And then there was one: Co-CEO Jennifer Morgan to depart SAP
In a surprising move, SAP ended its co-CEO experiment yesterday when the company announced Jennifer Morgan will be exiting stage left on April 30th, leaving Christian Klein as the lone CEO.
The pair took over at the end of last year when Bill McDermott left the company to become CEO at ServiceNow, and it looked like SAP was following Oracle’s model of co-CEOs, which had Safra Catz and Mark Hurd sharing the job for several years before Hurd passed away last year.
SAP indicated that Morgan and the board came to a mutual decision, and that it felt that it would be better moving forward with a single person at the helm. The company made it sound like going with a single CEO was always in the plans, and they were just speeding up the time table, but it feels like it might have been a bit more of a board decision and a bit less Morgan, as these things tend to go.
“More than ever, the current environment requires companies to take swift, determined action which is best supported by a very clear leadership structure. Therefore, the decision to transfer from Co-CEO to sole CEO model was taken earlier than planned to ensure strong, unambiguous steering in times of an unprecedented crisis,” the company wrote in a statement announcing the change.
The move also means that the company is moving away from having a woman at the helm, something that’s unfortunately still rare in tech. Why the company decided to move on from the shared role isn’t clear, beyond using the current economic situation as cover. Neither is it clear why they chose to go with Klein over Morgan, but it seems awfully soon to be making a move like this when the two took over so recently.
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Confluent lands another big round with $250M Series E on $4.5B valuation
The pandemic may feel all-encompassing at the moment, but Confluent announced a $250 million Series E today, showing that major investment continues in spite of the dire economic situation at the moment. The company is now valued at $4.5 billion.
Today’s round follows last year’s $125 million Series D. At that point the company was valued at a mere $2.5 billion. Investors obviously see a lot of potential here.
Coatue Management led the round, with help from Altimeter Capital and Franklin Templeton. Existing investors Index Ventures and Sequoia Capital also participated. Today’s investment brings the total raised to $456 million.
The company is based on Apache Kafka, the open-source streaming data project that emerged from LinkedIn in 2011. Confluent launched in 2014 and has gained steam, funding and gaudy valuations along the way.
CEO and co-founder Jay Kreps reports that growth continued last year when sales grew 100% over the previous year. A big part of that is the cloud product the company launched in 2017. It added a free tier last September, which feels pretty prescient right about now.
But the company isn’t making money giving stuff away, so much as attracting users, who can become customers at some point as they make their way through the sales funnel. The beauty of the cloud product is that you can buy by the sip.
The company has big plans for the product this year. Although Kreps was loath to go into detail, he says that there will be a series of changes coming up this year that will add significantly to the product’s capabilities.
“As part of this we’re going to have a major new set of capabilities for our cloud service, and for open-source Kafka, and for our product that we’re going to announce every month for the rest of the year,” Kreps told TechCrunch. These will start rolling out the first week in May.
While he wouldn’t get specific, he says that it relates to the changing nature of cloud infrastructure deployment. “This whole infrastructure area is really evolving as it moves to the cloud. And so it has to become much, much more elastic and scalable as it really changes how it works. And we’re going to have announcements around what we think are the core capabilities of event streaming in the cloud,” he said.
While a round this big with a valuation this high and an institutional investor like Franklin Templeton involved typically means an IPO could be the next step, Kreps was not ready to talk about that, except to say the company does plan to begin behaving in the cadence of a public company with a set of quarterly earnings, just not for public consumption yet.
The company was founded in 2014. It has 1,000 employees and has plans to continue to hire and to expand the product. Kreps sees plenty of opportunity here in spite of the current economics.
“I don’t think you want to just turtle up and hang on to your existing customers and not expand if you’re in a market that’s really growing. What really got this round of investors excited is the fact that we’re onto something that has a huge market, and we want to continue to advance, even in these really weird uncertain times,” he said.
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The Nintendo Switch had a very good March
Nintendo is selling a lot of Switches. The convertible console has been a lifesaver for people sheltering in place around the world. COVID-19-induced travel restrictions and the long-awaited arrival of Animal Crossing: New Horizons have proven to be a perfect storm for the three-year-old platform.
New numbers out from NPD this morning shed some light on just how good last month was for Nintendo. Switch sales more than doubled their numbers from March 2019, per the analyst firm. It was a March record for the console, which launched in March 2017. It was also the best first-quarter unit sales for any gaming console since the company’s DS system, way back in 2010.
US NPD HW – Nintendo Switch set a new all-time record for hardware unit sales in a March month, besting the previous high set by Nintendo Switch in its March 2017 launch month.
— Mat Piscatella (@MatPiscatella) April 21, 2020
The arrival of Animal Crossing: New Horizons was no doubt a bit part of the sales bump. The latest addition to the popular sim series was both the best-selling game on any platform for March and had the third-best-selling launch month of any title in Nintendo’s history since NPD started tracking. Only Super Smash Bros. Ultimate and Super Smash Bros. Brawl (2018 and 2008, respectively) sold more physical units in their first month.
New Horizons is already the best selling title in Animal Crossing’s history, according to the firm. Both the timing of the title and its focus on social gaming play have been a huge boost to the game. It’s also been a hit with critics, currently sporting a 91% on Metacritic.
Stores have struggled to keep Switch units in stock amid a sharp bump in sales. Nintendo is reportedly boosting production of the system up by 10% in order to keep up with demand.
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Disruptor Beam relaunches as gaming infrastructure-maker Beamable
Disruptor Beam, the mobile gaming startup behind Star Trek Timelines, has a new name and a new business. It’s now calling itself Beamable, and it’s selling a set of tools to help game developers add commerce and social functionality to their titles.
The company’s direction became clear earlier this year when it sold Timelines to Tilting Point so that it could focus on its developer tools. Now Beamable is officially launching its Early Access program for games that are live, or that are scheduled to go live in the next 12 months.
CEO Jon Radoff told me that Disruptor Beam first built this technology for its own games — not just Timelines, but also Game of Thrones Ascent and Walking Dead: March to War.
Radoff suggested that there’s a real need for this as gaming continues shifting towards a “games as a service” model, where developers don’t just release a title and move on, but rather continue adding new features and content, while continuing to make money from players.
Image Credits: Beamable
The largest developers with the most popular games can support this approach, but he said, “For the next 5,000 games on the app stores, any of the things they’ve built are pretty primitive and they really need help.”
He added, “For these developers, 30% or 40% of their effort goes into making a cool game, and all the other money and time goes into things the player doesn’t really see — the store and the commerce … It’s kind of like a tax on their ongoing operation.”
With Beamable, on the other hand, developers can take advantage of the infrastructure that the company has already built for in-game storefronts, merchandising, content management and social interactions. The platform also ties together the company’s backend infrastructure with the Unity 3D editor and the live gameplay experience.
“Other products we’ve investigated are just middleware,” said Tap Slots CEO Markus Weichselbaum in a statement. “Beamable is fully-integrated with Unity, including user interfaces that work in both the Unity 3D editor and game clients. This saves us massive amounts of time we’d otherwise spend in the guts of the technology and rediscovering best practices, instead of doing what we need to do: designing great games.”
In addition to selling Timelines, Disruptor Beam also shifted its business by shutting down Ascent and March to War, and it’s sold an unnamed, still-in-development title to East Side Games.
The Beamable team Image Credits: Beamable
Radoff suggested that when Disruptor Beam started, the market for licensed games tied to major entertainment franchises was still “the Wild, Wild West” providing “a tremendous opportunity” for startups to innovate. Now, however, it’s a “mature market” that’s dominated by larger developers.
Radoff also acknowledged that he spent much of 2019 “trying to figure out how to have my cake and eat it too” — in other words, how the company could turn the game platform into a business while continuing to develop games of its own.
“Ultimately, I concluded that game development is an obsession,” he said. “When you have a company in which any amount of game development is happening, no matter what you do, you’re always going to be obsessed with game development, and that obsession tends to push out your ability to create great technology or a great product for developers.”
Instead, Radoff decided to sell off the company’s games and try to build an organization (now operating remotely via Zoom, like everyone else) that’s equally obsessed with building a development platform — primarily for mobile games, but also for PC and console.
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Sonos launches Sonos Radio, a free streaming radio service including artist and genre stations
Sonos has launched its first in-house music streaming offering: Sonos Radio, a digital streaming radio service that includes both existing radio stations from TuneIn and iHeartRadio, as well as its own original programming through three new products including two ad-free offerings and one ad-supported option.
The original streaming options from Sonos include Sonos Sound System; an ad-free single station hosted by Sonos itself, that will play “new and well-known” music, along with snippets of stories from artists about their music, as well as hours guest-hosted by select artists themselves. Sonos says this is all about mixing crowd-pleasers with the occasional song you might’ve missed, in a bid to create a single stream that will have broad appeal.
There’s also Artist Stations, which also don’t have any ads, and which are hand-curated by artists and feature a selection of songs they love or that have inspired them. The first such station, debuting with the Sonos Radio launch, is Thom Yorke’s ‘In the Absence Thereof…’, and there are more to follow in the “coming weeks,” including stations from Brittany Howard of Alabama Shakes, David Byrne and more.
The final component of the original Sonos streaming content is Sonos Stations, which include over 30 dedicated genre stations. These are also free, but are ad-supported, so you’ll hear the occasional promotional message throughout the stream, kind of like you get with Spotify’s free tier.
To date, Sonos has acted strictly as an integrator for the services of others, operating the platform layer to provide in-house, multi-room streaming via its Sonos speaker and audio equipment products. This marks its first foray into doing something on the services side, so it’s a big change. I asked about whether this signals further moves into streaming, including through a potential paid premium offering with on-demand content, which would more directly compete with some of its biggest partners including Apple, Google and Spotify, and Sonos Product Marketing Director Ryan Richards didn’t shut the door on that possibility.
“This is about lean-back listening, it’s about discovery,” he said. “There are a lot of options for active listening out there, too, and so what we’re really focused on is first and foremost making the best possible radio service for our customers. In the future, we’ll see how that changes, but that’s what we’re focused on now.”
At launch, the global radio option backed by iHeartRadio and TuneIn will be available globally, but Sonos Radio’s original products will only be available in the U.S., Canada, the U.K., Ireland and Australia, with the company planning to expand availability in future. Its in-house offerings are powered by a deal with Napster to use their streaming catalog, and Richards told me that that arrangement also bounds the availability of the services. Sonos is working on signing up additional streaming licensing partners for an expanded geographic footprint and catalogue size, however.
The new Sonos Radio features won’t be compatible with voice control via either Google Assistant or Amazon’s Alexa on Sonos hardware that supports that at launch, though Richards says the company is looking at adding that as a future feature update. Sonos also acquired a startup that built its own smart voice assistant last November, so that could potentially still result in another in-house offering to lessen its reliance on partners at some point in the future.
To get access, anyone with a Sonos system should see the new offering in their Sonos app via a software update available today.
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Env0 announces $3.3M seed to bring more control to Infrastructure as Code
Env0, a startup that wants to help companies bring some order to delivery of Infrastructure as Code, announced a $3.3 million seed investment today and the release of the Beta of the company’s first product.
Boldstart Ventures and Grove Ventures co-led the round with participation from several angel investors including Guy Podjarny of Snyk.
Company co-founder and CEO Ohad Maislish says the ability of developers to deliver code quickly is a blessing and a curse, and his company wants to give IT some control over how and when code gets committed.
“The challenge companies have is how to balance between self-service and oversight of cloud resources in a cloud native kind of way, and to balance this with visibility, predictability, and most importantly, governance around cloud security and costs,” Maislish said.
The product lets companies define when it’s OK for developers to deliver code and how much they can spend instead of letting them deliver anything, at any time, at any cost. You do this by giving overall control of the process to an administrator, who can then define templates and projects. The templates define which repositories and products you can use for a given cloud vendor and the projects correlate to the users allowed to access those templates.
Image Credit: Env0
Ed Sim, founder and managing partner at Boldstart says the startup has been able to find a good balance between governance and the need for speed that today’s developers require in a continuous delivery environment. “Env0 is the first SaaS solution that meets all of those needs by offering self-service cloud environments with centralized governance,” Sim said in a statement.
It’s not easy launching an early-stage company in the middle of the current economic situation, but Maislish believes his company is in a decent position as it provides a way to control self-service development, something that is even more important when your developers are working from home outside of the purview of IT and security.
The company launched 18 months ago and has been in private beta for some time. Today marks the launch of the public beta. It currently has 10 employees.
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ForgeRock nabs $93.5M for its ID management platform, gears up next for an IPO
For better or worse, digital identity management services — the process of identifying and authenticating users on networks to access services — has become a ubiquitous part of interacting on the internet, all the more so in the recent weeks as we have been asked to carry out increasingly more of our lives online.
Used correctly, they help ensure that it’s really you logging into your online banking service; used badly, you feel like you can’t innocently watch something silly on YouTube without being watched yourself. Altogether, they are a huge business: worth $16 billion today according to Gartner but growing at upwards of 30% and potentially as big as $30.5 billion by 2024, according to the latest forecasts.
Now, a company called ForgeRock, which has built a platform that is used to help make sure that those accessing services really are who they say are, and help organizations account for how their services are getting used, is announcing a big round of funding to continue expanding its business amid a huge boost in demand.
The company is today announcing that it has raised $93.5 million in funding, a Series E it will use to continue expanding its product and take it to its next step as a business, specifically investing in R&D, cloud services and its ForgeRock Identity Cloud, and general global business development.
The round is being led by Riverwood Capital, and Accenture Ventures, as well as previous investors Accel, Meritech Capital, Foundation Capital and KKR Growth, also participated.
Fran Rosch, the startup’s CEO, said in an interview that this will likely be its final round of funding ahead of an IPO, although given the current static of affairs with a lot of M&A, there is no timing set for when that might happen. (Notably, the company had said its last round of funding — $88 million in 2017 — would be its final ahead of an IPO, although that was under a different CEO.)
This Series E brings the total raised by the company to $230 million. Rosch confirmed it was raised as a material upround, although he declined to give a valuation. For some context, the company’s last post-money valuation was $646.50 million per PitchBook, and so this round values the company at more than $730 million.
ForgeRock has annual recurring revenues of more than $100 million, with annual revenues also at over $100 million, Rosch said. It operates in an industry heavy with competition, with some of the others vying for pole position in the various aspects of identity management including Okta, LastPass, Duo Serurity and Ping Identity.
But within that list it has amassed some impressive traction. In total it has 1,100 enterprise customers, who in turn collectively manage 2 billion identities through ForgeRock’s platform, with considerably more devices also authenticated and managed on top of that.
Customers include the likes of the BBC — which uses ForgeRock to authenticate and log not just 45 million users but also the devices they use to access its iPlayer on-demand video streaming service — Comcast, a number of major banks, the European Union and several other government organizations. ForgeRock was originally founded in Norway about a decade ago, and while it now has its headquarters in San Francisco, it still has about half its employees and half its customers on the other side of the Atlantic.
Currently ForgeRock provides services to businesses related to identity management including password and username creation, identity governance, directory services, privacy and consent gates, which they in turn provide both to their human customers as well as to devices accessing their services, but we’re in a period of change right now when it comes to identity management. It stays away from direct-to-consumer password management services and Rosch said there are no plans to move into that area.
These days, we’ve become more aware of privacy and data protection. Sometimes, it’s been because of the wrong reasons, such as giant security breaches that have leaked some aspect of our personal information into a giant database, or because of a news story that has uncovered how our information has unwittingly been used in ‘legit’ commercial schemes, or other ways we never imagined it would.
Those developments, combined with advances in technology, are very likely to lead us to a place over time where identity management will become significantly more shielded from misuse. These could include more ubiquitous use of federated identities, “lockers” that store our authentication credentials that can be used to log into services but remain separate from their control, and potentially even applications of blockchain technology.
All of this means that while a company like ForgeRock will continue to provide its current services, it’s also investing big in what it believes will be the next steps that we’ll take as an industry, and society, when it comes to digital identity management — something that has had a boost of late.
“There are a lot of interesting things going on, and we are working closely behind the scenes to flesh them out,” Rosch said. “For example, we’re looking at how best to break up data links where we control identities to get access for a temporary period of time but then pull back. It’s a powerful trend that is still about four to five years out. But we are preparing for this, a time when our platform can consume decentralised identity, on par with logins from Google or Facebook today. That is an interesting area.”
He notes that the current market, where there has been an overall surge for all online services as people are staying home to slow the speed of the coronavirus pandemic, has seen big boosts in specific verticals.
Its largest financial services and banking customers have seen traffic up by 50%, and digital streaming has been up by 300% — with customers like the BBC seeing spikes in usage at 5pm every day (at the time of the government COVID-19 briefing) that are as high as its most popular primetime shows or sporting events — and use of government services has also been surging, in part because many services that hadn’t been online are now developing online presences or seeing much more traffic from digital channels than before. Unsurprisingly, its customers in hotel and travel, as well as retail, have seen drops, he added.
“ForgeRock’s comprehensive platform is very well-positioned to capitalize on the enormous opportunity in the Identity & Access Management market,” said Jeff Parks, co-founder and managing partner of Riverwood Capital, in a statement. “ForgeRock is the leader in solving a wide range of workforce and consumer identity use cases for the Global 2000 and is trusted by some of the largest companies to manage millions of user identities. We have seen the growth acceleration and are thrilled to partner with this leadership team.” Parks is joining the board with this round.
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Vestiaire Collective raises $64.2 million for its second-hand fashion platform
Vestiaire Collective just closed another big round of funding in the middle of an economic crisis — the round closed in early April. The startup raised $64.2 million (€59 million) and the company has raised more than $240 million over the year, according to Crunchbase. Vestiaire Collective operates a marketplace of pre-owned fashion items. Users can both sell and buy clothes and accessories on the platform.
There’s a huge list of investors in today’s round — Korelya Capital, Fidelity International-managed funds, Vaultier7, Cuit Invest and existing investors Eurazeo (Eurazeo Growth and Idinvest Venture funds), Bpifrance, Vitruvian Partners, Condé Nast, Luxury Tech Fund and Vestiaire Collective CEO Max Bittner are all participating.
With 9 million members across 90 countries, Vestiaire Collective has become a huge marketplace. And it makes sense that an e-commerce website focused on pre-owned items is working well. There has been a ton of backlash against fast fashion over the past few years.
People now also value circular business models as it becomes more affordable to refresh your wardrobe, especially during an economic crisis, and it is better for the environment.
As always, Vestiaire Collective will use the new influx of cash to expand to more countries. In particular, with Korelya Capital as a new backer, the company will expand to South Korea and Japan this year. While the company started in France, 80% of transactions are now cross-border transactions.
Originally, Vestiaire Collective asked you to send your items to its warehouses to check them before putting them on sale. The startup has been betting on direct shipping from the seller to the buyer in Europe and it has been working well. You can get reimbursed if there’s something wrong with what you ordered though.
Direct shipping has been available in Europe since September 2019 and it now represents over 50% of orders in the region. Up next, Vestiaire Collective will introduce direct shipping in the U.S. this summer and in Asia by the end of 2020.
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3D-printed glasses startup Fitz is making custom protective eyewear for healthcare workers
A lot of startups have answered the call for more personal protective equipment (PPE) and other essentials to support healthcare workers in their efforts to curb the spread and impact of COVID-19. One of those is direct-to-consumer 3D-printed eyewear brand Fitz, which is employing its custom-fit glasses technology to build protective, prescription specs for front-line healthcare workers in need of the best protection they can get.
Fitz Protect is a version of Fitz’s eyewear that uses the same custom measurement tool Fitz created for use via its iOS app, made possible by Apple’s depth-sensing Face ID camera on newer iPhones and all iPad Pro models. The app allows virtual try-on, and provides millimeter-level accurate measurements for a custom fit. Protect is a version of the glasses that still supports a wide range of prescriptions, but that also extends further like safety glasses to provide more coverage and guard against errant entry of any fluids through the eyes.
Healthcare professionals are doing what they can to ensure their face, mouth, nose and eyes are protected from any coughs, sneezes or other droplet-spreading activity from COVID-19 patients that could pass on the infection. These measures have more broadly focused on face shields that feature a single transparent plastic sheet, and N95 masks (and alternatives when not available) to protect the mouth and nose.
Fitz CEO Gabriel Schlumberger explained via email that the design for Fitz Protect came from working front-line doctors and nurses from New York, LA and Texas who were all looking for something to source prescription protective eyewear.
“More than 60% of doctors are glasses wearers, and current guidance is for them to stop wearing contact lenses,” Schlumberger explained, adding that Fitz Protect is also designed to be worn in conjunction with a face shield, when that’s an available option, to provide yet another layer of defense.
“We heard from prescription glasses wearers that their standard glasses didn’t provide anywhere near adequate coverage, especially over the eyebrows, and in some cases they were adding cardboard cut-outs,” he said. “We leveraged our existing system to create something much better. ”
Fitz’s model also helps on the pricing side because it’s already designed to be an aggressively cost-competitive offering when compared to traditional prescription eyewear. Their glasses typically retail for just $95 including frames, lenses and shipping, and are also offered in a $185 per year unlimited frame membership plan. For doctors, nurses and hospital staff, the entire cost of Fitz Protect is being waived, and the company is seeking donations to help offset its own manufacturing costs, which currently stand at around $100 per set, though process improvements should bring that down, according to Schlumberger, as they expand availability.
Already, he said that nearly 3,000 healthcare professionals have signed up to receive a pair in their first week of availability, so they’re working on adding scale to keep up with the unexpected demand.
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Introducing the Digital Startup Alley Package for Disrupt SF
Building a startup is hard enough. But COVID-19, our generation’s worst plot twist, gives new meaning to uncertainty and stress. No one had “pandemic” on their early-stage startup’s radar, which begs the question: How do you move your business forward in unprecedented times?
It’s a huge challenge, and we’ve worked hard to find a way to help you keep momentum in the face of lockdowns and travel restrictions. Drumroll please — the Digital Startup Alley Package, a virtual exhibition for startups at Disrupt SF (September 14-16).
Accept no virtual substitutes. Disrupt is the OG of startup conferences, and TechCrunch has the resources and industry connections to replicate the Startup Alley experience as a truly world-class virtual event.
The Digital Startup Alley Package lets early-stage, pre-Series A startups disrupt from home for only $445. Digital Startup Alley kicks off early, and it runs through the end of the physical event in September. Place your startup in front of thousands of influential investors, technologists, customers and media — with months to pitch, demo, network and schedule meetings.
The Digital Startup Alley Package covers three people and includes:
CrunchMatch: TechCrunch’s AI-powered founder/investor networking platform. Save time, zero in and connect with the people who can move your business forward. Each startup will create a customizable profile, allowing startups to easily note their value add and business model to potential customers and investors.
Exceptional Pitch Coaching: Grab a brew and join TechCrunch editors for Pitchers and Pitches — an interactive opportunity to learn from the best. Whip your pitch into shape with the team that coaches the Startup Battlefield competitors.
Exposure to Investors: Exhibiting startups will be included in a deck available exclusively to investors attending Disrupt SF.
Exhibitor Guide: The definitive resource to Startup Alley and Disrupt SF — modified to reflect our digital exhibitors. Plus, you get access to the content included with a Disrupt Digital Pro Pass.
Exclusive Founder Webinars: All Startup Alley exhibitors will get exclusive access to the brightest industry minds to hear their current thinking on ways startups can adapt and thrive both during and after the COVID-19 pandemic.
Pro Tip: Come September, if you can exhibit at Disrupt SF in person, you can upgrade your package and still enjoy the benefits of Digital Startup Alley.
Remember, founders don’t quit — they adapt and move forward. Buy your Digital Startup Alley Package today.
TechCrunch is mindful of the COVID-19 issue and its impact on live events. You can follow our updates here.
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