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Court orders Apple to implement App Store changes, 2022 forecast, TikTok tries gaming – TechCrunch

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Welcome back to This Week in Apps, the weekly TechCrunch series that recaps the latest in mobile OS news, mobile applications and the overall app economy.

The app industry continues to grow, with a record 218 billion downloads and $143 billion in global consumer spend in 2020. Consumers last year also spent 3.5 trillion minutes using apps on Android devices alone. And in the U.S., app usage surged ahead of the time spent watching live TV. Currently, the average American watches 3.7 hours of live TV per day, but now spends four hours per day on their mobile devices.

Apps aren’t just a way to pass idle hours — they’re also a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus. In 2020, investors poured $73 billion in capital into mobile companies — a figure that’s up 27% year-over-year.

This Week in Apps offers a way to keep up with this fast-moving industry in one place with the latest from the world of apps, including news, updates, startup fundings, mergers and acquisitions, and suggestions about new apps and games to try, too.

Do you want This Week in Apps in your inbox every Saturday? Sign up here: techcrunch.com/newsletters

Apple lost its request to delay App Store changes

Image Credits: Andrew Harrer / Bloomberg / Getty Images

A federal judge ruled this week that Apple can’t push back the deadline to update its App Store policies, as previously ordered in the court’s decision on California’s Epic Games v. Apple lawsuit. Though Apple largely won that case when the judge declared that Apple was not acting as a monopolist (as Epic Games had alleged), the court sided with the Fortnite maker on the matter of Apple’s anti-steering policies regarding restrictions on in-app purchases.

The original ruling stated that Apple would no longer be allowed to prohibit developers from pointing to other means of payment besides Apple’s own payment systems. But Apple wanted that decision put on hold until its appeals case was decided — a delay that would have effectively pushed back the App Store changes by a matter of years.

The judge heard Apple’s requests for a stay on the injunction that was ordered, which would have pushed back the December 9 deadline which forces Apple to start allowing links to alternative payment options inside apps.

The question is now whether or not Apple will actually comply (in the way developers are imagining) and if so, how exactly it will interpret the ruling. In South Korea, Apple was ordered to do something similar but said it believed it was already in compliance due to how the law was written, leading to further discussions between it and regulators. Meanwhile, Google complied with the South Korean law but noted it still requires commissions for third-party payments, just at a reduced rate. While it’s a major step to see any of these app stores open up at all, these moves indicate that the language used to direct changes across the app store has to be precise, or else the companies will find a loophole.

In the meantime, Apple says it intends to ask the Ninth Circuit for a stay as it believes “no additional business changes should be required to take effect until all appeals in this case are resolved.”

Epic Games CEO Tim Sweeney pointed out the judge’s ruling was good for developers, not necessarily good for Epic itself, as Apple plans to block Fortnite from the App Store throughout the appeal process.

2022 Mobile Forecast

App Annie released its annual mobile forecast, this time predicting six major trends to keep your eyes on for the year ahead. Its key takeaways?

  • TikTok will continue its rocketship growth. The firm predicts the app will reach 1.5 billion active users — a figure it will reach 1.75 years faster than WhatsApp did.
  • Big new milestones are ahead for a number of top apps. Pinterest and Temple Run 2 will reach 1 billion downloads. Subway Surfers will hit 2 billion. TikTok will reach 3 billion and reach $3 billion in consumer spending.
  • Metaverse apps will gain big. The apps (e.g. Roblox, Minecraft) will see over $3 billion in consumer spending.
  • Gen Z fintech apps will grow. Mobile-first fintech apps will grow by 160% in 2022, with crypto driving adoption.
  • Video streaming subscription apps will also win big, as entertainment apps hit $12 billion in consumer spending.
  • Creator economy heats up on mobile. Social apps will see $9 billion in App Store spending thanks to creators.

Platforms: Apple

  • Apple to keep App Store Connect open over the holidays. In a change from previous years, Apple said it will keep the App Store open to developer submissions over the 2021 holidays. However, it cautioned that during the dates of November 24 to 28 and from December 23 to 27, submissions may take longer — signaling it’s running with a reduced staff.
  • Apple releases iOS 15.2 into beta. The standout addition in this release is Apple’s new safety feature for kids in iMessage, which allows parents to block potentially sensitive photos in iMessage that may contain nudity, and alert parents if kids decide to view the messages anyway. Other notable new additions include the new Digital Legacy program that allows users to designate people as “Legacy Contacts” who can access your account and personal info in the event of your death, and the new Find My app feature that will alert users to “Unknown Items” that are following you around (an anti-stalking feature). The Apple TV app also got a visual refresh on iPad.
  • Apple reminded developers that a COVID-era deferral on in-app purchases related to virtual group events is nearing its end. In 2020, Apple temporarily deferred the requirement to offer paid online group event services (one-to-few and one-to-many real-time services) through its in-app purchase system. This included businesses like online tutoring, medical consultations, real estate tours, virtual fitness and more. As COVID raged on, Apple deferred that deadline twice more, to June 2021 and then to December 2021, with the goal of supporting businesses impacted by the pandemic. But it now says the deadline will not be pushed again and apps will have to implement IAP by December 31, 2021, or they won’t be approved.
Apple Business Essentials device management interface on MacBook Pro, iPad and iPhone

Image Credits: Apple

  • Apple introduced its own device management platform for smaller businesses, Apple Business Essentials. The solution is aimed at businesses with fewer than 500 employees, and includes device management, storage and support in a single subscription. (The storage piece can be iCloud or a third-party provider) and support is offered both to admins and employees through AppleCare+. The new product emerged from a combination of Apple’s Fleetsmith acquisition and its Apple Device Enrollment Program. 

Platforms: Google

  • Google this week recapped its #AndroidDevSummit announcements, culminating in the release of Jetpack Compose 1.1 beta. The new APIs in 1.1 are now stable, and offer new functionality and performance improvements, the company noted. 1.1 also introduces new features like improved focus handling and touch target sizing or ImageVector caching and support for Android 12 stretch overscroll. And it graduates a number of experimental APIs to stable and supports newer versions of Kotlin.
  • Google additionally noted it has released compose-material3, a new artifact for building Material You UIs with Jetpack Compose. It offers updated components and color system, including support for dynamic color, creating a personalized color palette from a user’s wallpaper.

E-commerce & Food Delivery

  • YouTube is launching a holiday “Stream and Shop” event on November 15-22 which will feature a week of livestreams from creators and brands offering a look at favorite products, deals and discounts.
  • NBCU’s Bravo cable brand is livestreaming a shopping show on Instagram on Black Friday. The show will be hosted by curve model and TikTok influencer Remi Bader, and called “Impulse Try with Remi Bader.” Fans will be able to ask Bader questions about merchandise in real time while viewing items for sale.
  • Apple’s own Apple Store app added a new “Lists” feature that makes it easier to save the items you’re thinking of buying, which can also be shared with a specialist in-store. The app also added videos with audio descriptions that detail the products.
  • Facebook launched Shops in Groups and improved Live Shopping for Creators. The former would allow a group to raise funds by selling merch, while the latter will allow influencers and brands to promote cross-streaming live events, instead of pointing to each other’s pages.
  • Instacart rolled out a new “Deals Tab” in its app where it featured reduced and free delivery options in select markets. The feature will offer daily coupons, sales, bulk product discounts and more. Another feature called “Dollar Store Hub” will allow users to shop from discount stores like Dollar Tree, 99 Cents Only Store, Five Below and Family Dollar.

Image Credits: Instacart

Augmented Reality

  • Niantic places its bet on a “real-world” AR metaverse. The Pokémon GO maker announced the launch of Lightship, an AR Developer Kit (ARDK) that makes it easier to build AR experiences. In introducing the new tools, CEO John Hanke referred to Meta (Facebook)’s vision of a VR metaverse as a “dystopian nightmare” and said his company’s tools would bring people together in person — in the real world, not a virtual one.

Fintech

  • Coinbase stock sank over 13% after missing analyst estimates on its Q3 earnings with $1.31 billion versus the $1.57 billion expected. The company also said monthly transacting users fell from 8.8 million in Q2 to 7.4 million in Q3, and trading volume fell to $327 billion from $462 billion.
  • Discord paused its plans to explore crypto integrations and NFTs after significant backlash from the platform’s users. The company clarified the original screenshot it had shared was part of a hackathon project, not an official announcement. Some fans were concerned over the environmental impacts of cryptocurrency mining while some had objections to “NFT bros.” And others were worried about the potential for crypto scams across Discord. Users were encouraging each other to cancel their subscriptions in protest, leading to the company’s decision to press pause.

Social

Image Credits: Sensor Tower

  • TikTok (including Douyin) remained the most-download app worldwide in October 2021 in the non-games category with more than 57 million installs, per Sensor Tower data. China contributed to 17% of installs, followed by the U.S. at 11%. Instagram was the second most downloaded app, with 56 million installs, a 31% year-over-year increase.
  • Instagram announced the company is testing a new feature called “Take a Break,” which will allow users to remind themselves to take a break from using the app after either 10, 20 or 30 minutes, depending on their preferences. As an opt-in feature, however, the reminders may have a limited impact, as users would have to be motivated to set up the new control for themselves.
  • Instagram is also offering huge creator bonuses for posting content on its TikTok rival, Reels. Some creators are reporting earning up to $10,000 in monthly bonus money, but the system’s criteria is opaque, making the reward feel more like a lottery win than an income. In another challenge to TikTok, Instagram added text-to-speech and voice effects tools to Reels, as well.
  • Instagram looks ready to launch creator subscriptions. On November 1, the company added new in-app purchases to its U.S. app, which are labeled “Instagram Subscriptions” and range in price from $0.99 to $4.99. When we asked what was up, the company said it had nothing to share at this time.
  • Facebook announced new partners for its Creative App Platform, first introduced at F8, which allows people to discover creative apps directly in Facebook Stories. It’s now working with VivaVideo, and Vita, which will soon be joined by Picsart, Camera360 and Sweet Selfie.

Messaging

  • WhatsApp is working on Novi integration. An APK teardown revealed the messaging app may soon be integrating with Facebook’s (um, Meta’s) digital wallet, Novi, according to details in the app’s code.
  • Meta (formerly, Facebook)’s WhatsApp has been given the green light to proceed with a lawsuit against Israeli spyware firm NSO Group. Meta sued NSO Group in 2019, which tried to defend itself by way of the Foreign Sovereign Immunity Act. The court decided because the NSO Group a private company, the lawsuit can continue. The firm had infected 1,400 devices with WhatsApp malware.

Streaming & Entertainment

Image Credits: Netflix

  • Netflix added a short-form video feature to Kids’ profiles in its iOS app. The company said it’s testing a new feature that would introduce kids to its content library by way of short, auto-playing clips. The new addition has some resemblance to the TikTok-inspired Fast Laughs feature for adult profiles, except that these videos are horizontal, not vertical, and a timer counts down how many clips are left to watch.
  • YouTube expanded its test that launches mobile users directly into its TikTok-like product, YouTube Shorts, if that was the area of the app users had last visited. The feature is being tested globally on iOS and is now expanding to Android, TechCrunch confirmed.
  • Clubhouse announced the launch of a new feature called Replays on iOS and Android that makes its live audio programs available to listen to after the fact. The app’s public rooms can optionally be recorded as they happen and then saved to a club or user profile. The Replays will also be downloadable so that anyone hosting a room can share it externally, beyond Clubhouse, “as a podcast, a clip on YouTube, an Instagram story, a TikTok video, or anywhere else,” the company said.
  • Amazon’s Prime Video app introduced a new feature that allows users to create shareable clips from favorite shows. The feature is initially available only in the U.S. on iOS, and only on a limited number of originals, including “The Boys,” “The Wilds,” “Invincible” and “Fairfax.” The company says it plans to add more shows in the future. The feature is notable as most video apps block any sort of sharing and even make screenshots come out all black.

Image Credits: Amazon

  • The Google TV app introduced a new option that will alert you when content you’ve added to your watchlist becomes available for free. The feature can be enabled in the app’s Settings.
  • London-based music tech app TagMix, which allows users to add pro-quality sounds to live video, entered into a licensing agreement with Warner Music Group (WMG) providing the app with access to a selection of the company’s artists.
  • Spotify launched a new destination for its music charts that aims to give both artists and fans more data. The site will feature the Weekly Top 50 Global Songs, Albums and Artists, and logged-in users can dive into the full Top 200 Global Songs, Albums and Artists charts, as well as view detailed stats like streaks, peak position, song credits and the brand new Genre, City and Local Pulse charts.
  • Spotify also finally rolled out a blocking feature that allows users to block others from viewing their listening activity and profile on the app. Users have been asking for such an option since at least 2018.
  • YouTube is removing the “dislike” count on videos across its platform. The decision is likely to be controversial, given the extent that it impacts the public’s visibility into a video’s reception. But YouTube believes the change will better protect its creators from harassment and reduce the threat of what it calls “dislike attacks.” While dislike counts won’t be visible to the public, YouTube is not removing the dislike button itself. Users can still click the thumbs down button on videos to signal their dislike to creators privately.

Image Credits: YouTube

Gaming

  • TikTok Gaming? Zynga is teaming up with TikTok to release an exclusive HTML5 game on the short-form video app. The game, “Disco Loco 3D,” is a single-player endless runner where players collect their own dance moves while challenging friends, avoiding obstacles and collecting medallions as they walk down a catwalk, similar in spirit to Zynga’s “High Heels.” While TikTok says the game is meant to test its audience’s general interest in gaming within its app, the company confirmed that discussions with other game makers are already underway.
  • Zynga reported record third-quarter revenue of $705 million, up 40% from the same period last year, and reached its largest mobile audience ever of 183 million monthly active users, up 120% year over year. The company spoke to TechCrunch about navigating the advertising crisis, blockchain gaming and other plans.
  • Casual game ad costs have declined 38% since the launch of iOS 14.6, but core ad costs are up 78%, according to Moloco (via Business of Apps). The Cost per Install for casual games (arcade, card, puzzle) on iOS dropped 45%, compared to 30% on Android.
  • The top-grossing mobile game in October 2021 was Tencent’s Honor of Kings, which earned $329 million in player spending, up 46.2% YoY, reports Sensor Tower; 96.7% of that revenue was from China, with 1.2% from Taiwan. Tencent’s PUBG Mobile was the second-highest earner with $197 million in gross revenue, where 51% was from China and 11.5% was from the U.S. The remaining top-grossing games were (in order), King’s Candy Crush Saga, Garena’s Garena Free Fire and Riot Games’ League of Legends: Wild Right.

Image Credits: Sensor Tower

Health & Fitness

  • Meditation app Calm added a new family plan that supports up to six accounts. The “Premium Family” subscription mirrors those you’d find on music streaming services, and is $99.99 per year instead of the $69.99 for an individual plan.

Image Credits: Calm

Travel & Transportation

  • China’s Didi is preparing to relaunch its ride-hailing and other apps in China by year-end, following the close of Beijing’s cybersecurity investigation into the company’s data practices.

Productivity

Image Credits: Google

  • Google introduced a new Gmail widget for iOS home screens to help users better manage their inbox. The widget will now display the senders and subjects of your most recent emails, similar to how its Android widget works.
  • Google also added picture-in-picture support for Google Meet on iOS so you can move between apps and exit to your home screen while in a video call. The feature will launch on the Gmail app in the next few weeks, as well, the company said.

Utilities

  • Google is testing a new voice assistant designed for people with speech impairments. The Android app, known as Project Relate, is accepting signups in the hopes of gathering enough participants to give it enough data to train the speech recognition engines.
  • Google Maps on iOS now has a dark mode on iOS. The new theme doesn’t just switch the map to black, but makes the other app elements black as well, like the navigation buttons and bars. The feature is available under the Settings screen accessed under your profile icon.
  • Google removed Google Assistant’s “Your News Update” feature, first launched in 2019, which offered personalized audio digests based on user data. Users could customize the feature in Assistant’s settings, then play back the news over other devices, like Google Home speakers.
  • The Google Recorder added support for three new languages: French, German and Japanese. The update is rolling out first to Pixel 6 and 6 Pro devices.

Government & Policy

  • FOIA records show that the U.S. Treasury bought location data and other smartphone app data from the company Babel Street to find people dodging taxes and sanctions, The Intercept reported.
  • Mississippi is piloting a mobile driver license as a first step toward developing a multipurpose digital ID wallet that would store a range of state certificates and licenses. The move follows Utah’s mobile driver license and Apple’s announcement in September of eight U.S. states signed up to adopt mobile IDs, including Utah, as well as Arizona, Connecticut, Georgia, Iowa, Kentucky, Maryland and Oklahoma.
  • The U.K.’s Supreme Court dismissed a lawsuit against Google that sought $4 billion for allegedly tracking iOS Safari users without consent during 2011 and 2012.
  • Chinese tech companies are censoring language-learning apps and others, Protocol reported. Language-learning app Talkmate removed the Uyghur and Tibetan language offerings due to government policies, then Chinese streaming service Bilibili banned comments posted in Uyghur and Tibetan.

Security & Privacy

  • Security researchers uncovered new spyware that’s targeting South Korean Android users by masquerading as legitimate lifestyle apps. But in reality, the spyware is stealing data from the user’s device, including login credentials, messages and precise location and images.
  • A researcher detailed a hacker-for-hire operation, RocketHack, which had infiltrated the email and Telegram apps of some 3,500 people, including politicians, political candidates, IVF doctors, human rights activists, engineers and others.

Spotify announced its plans to acquire digital audiobook distributor Findaway, whose business connects creators with reseller partners like Apple, Google, Scribd, Audible, Nook, Rakuten Kobo, Chirp, Storytel (a Spotify partner), Overdrive, Audiobooks.com and dozens of other global brands. It also operates a collection of brands that connect publishers and authors with narrators. Spotify declined to share the financial terms of the deal, which is expected to close in the fourth quarter of 2021, subject to regulatory review and approval. The company said it will make more audiobooks available in its app starting next year.

? Taipei-based instant booking app FunNow raised $15 million in Series B funding co-led by Perfect Hexagon Commodity & Investment Bank and Ascendo Ventures.

? Seoul-based edtech company Mathpresso, the makers of the AI learning app QANDA, added an undisclosed investment from Google, which comes five months after the company’s $50 million Series C. More than 85% of QANDA’s 45 million registered users are outside of Korea, in Japan and Southeast Asia.

? London-based Blink, a productivity app for frontline works, raised $20 million in Series A funding led by Next47, valuing the business at $100 million. The app has strong traction with metropolitan bus networks, where it’s used by 5,000 drivers who do things like check payslips, shifts and holiday and overtime pay, as well as read announcements and chat with others. The company is now planning to relocate to NYC.

? Daily, a startup offering APIs that let developers add video and audio features to apps and websites, raised $40 million in Series B funding led by Renegade Partners. The round brought Daily’s total raise to date to $60 million.

Snax

Image Credits: Snax

This fun, new streaming app combines gameplay with its short-form content. The Snax app offers original mini-movies where you play along — either by making choose-your-own-adventure choices for the characters, figuring out riddles, helping hunt for clues in murder mysteries or, soon, even playing games like chess or poker as part of the story. The videos are created by partnered writers and filmmakers, while Snax adds the interactive elements to make the films engaging. Users watch shorter clips then play the game or solve the puzzle before moving on. (Don’t worry, hints are available if you’re stumped!) The app is a free download but offers in-app subscriptions to stream all its series.

VeVe Collectibles

Image Credits: VeVe Collectibles

This digital collectibles app isn’t brand new (it launched this year), but it soared up the charts this week to break into the top of the App Store. The app allows users to collect and display limited-edition 3D sculptures of their favorites across pop culture, gaming, sports, film and TV, anime and animation. This includes collectibles from top brands like Batman, Adventure Time, Monster Hunter, NFL, DC Collectibles, Star Trek, Jurassic Park, Fast and the Furious, Back to the Future, Ultraman, Superman and others. This week, the app got a boost from the announcement that Disney was partnering with it for its Disney+ Day on November 12. The companies launched a series of digital collectible NFTs — “Golden Moments” — that were inspired by stories from Disney, Pixar, Marvel and Star Wars. In some markets, the purchase of a Golden Moments NFT also came with three months of Disney+. An ultra-rare collectible was also available on Disney+ day, which came with 12 free months.

Tweets

Michael Flarup is bringing his book about icon design to life, via a Kickstarter campaign. The book will feature hundreds of works of art from design teams worldwide.



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Galaxy Digital calls off $1.2 billion acquisition of BitGo – TechCrunch

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Crypto sector’s first $1 billion deal, announced at the height of record surge in token prices, is disbanding as the market reverses much of the gains.

Galaxy Digital said Monday it has terminated the $1.2 billion proposed acquisition of crypto custodian BitGo, a high-profile deal they announced in May last year, after the San Francisco-based startup failed to provide its audited financial statements for the year 2021.

BitGo’s alleged failure to provide the financial statements by July 31 violated the terms the two firms had agreed upon last year, Galaxy Digital said in a public statement, adding that the termination of the deal won’t incur the company any fee. Shares of Galaxy Digital, which trades in Toronto, jumped on the news.

The proposed acquisition — which was proposed to include Galaxy Digital issuing 33.8 million new shares, and a $265 million cash component — was supposed to be crypto sector’s first $1 billion deal. The BitGo purchase was positioned to help Galaxy Digital broaden its offerings for institutional investors by adding services such as investment banking, prime lending and tax services. BitGo counts Galaxy Digital, Goldman Sachs, Valor Equity Partners, Craft Ventures, DRW and Redpoint Ventures among its backers.

“The power of the technology, solutions, and people we will have as a result of this acquisition will unlock unique value for our clients and drive long-term growth for our combined business. We are excited to welcome Mike Belshe and the talented BitGo team to Galaxy Digital,” Mike Novogratz, chief executive officer and founder of Galaxy Digital, said at the time.

Novogratz (pictured above) said Monday: “Galaxy remains positioned for success and to take advantage of strategic opportunities to grow in a sustainable manner. We are committed to continuing our process to list in the U.S. and providing our clients with a prime solution that truly makes Galaxy a one-stop shop for institutions.”

The announcement follows Galaxy Digital reporting a second-quarter loss of $554.7 million, up from a loss of $183 million a year ago, earlier this month. In the company’s earnings call, Novogratz said Galaxy Digital had about $1 billion in cash on hand.

Galaxy Digital said today it is waiting for the SEC’s review and stock exchange approval for a Nasdaq listing.



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Uber to sunset free loyalty program in favor of subscription membership – TechCrunch

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Ride-hailing giant Uber is shutting down its free loyalty program, Uber Rewards, so it can focus on its subscription-based Uber One membership.

Uber first launched the rewards program in 2018 as a sort of frequent flyer scheme that allowed riders to earn points for every dollar spent on rides or Uber Eats deliveries. Those points could then be used to get discounts on future rides or deliveries. In November 2021, Uber began introducing Uber One, which, for $9.99 per month or $99.99 annually, allows members perks like 5% off certain rides or delivery orders and unlimited $0 delivery fees on food orders of over $15 and grocery orders of over $30.

In an email sent to customers that was picked up by The Verge, Uber said users can still earn points via the legacy rewards program until the end of August, and that they can redeem those points until October 31. Uber Rewards will officially shut down on November 1, 2022, according to an update posted by the company.

The Uber Rewards program allowed users to earn 1x point for every Uber Pool dollar spent, 2x for every UberX dollar spent and 3x for every $1 spent on Premium. The number of points accumulated would put members into different castes of loyalty, from Blue to Gold to Platinum to Diamond, the latter of which comes with benefits like access to highly rated drivers, free delivery on three Uber Eats orders, access to better customer service and free upgrades.

While phone support will continue for Diamond users, now the only way to get additional perks with Uber will be to shell out for a subscription. Existing Rewards members will get a free one-month subscription to Uber One, but then will be charged for access. If you’re someone who orders Uber Eats more than twice a month, you can easily break even with the Uber One subscription, but plenty of users might not see the money saving benefits in the switch.

Uber did not respond immediately for clarity as to why it is shutting down the Rewards program in favor of the Uber One membership. Perhaps the company did not see the returns and user loyalty that it would have expected from the program and thinks a subscription offering will provide better returns.



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As companies fight to retain talent, employee benefits startups might escape cost cuts – TechCrunch

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How will employee benefits startups fare when their corporate customers start slashing costs as the market goes downhill? We’re going to find out if current trends continue.

There was a spike in the number of startups offering employee benefits services through a B2B2C model last year, as nearly every company focused on employee benefits amid the Great Resignation in an effort to retain and attract talent. These startups sell everything from paid care leave coordination and fertility services to discounted gym memberships to consumers through their employers.

But the freewheeling spending of 2021 is now over, and some of these startups could find their offered services on the chopping block if market conditions continue to worsen.

If there is indeed a recession on the horizon, many of these startups would be right to fear for their future growth, but Brian Kropp, chief of HR research at Gartner, doesn’t think this downturn will mirror the last. Kropp told TechCrunch that even if the market enters a recession, it won’t be similar to what we saw in 2008 because of the ongoing labor shortage.



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You’re not that special (I swear, there’s a startup angle here) – TechCrunch

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Welcome to Startups Weekly, a fresh human-first take on this week’s startup news and trends. To get this in your inbox, subscribe here.

For longtime Startups Weekly readers, you’ll remember that edtech used to be my primary beat. Like, day one beat. Most of my coverage was focused on edtech’s rise in the early innings of the pandemic, the unicorn mad rush and even some IPOs. Duolingo continues to be the company that I know the most about, mostly because I wrote thousands of words about its savvy owl and wild founding story.

While I’m more focused on fintech these days, I was curious if edtech is still a big deal or if the sector — like most during the downturn — is facing a reset. This week, I interviewed seven leading venture capitalists who have a focus on education technology to better understand how the sector is faring during the downturn.

The big takeaway? Edtech is facing a reality check in the form of discipline. Investors explained that the whole startup ecosystem is slower this year; edtech is no different. If anything, as USV’s Rebecca Kaden put it, “The boom in the category in the last couple years means most of our education-focused portfolio is funded quite well [ … ] rounds would be opportunistic rather than out of need, and most are focused on building their businesses for the next couple years.”

As Kaden describes, it’s time to focus and edtech, luckily, has the capital to do it. It makes me think a bit about advice that my friend often gives our friend group: We’re not that special, and that’s a good thing. He means in the kindest way, and the lesson there is that feelings of change, stress or anxiety are not as deep as we may think when we first feel them. What we’re experiencing is shared by other people in their mid-20s, or, well, other sectors in startup land right now. All that matters is if you’ve invested in yourself long enough before the spotlight turns on that when the lights go down, you’re still there. Just quieter and maybe focused a bit more on backstage.

Anyway, for the full survey, read my TechCrunch+ piece: “7 investors discuss why edtech startups must go back to basics to survive.” You can also check out my accompanying analysis, “Edtech isn’t special anymore, and that’s a good thing.” 

In the rest of this newsletter, we’ll get into one Haus’ closed doors, SoftBank execution fund and a pitch deck teardown you don’t want to miss. As always, you can support me by forwarding this newsletter to a friend or following me on Twitter

Bring the Haus down

I wrote about Haus, a buzzy VC-backed aperitif company going up for sale in light of a collapsed Series A. CEO and co-founder Helena Price Hambrecht spoke to TechCrunch about what went down between the company and its potential lead investor, the reasoning they got behind the fallen deal and what’s next.

Here’s what’s important: I’ve never seen an entrepreneur so transparent about the challenges, and unfortunate outcomes, that happen within startups. Here’s an excerpt from my interview with her.

“It’s always dangerous to be low on cash. We got there, and it’s unfortunate, but I know there are many companies in this position right now,” Hambrecht says. “I have been sharing my work online for over 20 years now. It’s definitely something in my DNA. If me sharing this process is helpful for another founder in a tough spot and considering their options, then it makes all of this a little more worth it.”

As for what’s next for the entrepreneur, a Silicon Valley branding veteran, there’s no immediate plans to jump into a new startup.

“My goal, right now, is to be as helpful as I can to make this ABC process have the best outcome possible. After that, I’m going to take some time to process the last four years; it’s been so extraordinary, as well as brutal and traumatic; I’m going to rest and process that.”

Image Credits: MirageC (opens in a new window) / Getty Images

So, when is the SoftBank Execution Fund III dropping?

This week on Equity, your favorite trio dug into the numbers and nuance behind the headlines. It meant SoftBank, Coinbase and deals from ByteDance, Haus and Axios.

Here’s why it’s important: Part of the conversation hovered around SoftBank’s losses on losses, which was really the highlight of the show. Do we see a redemption arc forming for one of the biggest, buzziest investors of the past few years? And what does Tiger Global think? So many questions, and it’s always fun to get Mary Ann and Alex’s take.

SoftBank Group President Masayoshi Son Keynote Address at The JCI World Congress

Image Credits: Kiyoshi Ota / Bloomberg / Getty Images

Pitch Deck Teardown: Five Flute’s $1.2M pre-seed deck

TC’s Haje Jan Kamps is back with another pitch deck teardown, this time looking at the deck that helped Five Flute raise a $1.2 million pre-seed round.

Here’s why it’s important: If you haven’t been following along with this series, you’re — and I mean this in the kindest way — missing out. Haje goes slide by slide, and in this case, taught me a lot about why more can be more in terms of length of deck and why a “chockablock of words” is a top mistake founders make. Read the story here and pitch Haje for the series if you so dare.

If you missed last week’s newsletter

Read it here: “Venture investors to founders: Turn down for what?” We also have a companion podcast out, which you can listen to here: “Founders, whales and the sea change in the entrepreneurial energy.”

Seen on TechCrunch

Coinbase’s earnings fall short of expectations as crypto winter rages

Finix raises $30 million as fintech’s spotlight picks its sides

Mark Cuban, Mavericks in hot water over Voyager ‘Ponzi scheme’

Cloud security startup Wiz reaches $100M ARR in just 18 months

Seen on TechCrunch+

The best cloud unicorns aren’t as overvalued as you might think

Some frank advice for open source startups seeking product-market fit

How digital health startups are navigating the post-Roe legal landscape

Same time, same place, next week? Talk soon,

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Twilio gets hacked, teens ditch Facebook, and SpaceX takes South Korea to the moon – TechCrunch

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Hi again! Welcome back to Week in Review, the newsletter where we quickly recap the top stories from TechCrunch dot-com this week. Want it in your inbox every Saturday? Sign up here.

Is Facebook for old people? If you’ve got a teenager around the house, you’ve probably heard them say as much. The most read story this week is on a Pew study that suggests this generation of teens has largely abandoned the platform in favor of Instagram/YouTube/TikTok/etc.; whereas in 2014 around 71% of teens used Facebook, the study says in 2022 that number has dropped down to 32%.

other stuff

Mark Cuban sued over crypto platform promotion: “A group of Voyager Digital customers filed a class-action suit in Florida federal court against Cuban, as well as the basketball team he owns, the Dallas Mavericks,” writes Anita, “alleging their promotion of the crypto platform resulted in more than 3.5 million investors losing $5 billion collectively.”

A troubling layoff trend: While tech layoffs might, maybe, hopefully be showing signs of slowing, Natasha M points out a troubling trend: some companies are announcing layoffs only to announce another round of layoffs just weeks or months later.

SpaceX launches South Korea’s first moon mission: South Korea has launched its first-ever lunar mission — a lunar orbiter “launched atop a SpaceX Falcon 9 rocket” ahead of plans to land on the surface some time in 2030.

Twilio gets hacked: While it’s unclear exactly what data was taken, Twilio says the data of at least 125 customers was accessed after some of its employees were tricked “into handing over their corporate login credentials” by an intense SMS phishing attack.

Amazon’s bizarre new show: Think “America’s Funniest Home Videos,” but made up of user-submitted footage from Ring security cameras. By now most people probably realize their every step is recorded on a security camera or three — but doesn’t embracing it as Entertainment™ like this feel kind of…icky?

Haus hits hard times: Haus, a company that ships specialized low-alcohol drinks direct to consumers, is looking for a buyer after a major investor backed out of its Series A. The challenge? Investor diligence for an alcohol company can take months, and Haus just doesn’t “have the cash to support continued operations at this time.”

Image Credits: Haus

audio stuff

How clean is the air you breathe every day? Aclima co-founder Davida Herzl wants everyone to be able to answer that question, and sat down with Jordan and Darrell on this week’s Found podcast to explain her mission. Meanwhile on Chain Reaction, Jacquelyn and Anita explain the U.S. gov’s crackdown of the cryptocurrency mixer Tornado Cash, and the Equity crew spent Wednesday’s show discussing whether the turbulent market conditions of late will mean we see fewer early-stage endeavors in the months ahead.

additional stuff

What lies behind the paywall? A lot of really good stuff! Here’s what TechCrunch+ subscribers were reading most this week…

Building an MVP when you can’t code: Got a great idea but can’t code? You can still get the ball rolling. Magnus Grimeland, founder of the early-stage VC firm Antler, lays out some of the key principles to keep in mind.

Are SaaS valuations staging a recovery?: “…the good news for software startup founders,” writes Alex, “is that the period when the deck was being increasingly stacked against them may now be behind us.”

VCs and AI-powered investment tools: Do VCs want AI-powered tools to help them figure out where to put their money? Kyle Wiggers takes a look at the concept, and why not all VCs are on board with it.



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Digital pensions platform Penfold raises $8.5M Series A led by Bridford Group – TechCrunch

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Penfold, a digital pensions platform, has closed a £7m ($8.49m) Series A funding round led by Bridford Group, an investment group.

Also participating in the round was Jeremy Coller, Chief Investment Officer and Chairman of Coller Capital. Penfold also raised additional funding via a crowdfund amongst its customer base. The cash will be used to expand Penfold’s workplace pension division.

Chris Eastwood, Co-Founder at Penfold, commented (in a statement): “It’s been a big year for Penfold – from launching our workplace pension offering, to reaching £100m AUA.”

Bridford Group, lead investor, commented: “The pensions industry represents a huge market – with £8trn in savings in the UK alone. Despite this, many people remain uninterested and unengaged in their pensions. With so many people not saving enough, there’s a real opportunity for a new provider to step in.” 



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After the FBI raid at Mar-a-Lago, online threats quickly turn into real-world violence – TechCrunch

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Threats of violence reached a fever pitch — reminiscent of the days leading up to the Capitol attack — following the news that the FBI raided Trump’s Florida beach club to retrieve classified documents the former president may have unlawfully taken there.

After Trump himself confirmed Monday’s raid at Mar-a-Lago, pro-Trump pundits and politicians rallied around declarations of “war,” and Trump’s ever-fervent supporters called for everything from dismantling the federal law enforcement agency to committing acts of violence against its agents. The situation escalated from there in record time, with online rhetoric boiling over quickly into real-world violence.

By Thursday, an armed man identified as Ricky Shiffer attempted to force his way into an FBI office in Cincinnati, Ohio, brandishing a rifle before fleeing. Law enforcement pursued Shiffer and he was fatally shot during the ensuing standoff with police.

Analysts with the Institute for Strategic Dialogue (ISD), a nonprofit that researches extremism and disinformation, found evidence that Shiffer was driven to commit violence by “conspiratorial beliefs related to former President Trump and the 2020 election…interest in killing federal law enforcement, and the recent search warrant executed at Mar-a-Lago earlier this week.” He was also reportedly present at the January 6 attack — another echo between this week’s escalating online threats and the tensions that culminated in political violence at the Capitol that day.

Shiffer appears to have been active on both Twitter and Truth Social, the platform from Trump’s media company that hosts the former president and his supporters. As Thursday’s attack unfolded, Shiffer appeared to post to Truth Social about how his plan to infiltrate the FBI office by breaking through a ballistic glass barrier with a nail gun had gone awry. “Well, I thought I had a way through bullet proof glass, and I didn’t,” the account posted Thursday morning. “If you don’t hear from me, it is true I tried attacking the F.B.I., and it’ll mean either I was taken off the internet, the F.B.I. got me, or they sent the regular cops…”

In posts on Truth Social, the account implored others to “be ready to kill the enemy” and “kill the FBI on sight” in light of Monday’s raid at Mar-a-Lago. It also urged followers to heed a “call to arms” to arm themselves and prepare for combat. “If you know of any protests or attacks, please post here,” the account declared earlier this week.

By Friday, that account was removed from the platform and a search of Shiffer’s name mostly surfaced content denouncing his actions. “Why did you censor #rickyshiffer‘s profile? So much for #truth and #transparency,” one Truth Social user posted on Friday. Still, online conspiracies around the week’s events remain in wide circulation on Truth Social and elsewhere, blaming antifa for the attack on the Ohio FBI office, accusing the agency of planting documents at Mar-a-Lago and sowing unfounded fears that well-armed IRS agents will descend on Americans in light of Friday’s House passage of the Inflation Reduction Act.

“‘Violence against law enforcement is not the answer no matter what anybody is upset about or who they’re upset with,’ FBI director Christopher Wray said in light of emerging threats of violence this week. Trump appointed Wray to the role in 2017 after infamously ousting former FBI director James Comey.”

Friday is also the five-year anniversary of the Unite the Right rally, which saw white nationalists clad in Nazi imagery marching openly through the streets of Charlottesville, Virginia. The ensuing events left 32-year-old protester Heather Heyer dead and sent political shockwaves through a nation that had largely grown complacent about the simmering threat of white supremacist violence.



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