Ripple, the payments startup with an IPO in the cards and a complex relationship with the XRP cryptocurrency, is branching out into lending.
Read more An undisclosed vulnerability in LND versions 0.10.x and below was revealed Thursday. Developers are urging node operators to update to the newest version.
Read more A new report from bitFlyer Japan states the exchange is now custodying more than 161.8 billion yen ($1.5 billion) on behalf of its clients, a two-year record for the company.
Read more Bitcoin’s price jumped on news of payments firm Square’s investment while traders have amassed over $165 million in ether options open interest for December expiration.
Read more Eight of the nine mining projects answering a survey on EIP 1559 had a negative impression of the proposal, with seven saying they would not implement the change.
Read more Lalamove, an on-demand logistics service active in China, Southeast Asia, and Latin America, has officially entered the U.S. seven years after launch.
As the COVID-19 pandemic keeps millions of Americans home, Hong Kong-based Lalamove believes it can seize the growing demand for delivery services in the country. It makes its debut in the Dallas Fort-Worth area, a major hub for distribution and logistics in the U.S. In days the service will launch in Chicago and Houston.
The startup was one of the first in Hong Kong to hit the $1 billion unicorn valuation mark alongside its archrival GoGoVan. Its business is multifold and highly localized, but essentially it works as an Uber for businesses and individuals that need to move goods within the city.
In China, where it’s known as Huolala (货拉拉), it primarily serves as a broker between shippers who need to send cargo and a network of truck drivers. In Southeast Asia, the business functions similarly with the addition of food delivery for restaurants, a crowded and cash-burning space. In the U.S., its fleet of sedans, SUVs and pickup trucks are available 24/7, allowing it to target customers spanning catering, retail, e-commerce, manufacturing and construction, with fees starting at $8.90.
“Delivery is essential, especially during the pandemic. But many local businesses don’t have or cannot afford in-house fleets, so we’re excited to work with businesses in the Dallas Fort-Worth area to provide same-day, on-demand delivery services to their customers,” said Blake Larson, international managing director at Lalamove and formerly co-founder of Rocket Internet’s Asia-focused e-hailing startup Easy Taxi.
Like GoGoVan, Lalamove was founded by a Hong Kong entrepreneur who was educated in the U.S. Both companies have scored fundings from heavyweight institutions from China and elsewhere.
Lalamove’s investors included Hillhouse Capital, Sequoia Capital China and Xiaomi founder’s Shunwei Capital. Through a merger with China’s 58 Suyun, GoGoVan counts Tencent, Alibaba, KKR and New Horizon Capital amongst its backers.
The Hong Kong startup’s global expansion comes at a time when TikTok stumbles in the U.S. due to its links to China. In the logistics startup’s case, a Chinese team operates the Chinese division Huolala, while separate international teams manage the overseas segments of Lalamove, TechCrunch understands. The core of TikTok’s challenge in the U.S. is the video app’s dependence on its Chinese parent ByteDance’s technological capabilities.
To date, Lalamove has verified and onboarded more than 500 partner drivers in Dallas Fort-Worth, with plans to add another 500 in the area by the end of this year. It’s also hiring for its regional operational office at a time when the U.S. is struck by widespread virus-induced layoffs, furloughs and slowdown in hiring.
Lalamove claims it has to date matched more than 7 million users with a pool of over 700,000 delivery partners in 22 markets around the world.
If you’ve been following the SPAC boom, you may have noticed something about these blank-check vehicles that are springing up left and right in order to take public privately held companies. They are being organized mostly by men.
It’s not surprising, given the relative dearth of women in senior financial positions in banking and the venture industry. But it also begs the question of whether women, already hustling to overcome a wealth gap, could be left behind if the trend gains momentum.
Consider that studies have shown women investors are are twice as likely to invest in startups with at least one female founder, and more than three times as likely to invest in startups with female CEOs. It’s not a huge leap to imagine that women-led SPACs might also be more inclined to identify women-led companies with which to merge and take public.
SPAC sponsors can reap handsome rewards, too. In return for lining up investors, then persuading a target company to accept the terms it offers them, sponsors typically receive 25% of the SPACs founder shares, which can mean a lot of money in a short amount of time, given that SPACs typically aim to merge with a company in two years or less. In fact, even if the SPAC performs terribly — say the company with which it merges is later accused of fraud — those sponsors get paid.
Eventbrite cofounder Kevin Hartz, who is overseeing a $200 million SPAC, explained it to us in August this way: “On a $200 million SPAC, there’s a $50 million ‘promote’ that is earned.” But “if that company doesn’t perform and, say, drops in half over a year or 18-month period, then the shares are still worth $25 million. (Hartz himself called this guaranteed payout “egregious,” though he and his partner in the SPAC, Troy Steckenrider, didn’t structure their SPAC differently, saying that as a first-time SPAC sponsor, they wanted to keep things straightforward.)
Women aren’t entirely unaccounted for in the current SPAC craze. Thanks to a state law passed in California in 2018, nearly all SPACs based in California have a female director, as reported earlier by Axios.
More, in the two weeks, at least three SPACs to register with the SEC have been launched exclusively or in part by sponsors who are women. Hope Taiz, a New York-based investor who began her investment banking career at Drexel Burnham Lambert, registered plans this week with the SEC to raise a $300 million blank-check company called Aequi Acquisition.
Northern Star Acquisition, a consumer-focused SPAC co-led by magazine vet Joanna Coles, meanwhile filed for a $300 million IPO last week, and Climate Change Crisis Real Impact I Acquisition, a SPAC focused on climate technology, raised $200 million in an IPO . The blank check company is co-led by Mary Powell, the former CEO of Green Mountain Power.
One SPAC sponsor — Betsy Cohen, a founder and former CEO of the financial services company Bancorp — has really taken to SPACs, establishing four fintech-related shell firms so far, the most recent of which raised $750 million last month. (As an interesting aside, the SPAC programs of both Goldman Sachs and Jefferies are led by women.)
Given these developments, some might wonder — reasonably — if it isn’t a little early to worry about women missing out on this apparent gold rush. Still, women-led SPACs represent a minuscule percentage of the 133 SPACs that have raised more than $50 billion in proceeds this year at last count.
More, the only tech investors to jump into the pool to date are exclusively men, including Chamath Palihapitiya of Social Capital (who has dozens of SPACs in mind); Hartz and Steckenrider; entrepreneur-investors Reid Hoffman and Mark Pincus, Ribbit Capital’s Mickey Malka; former Uber executive Emil Michael; and the founders of FirstMark Capital.
It isn’t that their female counterparts aren’t paying attention, seemingly. A number of top women VCs with whom we’ve talked say they’re following the action and weighing how to participate. One such prominent investor told us she’s been researching under what circumstances it makes sense for VC firms to engage in a SPAC’s origination.
Others may be looking to gain exposure first to SPACs through their portfolio companies. Dana Grayson of Construct Capital, for example, led an early investment in the 3D printing company Desktop Metal — which is going public through a SPAC-led deal — while a partner the firm NEA. At TechCrunch’s recent Disrupt event, Grayson, speaking about Desktop Metal, called SPACs a “great new viable alternative for companies.”
Either way, observes Kristi Marvin, a former investment banker who now runs the data site SPACInsider, it’s not time to panic, she suggests.
For one thing, as with “most banking things, SPACs skew heavily male,” so it’s to be expected that many more men are sponsoring SPACs. The SPAC market is also on the verge of overheating, based on what she is seeing. “You have 10 deals trying to price in the same day, and investors are tapped out.”
SPACs also require a learning curve that some underestimate. “It’s why you see hedge funds and PE firms more involved in SPACs; they have infrastructure to do them versus three guys who are facing a ton of work just to do the administrative side of things,” notes Marvin.
As with other financial products, Marvin expects to see more women embrace SPACs over time, especially if they prove to be as durable as many early adherents suggest. That said, she adds, “If in a year or two, it’s still only male VCs who’ve dipped their toe into SPACs, it may be a problem.”
According to details from a shocking new affidavit, the FBI uncovered a group planning “violent action against multiple state governments,” including a detailed plot to capture or kill Michigan Governor Gretchen Whitmer. Individuals involved in the plot organized across Facebook groups, in-person events and at least two encrypted chat apps that the FBI did not name.
Whitmer, a Democrat, became a major target of pervasive anti-lockdown sentiment on the political right earlier this year when states imposed restrictions to slow the spread of the coronavirus. According to the affidavit, at a June in-person meeting, members of the group “talked about murdering ‘tyrants’ or ‘taking’ a sitting governor.” Thirteen people have been charged in relation to the kidnapping plot.
The group grew its numbers after contacting a Michigan-based militia known as the Wolverine Watchmen that shared overlapping interests. While it was not named at the time, Facebook removed the Wolverine Watchmen group from its platform in June when it purged a number of groups connected to the anti-government boogaloo movement. Wolverine Watchmen recruited on Facebook for seven months, from November of last year until June.
“Today we are designating a violent US-based anti-government network as a dangerous organization and banning it from our platform,” Facebook wrote at the time, drawing a distinction between violent boogaloo groups and the “loosely-affiliated” boogaloo movement.
Facebook says it played a “proactive” role in the FBI investigation, first reaching out to law enforcement six months ago. The FBI said it became aware of the activity through social media and also relied on an informant to collect information from within the group.
“We remove content, disable accounts and immediately report to law enforcement when there is a credible threat of imminent harm to people or public safety,” a Facebook spokesperson told TechCrunch. “We proactively reached out and cooperated with the FBI early in this ongoing investigation.”
TechCrunch asked Facebook if the individuals connected with the Michigan militia through Facebook groups but the company did not provide an answer to that question. In August, Facebook identified and banned a number of other Michigan-based militarized groups from Facebook and Instagram, including the Michigan Liberty Militia and the Michigan Militia Corps, as well as another group that uses the “Wolverine” name.
Adam Fox, one of the group’s alleged organizers, live-streamed to a private Facebook group earlier this year, complaining that Michigan’s restrictions were keeping gyms closed. In the video, Fox referred to Governor Whitmer as “this tyrant bitch,” and stated, “I don’t know, boys, we gotta do something.”
In April, Trump cheered on protests against those measures in Virginia, Minnesota and Michigan, three states with Democratic governors. Many of these early events were organized on Facebook, but anti-Whitmer sentiment quickly became ubiquitous on the right across social networks and traditional media.
By July, the group considered attacking a Michigan State Police location but landed on abducting Whitmer from her private vacation home or governor’s summer residence. The same day that decision was made, Fox wrote on a private Facebook page “We about to be busy ladies and gentlemen . . . This is where the Patriot shows up. Sacrifices his time, money, blood sweat and tears . . . it starts now so get fucking prepared!!”
The group alternated between planning to kidnap Whitmer for a private “trial” and killing her on sight. Over the course of the coming months, they conducted surveillance of Whitmer’s vacation home, collected supplies and planned detailed logistics for the kidnapping plot, including the idea of blowing up a nearby bridge to divert police attention. The group discussed those detailed plans in an encrypted chat.
According to the affidavit, “On several occasions, FOX has expressed his intention and desire to kidnap Governor Whitmer before November, 3, 2020, the date of the national election.”
The affidavit also details some of the training exercises the plot’s members engaged in with militias in Wisconsin and Michigan, where they practiced making IEDs “using black powder, balloons, a fuse, and BBs for shrapnel,” and conducted firearm and combat training drills. They shared photos and videos of their techniques through “Facebook discussions,” according to the affidavit.
A shift at Facebook
Facebook’s attitude toward some forms of extremist activity changed radically in recent months. While armed political groups had long been flourishing on the platform, the company cracked down on what it calls “militarized social movements” in August. Just this week, Facebook announced both a broader ban on the pro-Trump conspiracy known as QAnon and a new policy for voter intimidation efforts that use militaristic language.
When asked if the terror plot had an impact on the company’s recent spate of surprising policy changes, Facebook did not provide a direct response. It’s also not clear if the domestic terror plot used Facebook groups to recruit and connect online or just to communicate among members who already knew each other in real life.
Researchers who study extremism have long expressed concerns that Facebook’s algorithmic recommendations can push users toward dangerous ideas — and dangerous behavior.
Militias and other kinds of domestic extremist groups have increasingly leaned on Facebook for recruitment in recent years. Once members are connected and vetted, often through public groups, they are allowed into an inner circle, sometimes in the form of a private Facebook group. The Proud Boys, a violent far-right group with ties to white supremacists, were a prominent example of this recruitment strategy.
Users can be ushered into these extremist groups by Facebook’s algorithmic suggestions, which previously appeared in a box next to a group’s activity. For Facebook pages, those suggestions still appear to the side of the main stream of content, directing users toward “related pages.”
Facebook banned the Proud Boys from its platform in late 2018. But groups interested in violence that kept a lower profile have maintained a large presence on the platform well into 2020, including a number of state “patriot” organizations and anti-government boogaloo groups that coordinate firearm and combat trainings through the platform.
In June, Facebook banned a “violent network” of boogaloo groups, but other groups remain, organizing under code words related to the boogaloo movement. One boogaloo page TechCrunch identified calling itself “definitely not boogaloo” was selling “Boogaloo Boys” patches and posting violent memes as recently as this week.
Unfortunately for researchers and reporters tracking this kind of activity, Facebook recently removed the option to see how many members are in a public group at a glance from the search page.
Facebook recently announced a plan to actually expand the reach of its public groups, surfacing them to more users. “Public Group posts may now get more distribution on and off Facebook so that more people can discover and join in on the conversation,” Facebook wrote in the announcement.
Alphabet’s self-driving technology company hits a major milestone, Apple TV+ extends its free subscription period and Affirm files to go public. This is your Daily Crunch for October 8, 2020.
The big story: Waymo opens up driverless ride-hailing
Waymo hit a major milestone today: It’s offering fully driverless rides to (some) members of the public.
While the Alphabet-owned company has offered plenty of self-driving rides before, they usually came with a human in the driver’s seat for safety. Members of the early rider program who’d signed nondisclosure agreements were able to try out fully driverless rides — but again, they had to sign NDAs first.
Today, the company said members of its more open Waymo One program in Phoenix will be able to go fully driverless, and to take friends and family with them. And over the next few weeks, the program will open up to even more passengers.
The tech giants
Apple is extending some Apple TV+ subs through February 2021 for free — Apple gave away a free year of Apple TV+ to new device purchasers last year; now it’s bumping those subs out to February.
Amazon debuts its first fully electric delivery vehicle, created in partnership with Rivian — The van’s unique features include sensor-based highway driving and traffic assist features.
IBM plans to spin off infrastructure services as a separate $19B business — The company said this will allow it to focus on newer opportunities in hybrid cloud applications and artificial intelligence.
Startups, funding and venture capital
Instacart raises $200M more at a $17.7B valuation — It’s not hard to trace a connection between COVID-19 and Instacart’s business results.
Affirm files confidentially to go public — The news comes after the impending debut was reported in July.
Delivery startup goPuff raises $380M at a $3.9B valuation — GoPuff delivers products like over-the-counter medicine, baby food and alcohol (basically, the stuff you’d buy at a convenience store) in 30 minutes or less.
Advice and analysis from Extra Crunch
Investors, founders report hot market for API startups — Startups that deliver their service via an API are having a moment.
Tech’s role in the COVID-19 response: Assist, don’t reinvent — Speakers at Disrupt explained how technology companies have taken a backseat to frontline workers, rather than attempting to “solve” the issues on their own.
These 3 factors are holding back podcast monetization — Fundamental fixes could unleash the channel’s revenue potential.
(Reminder: Extra Crunch is our subscription membership program, which aims to democratize information about startups. You can sign up here.)
Everything else
General Motors finally gets serious about in-car tech, taps Unreal Engine for next-gen interface — Matt Burns writes that GM’s current crop of in-car user interfaces is among the worst on the market.
Consumers spent a record $28B in apps in Q3, aided by pandemic — According to a new report from App Annie, consumers in the third quarter downloaded 33 billion new apps globally.
US Space Force is getting an immersive space sim training tool built in part by the VFX studio behind ‘The Mandalorian’ — The U.S. Space Force obviously won’t be able to train most of their service people in actual space, so the new arm of America’s defense forces has tasked Slingshot Aerospace to create a VR space sim.
The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.
This week Natasha was on vacation, so Danny and your humble servant had to endeavor alone. She’s back next week, so we’ll be back to full strength as a collective soon enough.
But even with a depleted hosting crew, we had a mountain of news to get through. And to joke about, as Danny was in the mood for a laugh. Here’s the rundown:
- Reddit co-founder Alexis Ohanian’s New Venture Fund Invests in Disposable Camera App: Danny and I are arbiters of what is cool, so we were the perfect pair to discuss influencers and new social applications. This one is actually neat, and Ohanian’s inclusion in the investment viz his new fund was noteworthy.
- Zira raises $3.1M for its shift-scheduling service that helps manage hourly workers: This is a round that I covered, looking into Zira.ai and its product. Our take? It’s neat, but operates in a competitive market.
- Shogun raises $35M to help brands take on Amazon with faster and better sites of their own: This is a similar story. A neat company with a neat product in a space where there is proven demand (TAM, in other words), and competition.
- Unqork’s $207M Series C underscores growing enterprise demand for no-code apps: Another round worth mentioning is the Unqork deal. Unqork is a no-code service that helps other businesses create apps for their companies. It’s growing like a weed, and is thus something worth knowing a bit about.
- Mmhmm, Five-Month-Old Video Startup Making Virtual Meetings More Fun, Raises $31 Million Pre-Launch: Yes, mmhmm has raised more money, and, we’re excited to learn, could be launching this very month.
- Remotion raises $13M to create a workplace video platform for short, spontaneous conversations: Following the Slack news, this round stood out to us. Who will build the remote work comms platform of the future that people like to use?
- And then there was a host of other stuff to get through, like the FirstMark SPAC news, Root’s impending IPO and more on Airbnb’s impending public offering.
That was a lot. We did our best. Hugs and chat with you next week!
Equity drops every Monday at 7:00 a.m. PT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.