back in June, when TikTok said it will seek “required permissions” to collect “faceprints and voiceprints” where required by law, but failed to elaborate on whether it’s considering federal law, states laws, or both (only a handful of U.S. states have biometric privacy laws, including Illinois, Washington, California, Texas and New York).

Klobuchar and Thune’s letter asks TikTok to explicitly explain what constitutes a “faceprint” and “voiceprint”, as well as to explain how this data will be used and how long it will be retained. The senators also quizzed TikTok on whether any data is gathered for users under the age of 18; whether it makes any inferences about its users based on the biometric data it collects; and to provide a list of all third parties that have access to the data.

“The coronavirus pandemic led to an increase in online activity, which has magnified the need to protect consumers’ privacy,” the letter reads. “This is especially true for children and teenagers, who comprise more than 32% of TikTok’s active users and have relied on online applications such as TikTok for entertainment and for interaction with their friends and loved ones.”

TikTok has been given until August 25 to respond to the lawmakers’ questions. A TikTok spokesperson did not immediately comment.

This isn’t the first time TikTok’s excessive data collection plans have come under scrutiny. Earlier this year, the company paid out $92 million to settle a class-action lawsuit claiming it unlawfully collected users’ biometric data and shared it with third parties. This came after the FTC in 2019 slapped TikTok with a $5.7 million fine for violating the Children’s Online Privacy Protection Act (COPPA), which requires apps to receive parental permission before collecting a minor’s data.

Reddit is quietly rolling out a TikTok-like video feed button on iOS

By Amanda Silberling

From Instagram’s Reels to Snapchat’s Spotlight, most social media platforms are looking toward the TikTok boom for inspiration. Now, even Reddit, a discussion-based forum, is making short-form video more pronounced on its iOS app.

According to Reddit, most iOS users should have a button on their app directly to the right of the search bar — when tapped, it will show a stream of videos in a TikTok-like configuration. When presented with a video, (which shows the poster who uploaded it and the subreddit it’s from), users can upvote or downvote, comment, gift an award, or share it. Like TikTok, users can swipe up to see another video, feeding content from subreddits the user is subscribed to, as well as related ones. For instance, if you’re subscribed to r/printmaking, you might see content from r/pottery or r/bookbinding.

The user interface of the videos isn’t new — Reddit has been experimenting with this format over the last year. But before, this manner of watching Reddit videos was only accessible by tapping on a video while scrolling through your feed — rather than promoting discovery of other communities, the first several videos recommended would be from the same subreddit.

Images of new Reddit features

Image Credits: Reddit, screenshots by TechCrunch

“Reddit’s mission is to bring community and belonging to everyone in the world, and subsequently, Reddit’s video team’s mission is to bring community through video,” a Reddit spokesperson told TechCrunch, about the new addition. “Over the course of the last year, our goal was to build a unified video player, and re-envision the player interface to match what users (new and old) expect when it comes to an in-app video player — especially commenting, viewing, engaging, and discovering new content and communities through video,” they noted.

Reddit doesn’t yet have a timeline for when the feature will roll out to everyone, but confirmed that this icon first appeared for some users in late July and has continued to roll out to almost all iOS users. But by placing a broader, yet still personalized video feed on the home screen, Reddit is signaling a growing curiosity in short form video. In December 2020, Reddit acquired Dubsmash, a Brooklyn-via-Berlin-based TikTok competitor. The terms of the deals were undisclosed, but Facebook and Snap also reportedly showed interest in the platform, which hit 1 billion monthly views in January 2020.

Reddit declined to comment on whether or not its new video player is using an algorithm to promote discovery of new subreddits based on user activity. However, a Reddit spokesperson confirmed that the company will use Dubsmash’s technology to develop other features down the road, though not for this particular product, they said.

Reddit first launched its native video platform in 2017, which allows users to upload MP4 and MOV files to the site. Then, in August 2019, it launched RPAN (Reddit Public Access Network), which lets people livestream to the r/pan subreddit — the most popular live streams are promoted across the platform. Reddit currently attracts 50 million daily active visitors and hosts 100,000 active subreddits.

TikTok to add more privacy protections for teenaged users, limit push notifications

By Sarah Perez

TikTok today becomes the latest tech company to roll out increased protections for minors on its platform in the wake of increased regulatory scrutiny. The company says it will introduce a series of product changes for teen users aged 13 to 17, aimed at making their TikTok experience more private, safer and less addictive. TikTok’s news follows similar moves recently announced by other tech companies catering to teens, including Google and YouTube, as well as Instagram.

The changes TikTok plans to roll out over the coming months will address in-app messaging, the public nature of users’ videos, the default download settings for videos and TikTok’s use of push notifications.

This expands on the changes to privacy settings and defaults for users under the age of 18 that TikTok introduced in January. At the time, TikTok debuted stricter rules for teens aged 13 to 15 and slightly more permissive settings for users 16 to 17 focused on default account types, commenting and the use of TikTok’s interactive features, like Stitch and Duet.

Now, TikTok says new users aged 16 to 17 will have their Direct Message setting be set to “No One” by default and existing users would be prompted to review and confirm their settings the next time they use the messaging feature.

The company won’t prevent teens from using Direct Messages, however, but they will have to make a more explicit choice to do so.

The app will also now display a pop-up message when a teen under the age of 16 publishes their first video that asks them to choose who can watch their content — either followers, friends only or only themselves. (The “Everyone” option is disabled.) Before, TikTok had limited who would come across the accounts belonging to teens under the age of 16, which would reduce the visibility of their content to only followers they approved, when using the default settings. Now, it’s more directly pushing teens to make a choice about how public they want their content to be — and they have to decide in order for the video to be published, TikTok notes.

Image Credits: TikTok

TikTok also said it will disable Duet and Stitch for users under 16, but this is not new — it was a part of the privacy changes that rolled out in January.

Separately, teens 16 to 17 will now be asked to make a decision about whether or not their videos can be downloaded by others. While TikTok won’t prevent the teens from making their content downloadable, it will pop up a box that asks them to reconfirm their choice, while reminding them that this means the videos could be shared to other platforms. (Downloads remain disabled for users 13 to 15, meanwhile.)

Image Credits: TikTok

The final change is perhaps the most interesting because it’s something neither YouTube nor Instagram introduced: TikTok will limit push notifications.

Younger teens ages 13 to 15 won’t receive any push notifications after 9 PM, while those aged 16 to 17 won’t receive any notifications after 10 PM.

This part of the update is reflective of TikTok’s global mindset and its parent company’s Chinese roots. Today, China is in the midst of a tech crackdown, encompassing antitrust regulations, data security practices, tech business models and even social mores — like the addictive nature of video games, which state media equated to a drug like “opium.”

TikTok, too, has been called out as one of the most addictive social apps on the market, thanks to its advanced personalization technology, interactive design and simple interface, and psychological tricks that activate the pleasure center of users brains. The company already inserts “take a break” videos inside its main feed, because users have been losing hours to scrolling the app. Its decision to limit notifications is yet another acknowledgment of the app’s ability to lead users — and particularly younger users — to create negative digital media habits. By preventing notifications during certain hours, TikTok can point potential regulators to a feature that demonstrates it’s doing something to address that problem.

The changes come at a time when there’s a broader shift in the industry in terms of how tech companies cater to their younger users, as concerns about screen time, addictiveness, online abuse, data collection, privacy and more have been brought to light.

In the U.S., Congress has been pressuring companies to do more to protect younger users from the more harmful and negative impacts of technology.

One key piece of legislation in the works is an update to the decades-old children’s privacy law, COPPA (Children’s Online Privacy Protection Act). A new bill, the Protecting the Information of our Vulnerable Children and Youth Act, would expand COPPA to include teens under the age of 18 and prevent tech companies from using targeted advertising, among other things.

As a result, tech companies have been revamping their products to make teens’ experience more private and they’ve increased protections, including over how teens’ data is collected and used by advertisers.

TikTok was early to take action on protections to teens, as a result of the multimillion-dollar fine by the U.S. Federal Trade Commission for earlier violations of children’s privacy laws in a crackdown by the government agency that later extended to YouTube. Beyond the privacy changes from earlier in the year and take a break reminders, TikTok also led the market by bundling parent controls inside its app with the Family Pairing feature. The company also offers other resources for parents, including educational safety videos and parental guides. And it brought in outside experts to advise on policy creation, with the introduction of the TikTok Content Advisory Council.

“Our priority is to ensure teens on TikTok have a safe and age-appropriate experience as they create and share on our platform,” said Tracy Elizabeth, TikTok’s Global Minor Safety Policy Lead, in a statement about today’s changes. “This announcement builds on our industry-leading efforts to make all accounts under 16 private by default, age-restrict features like direct messaging, and empower parents with Family Pairing,” she said.

Link-in-bio monetization platform Snipfeed raises a $5.5M seed round

By Amanda Silberling

The link-in-bio business is heating up as more mobile website builders compete for a coveted slice of real estate on a creator’s TikTok, Instagram, or Twitter. Linktree leads the space, securing a recent $45 million Series B raise to build out e-commerce features, but Beacons boasts competitive creator monetization tools with just a $6 million seed round in May. Now, Snipfeed enters the ring with its own $5.5 million seed round, including investments from CRV, Abstract Ventures, Crossbeam (Ali Hamed), id8, Michael Ovitz (founder of CAA), Michael Bosstick, Diaspora Ventures, and others.

Linktree has been around since 2016 and has more funding than its up-and-coming competitors. But for creators seeking to monetize their following, these newer platforms may be more attractive to some creators, since they already have built-in tools to help them monetize their followings. Linktree currently supports tipping on the platform for users subscribed to its $6 Linktree Pro platform, but Snipfeed offers a wider range of monetization options; some creators are making over $20,000 per month on the platform, according to CEO and co-founder Rédouane Ramdani.

Snipfeed started as a content discovery platform with 44,000 weekly active users — but when Snipfeed added a creator monetization tool to its platform, it became its most popular feature. So, in February 2020, with little to no funding left, the company completely pivoted to its current link-in-bio business. Since then, Snipfeed has amassed 50,000 registered users, with the user base growing 500% in the last six months (Linktree, for comparison, has over 12 million users).

Based in Paris and Los Angeles, Snipfeed’s 15-person staff is particularly interested in the “long tail” of creators, which it says encompasses over 46 million people.

“Content creator doesn’t necessarily mean you’re going to be the next Addison Rae or a TikTok star,” explained Ramdani. “It means that you might be a doctor or lawyer, and on top of that, you’re going to have a TikTok where you explain how to file your taxes and that kind of stuff. They have this expertise, and they’re wondering, ‘How can I turn that into a side-hustle?'”

Image Credits: Snipfeed

In addition to a standard tipping tool, Snipfeed allows users to sell digital goods, like on-demand video, ebooks, access to livestreams, and one-on-one consultations. But Snipfeed’s biggest differentiator is its Cameo-like system for selling personalized content. For example, TikToker maylikethemonthh uses Snipfeed to sell asynchronous, video-recorded tarot readings. While asking a single, personalized astrology question costs $5, a more in-depth reading can cost up to $20 or $40.

Snipfeed is free to set up, but if you make sales, the company takes 15% — this percentage is inclusive of any transaction fees. Through Snipfeed’s referral program, creators can make 5% of sales from anyone they onboard to the platform (this comes out of Snipfeed’s commission).

“We decided to go with this model because we really want to have a relationship where we help the creators really make money. We only make money if they make money,” Ramdani said.

If a creator or celebrity were to sell personalized videos on Cameo, they’d lose 25% to the platform. Meanwhile, Beacons takes 9% of sales from its free version, and 5% from its $10 per month version, which offers more customization, integrations, analytics.

Image Credits: Snipfeed

Still, depending on the type of creator, the features that each link-in-bio startup offers might matter more than the cost. Beacons allows users to share a shopping-enabled TikTok feed, which could be huge a money-maker for creators that often share product recommendations with affiliate links, which give them a commission from sales. Ramdani said that astrologers have been particularly successful on Snipfeed, since fans can book a variety of asynchronous services at a wide range of prices. But these features could benefit any creator who can profit from answering followers’ specific questions — a chef could offer recipe ideas based on what’s in a fan’s fridge, or a life coach could make a personalized video if a follower requests advice.

With its $5.5 million in seed funding, Snipfeed plans to build out its e-commerce tools so that creators can sell physical products on their link-in-bio (Beacons and Linktree are also working on this with their recent funding rounds — but Beacons’ and Snipfeed’s seed rounds are small compared to Linktree’s Series B). The company also wants to develop educational content to show its users how to best monetize their platform — if Snipfeed can help its creators make money, then it’ll make more money too.

Index Ventures’ trio of new funds leads to $3 billion, and more TikTok

By Natasha Mascarenhas

Index Ventures has closed a trio of new funds: a $900 million early-stage fund, a $2 billion growth-stage fund and a previously announced $200 million seed-stage fund. The close gives Index $3 billion in new capital, its largest tranche yet, to deploy into emerging startups and existing portfolio companies, which include the likes of Plaid, Deliveroo and Revolut, which was just valued at $33 billion.

Index’s new capital comes a little over a year since it closed its last funds, which were a duet of $1.2 billion for growth-stage investments and $800 million for early-stage investments. It also is announced while venture dollars more broadly seem to be growing at an unprecedented rate — In recent weeks, Accel announced that it has closed $3 billion across three funds, too, and Andreessen Horowitz landed a $2.2 billion fund dedicated entirely to crypto startups.

The influx of money means that check sizes and valuations are growing across the entire ecosystem. Index, for example, said that it has grown its Series A check size from $10 million to $15 million, while it increased its growth check from $35 million to $50 million. Its check size in the United States is about 20% higher compared to its check size in Europe, meaning that the former represents between 55% to 60% of the firm’s total investing dollars.

While Index’s check size is growing slightly bigger to keep up with competition, partner Mark Goldberg said that the firm is staying disciplined so it doesn’t fall prey to FOMO rounds or buzzy valuations.

“There have been situations where two years ago, I would have engaged,” in a competition for a late-stage round, he said. “And now I say that we probably are not going to compete … because at the heart of the matter, I think capital is a commodity.” The partner didn’t point to Accel’s $3 billion close, but instead noted how “Tiger Global and other crossover funds” have created a new capital product, which means that Index’s ability to compete must look different than just offering a ton of money.

“If you’re just looking for capital, we’re probably not going to be the best product for you,” Goldberg added.

Index Partner Martin Mignot thinks that a “bifurcation is really happening” in the fundraising market, where some founders are able to raise easily, but many continue to struggle if they’re not “at the right sector in the right place at the right time.” Mignot has been spending time looking at Africa as a potential investment area that continues to be underresourced. He hinted that an official initiative focused on Africa startups may be underway.

The firm said it has “several initiatives in place related to diversity including increasing the number of individuals on our investment from underrepresented groups and diversifying our investment funnel” but said that it does not track diversity statistics at a portfolio company level “yet.” Index said that its investment team is composed of 38% of individuals who identify as female and 14% of individuals who come from underrepresented groups, although its unclear whether they have check-writing power.

Index appears to be going through a period of experimentation when it comes to the services offered to portfolio companies. While the firm declined to give too many specifics on upcoming initiatives around diversity or more generally, it did note its growing TikTok presence as part of its strategy.

The Index Ventures TikTok has over 28,000 followers. Its most viewed video is about Costco’s business model, with 4.8 million views followed by an interview clip from Scale AI founder Alexandr Wang, with 315,000 views.

“It’s not something where I think the next deal comes from the TikTok account, but it’s one of those initiatives where … I think it will pay dividends” in helping Index reach a younger audience that isn’t active on tech Twitter or Clubhouse. Index’s TikTok, led by Rex Woodbury, is reminiscent of how some emerging fund managers are approaching creative deal flow.

The firm is also experimenting with incubating startups in-house, which has historically never been a major focus. A tweet suggests that Index is actively recruiting entrepreneurs to join the incubator, which could be divided thematically. Goldberg declined to give more specifics around how incubation programs are structured and what the terms are, saying that the Index Incubator is not an official product yet.

That said, one can only imagine that a firm freshly capitalized with billions of dollars probably has some money to spare — from incubated projects to those growth-stage companies in need of active investors.

China Roundup: What’s going on with China’s data security clampdown?

By Rita Liao

Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world.

A tectonic shift is underway in how Beijing regulates and accesses the troves of citizen data collected by its tech giants. More details of China’s new cybersecurity rules have recently come to light as Didi, the SoftBank-backed ride-sharing dominator in China, became the target of the Chinese government’s latest effort to heighten data protection. This week, we look at what this changing landscape means to Chinese tech firms wooing investors in the United States.

Data sovereignty

The new wave of discussion around China’s cybersecurity rules started with the bombshell dropped on Didi. Just two days after its $4 billion IPO in New York, the ride-hailing giant was hit with a probe by China’s Cybersecurity Review Office on July 2. Two days later, the same government agency ordered the Didi app, which has amassed nearly 500 million annual users, to be yanked because it was “illegally collecting user data.”

The Cybersecurity Review Office is an agency within the Cyberspace Administration of China, the country’s top internet regulator. It has existed for a few years but its roles were only made clear in April 2020 when China put forward its rules on internet security reviews.

Didi appears to be the first target of the department’s enforcement actions. A memo of an “expert meeting” shared among Didi’s investors, which TechCrunch reviewed, said the ride-hailing firm had failed to assure Beijing its data practices were secure before going public in New York. A major concern was that Didi’s data, if unguarded by Chinese laws, could be subject to scrutiny by U.S. regulators. But a Didi executive claimed that the firm stored all its China data locally and it is “absolutely not possible” that it passed data to the U.S.

Before long, the Cybersecurity Review Office was onto other players that could similarly compromise the data security of Chinese users. On July 5, it put SoftBank-backed truck-sharing platform Full Truck Alliance and recruiting site Boss Zhipin — both of which recently IPO’ed in the U.S. — under the same review process as it did with Didi.

The probes were just the beginning. On July 10, the Cybersecurity Review Office unveiled the draft of a revised version of the data security review rules passed last year. One of the major changes is that any business commanding over one million users is subject to security checks if it is seeking an overseas IPO.

Just as the U.S. government frets over Chinese companies commanding Americans’ data, as in the case of TikTok, China is now making sure that its citizen data stays onshore and protected from U.S. authorities. Foreign players operating in China have to comply, too. Giants like Apple and Tesla have pledged and moved to store their Chinese user data within the country.

The new data rule is no doubt a stumbling block for Chinese companies that want to list abroad. TikTok owner ByteDance indefinitely put on hold its plans of a U.S. listing after Chinese officials told it to address data security risks, according to a report by The Wall Street Journal. But how about incumbents like Alibaba that have traded their stocks on Wall Street for years? And do the revised rules apply to companies listing in Hong Kong, which is being increasingly integrated with mainland China?

Also in the news

  • Tencent and Alibaba may tear down their “walled gardens.” According to The Wall Street Journal, the archrivals are considering opening their services to each other. This means users may be able to pay via Alipay on the WeChat app, which currently excludes Alibaba-affiliated Alipay. China has recently been working to rein in its tech darlings and already slapped anticompetition penalties on a cohort of tech firms. Jack Ma’s fintech behemoth Ant Group has been put on the spot and forced to restructure into a financial holding company that would potentially curb its profitability and subject it to more regulatory oversight.
  • TikTok tops 3 billion downloads from the App Store and Google Play, according to Sensor Tower. This makes the hit video platform the only app not owned by Facebook to cross the milestone across the two app stores, said the research firm, and it’s only the fifth one after WhatsApp, Messenger, Facebook and Instagram to achieve that. TikTok is also generating big bucks for ByteDance. Globally, it has made more than $2.5 billion in consumer spending since its launch.
  • Tencent ups its stake in food delivery giant Meituan to 17.2%The deal cost Tencent, a longtime patron of Meituan, $400 million. The proceeds will allow Meituan to invest further in “cutting edge tech” such as unmanned delivery cars and drones, an area where other tech firms have also made similar promises to automate parcel and food deliveries.
  • The smart vehicle craze continues. These days, hardly a week goes by without a major announcement by an autonomous driving or smart car company in China. The news last week came from Banma, which was set up by Alibaba and state-owned carmaker SAIC Motor to make internet-connected cars. It just raised $460 million from Alibaba and SAIC Motor, among others and claimed its technology now serves three million users. It raised its first round in 2018 with 1.6 billion yuan (around $250 million) and was already valued at over $1 billion at the time.

Numerade lands $100M valuation for short-form STEM videos

By Natasha Mascarenhas

Edtech entrepreneurs are using their moment in the sun to rethink the structures and impact of nearly every aspect of modern-day learning, from the art of testing to the reality of information retention. Yet, the most popular product up for grabs may just be a seemingly simple one: the almighty tutoring session. Numerade, an edtech founded in 2018, just had its take on scalable, high-quality tutoring sessions valued at $100 million.

Numerade sells subscriptions to short-form videos that explain how certain equations and experiments work, and then uses an algorithm to make those explainers better suited to a learner’s comprehension style. Per CEO and co-founder Nhon Ma, the startup’s focus on asynchronous, contextualized content will make it easier to scale high-quality tutoring at an affordable price.

“Real teaching involves sight and sound, but also the context of how something is delivered in the vernacular of how a student actually learns,” Ma said. And he wants Numerade to be a platform that goes beyond the robotic Q&A and step-by-step answer platforms such as Wolfram Alpha, and actually integrates science into how solutions are communicated to users.

Today, the company announced that it has raised $26 million at a $100 million valuation in a round including investors such as IDG Capital, General Catalyst, Mucker Capital, Kapor Capital, Interplay Ventures, and strategic investors such as Margo Georgiadis, the former CEO of Ancestry, Khaled Helioui, the former CEO of Bigpoint Games and angel investor in Uber, and Taavet Hinrikus, founder of Wise.

“There are supply and demand mechanics inherent to synchronous tutoring,” Ma said. He explained how the best tutors have limited time, may demand premiums, and overall lead to a constraint on the supply side of marketplaces. Group tutoring has been an option employed by some companies, pairing multiple students to one tutor for efficiency saake, but he thinks that it is “really outdated, and actually decreases the quality of tutoring.”

With Numerade avoiding both live learning and Wolfram-Alpha style explainers that just give the answer to students, the company has turned to a third option: videos. Videos are not new to edtech, but currently majorly reside in massive open online course providers such as Coursera or Udemy, or ‘edutainment’ platforms like MasterClass and Outschool. Numerade thinks that teacher-led or educator-guided videos can be built around a specific problem within Chapter 2 of Fundamentals of Physics.

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Student learning from Numerade videos. Image Credits: Numerade

The company has three main products: bootcamp videos for foundational knowledge, step-by-step videos that turn that knowledge into a skill and focus on sequence, and finally, quizzes that assess how much of the aforementioned information was retained.

The true moonshot in the startup, though, is the algorithm that decides which students see which videos. When explaining how the algorithm works, Ma used words like “deep learning” and “computer vision” and “ontology” but mostly the algorithm boils down to this: it wants to bring TikTok-level specificity to educational videos, using users’ historical actions to better push certain content that fits their learning style.

For example, the startup believes that offering step-by-step videos help the brain understand patterns, diversity of problems, and eventually better understand solutions. The algorithm mostly shows up in Numerade quizzes, which will see how a student performs on a topic and then input those results back into the model to assumedly better cater a new series of bootcamps and questions.

“To help a student grow and learn, our model first understands their strengths and weaknesses and then surfaces relevant conceptual, practical, and assessment content to build their subject knowledge. The algorithm can parse structured data from videos and provide different teaching styles to suit the needs of all students,” he said.

As of now, Numerade’s algorithm appears preliminary. Users need to be paid subscribers and have a sufficient usage history in order to start benefiting from more targeted content. Even so, it’s unclear how the algorithm leads to different pedagogical content to students beyond resurfacing concepts that a student erred on in a previous quiz.

Numerade’s moonshot is built on an equally ambitious premise: that students want to learn concepts, not just Google for the fastest answer so they can finish procrastinated homework. Ma explained how engagement time on Numerade videos can be somewhere from double to triple the video’s entire length, which means that students are interacting with the content beyond just skipping over to the answer

Numerade isn’t alone in trying to take on Wolfram Alpha. Over the past year, edtech unicorns like Quizlet and Course Hero have invested heavily in AI-powered chatbots and live calculators, the latter largely through acquisitions of companies such as Numerade. These platforms are rallying around the idea that tech-powered tutoring sessions should prioritize speed and simplicity, instead of relationship-building and time. In other words, maybe students won’t go to a tutor once a week for math, but they will go to a platform that can methodically explain an answer at midnight, hours before their precalculus exam.

Despite its somewhat early-stage algorithm innovation and heavy-weigh competition, Numerade’s fresh venture backing and ability to bring in revenue is promising. While declining to divulge specifics, Ma said that the company is “quickly tracking” to eight figures in ARR, meaning it’s making at least $10 million in annual revenue from its current subscriber base. He sees perspective as Numerade’s biggest competitive advantage.

“A common criticism of commercial STEM education is that it’s too modular — textbooks teach physics as stand-alone,” Ma said. “Our algorithm does not, instead it treats STEM as an interlocking ecosystem; concepts in math, physics, chemistry, and biology are omnidirectionally related.”

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