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Self-driving startup AutoX expands beyond deliveries and sets its sights on Europe
AutoX, the Hong Kong and San Jose, Calif.-based autonomous vehicle technology company, is pushing past its grocery delivery roots and into the AV supplier and robotaxi business.
And now, it’s taking its business to Europe.
AutoX has partnered with NEVS — the Swedish holding company and electric vehicle manufacturer that bought Saab’s assets out of bankruptcy — to deploy a robotaxi pilot service in Europe by the end of 2020. Under the exclusive partnership, AutoX will integrate its autonomous drive technology into a next-generation electric vehicle inspired by NEVS’s “InMotion” concept that was shown at CES Asia in 2017.
This next-generation vehicle is being developed by NEVS in Trollhättan, Sweden. Testing of the autonomous NEVs vehicles will begin in the third quarter of 2019. The vehicles will hit public roads in Europe next year, the companies said.
AutoX founder and CEO Jianxiong Xiao, commonly referred to as Professor X, noted that this particular vehicle is ideal for an autonomous taxi service because it is purpose-built for this specific application, doesn’t produce tailpipe emissions, can be used 24 hours a day and can help reduce the number of vehicles in the streets.
The companies ultimately want to deploy a large fleet of robotaxis globally.
The partnership with NEVs is the latest sign that AutoX has broader ambitions for its autonomous vehicle technology than delivery services. AutoX launched in 2016 and was initially focused on using self-driving vehicles for delivering packages, namely groceries. Last August, the startup kicked off a grocery delivery and mobile store pilot in a limited area in San Jose in partnership with GrubMarket.com and local high-end grocery store DeMartini Orchard.
But more recently, the company, which has raised about $58 million from venture and strategic investors, has expanded its plans. The company now wants to supply manufacturers with autonomous vehicle technology and launch its own robotaxi service.
In June, AutoX became the second company to receive permission from California regulators to transport passengers in its robotaxis. AutoX is calling its California robotaxi service xTaxi.
The California Public Utilities Commission has also granted Pony.ai, Waymo and Zoox permits to participate in the state’s Autonomous Vehicle Passenger Service pilot, which prohibits the companies from charging for these robotaxi rides.
Professor X has previously said his mission is to open up autonomous vehicles to everyone, and so this expansion shouldn’t come as a surprise. It’s a goal the company contends can be reached using economical (and better) hardware. The company does use light detection and ranging radar, known as lidar. But instead of loading up its self-driving vehicles with numerous expensive lidar units, AutoX relies more on cameras, which it argues have better resolution. The company’s proprietary AI algorithms tie everything together.
For now, the xTaxi pilot in California will be rather limited. It will operate in the same operational design domain as the delivery service in San Jose, an area of about five square miles. But the company clearly has ambitions to expand both in size and geographic reach. AutoX has more than 115 employees, and plans to hire more than 50 people this year.
The company is also working with San Jose city government to launch another pilot downtown. It has yet to reveal details, although the pilot could launch as early as next month.
AutoX also has a permit to operate a robotaxi service in Shenzhen, China. It’s not clear whether the company will operate this service on its own or follow the model it set in Europe with NEVS. It’s possible AutoX will partner with BYD in China. AutoX is already working with the Chinese company to integrate its AV tech into BYD vehicles.
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How to go to market in middle America
Deborah Eisenberg is the founder of TechStarts PR, where she helps technology companies both big and small hone their message and reach their audience.
There comes a time for many startup companies where they either realize they need to do a nationwide rollout, or they need to actively target buyers in the middle of the country. If you are a startup on either the East or the West Coasts, it’s worth thinking about how this market might present its own set of unique challenges, and how you plan to overcome them.
There are a lot of misconceptions about what some people call “flyover country,” and as a San Francisco native who spent two decades in New York, Washington DC, and Boston before moving to Pittsburgh, I can assure you they are almost all wrong. Without getting into specifics, the reality of “middle America” is that it’s the same as anywhere else.
Income, education, world view, and waistlines are all varied. It’s pretty accurate that San Francisco possesses a culture obsessed with fitness and entrepreneurship, but California isn’t necessarily all like that, and if you think it is, I encourage you to go to Bakersfield, the Central Valley, or Eureka sometime.
In addition, just because the stereotypes are wrong doesn’t mean there’s nothing different about doing business here. As you think about how to conduct your rollout, here are some things you should consider:
Table of Contents
Research
As with any market, research is key since it informs every other aspect of the rollout. Start by looking into who your competition is.
Since there are fewer VC-backed startups in middle America, and smaller companies tend to get less press, the research may be harder. However, there are some major universities that are actively putting money into their own Entrepreneurship programs and those spinoffs often do very well.
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Mylk Guys wants to be the online vegan grocery store that non-vegans can love
Gaurav Maken, the chief executive officer of the online vegan grocery store Mylk Guys, doesn’t think of his company as a place to just buy food. For him, it’s a testing ground and platform for all of the new food products he expects to be developed as startup entrepreneurs and established food companies start tackling the plant-based and alternative-meat market in earnest.
The company has raised $2.5 million in support of that vision from investors, including Khosla Ventures, Pear Ventures and Fifty Years.
“Today we’re an online grocery store,” says Maken. “We are also a place for cultured meats and any genetically engineered food that allows us to scale our food production and allows us to keep feeding people.”
Maken isn’t wedded to plant-based products and envisions a virtual store stocked with products that create more sustainable consumption options for its customers. In fact, 40% of the company’s customers are not vegan, according to Maken.
“We don’t only think about vegans. We think about sustainable food systems,” says Maken. “Our audience is an educated consumer who wants to have less of an impact from their diet… They’re just folks trying to do better with their eating habits.”
Right now, the company sells around 1,300 products through its site. And the pitch that Maken makes to suppliers is that they can access the data around their customers (unlike other online retailers, whose name rhymes with shmamazon).
“We provide analytics and a way for brands to unlock the data coming from their customers,” Maken says. “Our focus is how can we get you a personalized staple that works for you.”
The company’s top sellers are vegan cheeses like Sparrow Camembert, lines of vegan jerkies and the Beyond Burger, Maken said.
“You can build brands that are successful that are $1 million brands or $5 million brands and the reason why you haven’t is because they haven’t had the platform to provide national distribution to be successful,” says Maken.
Mylk Guys launched in 2018 and went through the Y Combinator accelerator program. Now, with its new capital, the company is focusing on expanding its sales and marketing on the East Coast, opening a new warehouse for distribution and reaching out to the vegan community on the Eastern Seaboard.
The model for selling more sustainable foods directly to the consumer has at least one precedent. Los Angeles-based Thrive Market raised $111 million in a 2016 round of funding for its online sustainable product-focused grocery store.
As recent reports indicate, the sustainable food business is only growing. Citing reports from Ecovia Intelligence, the publication Environmental Leader reported that organic food sales topped $100 billion for the first time in 2018.
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Lexion raises $4.2M to bring AI to contract management
Contract management isn’t exactly an exciting subject, but it’s a real pain point for many companies. It also lends itself to automation, thanks to recent advances in machine learning and natural language processing. It’s no surprise then, that we see renewed interest in this space and that investors are putting more money into it. Earlier this week, Icertis raised a $115 million Series E round, for example, at a valuation of more than $1 billion. Icertis has been in this business for 10 years, though. On the other end of the spectrum, contract management startup Lexion today announced that it has raised a $4.2 million seed round led by Madrona Venture Group and law firm Wilson Sonsini Goodrich & Rosati, which was also one of the first users of the product.
Lexion was incubated at the Allen Institute for Artificial Intelligence (AI2), one of the late Microsoft co-founders’ four scientific research institutes. The company’s co-founder and CEO, Gaurav Oberoi, is a bit of a serial entrepreneur, whose first startup, BillMonk, was first featured on TechCrunch back in 2006. His second go-around was Precision Polling, which SurveyMonkey then acquired shortly after it launched. Oberoi founded the company together with former Microsoft research software development engineering lead Emad Elwany and engineering veteran James Baird.
“Gaurav, Emad, and James are just the kind of entrepreneurs we love to back: smart, customer obsessed and attacking a big market with cutting-edge technology,” said Madrona Venture Group managing director Tim Porter. “AI2 is turning out some of the best applied machine learning solutions, and contract management is a perfect example — it’s a huge issue for companies at every size and the demand for visibility into contracts is only increasing as companies face growing regulatory and compliance pressures.”
Contract management is becoming a bit of a crowded space, though, something Oberoi acknowledged. But he argues that Lexion is tackling a different market from many of its competitors.
“We think there’s growing demand and a big opportunity in the mid-market,” he said. “I think similar to how back in the 2000s, Siebel or other companies offered very expensive CRM software and now you have Salesforce — and now Salesforce is the expensive version — and you have this long tail of products in the mid-market. I think the same is happening to contracts. […] We’re working with companies that are as small as post-seed or post-Series A to a publicly traded company.”
Given that it handles plenty of highly confidential information, it’s no surprise that Lexion says that it takes security very seriously. “I think, something that all young startups that are selling into business or enterprise in 2019 need to address upfront,” Oberoi said. “We realized, even before we raised funding and got very serious about growing this business, that security has to be part of our DNA and culture from the get-go.” He also noted that every new feature and product iteration at Lexion goes through a security review.
Like most startups at this stage, Lexion plans to invest the new funding into building out its product — and especially its AI engine — and go-to-market and sales strategy.
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Tiny UK startup takes on Google’s Wing in the race to a drone traffic control system
A future where drones can easily and cheaply do many useful things such as deliver packages, undertake search and rescue missions and deliver urgent medical supplies, not to mention unclogging our roads with flying taxis, seems like a future worth shooting for. But before all this can happen, we need to make sure the thousands of drones in the sky are operating safely. A drone needs to be able to automatically detect when entering into the flight path of another drone, manned aircraft or restricted area and to alter its course accordingly to safely continue its journey. The alternative is the chaos and danger of the recent incidences of drones buzzing major airports, for instance.
There is a race on to produce just such a system. Wing LLC, an offshoot of the Alphabet / Google-owned X company, has announced a platform it calls OpenSky that it hopes will become the basis for a full-fledged air-traffic control system for drones. So far, it’s only been approved to manage drone flights in Australia, although it is also working on demonstration programs with the U.S. Federal Aviation Administration.
But this week, Altitude Angel, a U.K.-based startup backed by Seraphim Capital and with $4.9 million in funding, has launched its own UTM (Unmanned Traffic Management) system.
Its Conflict Resolution System (anti-collision) is basically an automatic collision-avoidance technology. This means that any drone flying beyond the line of sight will remain safe in the sky and not cross existing flight plans or into restricted areas. By being automated, Altitude Angel says this technology will prevent any mid-air collisions, simply because by knowing where everything else is in the sky, there’ll be no surprises.
Altitude Angel’s CRS has both “strategic” and “tactical” aspects.
The strategic part happens during the planning stages of a flight, i.e. when someone is submitting flight plans and requesting airspace permission. The system analyses the proposed route and cross-references it with any other flight plans that have been submitted, along with any restricted areas on the ground, to then propose a reroute to eliminate any flight-plan conflicts. Eventually, what happens is that a drone operator does this from an app on their phone, and the approval to flight is automated.
The next stage is tactical. This happens while the drone is actually in flight. The dynamic system continuously monitors the airspace around the aircraft both for other aircraft or for changes in the airspace (such as a temporary flight restriction around a police incident) and automatically adjusts the route.
The key aspect of this CRS is that drones and drone pilots can store flight plans with a globally distributed service without needing to exchange private or potentially sensitive data with each other while benefiting from an immediate pre-flight conflict resolution advice.
Altitude Angel CEO and founder Richard Parker says: “The ability for drones and automated aircraft to strategically plan flights, be made aware of potential conflict and alter their route accordingly is critical in ensuring safety in our skies. This first step is all about pre-flight coordination, between drone pilots, fleet operators and other UTM companies. Being able to predict and resolve conflict mid-flight by providing appropriate and timely guidance will revolutionize automated flight. CRS is one of the critical building blocks on which the drone and automated flight industries will grow.”
Altitude Angel won’t be the last to unveil a CRS of this type, but it’s instructive that there are startups confident of taking on the mighty Google and Amazon — which also has similar drone delivery plans — to achieve this type of platform.
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VertoFX raises $2M for its African and EM currency trading platform
VertoFX, an Africa and emerging markets-focused currency trading and payment startup, has raised a $2.1 million seed round, led by Accelerated Digital Ventures.
The London-based company, with a subsidiary in Lagos, Nigeria, has created a platform that allows businesses and banks to exchange and make payments in exotic foreign currencies that don’t often convert or trade conveniently across businesses or banks.
For example, South Africa’s Rand is Africa’s most convertible and traded currency — with lower spreads and transaction costs — while currencies of countries such as Ethiopia or Egypt may be difficult or expensive to trade or transact B2B payments.
“That’s the reason we are utilizing technology to create a marketplace model and price discovery to create liquidity for these currencies,” VertoFX founder Ola Oyetayo told TechCrunch.
There are around 40 global currencies that are considered exotic or illiquid, most of them in frontier markets in Asia, Africa and the Middle-East, according to Oyetayo.
And there’s a revenue opportunity to creating a convenient online marketplace for trading and payments in these currencies.
“Our research says there’s about $400 billion being done by small and medium-scale businesses in Africa alone in transactional volume on an annual basis. If we take 1% of that as a commission or transaction fee, that’s a $4 billion addressable market, just in the continent,” said Oyetayo.
VertoFX was founded in 2017 by Oyetayo and Anthony Oduwole — both ex-global bankers born in Nigeria. The company was part of Y Combinator’s 2019 winter cohort and processed around $7 million in transaction volume last month, according to Oyetayo.
VertoFX is registered as a payment services provider with the U.K.’s Financial Conduct Authority. Current clients include several undisclosed banks and San Francisco-based payment venture Flutterwave.
VertoFX doesn’t release revenue figures, but confirmed it earns a commission, or spread, on each transaction processed on its platform. There are currently 19 currencies on the platform and the ability to settle in 120 countries, including China and the U.S.
VertoFX is also moving into offering market research — toward potential subscription services — on the currencies it trades, according to Oyetayo.
The startup will use the round for platform development, expanding the currencies and gaining licenses in new countries. “We’ll also use the round for hiring, primarily in compliance and regulator type roles,” said Oyetayo. VertoFX already has a developer team in India and is looking at local developer talent for its Africa offices.
ADV’s Ryan Proctor confirmed the VC firm’s lead on the investment round, which also included participation from YC and several local angel investors in Africa, Oyetayo told TechCrunch.
On the possibility of becoming acquired by a big bank, VertoFX isn’t so interested, according to Oyetayo.
“We both come from big banks and if we’d wanted to go down that route we’d have developed this more as a software as a service platform,” he said.
“We’re playing the long game here, and I don’t think acquisition is the end game,” he said.
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Hardware startups take center stage for Hardware Battlefield at TC Shenzhen
Software grabs so much attention that it even has its own catchphrase — there’s an app for that. It’s not a bad thing, but we know nothing happens without hardware. That’s why we’re hunting for the best early-stage hardware startups to take center stage at Hardware Battlefield at TC Shenzhen on November 11-12 in China.
Apply here to compete in TC Hardware Battlefield 2019, our hardware-focused pitch competition. If selected, you’ll go head-to-head against some of the world’s most innovative hardware makers for a shot at $25,000. What’s more, you’ll pitch your creations to the world’s top investors. Imagine what that kind of exposure could do for your bottom line.
This is our fifth Hardware Battlefield and our first in China. Shenzhen has a global reputation for the support it offers hardware startups through a combination of accelerators, rapid prototyping and world-class manufacturing. We’re thrilled to collaborate with our partner TechNode to host TC Hardware Battlefield 2019 as part of the larger TechCrunch Shenzhen that runs November 9-12.
Any early-stage hardware startup — from any country — can apply to this competition. We’ve seen an impressive range of hardware in previous Battlefields, including robotic arms, food testing devices, malaria diagnostic tools, smart socks for diabetics and e-motorcycles. Show us what you’ve got!
Meet the minimum requirements listed below, and you’re qualified for consideration:
- Fill out the TC Hardware Battlefield 2019 application before the August 14 deadline.
- You must have a minimally viable product to demo onstage
- Your product has received little if any, press coverage to date
- Your product must be a hardware device or component
If you’ve never experienced one of our Battlefield pitch competitions, you’re in for the ride of a lifetime. Here’s how this Hardware Battlefield works.
The vetting process is very selective, and TechCrunch editors thoroughly review every qualified application. They’ll pick 10-15 outstanding hardware startups to compete. Every participating team receives extensive coaching from TechCrunch editors wise in the ways of Battlefield competitions. How extensive? Try six weeks of training that leaves you ready to step on the main stage in front of a panel of judges comprised of expert VCs, founders and technologists.
Each team has just six minutes to pitch and demo their products and then respond to an in-depth Q&A from the judges. One team will rise above the rest to become the Hardware Battlefield champion and take home a check for $25,000.
Even if you don’t win the whole shooting match, you’ll walk away with invaluable — some might say life-changing — media and investor exposure. Of course, we’ll capture the entire event on video and publish it on TechCrunch to a global audience.
Hardware Battlefield at TC Shenzhen takes place on November 11-12. Don’t miss your chance to launch your hardware startup on the world’s most famous tech stage. Apply today!
Is your company interested in sponsoring or exhibiting at Hardware Battlefield at TC Shenzhen? Contact our sponsorship sales team by filling out this form.
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VMware acquires ML acceleration startup Bitfusion
VMware today announced that it has acquired Bitfusion, a former participant in our Startup Battlefield competition. Bitfusion was one of the earliest companies to help businesses accelerate their complex computing workloads on GPUs, FPGAs and ASICs. In its earliest iteration, over four years ago, the company’s focus was less on AI and machine learning and more on other areas of high-performance computing, but, unsurprisingly, that shifted as the interested in AI and ML increased in recent years.
VMware will use Bitfusion’s technology, which is vendor- and hardware-agnostic, to bring similar capabilities to its customers. Specifically, it plans to integrate Bitfusion into its vSphere platform.
“Once closed, the acquisition of Bitfusion will bolster VMware’s strategy of supporting AI- and ML-based workloads by virtualizing hardware accelerators,” writes Krish Prasad, senior vice president and general manager of VMware’s Cloud Platform Business Unit. “Multi-vendor hardware accelerators and the ecosystem around them are key components for delivering modern applications. These accelerators can be used regardless of location in the environment – on-premises and/or in the cloud.”
Prasad also notes that to get the most out of hardware accelerators like GPUs, most enterprises deploy them on bare metal. VMware, however, argues that this leads to poor utilization and poor efficiencies (as it would, of course, given that it is in the business of virtualization). “This provides a perfect opportunity to virtualize them—providing increased sharing of resources and lowering costs,” writes Prasad.
The two companies did not disclose the price of the acquisition. Bitfusion had raised $5 million in 2017 and a smaller, strategic investment from Samsung Ventures in 2018.
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Submittable raises $10M to help publishers and other organizations manage their submissions
Submittable is announcing that it has raised $10 million in Series B funding.
When I first wrote about the company in 2012, it was focused on helping literary magazines manage their submissions — useful, but maybe not the kind of thing that venture capitalists write big checks for.
Since then, Submittable raised a $5 million Series A and expanded by helping companies in a number of industries manage their submissions and applications. Co-founder and CEO Michael FitzGerald said the company has built products for four main verticals (corporate, academic, philanthropy and publishing) and has signed up big customers like AT&T, HBO, Conde Nast, Harvard and MIT.
And while publishing may no longer be the main focus, FitzGerald — a published novelist himself — noted that “in the publishing world, we’re pretty much the way you do it.” I’ve certainly been seeing more Submittable submissions pages, (although FitzGerald acknowledged that the service hasn’t quite taken hold among science fiction magazines).
He also said the product has been getting increasingly sophisticated, for example, allowing a publisher to review and rank submissions based on very specific qualities like sentence structure and voice.
Besides expanding into additional verticals and launching on mobile, one of FitzGerald’s main goals it to create what he called “ZipRecruiter for Opportunities,” a marketplace that uses Submittable data to connect individuals and organizations that seem like a good fit, whether they’re writers and magazines, scholarships and students or any other pairing for “any opportunity that isn’t a job.”
Submittable is based in Missoula, Mont., and the round was led by Next Coast Ventures, a firm that invests in startups outside the big coastal tech hubs. (Previous investors True Ventures and Next Frontier also participated.) Next Coast co-founder and managing director Michael Smerklo is joining the startup’s board of directors.
“Submittable is a perfect example of what is possible outside Silicon Valley,” Smerklo said in a statement. “The platform is modernizing the often painful undertaking of managing the submission process and leveraging that data for genuine opportunity creation.”
FitzGerald (who’s spoken elsewhere about his experience working as a startup CEO while also facing a Stage 4 cancer diagnosis) said the plan is to expand the Submittable team from 88 to 240 people by the end of 2020. He acknowledged that the location has created some challenges in hiring, particularly when it comes to experienced executives, but he said he’s been assisted by the fact that ClassPass and OnxMaps have also opened offices in Missoula.
Plus, he said that one of the most effective tactics involves searching LinkedIn for executives who went to high school in Missoula between 1985 and 2000: “Everyone is looking for a way home.”
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Rent the Backyard wants to build a studio apartment in your yard
Rent the Backyard is one of the rare startups with a name that perfectly suits what it does.
The company, which is part of Y Combinator’s current batch, builds studio apartments in homeowners’ backyards, which are then rented out for income.
Of course, if you already own a house with a yard, you could theoretically do this for yourself, without getting a startup involved, but co-founder Brian Bakerman told me, “The goal is to have no headaches for the homeowners.”
That means Rent the Backyard works with a partner to build the apartment, finances the construction, lists the property, selects the tenant, collects the rent and serves as the landlord. In exchange for all that, it has an ownership stake in the unit and keeps 50% of the rent.
The startup also handles the permitting, which co-founder Spencer Burleigh said has become much easier with recent changes in California law. In fact, he pointed to stories about how these changes have led to skyrocketing applications (16 in 2016, 350 in 2018) to build “in-law” units in San Jose, which is where the startup is focused for now.
Bakerman said that many homeowners simply can’t afford the upfront cost of building these units, so by providing the financing, Rent the Backyard can unlock new income and make home ownership more affordable. At the same time, it’s also helping renters by creating more apartments.
Of course, for a homeowner, that means giving up a big piece of your backyard (which must be at least 30 feet by 30 feet in size), but Bakerman said that many yards are “underutilized” anyway.
“In places like the Bay Area … people are spending a ridiculous amount on their homes,” he added. “They often can’t afford those lifestyles, but everyone wants to attain home ownership.”
The company’s website includes a calculator of how much rental income you might earn, and it says that most owners will be able to make more than $10,000 of additional income each year.
Over time, Rent the Backyard will give the homeowner an increasing share of equity in the apartment, until they own it completely after 30 years. Homeowners also can buy out the startup’s equity and take full ownership at any time (which they’ll need to do if they sell their home and move out).
To be clear, Rent the Backyard hasn’t actually built any apartments yet, but it’s already signed up construction partners, and the goal is to get 10 units permitted and ready for construction by the end of the summer.
“It’s a pretty fast process,” Bakerman said. “It could just be a handful of weeks before we’re able to start building” — and because the units use prefabricated construction methods, the actual building could take as little as a week and a half.
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