Check out this week’s Bad Crypto podcast
The latest flash loan attack in the decentralized finance world has caused a total loss of $6 million.
Read more In an otherwise extremely bullish week, famed investor Ray Dalio reiterated his skepticism of bitcoin and digital assets.
Read more Roger Ver, one of the biggest bitcoin cash advocates, is not a fan of the scheduled fork event of the cryptocurrency’s network.
Read more The cryptocurrency merchant bank has acquired a lending firm and a trading company as it seeks to become the “go to” platform for institutional access to digital assets, the firm said Friday.
Read more The cryptocurrency dropped as low as $15,750, having hit highs over $16,300 in the Asian trading hours.
Read more Welcome back to Human Capital. In this week’s edition of HC, you’ll read about the latest labor struggles at Amazon and the Chan Zuckerberg Initiative, President-Elect Joe Biden’s promises to gig workers, a primary care network for Black people and people of color and more. Lastly, I pulled out some nuggets from DoorDash’s S-1 that are relevant to DEI and labor.
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Former Amazon warehouse worker sues company alleging failure to provide PPE to workers during pandemic
Christian Smalls, a former Amazon warehouse employee, filed a lawsuit against the company today alleging Amazon failed to provide personal protective equipment to Black and Latinx workers during the COVID-19 pandemic.
The class action suit alleges Amazon failed to properly protect its warehouse workers and violated elements of New York City’s human rights law, as well as federal and state laws.
“I was a loyal worker and gave my all to Amazon until I was unceremoniously terminated and tossed aside like yesterday’s trash because I insisted that Amazon protect its dedicated workers from COVID-19,” Smalls said in a statement. “I just wanted Amazon to provide basic protective gear to the workers and sanitize the workplace.”
Center for Black Innovation gets $2.1 million
The Knight Foundation, Surdna Foundation and Comcast NBCUNiversal put $2.1 million into the Center for Black Innovation. The plan is to support Black entrepreneurs and increase the number of Black founders in Miami and throughout the U.S. The money will go toward investor education, facilitating matchmaking sessions between founders and investors, offering courses to founders and more.
Chan Zuckerberg Initiative faces racial discrimination complaint
BERLIN, GERMANY – FEBRUARY 25: (r-l) Mark Zuckerberg, CEO and founder of the social media platform Facebook, and his wife Priscilla Chan pose for a photo before the Axel-Springer-Award on February 25, 2016 in Berlin. Mark Zuckerberg got this first time awarding price for special innovations. (Photo by Florian Gaertner/Photothek via Getty Images)
Ray Holgado, a former employee of the Chan Zuckerberg Initiative, recently filed a racial discrimination complaint with the California Department of Fair Employment and Housing. Holgado, who is Black, worked at CZI from September 2018 through August 2020.
“Despite its social justice rhetoric, CZI is not a welcoming environment for Black employees,” Holgado’s complaint states. “Black employees are underpaid, undervalued, denied growth opportunities, and marginalized. Black employees who want to advance within the organization are shut down and labeled as too assertive or aggressive, while non-Black employees are favored and encouraged. When Black employees have communicated these concerns to CZI leadership, CZI has responded defensively and failed to address the underlying issues. CZI has utterly failed to ‘build a more inclusive, just, and healthy future’ for its Black employees.”
In a statement to TechCrunch, CZI denied the claims.
“While we take any allegation of discrimination seriously and will do so here, this former employee’s specific allegations were previously raised internally, independently investigated, and found to be unsubstantiated,” the spokesperson said. “The Chan Zuckerberg Initiative is committed to fair treatment, access, and advancement for all members of the CZI team. We do not tolerate discrimination of any kind, full stop.”
DEI nuggets from DoorDash’s S-1
Food delivery company DoorDash filed its paperwork to go public today. It’s a long document, so I’ve pulled out the relevant items related to DEI and labor.
DoorDash says it’s committed to diversity and inclusion in its S-1, despite never having released a diversity report
At DoorDash, we are committed to growing and empowering inclusive communities in our company, our industry, and the cities we serve. We believe that a diverse and inclusive workforce is critical to helping us attract and retain the talent necessary to grow our business. We also believe we will be a more successful company if we amplify the voices of those who have not always been heard, and when everyone has ‘room at the table’ and the tools, resources, and opportunities to succeed.
DoorDash also seems to be proud of the fact that none of its 3,279 employees have unionized:
None of our employees are represented by a labor union. We have not experienced any work stoppages, and we believe that our employee relations are strong.
DoorDash, like other gig economy companies, is also gearing up to pursue Prop 22-like legislation in other states:
As such, the passage of the 2020 California ballot initiative is likely to have an adverse impact on our results of operations. In addition, several other states where we operate may be considering adopting legislation similar to the 2020 California ballot initiative, which we would expect to increase our costs related to Dashers in such jurisdictions and could also adversely impact our results of operations.
Spora Health launches primary care provider network for Black people and POC
Image Credits: Spora Health
Spora Health launched its One Medical-like primary care provider network for Black people and people of color.
“An equitable healthcare system has never existed in America, especially for Black folks and that is the goal,” Spora Health founder and CEO Dan Miller told TechCrunch.
Spora Health, which recently closed a $1.2 million seed round, is a primary care provider for Black people and people of color. Initially, Spora Health is taking a telemedicine approach, but eventually plans to open physical locations.
Lyft on passage of Prop 22
“As we look to the future, the win on Proposition 22 in California was a landmark achievement and a major victory for drivers, our industry and the broader Lyft community,” Lyft President John Zimmer said in Lyft’s earnings report this week. “The campaign was successful because it ultimately reflected the desires and priorities of drivers. More than 120,000 drivers signed up to be part of the effort to pass Prop 22 – they rallied, they volunteered, they shared their stories. Voters saw that and stood in solidarity with them. We look forward to continuing our conversations with policymakers across the country.”
Similar to Uber, Lyft is also looking to explore similar legislation across the country. On the earnings call, Lyft CEO Logan Green said Prop 22 provides a model for other states.
Uber and Lyft request rehearing on case that upheld preliminary injunction
Uber and Lyft both filed a petition for rehearings in the case brought forth by California Attorney General Xavier Becerra. Last month, an appeals court upheld a lower court ruling that would force Uber and Lyft to classify their drivers as employees. But now that Proposition 22 has passed, Uber and Lyft want the court to determine if the injunction is still appropriate.
Meanwhile, Uber and Lyft will likely still face lawsuits over worker classification in California since the recently-passed proposition can not be applied retroactively. According to Bloomberg Law, those legal options, however, will be limited and damages will be capped.
Human Rights Watch and Amnesty International on Prop 22
In a joint statement, the Human Rights Watch and Amnesty International called Prop 22 a “devastating blow to the rights” of gig workers.
No worker should face exploitative or otherwise abusive work conditions, but many app-based workers do. We urge app-based companies to bring their wage and labor policies and practices in line with international human and labor rights standards. We urge the government of California to explore other legal avenues for holding companies accountable for respecting workers’ rights. Finally, we urge the United States Congress and the United States Department of Labor to protect the rights of app-based workers, such as through legislative and regulatory action that helps ensure a living wage, paid sick and family leave, and workers’ compensation for illness and injury.
Biden promises to get gig workers the “benefits and protections they deserve”
TOPSHOT – Former vice-president and Democratic presidential nominee Joe Biden (L) and Senator from California and Democratic vice presidential nominee Kamala Harris greet supporters outside the Chase Center in Wilmington, Delaware, at the conclusion of the Democratic National Convention, held virtually amid the novel coronavirus pandemic, on August 20, 2020. (Photo by Olivier DOULIERY / AFP) (Photo by OLIVIER DOULIERY/AFP via Getty Images)
Under President-Elect Joe Biden’s administration, he has promised to “ensure workers in the ‘gig economy’ and beyond receive the legal benefits and protections they deserve,” his transition site states. The administration goes on to describe how gig workers are misclassified and therefore deprived of their rightful benefits and protections.
“This epidemic of misclassification is made possible by ambiguous legal tests that give too much discretion to employers, too little protection to workers, and too little direction to government agencies and courts,” the site states.
Moving forward, Biden says he will work with Congress to create a federal standard that is modeled on the ABC test. Whether Biden follows through with that promise, however, has yet to be seen.
You can read more about how gig workers feel about the upcoming Biden administration as it relates to labor over on Vice.
This is The TechCrunch Exchange, a newsletter that goes out on Saturdays, based on the column of the same name. You can sign up for the email here.
DoorDash filed to go public on Friday, meaning we’ll have at least one more unicorn IPO before 2020 comes to a close. For a high-level look at its numbers, I wrote this, Danny covered who will profit from the deal, and I noodled on the impact of COVID-19 on its business.
I bring all that up because there is another COVID-19 impacted unicorn that we are expecting to see go public in very short order: Airbnb.
When Airbnb filed to go public in August, it seemed like a solid plan. The company was widely reported to be on an upswing from its COVID-doldrums, the public markets were hot for growth and tech shares, and the pandemic’s caseload in the United States was coming down from its summer highs. It looked great for Airbnb to wrap its Q3, drop its public S-1 with the new numbers, and laugh all the way to the bank after showing investors that even a global pandemic and travel industry depression couldn’t stop it.
And yet. The United States and world at large are now in the midst of the worst COVID-19 spike yet, and consumer spend is going down right before we get the company’s S-1. November feels less winsome for an Airbnb recovery than August or September did. Still, when Airbnb files — next week, the scuttlebutt indicates, so get ready — we’ll only have a look at its numbers through the third quarter.
That’s effectively the same timeframe for a dataset that the folks at Cardify sent over and I dug through. Per the company, which tracks real-time consumer spend data, here’s a look at how well Airbnb recovered ahead of its larger industry after the initial recession in pandemic lodging spend:
Impressive, right? Sadly for Airbnb, the initial boom of demand through late June into July tapered as time continued.
Zooming in somewhat, here’s Airbnb spend data from July 2020 through the end of October, the first month of Q4, compared to the same period of 2019:
Declines, then, but still an encouraging set of data for the company regardless. I would not have expected Airbnb spend — via third-party, admittedly — to be this strong.
The trend of folks renting a house for a month seems to have diminished somewhat, in case you are factoring that into your mental math concerning Airbnb revenues from the above charts. Cardify told TechCrunch that after peaking at around +70% in the March-April timeframe, “average booking sizes have now normalized and are approximately 30% higher on a YTD basis.”
There is weakness in October, the charts show, but that appears to be at least partially seasonal given the 2019 line, so I don’t want to over-ascribe rising COVID cases as the cause. The drooping line, however, was echoed in similar SimilarWeb data that was also shared with The Exchange. The dataset concerned accommodation booking volume around the world for a number of travel services, including Airbnb. Its data tracking the US market showed that a bookings recovery through September that made up some ground on March lows was undercut by October declines. Europe’s bookings’ recovery peaked in July and has been falling ever since. Asian volume is creeping higher, but down sharply from prior levels.
It was a mixed picture, but as Airbnb is doing better than its broader industry per Cardify, the aggregated data could be leading us to be more pessimistic than we otherwise need to be. We’ll see shortly what the real numbers are, but I couldn’t help but share what I was reading with you. On to the S-1!
Before DoorDash filed, we were going to talk about Brex today in this space after Airbnb. But, since we got extra busy, expect those notes early next week on The Exchange.
Market Notes
The week was super busy with earnings, so I’ve collected a few notes from calls with select companies after they reported. Apologies to everyone’s’ favorite reporting firm, but we’re space-limited.
Appian crushed earnings expectations. What drove the low-code application development services’ growth forward? According to CEO Matt Calkins, it wasn’t a single thing. Instead, the company’s performance was driven by a long ramp he said, though he did also state that the concept of low-code has reached the public consciousness in new, higher levels during the last few quarters.
Why? The year’s chaos pushed companies into new patterns faster than they had anticipated. Chalk this result up to the accelerating digital transformation being real, which is good news for startups. (For more on Appian and the low-code space, head here.)
Alteryx gave The Exchange an earnings first, providing both its newly former CEO Dean Stoecker and its new CEO Mark Anderson to chat results. The company crushed Q3 expectations, but its Q4 projections did not excite investors. What was up? Anderson argued that ARR growth, not forward GAAP revenue projections, is the most transparent and clear view of an expanding software company, to paraphrase his thinking. You can’t ignore revenue, he said, but given the nuances in how revenue is counted, pay attention to ARR.
Alteryx has a solid ARR target for 2021. We’ll see how investors view its Q4 results and if they align their thinking to that of the new CEO. Alteryx’s former CEO is bullish, saying that in time the market will realize that analytics is at the epicenter of digital transformation. And his company will be there with code to sell.
Moving along, earlier this week I asked a number of VCs about the software venture capital market in the wake of Monday’s sharp selloff and my question about what might happen to public and private software companies if other stocks suddenly became more attractive — strong vaccine news on Monday was later overwhelmed by surging cases as the week went along, but on Monday Zoom lost billions in value as investors fled.
One set of responses came in late, but I wanted to share them all the same as they were more bullish than I anticipated. In the view of Laela Sturdy, a general partner at Alphabet Capital G, “private software investors are unlikely to change their investing patterns much as a result of fluctuations in the public market,” adding later that “public market changes would have to be very extreme — as in 30 percent or more — in order to impact growth stage valuations.”
The connection between public valuations and trading patterns and private capital deployment exists, but how closely the two are linked depends on what’s happening at any given moment, and it appears that at the moment private investor excitement about software is durable.
Sturdy explained why that may be: “Long-term secular trends around cloud adoption, automation and AI, data, security, fintech infrastructure, and the ongoing rapid acceleration of digital transformation will help tech companies maintain their status as the darlings of growth investors in both the private and public markets.”
- Hopin raised $125 million at a $2.125 billion valuation after scaling to $20 million in ARR in under a year. Wow.
- Square and PayPal earnings augur well for fintech startups overall, though it appears that most fintech money is going to only the latest-stages of that niche. (TrueBill just raised $17 million, notably.)
- Udemy wants $100 million more.
- What’s ahead for edtech startups now that edtech stocks are taking hits?
- Menlo Security landed $100 million more at an $800 million valuation. Not bad!
Various and Sundry
And finally, the rest of the stuff that I couldn’t get to this week. Here we go:
- Chatted with Cambridge Innovation Capital, a neat venture capital firm from Cambridge in the U.K. — not the Cambridge on the American East Coast. More to say here, but the good news is that hubs of innovation really are maturing into startup factories the world around.
- I got my hands on an early copy of a survey of LPs put together by Allocate. It comes out Monday I think, but it said that “only 20% of [LP] respondents said COVID had slowed their investment activities,” which helps explain all the funds we’ve seen in the past few months.
Closing with something fun, remember that look we did of the performance of various startups in Q3? That was fun. Anyhoo, no-code “online form builder” JotForm told The Exchange that its revenue is up 50% from its 2019 results, that its enterprise customer base is up 620%, and that it expects to reach “100,000 total paid users by end of year.” Neat!
Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7 a.m. PT). Subscribe here.
DoorDash has become the go-to delivery choice for millions of people cooped up during the pandemic this year. Now it has filed an S-1, revealing its financials as it nears a long-intended IPO. These innards show an exciting business — and a larger story about how the year is going for tech companies in general.
When the company filed initial public offering paperwork back in February, it was coming off of an expensive year of growth in 2019. The California state legislature was passing laws, meanwhile, that directly targeted its gig-economy labor model. Then the pandemic hit. More from Alex Wilhelm:
DoorDash has grown incredibly rapidly, scaling its revenues from $291 million in 2018 to $885 million in 2019. And more recently, from $587 million in the first nine months of 2019 to $1.92 billion in the same period of 2020. That is 226% growth in 2020 thus far… How high-quality is DoorDash’s revenue? In the first three quarters of 2019, the company had gross margins of 39.9%, and in the same period of 2020 the figure rose to 53.1%, a huge improvement for the consumer consumable delivery confab.
The other jolt of good news for the company arrived last week. A California ballot proposition passed that preserved the contractor model it relies on for deliveries.
World events did not take a breath, though. A COVID-19 vaccine appeared on the horizon this week, and could lead to the pandemic ending as soon as next year. Will this be bad for DoorDash’s business? Alex took another look at the numbers for Extra Crunch, and didn’t come away with a clear answer. On the one hand, the company has been making ongoing investments in its delivery platform technology, which has helped to drive the success this year already. On the other hand, the S-1 is open about post-pandemic reality — profitability is going to decline. Alex:
To buy into the DoorDash IPO, especially at its currently floated $25 billion price, you have to believe that the company’s revenue growth will slow modestly at most. Otherwise the price makes no sense. Bearish investors who might expect the company to post negative growth in Q3 2021 won’t pay any price for DoorDash shares, but in between the two camps is a mess of vaccine timings, shifts in consumer behavior and macroeconomic questions that could determine how many American families can afford delivery. All of which will impact DoorDash’s future growth rates.
For those looking further out, DoorDash stock is about how you think the pandemic is going to change the world for the long term, or not. Are we going to be using DoorDash more often now for deliveries? Are we going to be at home as much in the first place? Or are we going to go back to offices, stores and restaurants like we did before?
Speaking of investors, Danny Crichton illustrates why it pays to bet on the world changing. The company has raised nearly $2.5 billion over the years. Today that includes an 18.2% ownership stake by Sequoia, 22.1% by the SoftBank Vision Fund, and 9.3% by Singapore’s GIC. As he writes for Extra Crunch, the founding executives Tony Xu, Andy Fang and Stanley Tang each own around 5% — smallish wedges of a growing pie. Maybe that is too much dilution? Or maybe, considering all of the other delivery companies that have failed or gone sideways, this is the pinnacle of success in the sector.
(Photo by Dogukan Keskinkilic/Anadolu Agency via Getty Images)
The Vaccine
We all knew that at some point solutions would be figured out. But as COVID-19 cases have climbed this season, and as anxiety built around elections, it was hard to believe that the vaccine was right around the corner. The initial success reported Monday by BioNTech and Pfizer may mean that these two companies are close to success. But many other companies are attempting to use the same experimental gene-based vaccines so we may see others winners soon.
The stock market is already repricing tech stocks, in any case. Besides the timely arrival of the DoorDash S-1, here are a few other headlines about the impact of the news:
Positive vaccine news punishes pandemic-boosted companies like Zoom, Peloton, Etsy
What happens to high-flying startups if the pandemic trade flips? (EC)
As public investors reprice edtech bets, what’s ahead for the hot startup sector? (EC)
5 VCs discuss the future of SaaS and software after Pfizer’s vaccine breakthrough (EC)
Image Credits: John Artman
Tencent’s fintech business is the size of an Ant
In other news about political turbulence and the tech world, Rita Liao inspects Tencent’s quietly huge fintech empire and concludes that it “will need to tread more carefully on regulatory issues.”
Here’s why, for those trying to understand this global company and its place across markets:
As Ant Group seizes the world’s attention with its record initial public offering, which was abruptly called off by Beijing, investors and analysts are revisiting the fintech interests of Tencent, Ant’s arch rival in China. It’s somewhat complicated to do this, not least because they are sprawled across a number of Tencent properties and, unlike Ant, don’t go by a single brand or operational structure — at least, not one that is obvious to the outside world. However, when you tease out Tencent’s fintech activity across its wider footprint — from direct operations like WeChat Pay through to its sizeable strategic investments and third-party marketplaces — you have something comparable in size to Ant, and in some services even bigger.
Image Credits: the_progressive (opens in a new window) / Flickr (opens in a new window) under a CC BY-SA 2.0 (opens in a new window) license. (Image has been modified)
How one founder combined edtech and gaming
Serial founder Darshan Somashekar writes that if you want to build a great edtech product, then perhaps it should be a game. Here’s more, from his guest column for Extra Crunch this week:
Earlier this year, we launched Solitaired, a casual gaming platform that ties card games to educational experiences and brain training. We’re still early, but signs are encouraging: Our average time on site is 30 minutes, more than three times that of our earlier business. Even better, users come back often, on average returning more than five times per month. Since we’re now in the gaming space, we should have expected these metrics, but they still blew our expectations away. We’ve also found that the downsides can be mitigated. For example, high engagement has led to strong virality, driving down our CAC and increasing our growth. In-app purchase abuses can be tempting for game developers, but by focusing on user growth KPIs, we don’t have the desire to go down those routes. Lastly, the threat of Big Tech is there, but at present most of their attempts have yet to strike a chord among users. More importantly, that’s why choosing a market so massive that even individual Big Tech players can’t dominate is key: With a market this size, you can shoot for the stars, miss the moon and still do well for yourself.
Around TechCrunch
Pioneers of in-space refueling and manufacturing join TC Sessions: Space 2020
NASA’s head of human spaceflight, Kathryn Lueders, will join us at TC Sessions: Space
Get fast money for your space startup at TC Sessions Space this December
Across the week
TechCrunch
This startup is betting that you want to binge remote-work content
Calling Dublin VCs: Be featured in The Great TechCrunch Survey of European VC
Human Capital: The gig economy in a post-Prop 22 world
‘Free speech’ social network Parler tops app store rankings following Biden’s election win
Renewable power represents almost 90% of total global power capacity added in 2020
Extra Crunch
Square and PayPal earnings bring good (and bad) news for fintech startups
What I wish I’d known about venture capital when I was a founder
Conflicts in California’s trade secret laws on customer lists create uncertainty
What we’ve learned about working from home 7 months into the pandemic
Dear Sophie: What does Biden’s win mean for tech immigration?
#EquityPod
Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.
The full Equity crew was on hand to debate the current venture capital market, curious about how risk-on, or risk-off things really are today. Danny, Natasha and I framed the conversation around a number of news items from the week, including:
- Wrkfrce has launched, and we wanted to chat more about the future of niche media, bringing The Juggernaut’s own recent round and the Quartz shakeup into the conversation.
- And on the media front — always a risky venture capital investing domain — Spotify has snapped up another podcasting company, this time paying $235 for Megaphone. Our take? A string of small exits probably won’t encourage VCs to take on more risk in the space (Hunter Walk said the same thing here.)
- Turning to risk more generally, I asked Natasha to weigh in on the earlier stages of the venture market, and Danny on its later tranches. There’s still lots of money, but it appears more focused on chasing winners than bolstering or supporting less-obvious startups.
- That market is not slowing a risk-on move toward more venture capital players, as the Spearhead news showed a new focus for the firm to invest in emerging fund managers.
- And there’s still plenty of risk tolerance in remote-work solutions like Hopin, which just raised $125 million at a $2+ billion valuation. We’re torn on the round, but Danny likes it and he’s a former VC.
- And we wrapped with a chat about upcoming IPOs, and the recent SoftBank results. If DoorDash, Airbnb and others are going to go this year, they need to go soon. So far, no dice.
It was a busy week, despite the month. Expect more of the same next week.
Finally, don’t forget that our own Chris Gates is cutting Equity videos out of every episode that you can find over on YouTube. He does a great job and it’s great to be on video, as well as audio platforms.
Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.
Welcome back to This Week in Apps, the TechCrunch series that recaps the latest OS news, the applications they support and the money that flows through it all.
The app industry is as hot as ever, with a record 204 billion downloads and $120 billion in consumer spending in 2019. People are now spending three hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.
Top Stories
Trump administration backs down on TikTok ban
(Photo by AaronP/Bauer-Griffin/GC Images)
The Trump administration seemingly forgot it had banned the TikTok app in the U.S., as the president focused this week instead on sowing doubt over the integrity of the U.S. elections — which the Dept. of Homeland Security just called the “most secure in American History,” by the way.
The inaction on the Trump administration’s part revealed what many suspected all along: that the TikTok ban was largely performative.
Earlier this week, TikTok went public with the fact that it hadn’t heard anything about its ban for weeks, despite the fact that it had a deadline of November 12 to divest its U.S. assets. The company filed a petition in the U.S. Court of Appeals for the D.C. Circuit on Tuesday, calling for a review of actions by CFIUS (Trump’s committee on foreign investment in the United States).
TikTok had earlier asked for an extension, but never heard back, it said.
Or, as the winning headline put it, courtesy of The Verge: “TikTok says the Trump administration has forgotten about trying to ban it, would like to know what’s up.”
In a statement, TikTok said:
“For a year, TikTok has actively engaged with CFIUS in good faith to address its national security concerns, even as we disagree with its assessment. In the nearly two months since the President gave his preliminary approval to our proposal to satisfy those concerns, we have offered detailed solutions to finalize that agreement – but have received no substantive feedback on our extensive data privacy and security framework.
Facing continual new requests and no clarity on whether our proposed solutions would be accepted, we requested the 30-day extension that is expressly permitted in the August 14 order. Today, with the November 12 CFIUS deadline imminent and without an extension in hand, we have no choice but to file a petition in court to defend our rights and those of our more than 1,500 employees in the US. We remain committed to working with the Administration — as we have all along — to resolve the issues it has raised, but our legal challenge today is a protection to ensure these discussions can take place.”
After getting the reminder, the Commerce Dept. on Thursday said it wouldn’t enforce the order that required TikTok to shut down, citing a preliminary injunction against the shutdown last month that came about as a result of the lawsuit by TikTok stars, who claimed the app’s closure would impact their ability to make an income. However, it also appealed that same ruling, leading to further confusion.
The question now is how will the incoming Biden administration proceed with regard to the Trump TikTok ban. Though Biden has criticized Trump’s China policy, concern over TikTok was one that saw bipartisan support. Biden even said during a campaign stop in September that it was worrisome that a Chinese operation would have access to over 100 million young people in the U.S.
Election results send conservative apps up the charts
After a nerve-wracking week of election results which devolved into political chaos as Trump rallied his base to believe baseless claims of fraud, a number of right-wing Trump supporters turned to alternative apps for social media and news.
The App Store’s top charts, which are determined by a combination of downloads and velocity, among other factors, soon featured a new set of alternative apps, led by free speech network Parler, which found itself in the No. 1 spot. (It’s since slipped thanks to Walmart’s Black Friday sales, which sent the retailer’s app flying up to No. 1.)
Image Credits: Screenshot from App Store
According to one estimate, Parler saw 980K downloads from November 3 through November 8. Other apps also benefitted from the election drama, including social network MeWe (now No. 10 on the iPhone Top Free Apps chart in the U.S. and right-wing news network Newsmax TV (No. 7).
Unlike Facebook and Twitter — which increasingly use fact-checking services to label or, in extreme cases, hide false claims behind an extra click — alternative apps do not. But they are not neutral platforms by any means. The verified account from “Team Trump” was among those that automatically greeted new Parler users, for example. Right-wing politicians like senator Ted Cruz and representative Devin Nunes as well as other conservative personalities have set up shop on Parler, too.
As a result, the community is lopsided. Users are posting to amplify their beliefs among those who largely feel the same as they do. And, because Parler does not combat misinformation and conspiracy theories with fact-checking, it’s already been targeted by a conspiracy theory of its very own. A Photoshopped image of a Fox News ticker spread confusion on Parler this week, as the modified image claimed that George Soros owned the social network. The conspiracy got enough traction that Parler founder John Matze had to post that it was not true. But Parler’s true origins and ownership are still being discussed.
It’s unclear to what extent the conservative apps represent a new wave of social media with long-term staying power, given that any relative newcomer to the space will still ultimately have to compete with very large networks, like Facebook’s 2 billion users. Though smaller than Facebook, Twitter’s 330 million monthly active users is still much larger than Parler’s monthly active user base of about 4 million (its active users are around half of its registered users, which is now 8 million.)
Larger platforms have resources to pour into more than just the basics of keeping the servers running. And, to date, that’s led to the demise of numerous other would-be Facebook rivals. The few apps that manage to grow a following these days are those that get a majority of younger, mainstream users, like TikTok and Snapchat.
Regardless of your political leanings, I think we can all agree there was a lot of this going on this week:
Instagram Redesign
Image Credits: Instagram
Instagram this week put its TikTok competitor Reels front-and-center in a redesigned version of its app by giving it the center position on its new navigation bar. The update also replaced the Activity tab (heart icon) with the Shop tab, following a test that had changed this aspect of the app’s home screen earlier this summer. And it revamped the Camera interface and did away with the IGTV button.
In the redesigned app, both the Compose button and the Activity tab have been relocated to the top-right of the home screen, while the center middle button now belongs to Reels.
Image Credits: Instagram
The redesign is an aggressive attempt on Instagram’s part to direct users to its short-form video feed, Reels, which has so far seen only a lukewarm reception from reviewers, who have called it stale, lacking in effects and another contributor to Instagram bloat.
The changes were also a big push to make the Instagram app more of an online shopping destination at a critical time for the e-commerce market. The coronavirus pandemic accelerated the shift to e-commerce by at least five years, according to some analysts. That means any plans Instagram had to become a major player in online commerce were also just expedited.
Both moves signal a company that’s worried about the impact TikTok may have on the long-term future of its business. TikTok is now projected to top 1.2 billion monthly active users in 2021. And as its recent partnership with Shopify on social commerce indicates, it could be a new home for social commerce soon too.
Weekly News
Platforms
- Apple at its Mac event detailed that its new Apple Silicon Macs would be able to run iOS apps. The news was first announced at WWDC, but is now officially going to roll out with Big Sur and the new Macs. Apple showed off Among Us and HBO Max apps during a demo, but it’s unclear if others are being allowed to opt out.
- Apple’s TestFlight beta testing app now supports automatic updates. At last!
- iOS 14.3 and iPadOS 14.3 beta 1 releases arrived.
- Android added support for PyTorch for on-device AI processing.
- Epic Games scores a point in the App Store legal battle over in-app purchase fees. A judge dismissed Apple’s claims that Epic’s actions were wrong, which reduces the potential risk of its lawsuit, limiting Apple’s counterclaims to breach of contract. (Punitive damages have not yet been discussed.)
- Apple to suggest third-party apps during setup, with iOS 14.3, according to details found in the app’s code. This appears to be there for compliance with local laws in select countries where antitrust issues are a concern.
- Android Enterprise Recommended program adds Samsung and others. The program, launched in 2018, helps enterprise customers evaluate and approve devices that meet Google’s requirements for hardware, software and updates. This change brings Samsung Galaxy devices and others into the fold.
- Time to vote for Google Play’s “Best of 2020.” You can vote through November 23 to help pick Google’s Users’ Choice winners.
Security & Privacy
- Zoom settled with FTC after making deceptive security claims. The company had claimed its video calls were protected by “end-to-end” encryption that made it impossible for anyone, including Zoom to listen in. This wasn’t true, as Zoom maintained the cryptographic keys that could allow it to access the content of its customers’ meetings.
Apps in the News
Image Credits: Facebook
- Facebook copies Snapchat…again. Messenger and Instagram are getting a new “Vanish Mode” feature that lets you enable disappearing messages from within a conversation. The upgrade on Instagram is only part of the big messaging update that unifies the inbox with Facebook.
- Apple cracked down on iOS terminal apps. a-Shell and iSH, two terminal apps popular with developers, were blocked from the App Store because they…drum roll…execute scripts. Oh c’mon, Apple. iSH appealed and was returned to the App Store. a-Shell has appealed as well. Apple ended up apologizing.
- No more free storage for your Google Photos. Google this week said all your photo uploads will now count towards your Google account’s 15GB of free storage. Get ready to pay for Google One.
- TikTok expands fundraising features. The company already allowed users to fundraise from donation stickers. Now you can do so directly from your profile, too.
- Disney+ app reaches 100M+ global downloads, with 62% coming from the U.S., according to Apptopia data.
- TikTok to top 1.2B MAUs by 2021, per App Annie’s forecast.
- Bumble’s new feature prevents bad actors from using “unmatch” to avoid being reported for harassment and other issues. The change came following reports of victims of harassment and crime, including rape, were unable to report their abusers because they had unmatched their victims.
- Zynga recorded a 46% rise in revenue in Q3 2020, to reach $503 million, an increase in DAUs of 53% to 31 million, and a 23% increase in MAUs to 83 million.
Trends
Image Credits: Netflix/TechCrunch
- Netflix tries a TikTok-like feature. Netflix experiments with a full-screen vertical video feed featuring comedy clips. The company says the goal is to help users discover new shows and add them to their watch list.
- U.S. Elections boosted mental wellness app installs by 30%. According to Sensor Tower data, the top five meditation apps (Calm, Headspace, Pray.com, Breethe and Insight Timer) saw their installs collectively grow 30% week-over-week in the period from November 3 to November 5 as compared to October 27 to October 29.
- App Annie 2021 forecast: Remote business apps (e.g. Zoom) are expected to see a compound annual growth rate (CAGR) of 57% and remote learning apps will see 62% growth in 2021. Total time in mobile banking and finance apps will surpass 31 billion hours annually in 2021, representing a four-year CAGR of 35%. Fitness and e-commerce will grow as well, at +23% and +40%, respectively.
- Chinese e-commerce platforms are gamifying Single’s Day, the world’s largest shopping festival, to keep consumers in their apps longer. Friends can join each other’s teams to get even bigger deals. Some people, however, criticize.
Funding and M&A
- JumpCloud raises $75M in Series E funding for its cloud directory and Apple MDM expansion
- Nigeria’s Kuda raises $10M to be the mobile-first challenger bank for Africa.
- Food delivery app and website DoorDash filed to go public. The company has raised $2.5 billion in capital to date.
- Personal finance app Truebill raises $17M. The app and website help users track down subscriptions they no longer want to pay for, negotiate to lower bills and more.
Downloads
HBO’s “His Dark Materials: My Daemon”
HBO teamed up with creative studio Framestore to create a new iOS and Apple Watch app that lets fans of the show “His Dark Materials” interact with their own “daemons” — the magical animal companions that serve as an extension of characters’ souls, TechCrunch reported. The app uses AR to allow the daemon to interact with the world around you.
NightWare for Apple Watch treats PTSD
Image Credits: NightWare
The FDA approved an Apple Watch app for the treatment of PTSD. The app, NightWare, is only available with a prescription, and uses Apple Watch sensors to track body movements and the heart rate during sleep to create a profile. When it detects a PTSD nightmare, the watch vibrates to disrupt the the user’s sleep and bring them out.
OmniFocus launches iOS 14 widgets
Image Credits: OmniFocus
Productivity app OmniFocus launched new iOS 14 widgets this week, including a forecast widget with a calendar view for today and the days ahead and a perspective items widget with a list of upcoming items in a perspective of your choice. The widgets are available in small, medium, and large sizes, and can have their font size customized.
