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Soft Robotics raises $23 million from investors including industrial robot giant FANUC

Published January 20, 2020

Robotics startup company Soft Robotics has closed its Series B round of funding, raising $23 million led by Calibrate Ventures and Material Impact, and including participation from exiting investors including Honeywell, Yahama, Hyperplane and more. This round also brings in FANUC, the world’s largest maker of industrial robots and a recently announced strategic partner for Soft Robotics .

The company said in a press release announcing this latest round of funding that the round was oversubscribed, which suggests it isn’t looking to glut itself on capital investors, given that this $23 million follows a similarly sized $20 million round that closed in 2018 which it also referred to as “oversubscribed.” Prior to that, Soft Robotics had raised $5 million in a Series A round closed in 2015. It has plenty of large, global clients already, so it’s probably not hurting for revenue.

Soft Robotics is focused on developing robotic grippers that, as you might’ve guessed from the name, make use of soft material endpoints that can more easily grip a range of different objects without the kind of extremely specific and tolerance-allergic complex programming that’s required for most traditional industrial robotic claws.

With its 2018 funding raise, Soft Robotics said that it was expanding further into food and beverage, as well as doubling down on its presence in the retail and logistics industries. This round and its new partnership with FANUC (which involves a new integrated system that pairs its mGrip robotic gripper with a new Mini-P controller, all with simple integration to FANUC’s existing lineup of industrial robots) will give it strategic and functional access to what is the most influenentioal industrial robotics company in the world.

This round will specifically help Soft Robotics spend on growth, looking to increase its variability even further and work on expanding its food packaging and consumer goods applications, as well as diving into e-commerce and logistics – specifically to help automate and improve the returns process, a costly and ever-growing challenge as more retail moves online.

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France improves stock options policies for startup employees

Published January 20, 2020

A couple of weeks ago, France’s digital minister Cédric O announced some changes when it comes to stock options in France. President Emmanuel Macron is going to talk about the new policy today ahead of the World Economic Forum.

While I don’t want to be too technical, here’s a quick overview of the changes.

First, the price of stock options (also known as BSPCE in France) won’t be based on the same VC-determined valuation. Let’s take an example — a VC fund invests in a Series A round, valuing the company at €12 million.

If you join the company after, you can get stock options based on a lower valuation, which increases the chances of higher returns. Going forward, there will be a different valuation for employees getting stock options.

Second, if you work for a foreign startup but you’re based in France, you couldn’t receive stock options. For instance, if you’re a Citymapper employee — a startup that is headquartered in London — based out of the Paris office, you could forget about stock options. Employees based in France can now receive stock options even if the company isn’t incorporated in France.

Third, the French Tech Visa now also works for foreign companies with an office in Paris. If you work for Berlin-based N26 and you want to hire a great Brazilian data scientist in your Paris office, you can now go through the fast-track visa process for startup employees.

Last year, VC firm Index Ventures coordinated an effort to overhaul stock option policies across Europe by lobbying policymakers. Hundreds of tech CEOs have signed the ‘Not Optional’ letter since then.

According to Index Ventures, Germany, Spain and Belgium are the lowest-ranked European countries when it comes to the regulatory framework around stock options.

Loi de finances 2020 : des mesures fortes pour les startups et leurs salariés. Soutien continu et renforcé aux entreprises de la #FrenchTech qui créeront + de 25 000 emplois directs en 2020 partout en France et pour tous les niveaux de compétence #PLF2020 pic.twitter.com/4qGafp5zYH

— Cédric O (@cedric_o) December 30, 2019

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Open banking platform Tink raises €90M at a post-money valuation of €415M

Published January 20, 2020

Tink, the European open banking platform, is disclosing €90 million in new funding, just 11 months after the Sweden-headquartered company announced a €56 million round of funding.

Co-leading this new round is Dawn Capital, HMI Capital and Insight Partners. The round also includes the incumbent postal operator and Italy’s largest financial services network Poste Italiane as a new investor, along with existing investors Heartcore Capital, ABN AMRO Ventures and BNP Paribas’ venture arm, Opera Tech Ventures.

The injection of capital will enable Tink to accelerate its European expansion plans and further develop its product accordingly.

“During 2020, we are committed to building out our platform with more bank connections and, on top of that, expand our product offering,” Tink co-founder and CEO Daniel Kjellén tells me. “Our aim is to become the preferred pan-European provider of digital banking services and increase our local presence across the region”.

Originally launched in Sweden in 2013 as a consumer-facing finance app with bank account aggregation at its heart, Tink has long since repositioned its offering to become a fully-fledged open banking platform, requisite with developer APIs, to enable banks and other financial service providers to ride the open banking/PSD2 train.

Through its various APIs, Tink provides four pillars of technology: “Account Aggregation,” “Payment Initiation,” “Personal Finance Management” and “Data Enrichment.” These can be used by third parties to roll their own standalone apps or integrated into existing banking applications.

“We have grown significantly, both in terms of our platform’s connectivity and as an organisation,” says Kjellén, when asked what has changed in the last 11 months. “We have during the year launched our platform in Belgium, Austria, the U.K., Germany, Spain, the Netherlands, Portugal and Italy. In total, our open banking platform is right now live in twelve European markets and connects to more than 2,500 banks that reach more than 250 million bank customers across Europe”.

The company’s headcount has also grown a lot, too. In the beginning of 2019 it sat at around 120, but is now at 300 employees. Most but not all are based in its headquarters in Stockholm, alongside local offices including recently opened sites in Paris, Helsinki, Oslo, Madrid, Warsaw, Milan and Copenhagen.

Perhaps better positioned than most, I asked Kjellén what types of use cases are really resonating with open banking, given that many industry commentators don’t think it has quite yet lived up to the hype.

“Many of our customers are seeing the advantage of being able to build smart multi-banking products with the data that they are now able to fetch and use to add value for their end users,” he says. “The use cases that really show the potential of open banking that we see our customers thriving with are those that leverage the full value of the financial data to deliver truly personalised experiences at scale, or remove friction in the user journey to a minimum, such as proactive price comparison, enhanced credit scoring and onboarding. Use cases such as these show that the consumer’s data can really work for them and bring improvements to their everyday interactions”.

One example Kjellén gives me is Klarna, the checkout credit provider, which he says is using open banking to provide a “wonderful” in-app experience. “I love that I as a consumer can now choose to change my mind and slice up the payments for a purchase I have already paid in full with my bank card,” he explains. “This shows how the potential of open banking goes way beyond just accessing a transaction history and allows the most innovative players, such as Klarna, to create a new standard in consumer experience”.

Kjellén says another standout use-case is using PSD2 APIs to verify identity to complete any type of customer registration completely automatically. “[That is] something that I find very innovative. It automates the previously time-consuming administration on the business side and delivers a completely seamless digital service on the end user side,” he says.

Meanwhile, Tink says its customer numbers have “quadrupled” in the past year, and includes PayPal, Klarna, NatWest, ABN AMRO, BNP Paribas Fortis, Nordea and SEB. “More than 4,000 developers are currently using Tink to build and power new innovative financial services and products,” adds Kjellén.

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Samsung invests $500M to set up a smartphone display plant in India

Published January 19, 2020

Samsung, which once led India’s smartphone market, is investing $500 million in its India operations to set up a manufacturing plant at the outskirts of New Delhi to produce displays.

The company disclosed the investment and its plan in a filing to the local regulator earlier this month. The South Korean giant said the plant would produce displays for smartphones as well as a wide-range of other electronics devices.

In the filing, the company disclosed that it has allocated some land area from its existing factory in Noida for the new plant.

In 2018, Samsung opened a factory in Noida that it claimed was the world’s largest mobile manufacturing plant. For that factory, the company had committed to spend about $700 million.

The new plant should help Samsung further increase its capacity to produce smartphone components locally and access a range of tax benefits that New Delhi offers.

Those benefits would come in handy to the company as it faces off Xiaomi, the Chinese smartphone vendor that put an end to Samsung’s lead in India.

Samsung is now the second largest smartphone player in India, which is the world’s second largest market with nearly 500 million smartphone users. The company in recent months has also lost market share to Chinese brand Realme, which is poised to take over the South Korean giant in the quarter that ended in December last year, according to some analysts.

TechCrunch has reached out to Samsung for comment.

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TechCrunch’s Top 10 investigative reports from 2019

Published January 19, 2020

Facebook spying on teens, Twitter accounts hijacked by terrorists, and sexual abuse imagery found on Bing and Giphy were amongst the ugly truths revealed by TechCrunch’s investigating reporting in 2019. The tech industry needs more watchdogs than ever as its size enlargens the impact of safety failures and the abuse of power. Whether through malice, naivety, or greed, there was plenty of wrongdoing to sniff out.

Led by our security expert Zack Whittaker, TechCrunch undertook more long-form investigations this year to tackle these growing issues. Our coverage of fundraises, product launches, and glamorous exits only tell half the story. As perhaps the biggest and longest running news outlet dedicated to startups (and the giants they become), we’re responsible for keeping these companies honest and pushing for a more ethical and transparent approach to technology.

If you have a tip potentially worthy of an investigation, contact TechCrunch at tips@techcrunch.com or by using our anonymous tip line’s form.

Image: Bryce Durbin/TechCrunch

Here are our top 10 investigations from 2019, and their impact:

Facebook pays teens to spy on their data

Josh Constine’s landmark investigation discovered that Facebook was paying teens and adults $20 in gift cards per month to install a VPN that sent Facebook all their sensitive mobile data for market research purposes. The laundry list of problems with Facebook Research included not informing 187,000 users the data would go to Facebook until they signed up for “Project Atlas”, not receiving proper parental consent for over 4300 minors, and threatening legal action if a user spoke publicly about the program. The program also abused Apple’s enterprise certificate program designed only for distribution of employee-only apps within companies to avoid the App Store review process.

The fallout was enormous. Lawmakers wrote angry letters to Facebook. TechCrunch soon discovered a similar market research program from Google called Screenwise Meter that the company promptly shut down. Apple punished both Google and Facebook by shutting down all their employee-only apps for a day, causing office disruptions since Facebookers couldn’t access their shuttle schedule or lunch menu. Facebook tried to claim the program was above board, but finally succumbed to the backlash and shut down Facebook Research and all paid data collection programs for users under 18. Most importantly, the investigation led Facebook to shut down its Onavo app, which offered a VPN but in reality sucked in tons of mobile usage data to figure out which competitors to copy. Onavo helped Facebook realize it should acquire messaging rival WhatsApp for $19 billion, and it’s now at the center of anti-trust investigations into the company. TechCrunch’s reporting weakened Facebook’s exploitative market surveillance, pitted tech’s giants against each other, and raised the bar for transparency and ethics in data collection.

Protecting The WannaCry Kill Switch

Zack Whittaker’s profile of the heroes who helped save the internet from the fast-spreading WannaCry ransomware reveals the precarious nature of cybersecurity. The gripping tale documenting Marcus Hutchins’ benevolent work establishing the WannaCry kill switch may have contributed to a judge’s decision to sentence him to just one year of supervised release instead of 10 years in prison for an unrelated charge of creating malware as a teenager.

The dangers of Elon Musk’s tunnel

TechCrunch contributor Mark Harris’ investigation discovered inadequate emergency exits and more problems with Elon Musk’s plan for his Boring Company to build a Washington D.C.-to-Baltimore tunnel. Consulting fire safety and tunnel engineering experts, Harris build a strong case for why state and local governments should be suspicious of technology disrupters cutting corners in public infrastructure.

Bing image search is full of child abuse

Josh Constine’s investigation exposed how Bing’s image search results both showed child sexual abuse imagery, but also suggested search terms to innocent users that would surface this illegal material. A tip led Constine to commission a report by anti-abuse startup AntiToxin (now L1ght), forcing Microsoft to commit to UK regulators that it would make significant changes to stop this from happening. However, a follow-up investigation by the New York Times citing TechCrunch’s report revealed Bing had made little progress.

Expelled despite exculpatory data

Zack Whittaker’s investigation surfaced contradictory evidence in a case of alleged grade tampering by Tufts student Tiffany Filler who was questionably expelled. The article casts significant doubt on the accusations, and that could help the student get a fair shot at future academic or professional endeavors.

Burned by an educational laptop

Natasha Lomas’ chronicle of troubles at educational computer hardware startup pi-top, including a device malfunction that injured a U.S. student. An internal email revealed the student had suffered a “a very nasty finger burn” from a pi-top 3 laptop designed to be disassembled. Reliability issues swelled and layoffs ensued. The report highlights how startups operating in the physical world, especially around sensitive populations like students, must make safety a top priority.

Giphy fails to block child abuse imagery

Sarah Perez and Zack Whittaker teamed up with child protection startup L1ght to expose Giphy’s negligence in blocking sexual abuse imagery. The report revealed how criminals used the site to share illegal imagery, which was then accidentally indexed by search engines. TechCrunch’s investigation demonstrated that it’s not just public tech giants who need to be more vigilant about their content.

Airbnb’s weakness on anti-discrimination

Megan Rose Dickey explored a botched case of discrimination policy enforcement by Airbnb when a blind and deaf traveler’s reservation was cancelled because they have a guide dog. Airbnb tried to just “educate” the host who was accused of discrimination instead of levying any real punishment until Dickey’s reporting pushed it to suspend them for a month. The investigation reveals the lengths Airbnb goes to in order to protect its money-generating hosts, and how policy problems could mar its IPO.

Expired emails let terrorists tweet propaganda

Zack Whittaker discovered that Islamic State propaganda was being spread through hijacked Twitter accounts. His investigation revealed that if the email address associated with a Twitter account expired, attackers could re-register it to gain access and then receive password resets sent from Twitter. The article revealed the savvy but not necessarily sophisticated ways terrorist groups are exploiting big tech’s security shortcomings, and identified a dangerous loophole for all sites to close.

Porn & gambling apps slip past Apple

Josh Constine found dozens of pornography and real-money gambling apps had broken Apple’s rules but avoided App Store review by abusing its enterprise certificate program — many based in China. The report revealed the weak and easily defrauded requirements to receive an enterprise certificate. Seven months later, Apple revealed a spike in porn and gambling app takedown requests from China. The investigation could push Apple to tighten its enterprise certificate policies, and proved the company has plenty of its own problems to handle despite CEO Tim Cook’s frequent jabs at the policies of other tech giants.

Bonus: HQ Trivia employees fired for trying to remove CEO

This Game Of Thrones-worthy tale was too intriguing to leave out, even if the impact was more of a warning to all startup executives. Josh Constine’s look inside gaming startup HQ Trivia revealed a saga of employee revolt in response to its CEO’s ineptitude and inaction as the company nose-dived. Employees who organized a petition to the board to remove the CEO were fired, leading to further talent departures and stagnation. The investigation served to remind startup executives that they are responsible to their employees, who can exert power through collective action or their exodus.

If you have a tip for Josh Constine, you can reach him via encrypted Signal or text at (585)750-5674, joshc at TechCrunch dot com, or through Twitter DMs

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Taiwan’s entrepreneurs move forward after tense presidential election

Published January 18, 2020

Last Saturday, Taiwanese voters re-elected President Tsai Ing-wen to her second term after an election that split the country among generational and ideological lines. A crucial issue were the differences in how Tsai, a member of the Democratic Progressive Party (DPP), and her main opponent, Han Kuo-yu of the Kuomintang (KMT), approach Taiwan’s fraught relationship with China.

Despite the highly polarizing run-up to the election, however, both the DPP and KMT have taken measures to foster entrepreneurship in Taiwan. Now that Tsai has won, many investors don’t expect a dramatic impact, but instead are keeping an eye on how policies put in motion by both parties will play out. They are also looking for political allies who understand the startup ecosystem in Taiwan, which is often overshadowed by large hardware OEMs and semiconductor companies.

Policy

Joseph Huang, an investment partner at Infinity Ventures, has worked with both the DPP and KMT as limited partners, and says “from our side, they are always asking for how to create more awareness of Taiwan startups, how do we help them with institutions, how do we help them more?”

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Startups Weekly: Plaid’s $5.3B acquisition is a textbook Silicon Valley win

Published January 18, 2020

Hi everyone, my name is Eric Eldon and I’m the new writer of the Startups Weekly newsletter. 

I’ll be picking my favorite explicitly startup-focused articles of the week for you from Extra Crunch (where I’m the editor now), as well as TechCrunch (where I was the co-editor years ago… long story). 

Some people tell us that TechCrunch doesn’t cover startups like it used to. I don’t know if that is true, but it is definitely hard to keep track of our startup coverage mixed in with the rest of our news.

This newsletter will highlight the best startup coverage on TechCrunch and Extra Crunch to help fix that.

I probably hate reading bad startup advice and analysis even more than you do, and not only because I’ve had to read a lot of it over the years as an editor. I’ve also started a few companies myself, and I’ve had the chance to experience exits, failures and venture backing.

I’ll be highlighting articles that I think address something significant about building a company, and I’ll tell you why each one is worth a read. 

There will also be some experiments. Thanks for reading! And if you want it in your inbox, you can subscribe here. 

Everybody loves Plaid

Plaid’s product is beyond boring to most people, but it is already a name brand to its enterprise users and across the greater startup world, as its stats and funding rounds have grown. The $5.3 billion outcome announced this week cements its status as a top SaaS/fintech startup story of this era, in addition to being a popular platform for developers who need to sync user payment data.

Alex Wilhelm was all over the news. He dug into Visa’s presentation explaining the purchase on Extra Crunch — it paid more than twice Plaid’s last valuation — and found the classic tale of a large, slow-moving incumbent strategically buying a hot younger company in order to grow into newer markets. Then he got comments for Extra Crunch from a range of analysts… who basically said the same thing. 

You can now tune into the latest TechCrunch Equity episode to hear him talk about it with our resident former VC Danny Crichton.

Atrium gets out of the human law firm business

Closely watched Atrium is shutting down the law firm to focus on the tech company. Founder Justin Kan tells Josh Constine on TechCrunch that this is part of the evolution toward providing a better tech service.

The law firm had been designed to provide the human touch in a way that machines couldn’t, but Kan says that lawyers do that great as third parties.

Many SaaS startups are trying to take on the back office processes of the 20th century. Atrium’s change will be another reason for them to go all-in on software, with humans not included.

brooke hammerling

PR expert says maybe don’t do PR right now

One of the most loved and feared people in tech communications today, Brooke Hammerling has been in the middle of key stories of the decade with founders young and old. And sometimes on the opposite side of me.

 She knows her stuff. Here’s one of my favorite gems from the full interview with Jordan Crook over on Extra Crunch:

If you’re an early-stage company, and you’re an unknown founder, and you’re coming out with your own take on something, you don’t want to spend your money on PR too early.

You want to spend that money on product development and engagement and engineering and so forth.

Big funds do the small funding rounds now

That’s the word on the street from our resident former VC, who was recently out in San Francisco visiting his many friends and professional acquaintances. Danny put his notes together for TechCrunch back in the comfort of his New York apartment, and found that everyone is raising huge rounds [emphasis his] — and it’s all about being there for the future. Plaid’s cap table is a good example.

One of my favorite quotes:

As one VC explained to me last week (paraphrasing), “What’s weird today is that you have firms like Sequoia who show up for seed rounds, but they don’t really care about … anything. Valuation, terms, etc. It’s all a play for those later-stage rounds.” I think that’s a bit of an exaggeration to be clear, but ultimately, those one million-dollar checks are essentially a rounding error for the largest funds. The real return is in the mega rounds down the road. 

He also noticed for TechCrunch that VCs today seem to be especially tired. You can tell him what you think about these observations at danny@techcrunch.com.

(Photo by David Becker/Getty Images)

Home robots are making moves at CES

I have never been to CES and don’t plan to go, but Brian Heater always goes and this year he came back thinking that the home robot sector is getting serious.

His takeaway for Extra Crunch: 

There’s a cynical (and probably at least partially correct) view that these sorts of deals are publicity stunts — big companies using CES to demonstrate how forward-thinking they are about new technologies. But there’s something to be said for the show’s position at the forefront of such technologies. The products are real, even if wider use is hypothetical. And in an era when Amazon has deployed more than 100,000 robots across its U.S. fulfillment centers to enable next and same-day delivery, we’re well into the realm of real-world use.

Brian is also hosting a one-day TechCrunch conference focused on robotics startups at UC Berkeley in early March, for those who are focused on this space. The event last year was a huge hit and we’re looking forward to the next one. Follow the link to learn more. 

Will Silicon Valley win at weed?

Eaze has been one of the highest-profile cannabis distributors, but now it might be running out of cash, report Ingrid Owen and Josh Constine. There are many structural reasons why any cannabis business is very hard, legal or otherwise. 

But it’s interesting to take a look at who is succeeding in the consumer cannabis market and why.

One local example is Berner, a high school dropout in San Francisco who became a budtender and partnered with cannabis geneticists to create and promote the Girl Scout Cookies strain, and also became an international rap star (the main topic is his weed) and clothing designer.  

These days, he’s opening more and more Cookies retail cannabis outlets, including in Oakland and L.A., and cutting licensing and certification deals with a broad network of partners, (and claims to be turning down huge acquisition offers). Basically, his cannabis is also his modern multi-platform brand and the cool kids are into it. He does not appear to be running out of cash.

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LaunchDarkly CEO Edith Harbaugh explains why her company raised another $54M

Published January 18, 2020

This week, LaunchDarkly announced that it has raised another $54 million. Led by Bessemer Venture Partners and backed by the company’s existing investors, it brings the company’s total funding up to $130 million.

For the unfamiliar, LaunchDarkly builds a platform that allows companies to easily roll out new features to only certain customers, providing a dashboard for things like “canary launches” (pushing new stuff to a small group of users to make sure nothing breaks) or launching a feature only in select countries or territories. By productizing an increasingly popular development concept (“feature flagging”) and making it easier to toggle new stuff across different platforms and languages, the company is quickly finding customers in companies that would rather not spend time rolling their own solutions.

I spoke with CEO and co-founder Edith Harbaugh, who filled me in on where the idea for LaunchDarkly came from, how their product is being embraced by product managers and marketing teams and the company’s plans to expand with offices around the world. Here’s our chat, edited lightly for brevity and clarity.

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Instagram drops IGTV button, but only 1% downloaded the app

Published January 18, 2020

At most, 7 million of Instagram’s 1 billion-plus users have downloaded its standalone IGTV app in the 18 months since launch. And now, Instagram’s main app is removing the annoying orange IGTV button from its home page in what feels like an admission of lackluster results. For reference, TikTok received 1.15 billion downloads in the same period since IGTV launched in June 2018. In just the US, TikTok received 80.5 million downloads compared to IGTV’s 1.1 million since then, according to research commissioned by TechCrunch from Sensor Tower.

To be fair, TikTok has spent huge sums on install ads. But while long-form mobile video might gain steam as the years progress, Instagram hasn’t seemed to crack the code yet.

“As we’ve continued to work on making it easier for people to create and discover IGTV content, we’ve learned that most people are finding IGTV content through previews in Feed, the IGTV channel in Explore, creators’ profiles and the standalone app. Very few are clicking into the IGTV icon in the top right corner of the home screen in the Instagram app” a Facebook company spokesperson tells TechCrunch. “We always aim to keep Instagram as simple as possible, so we’re removing this icon based on these learnings and feedback from our community.”

Instagram users don’t need the separate IGTV app to watch longer videos, as the IGTV experience is embedded in the main app and can be accessed via in-feed teasers, a tab of the Explore page, promo stickers in Stories, and profile tabs. Still, the fact that it wasn’t an appealing enough destination to warrant a home page button shows IGTV hasn’t become a staple like past Instagram launches including video, Stories, augmented reality filters, or Close Friends.

One thing still missing is an open way for Instagram creators to earn money directly from their IGTV videos. Users can’t get an ad revenue share like with YouTube or Facebook Watch. They also can’t receive tips or sell exclusive content subscriptions like on Facebook, Twitch, or Patreon.

The only financial support Facebook and Instagram have offered IGTV creators is reimbursement for production costs for a few celebrities. Those contracts also require creators to avoid making content related to politics, social issues, or elections, according to Bloomberg‘s Lucas Shaw and Sarah Frier.

“In the last few years we’ve offset small production costs for video creators on our platforms and have put certain guidelines in place,” a Facebook spokesperson told Bloomberg. “We believe there’s a fundamental difference between allowing political and issue-based content on our platform and funding it ourselves.” That seems somewhat hypocritical given Facebook CEO Mark Zuckerberg’s criticism of Chinese app TikTok over censorship of political content.

Now users need to tap the IGTV tab inside Instagram Explore to view long-form videoAnother thing absent from IGTV? Large view counts. The first 20 IGTV videos I saw today in its Popular feed all had fewer than 200,000 views. BabyAriel, a creator with nearly 10 million Instagram followers that the company touted as a top IGTV creator has only post 20 of the longer videos to date with only one receiving over 500,000 views.

When the lack of monetization is combined with less than stellar view counts compared to YouTube and TikTok, it’s understandable why some creators might be hesistant to dedicate time to IGTV. Without their content keeping the feature reliably interesting, it’s no surprise users aren’t voluntarily diving in from the home page.

In another sign that Instagram is folding IGTV deeper into its app rather than providing it more breathing room of its own, and that it’s eager for more content, you can now opt to post IGTV videos right from the main Instagram feed post video uploader. AdWeek Social Pro reported this new “long video” upload option yesterday. A Facebook company spokesperson tells me “We want to keep our video upload process as simple as possible” and that “Our goal is to create a central place for video uploads”.

 

IGTV launched with a zealotish devotion to long-form vertical video despite the fact that little high quality content of this nature was being produced. Landscape orientation is helpful for longer clips that often require establishing shots and fitting multiple people on screen, while vertical was better for quick selfie monologues.

Yet Instagram co-founder Kevin Systrom described IGTV to me in August 2018, declaring that “What I’m most proud of is that Instagram took a stand and tried a brand new thing that is frankly hard to pull off. Full-screen vertical video that’s mobile only. That doesn’t exist anywhere else.”

Now it doesn’t exist on Instagram at all since May 2019 when IGTV retreated from its orthodoxy and began allowing landscape content. I’d recommended it do that from the beginning, or at least offer a cropping tool for helping users turn their landscape videos into coherent vertical ones, but nothing’s been launched there either.

If Instagram still cares about IGTV, it needs to attract more must-see videos by helping creators get paid for their art. Or it needs to pour investment into buying high quality programming like Snapchat Discover’s Shows. If Instagram doesn’t care, it should divert development resources to it’s TikTok clone Reels that actually looks very well made and has a shot at stealing market share in the remixable social entertainment space.

For a company that’s won by betting big and moving fast, IGTV feels half-baked and sluggish. That might have been alright when Snapchat was shrinking and TikTok was still Musically, but Instagram is heading into an era of much stiffer competition. Quibi and more want to consume multi-minute spans of video viewing on mobile, and the space could grow as adults familiarize with the format. But offering the platform isn’t enough for Instagram. It needs to actively assist creators with finding what content works, and how to earn sustainable wages marking it.

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As Alphabet crests the $1T mark, SaaS stocks reach all-time highs of their own

Published January 17, 2020

Continuing our irregular surveys of the public markets, two things happened this week that are worth our time. First, a third domestic technology company — Alphabet — passed the $1 trillion market capitalization threshold. And, second, software as a service (SaaS) stocks reached record highs on the public markets after retreating over last summer.

The two milestones, only modestly related events, indicate how temperate the public waters are for technology companies today, a fact that should extend warmth into the private market where startups, and their venture capital backers, work.

The happenings are good news for technology startups for a number of reasons, including that major tech players have never had as much wealth in hand with which to buy smaller companies, and strong SaaS valuations help both smaller startups fundraise, and their larger brethren possibly exit.

Indeed, the stridently good valuations that major tech companies and their smaller siblings enjoy today should be just the sort of market conditions under which unicorns want to debut. We’ll continue to make this point so long as the public markets continue to rise, pricing tech companies that have already floated higher like the cliche’s own tide.

But while Alphabet, Microsoft and Apple are worth $3.68 trillion as a trio, and SaaS stocks are now worth 12.3x times their revenue (using enterprise value instead of market cap, for those keeping score at home), not every private, venture-backed company will necessarily benefit from public investor largesse.

What about tech-ish startups?

How much the current public-market tech valuation expansion will help companies that are increasingly sorted into the tech-enabled bucket isn’t clear; some companies that went public in 2019 were quickly spit up by investors unwilling to support valuations that matched or rose above their final private valuations. SmileDirectClub was one such offering.

The dividing line between what counts as tech — often fuzzy — appears to be slicing along gross margin lines, and the repeatability of business. The higher margin, and more recurring a company is, the more it’s worth. This market reality is why SaaS stocks’ recent return to form is not a surprise.

For Casper and One Medical, the first two venture-backed IPO hopefuls of the year, the more tech-ish they can appear between now and pricing the better. Because technology companies today are valued so highly, perhaps even a faint dusting of tech will save their valuations as they cross the chasm between private and adult.

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