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The coronavirus pandemic’s impact on the holiday shopping season is already underway. Amazon has delayed its annual sales event, Prime Day, from July to October 2020, while top e-commerce retailers, including Walmart, Target and Amazon, are becoming more powerful than ever. According to a new report from App Annie, mobile shopping apps are poised to see their biggest shopping season to date. The mobile data and analytics firm is estimating that U.S. consumers will spend more than 1 billion hours on Android devices alone during the fourth quarter, a 50% increase from the same time last year.
This forecast represents a jump ahead for mobile commerce that wasn’t expected until four to six years from now, but the pandemic has pushed that timetable forward.
Image Credits: App Annie
The firm also predicts that the pace of online shopping will look different than in years past.
While, typically, holiday shopping would be concentrated in the weeks around Black Friday and Cyber Monday, it’s expected that the shopping season this year will be longer and more drawn out. To some extent, this could be attributed to Prime Day’s delay, but the economic pressures of the pandemic are also taking their toll.
Heading into the third quarter, unemployment rates in the U.S. were still higher than during the Great Financial Crisis and more than two times higher than pre-COVID rates. App Annie says this will manifest in lower disposable incomes and greater price sensitivity, which will in turn lead consumers to seek out deals and promotions for longer periods of time throughout the lead up to the 2020 holidays.
Prime Day’s delay may also impact the shopping activity that takes place during the normally busy November shopping days, given that the sales event will take place this year much closer to Black Friday and Cyber Monday than ever before.
App Annie also noted that Amazon’s app continues to rank No. 1 by monthly active users among U.S. Shopping apps, and sees strong cross-app usage with other top Shopping apps.
Image Credits: App Annie
For comparison’s sake, weekly sessions in Shopping apps had grown by 25% during peak weeks during Q4 2019. They were also up 15% in the U.K.
This growth trend will continue as the changes brought on by the pandemic have been built upon existing consumer behavior, which have now been dialed up. Those changes are here to stay, App Annie claims.
Image Credits: App Annie
Related to mobile shopping’s growth, and the more than 1 billion hours spent shopping in Q4 on Android, App Annie also predicts other categories of apps will benefit. PayPal, for example, reported its best quarter ever with total payment volume increasing 29% year over year.
Online grocery services are also booming, particularly in markets with rising COVID-19 cases, like the U.S. and Brazil. Higher usage of mobile grocery shopping apps is expected to continue through Thanksgiving in the U.S., as consumers use apps for checking inventory, self-checkout, delivery and buy online/pickup in store. Similarly, meal delivery services like Uber Eats, DoorDash and Grubhub are also expected to remain valuable and widely used in Q4.
Image Credits: App Annie
Outside the U.S., App Annie forecasts that Singles Day 2020 will bring in more than 310 billion CNY (over $45 billion in U.S. dollars) to make it the biggest shopping day ever. This will top last year’s record of $38 billion in sales, and follows Q3 2020’s 4.8% year-over-year retail sales growth in China.
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The other day I took a moment to count the number of stories we’ve done on TechCrunch on the DoD’s $10 billion, decade-long, winner-take-all, JEDI cloud contract. This marks the 30th time we’ve written about this deal over the last two years, and it comes after a busy week last week in JEDI cloud contract news.
That we’re still writing about this is fairly odd if you consider the winner was announced last October when the DoD chose Microsoft, but there is no end in sight to the on-going drama that is this procurement process.
Government contracts don’t typically catch our attention at TechCrunch, but this one felt different early on. There was the size and scope of the deal of course. There was the cute play on the “Star Wars” theme. There was Oracle acting like a batter complaining to the umpire before the first pitch was thrown. There was the fact that everyone thought Amazon would win until it didn’t.
There was a lot going on. In fact, there’s still a lot going on with this story.
Let’s start with Oracle, which dispatched CEO Safra Catz to the White House in April 2018 even before the RFP had been written. She was setting the stage to complain that the deal was going to be set up to favor Amazon, something that Oracle alleged until the day Microsoft was picked the winner.
Catz had been on the Trump transition team and so had the ear of the president. While the president certainly interjected himself in this process, it’s not known how much influence that particular meeting might have had. Suffice to say that it was only the first volley in Oracle’s long war against the JEDI contract procurement process.
It would include official complaints with the Government Accountability Office and a federal lawsuit worth not coincidentally $10 billion. It would claim the contract favored Amazon. It would argue that the one-vendor approach wasn’t proper. It would suggest that because the DoD had some former Amazon employees helping write the RFP, that it somehow favored Amazon. The GAO and two court cases found otherwise, ruling against Oracle every single time.
It’s worth noting that the Court of Appeals ruling last week indicated that Oracle didn’t even meet some of the basic contractual requirements, all the while complaining about the process itself from the start.
Nobody was more surprised that Amazon lost the deal than Amazon itself. It still believes to this day that it is technically superior to Microsoft and that it can offer the DoD the best approach. The DoD doesn’t agree. On Friday, it reaffirmed its choice of Microsoft. But that is not the end of this, not by a long shot.
Amazon has maintained since the decision was made last October that the decision-making process had been tainted by presidential interference in the process. They believe that because of the president’s personal dislike of Amazon CEO Jeff Bezos, who also owns the Washington Post, he inserted himself in the process to prevent Bezos’ company from winning that deal.
In January, Amazon filed a motion to stop work on the project until this could all be sorted out. In February, a judge halted work on the project until Amazon’s complaints could be heard by the court. It is September and that order is still in place.
In a blog post on Friday, Amazon reiterated its case, which is based on presidential interference and what it believes is technical superiority. “In February, the Court of Federal Claims stopped performance on JEDI. The Court determined AWS’s protest had merit, and that Microsoft’s proposal likely failed to meet a key solicitation requirement and was likely deficient and ineligible for award. Our protest detailed how pervasive these errors were (impacting all six technical evaluation factors), and the Judge stopped the DoD from moving forward because the very first issue she reviewed demonstrated serious flaws,” Amazon wrote in the post.
Microsoft on the other hand went quietly about its business throughout this process. It announced Azure Stack, a kind of portable cloud that would work well as a field operations computer system. It beefed up its government security credentials.
Even though Microsoft didn’t agree with the one-vendor approach, indicating that the government would benefit more from the multivendor approach many of its customers were taking, it made clear if those were the rules, it was in it to win it — and win it did, much to the surprise of everyone, especially Amazon.
Yet here we are, almost a year later and in spite of the fact that the DoD found once again, after further review, that Microsoft is still the winner, the contract remains in limbo. Until that pending court case is resolved, we will continue to watch and wait and wonder if this will ever be truly over, and the JEDI cloud contract will actually be implemented.
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We have seen a lot of action this week as the DoD tries to finally determine the final winner of the $10 billion, decade-long DoD JEDI cloud contract. Today, the DoD released a statement that after reviewing the proposals from finalists Microsoft and Amazon again, it reiterated that Microsoft was the winner of the contract.
“The Department has completed its comprehensive re-evaluation of the JEDI Cloud proposals and determined that Microsoft’s proposal continues to represent the best value to the Government. The JEDI Cloud contract is a firm-fixed-price, indefinite-delivery/indefinite-quantity contract that will make a full range of cloud computing services available to the DoD,” the DoD said in a statement.
This comes on the heels of yesterday’s Court of Appeals decision denying Oracle’s argument that the procurement process was flawed and that there was a conflict of interest because a former Amazon employee helped write the requirements for the RFP.
While the DoD has determined that it believes that Microsoft should still get the contract, after selecting them last October, that doesn’t mean this is the end of the line for this long-running saga. In fact, a federal judge halted work on the project in February pending a hearing on an ongoing protest from Amazon, which believes it should have won based on merit, and the fact it believes the president interfered with the procurement process to prevent Jeff Bezos, who owns The Washington Post, from getting the lucrative contract.
The DoD confirmed that the project could not begin until the legal wrangling was settled. “While contract performance will not begin immediately due to the Preliminary Injunction Order issued by the Court of Federal Claims on February 13, 2020, DoD is eager to begin delivering this capability to our men and women in uniform,” the DoD reported in a statement.
A Microsoft spokesperson said the company was ready to get to work on the project as soon as it got the OK to proceed. “We appreciate that after careful review, the DoD confirmed that we offered the right technology and the best value. We’re ready to get to work and make sure that those who serve our country have access to this much needed technology,” a Microsoft spokesperson told TechCrunch .
Meanwhile, in a blog post published late this afternoon, Amazon made it clear that it was unhappy with today’s outcome and will continue to pursue legal remedy for what they believe to be presidential interference that has threatened the integrity of the procurement process. Here’s how they concluded the blog post:
We strongly disagree with the DoD’s flawed evaluation and believe it’s critical for our country that the government and its elected leaders administer procurements objectively and in a manner that is free from political influence. The question we continue to ask ourselves is whether the President of the United States should be allowed to use the budget of the Department of Defense to pursue his own personal and political ends? Throughout our protest, we’ve been clear that we won’t allow blatant political interference, or inferior technology, to become an acceptable standard. Although these are not easy decisions to make, and we do not take them lightly, we will not back down in the face of targeted political cronyism or illusory corrective actions, and we will continue pursuing a fair, objective, and impartial review.
While today’s statement from DoD appears to take us one step closer to the end of the road for this long-running drama, it won’t be over until the court rules on Amazon’s arguments. It’s clear from today’s blog post that Amazon has no intention of stepping down.
Note: We have updated this story with content from an Amazon blog post responding to this news.
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Oracle was never fond of the JEDI cloud contract process, that massive $10 billion, decade-long Department of Defense cloud contract that went to a single vendor. It was forever arguing to anyone who would listen that that process was faulty and favored Amazon.
Yesterday it lost another round in court when the U.S. Court of Appeals rejected the database giant’s argument that the procurement process was flawed because it went to a single vendor. It also didn’t buy that there was a conflict of interest because a former Amazon employee was involved in writing the DoD’s request for proposal criteria.
On the latter point, the court wrote, “The court addressed the question whether the contracting officer had properly assessed the impact of the conflicts on the procurement and found that she had.”
Further, the court found that Oracle’s case didn’t have merit in some cases because it failed to meet certain basic contractual criteria. In other cases, it didn’t find that the DoD violated any specific procurement rules with this bidding process.
This represents the third time the company has tried to appeal the process in some way, four if you include direct executive intervention with the president. In fact, even before the RFP had been released in April 2018, CEO Safra Catz brought complaints to the president that the bid favored Amazon.
In November 2018, the Government Accountability Office (GAO) denied Oracle’s protest that it favored Amazon or any of the other points in their complaint. The following month, the company filed a $10 billion lawsuit in federal court, which was denied last August. Yesterday’s ruling is on the appeal of that decision.
It’s worth noting that for all its complaints that the deal favored Amazon, Microsoft actually won the bid. Even with that determination, the deal remains tied up in litigation as Amazon has filed multiple complaints, alleging that the president interfered with the deal and that they should have won on merit.
As with all things related to this contract, the drama has never stopped.
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When Congress called in tech CEOs to testify a few weeks ago, it felt like a defining moment. Hundreds of startups have become unicorns, with the largest worth more than $1 trillion (or perhaps $2 trillion). Indeed, modern tech companies have become so entrenched, Facebook is the only one of the Big Five American tech shops worth less than 13 figures.
The titanic valuations of many companies are predicated on current performance, cash on hand and lofty expectations for future growth. The pandemic has done little to stem Big Tech’s forward march and many startups have seen growth rates accelerate as other sectors rushed to support a suddenly remote workforce.
But inside tech’s current moment in the sun is a concern that Congress worked to highlight: Are these firms behaving anti-competitively?
By now you’ve heard the arguments concerning why Big Tech may be too big, but there’s a neat second story that we, the Equity crew, have been chatting about: Some startups are racing into the big kill zone.
They have to be a bit foolhardy to take on Google Gmail and Search, Amazon’s e-commerce platform or Apple’s App Store. Yet, there are startups targeting all of these categories and more, some flush with VC funding from investors who are eager to take a swing at tech’s biggest players
If the little companies manage to carve material market share for themselves, arguments that Big Tech was just too big to kill — let alone fail — will dissolve. But today, their incumbency is a reality and these startups are merely bold.
Still, when we look at the work being done, there are enough companies staring down the most valuable companies in American history (on an unadjusted basis) that we had to shout them out. Say hello to the “anti-antitrust club.”
Gmail has been the undisputed leader in consumer email for years (if not enterprise email, where Microsoft has massive inroads due to Exchange and Outlook). Startups have contested that market, including Mailbox, which sold to Dropbox for about $100 million back in 2013, but whenever a new feature came along that might entice users, Gmail managed to suck it up into its app.
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It was the Australian bush fire that finally did it.
For 12 years Adam Hearne had worked at companies that represented some of the world’s largest sources of greenhouse gas emissions. First at Rio Tinto, one of the largest industrial miners, and then at Amazon, where he handled inbound delivery operations across the EU, Hearne was involved in ensuring that things flowed smoothly for companies whose operations spew millions of tons of carbon dioxide into the environment.
Amazon’s business alone was responsible for emitting 51.17 million metric tons of carbon dioxide last year — the equivalent of 13 coal-burning power plants, according to a report from the company.
Then, Hearne’s home country burned.
In 2019 wildfires erupted that engulfed more than 46 million acres of land, destroyed over 9,000 buildings, and killed over 400 people and untold numbers of animals — driving some species to the brink of extinction.
Hearne, along with an old friend from his business school rugby days (Roheet Shah) and computer science and machine learning experts from Imperial College of London (Yuri Oparin and Jeremiah Smith), launched CarbonChain that year. The company, now poised to graduate from the latest Y Combinator cohort, is pitching a service that can accurately account for emissions from the commodities industry — which is responsible for 50% of the world’s greenhouse gas emissions.
The company’s services are coming at the right time. Countries around the globe are poised to adopt much more stringent regulations around carbon dioxide and greenhouse gas emissions. The European Union is slowly working toward passage of sweeping new regulations on climate change that are mirrored in the region’s local economies. Even petrostates like Russia are poised to enact new climate regulations (at least according to Russian officials).
What’s missing in all of this are ways for companies to accurately track their emissions and technologies that can adequately monitor how well emissions offsets are working.
CarbonChain tackles this problem by going to the sectors that are responsible for the largest percentage of greenhouse gas emissions, Hearne said.
“The world needs hard accounting and hard numbers of what commodities companies are producing,” said Hearne in a July interview.
To ensure that emissions reductions and regulations are working, regulators need to go after oil and gas and commodities and minerals producers, according to Hearne. “Those sectors are uniform and carbon intensive and that’s how you quantify them,” he said.
CarbonChain has built models for every single asset in the supply chain for these industries, according to Hearne. The company has created digital twins of every piece of equipment used in heavy industry. If CarbonChain can’t get the information about the equipment from the companies that use it, they go to the engineering firms that built the equipment or facility for the company.
“In order to get a number that doesn’t get laughed out of the room we have to go down to the aluminum smelter that has a power station right next to it,” said Hearne. “Ninety percent of its footprint is its electrical usage.”
According to Hearne, CarbonChain’s system is so precise that it can tell users how much carbon emissions are embedded in a cup of coffee or a glass of wine (which is two pounds of carbon dioxide for imported wine, by the way).
CarbonChain is already selling its services to commodities producers and carbon traders who are operating in existing carbon trading schemes.
So far, the company has received roughly $500,000 from the U.K. government and an investment from one of its (undisclosed) commodities customers.
But CarbonChain’s technology seems to have the most rigorous methodology of any of the companies that’s purporting to do emissions monitoring. Other startups purporting to provide carbon emissions data for companies include Persefoni, which raised $3.5 million for its solution, and another Y Combinator graduate, SINAI Technologies.
If the company can actually measure the embedded emissions of materials down to a single piece of rebar, it could have huge consequences for industry broadly.
The company also slots nicely into the trend of entrepreneurs with deep industry experience building vertical solutions based on the collection of massive data sets using machine learning.
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Taiwanese startup iKala, which offers an artificial intelligence-based customer acquisition and engagement platform, will expand into new Southeast Asian markets after raising a $17 million Series B. The round was led by Wistron Digital Technology Holding Company, the investment arm of the electronics manufacturer, with participation from returning investors Hotung Investment Holdings Limited and Pacific Venture Partners. It brings iKala’s total raised so far to $30.3 million.
The new funding will be used to launch in Indonesia and Malaysia, and expand in markets where iKala already operates, including Singapore, Thailand, Hong Kong, the Philippines, Vietnam and Japan. Wistron Digital Technology Holding Company, which also offers big data analytics, will serve as a strategic investor, and this also marks the Taiwanese firm’s entry into Southeast Asia.
IKala’s products are targeted toward e-commerce companies, and include KOL Radar, for influencer marketing, and Shoplus, a social commerce service focused on Southeast Asian markets.
In a statement about the funding, iKala board member Lee-feng Chien, former managing director at Google Taiwan, said, “Taiwan has an excellent reputation for having some of the best high-tech talents in both hardware and software around the region. With Wistron as a strategic partner, iKala can become a major driving force for transforming Taiwan into an AI industry and talent hub in Asia.”
While Taiwan’s technology industry is best-known for hardware, especially semiconductor manufacturers like Foxconn and TSMC, a new crop of startups are helping the country establish a reputation for AI prowess.
In addition to iKala, these include Appier, which also provides a customer analytics, and enterprise translation platform WritePath. Big American tech companies, including Amazon, Google and Microsoft, have also set up AI-focused research and development centers in Taiwan, drawing on the country’s engineering talent and government programs.
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Microsoft’s new Flight Simulator is a technological marvel that sets a new standard for the genre. But to recreate a world that feels real and alive and contains billions of buildings all in the right spots, Microsoft and Asobo Studios relied on the work of multiple partners.
One of those is the small Austrian startup Blackshark.ai from Graz that, with a team of only about 50 people, recreated every city and town around the world with the help of AI and massive computing resources in the cloud.
Ahead of the launch of the new Flight Simulator, we sat down with Blackshark co-founder and CEO Michael Putz to talk about working with Microsoft and the company’s broader vision.
Blackshark is actually a spin-off of game studio Bongfish, the maker of World of Tanks: Frontline, Motocross Madness and the Stoked snowboarding game series. As Putz told me, it was actually Stoked that set the company on the way to what would become Blackshark.
“One of the first games we did in 2007 was a snowboarding game called Stoked and S Stoked Bigger Edition, which was one of the first games having a full 360-degree mountain where you could use a helicopter to fly around and drop out, land everywhere and go down,” he explained. “The mountain itself was procedurally constructed and described — and also the placement of obstacles of vegetation, of other snowboarders and small animals had been done procedurally. Then we went more into the racing, shooting, driving genre, but we still had this idea of positional placement and descriptions in the back of our minds.”
Bongfish returned to this idea when it worked on World of Tanks, simply because of how time-consuming it is to build such a huge map where every rock is placed by hand.
Based on this experience, Bongfish started building an in-house AI team. That team used a number of machine-learning techniques to build a system that could learn from how designers build maps and then, at some point, build its own AI-created maps. The team actually ended up using this for some of its projects before Microsoft came into the picture.
“By random chance, I met someone from Microsoft who was looking for a studio to help them out on the new Flight Simulator. The core idea of the new Flight Simulator simulator was to use Bing Maps as a playing field, as a map, as a background,” Putz explained.
But Bing Maps’ photogrammetry data only yielded exact 1:1 replicas of 400 cities — for the vast majority of the planet, though, that data doesn’t exist. Microsoft and Asobo Studios needed a system for building the rest.
This is where Blackshark comes in. For Flight Simulator, the studio reconstructed 1.5 billion buildings from 2D satellite images.
Now, while Putz says he met the Microsoft team by chance, there’s a bit more to this. Back in the day, there was a Bing Maps team in Graz, which developed the first cameras and 3D versions of Bing Maps. And while Google Maps won the market, Bing Maps actually beat Google with its 3D maps. Microsoft then launched a research center in Graz and when that closed, Amazon and others came in to snap up the local talent.
“So it was easy for us to fill positions like a PhD in rooftop reconstruction,” Putz said. “I didn’t even know this existed, but this was exactly what we needed — and we found two of them.
“It’s easy to see why reconstructing a 3D building from a 2D map would be hard. Even figuring out a building’s exact outline isn’t easy.
“What we do basically in Flight Simulator is we look at areas, 2D areas and then finding out footprints of buildings, which is actually a computer vision task,” said Putz. “But if a building is obstructed by a shadow of a tree, we actually need machine learning because then it’s not clear anymore what is part of the building and what is not because of the overlap of the shadow — but then machine learning completes the remaining part of the building. That’s a super simple example.”
While Blackshark was able to rely on some other data, too, including photos, sensor data and existing map data, it has to make a determination about the height of the building and some of its characteristics based on very little information.
The obvious next problem is figuring out the height of a building. If there is existing GIS data, then that problem is easy to solve, but for most areas of the world, that data simply doesn’t exist or isn’t readily available. For those areas, the team takes the 2D image and looks for hints in the image, like shadows. To determine the height of a building based on a shadow, you need the time of day, though, and the Bing Maps images aren’t actually timestamped. For other use cases the company is working on, Blackshark has that and that makes things a lot easier. And that’s where machine learning comes in again.
“Machine learning takes a slightly different road,” noted Putz. “It also looks at the shadow, we think — because it’s a black box, we don’t really know what it’s doing. But also, if you look at a flat rooftop, like a skyscraper versus a shopping mall. Both have mostly flat rooftops, but the rooftop furniture is different on a skyscraper than on a shopping mall. This helps the AI to learn when you label it the right way.”
And then, if the system knows that the average height of a shopping mall in a given area is usually three floors, it can work with that.
One thing Blackshark is very open about is that its system will make mistakes — and if you buy Flight Simulator, you will see that there are obvious mistakes in how some of the buildings are placed. Indeed, Putz told me that he believes one of the hardest challenges in the project was to convince the company’s development partners and Microsoft to let them use this approach.
“You’re talking 1.5 billion buildings. At these numbers, you cannot do traditional Q&A anymore. And the traditional finger-pointing in like a level of Halo or something where you say ‘this pixel is not good, fix it,’ does not really work if you develop on a statistical basis like you do with AI. So it might be that 20% of the buildings are off — and it actually is the case I guess in the Flight Simulator — but there’s no other way to tackle this challenge because outsourcing to hand-model 1.5 billion buildings is, just from a logistical level and also budget level, not doable.”
Over time, that system will also improve, and because Microsoft streams a lot of the data to the game from Azure, users will surely see changes over time.
Labeling, though, is still something the team has to do simply to train the model, and that’s actually an area where Blackshark has made a lot of progress, though Putz wouldn’t say too much about it because it’s part of the company’s secret sauce and one of the main reasons why it can do all of this with just about 50 people.
“Data labels had not been a priority for our partners,” he said. “And so we used our own live labeling to basically label the entire planet by two or three guys […] It puts a very powerful tool and user interface in the hands of the data analysts. And basically, if the data analyst wants to detect a ship, he tells the learning algorithm what the ship is and then he gets immediate output of detected ships in a sample image.”
From there, the analyst can then train the algorithm to get even better at detecting a specific object like a ship, in this example, or a mall in Flight Simulator. Other geospatial analysis companies tend to focus on specific niches, Putz also noted, while the company’s tools are agnostic to the type of content being analyzed.
And that’s where Blackshark’s bigger vision comes in. Because while the company is now getting acclaim for its work with Microsoft, Blackshark also works with other companies around reconstructing city scenes for autonomous driving simulations, for example.
“Our bigger vision is a near-real-time digital twin of our planet, particularly the planet’s surface, which opens up a trillion use cases where traditional photogrammetry like a Google Earth or what Apple Maps is doing is not helping because those are just simplified for photos clued on simple geometrical structures. For this we have our cycle where we have been extracting intelligence from aerial data, which might be 2D images, but it also could be 3Dpoint counts, which are already doing another project. And then we are visualizing the semantics.”
Those semantics, which describe the building in very precise detail, have one major advantage over photogrammetry: Shadow and light information is essentially baked into the images, making it hard to relight a scene realistically. Since Blackshark knows everything about that building it is constructing, it can then also place windows and lights in those buildings, which creates the surprisingly realistic night scenes in Flight Simulator.
Point clouds, which aren’t being used in Flight Simulator, are another area Blackshark is focusing on right now. Point clouds are very hard to read for humans, especially once you get very close. Blackshark uses its AI systems to analyze point clouds to find out how many stories a building has.
“The whole company was founded on the idea that we need to have a huge advantage in technology in order to get there, and especially coming from video games, where huge productions like in Assassin’s Creed or GTA are now hitting capacity limits by having thousands of people working on it, which is very hard to scale, very hard to manage over continents and into a timely delivered product. For us, it was clear that there need to be more automated or semi-automated steps in order to do that.”
And though Blackshark found its start in the gaming field — and while it is working on this with Microsoft and Asobo Studios — it’s actually not focused on gaming but instead on things like autonomous driving and geographical analysis. Putz noted that another good example for this is Unreal Engine, which started as a game engine and is now everywhere.
“For me, having been in the games industry for a long time, it’s so encouraging to see, because when you develop games, you know how groundbreaking the technology is compared to other industries,” said Putz. “And when you look at simulators, from military simulators or industrial simulators, they always kind of look like shit compared to what we have in driving games. And the time has come that the game technologies are spreading out of the game stack and helping all those other industries. I think Blackshark is one of those examples for making this possible.”
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Pattern, a Lehi, Utah-based reseller that offers large and small brands a way to optimize their sales on marketplaces like Amazon, eBay, Walmart and Google Shopping, has raised $52 million in growth funding, the company said.
The money, from Ainge Advisory and KSV Global, will be used to expand the company’s business worldwide.
Founded in 2013, the e-commerce reseller uses analytics to lock down market-specific keywords in advertising and has managed to reach a run-rate that should see it hit $500 million in annual revenue by the end of 2020, according to Pattern co-founder and chief investment officer, Melanie Alder.
Brands like Nestlé, Pandora, Panasonic, Zebra and Skechers sell their goods to Pattern in an effort to juice sales on digital marketplaces.
“Pattern represents our brands in the US, across Europe, and in select markets in Asia, selling for us on global marketplaces such as Amazon, Walmart, Tmall, and JD as well as building and managing three of our direct-to-consumer sites,” said Kyle Bliffert, CEO and president of Atrium Innovations, a Nestlé Health Science company, in a statement. “The global e-commerce growth we have experienced by leveraging Pattern’s expertise is extraordinary.”
Pattern places bets on where a product is likely to receive the most attention using specific keywords, according to the company’s chief executive, Dave Wright. The company buys products from its brand partners and then sells them widely across marketplaces in the U.S., Europe and Asia. These markets represent $2.7 trillion in total sales and Wright expects it to reach $7 trillion by 2024.
As Wright noted, a majority of searches for sales begin on Amazon . The company just opened its eighteenth location in Germany. Pattern has grown sales for brands from $3 million to $26 million and the company makes money off of the margin on the sales of products. With the new funding, the company intends to expand into other geographies like Japan and India.
Wright says his company addresses one of the fundamental problems with advertising technology — the proliferation of tools hasn’t meant better optimization for most brands, because they’re teams aren’t equipped to specialize.
While there may be hundreds of different advertising and marketing folks working at a company, each company may have hundreds of brands that it sells and the dedicated teams to specific brands may only have one or two people on staff.
“Data makes all the difference,” said co-founder and CEO Dave Wright. “I’ve spent the bulk of my career in data science and data management, and our ability to detect and act on ‘patterns’ on e-commerce platforms has allowed the brands we represent to be incredibly successful.”
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Sonny Vu, the former founder and chief executive of the wearable technology company Misfit, has had a busy summer since he was named the new chief executive of 3D printing technology company Arevo.
Vu’s new startup brought on a new executive management team, launched a crowdfunding campaign for its 3D-printed Superstrata bicycle and is now announcing the close of a $25 million financing round to support the growth of its business.
It’d be a lot for anyone to take on even if it didn’t happen in the middle of a global pandemic. But Vu, a serial entrepreneur whose last business went head-to-head with Apple before it was acquired by Fossil for $260 million, doesn’t shy away from challenges.
Vu was first introduced to Arevo in 2019 and was initially going to come on as an advisor to the company. Since the acquisition of Misfit he had been investing from Alabaster, his personal investment vehicle. First introduced by Vinod Khosla, an investor in the business, Vu quickly moved from being an advisor to an executive at the helm of the business and an investor providing bridge financing until the company could close its latest round.
Vu had initially intended to start his own business, but was drawn to Arevo’s potential. “3D printing is about making things slowly and in small quantities. With Arevo’s technology you can make big things quite fast,” Vu said in an interview.
Several companies are attempting to take 3D printing into heavy industry and large-scale manufacturing. Relativity raised $140 million in its most recent financing to make rockets using 3D printers, Velo3D is a supplier of 3D printers to SpaceX and now Arevo has $34 million for its efforts to scale 3D printers. Of course, all of these investments pale in comparison to the whopping $438 million that Desktop Metal has raised for its 3D printing tech.
“Arevo is a compelling opportunity for us as it combines our three main investment foci: consumer internet, enterprise, and smart tech. We see fantastic potential in this market, and have backed Sonny before at Misfit,” said Hans Tung, in a statement. “Arevo is led by an experienced team with solid technological foundation and 3D printing manufacturing know-how at scale – to offer breakthrough products at competitive prices.”
Arevo already has a successful proof of concept with its Superstrata bicycle and manufacturing facilities in Vietnam that are intended to prove that the company’s technology will work as expected.
“We’re making this bike to make a point that we can make complex shapes at a pretty large scale,” Vu said. Unlike other companies that sell their printers to manufacturers, Arevo intends to sell parts. That’s because the printers are a pretty hefty ticket for anyone to buy. At $1 million to $1.4 million, it’s a big ask for a company to acquire if it wants to start using 3D printing.
On top of that cost, Vu said candidly that the company’s Achilles’ heel was the post-manufacturing treatment process required to finish the pieces. And while Arevo already counts automotive and aerospace companies as customers (including Airbus, which previously invested in the business), Vu wants to bring this to consumers. “We’ve had tennis racquet companies, golf clubs, surfboards,” approach Arevo about using the company’s technology, Vu says.
“We can do about two frames per day per machine,” Vu says of the latest production rates. “And coming up with our next-gen system we can do about six frames per day.”
The ascension of Vu to the chief executive position and the new capital infusion marks the latest chapter for Arevo, which is on its third chief executive since it was founded. Two years ago, Jim Miller, a former Amazon and Google executive, was brought on board to take the reins at the company. Miller’s appointment coincided with a $12.5 million investment round led by Asahi Glass, with Sumitomo Corp., Leslie Ventures and Khosla Ventures participating. Miller was involved with collaborating with Studio West on the design of its Superstrata bike.
Now, Defy Partners and GGV Capital are joining to lead the company’s Series B round with participation from Khosla Ventures, Alabaster and others. Brian Shin, a scout with Defy Ventures is joining the board, which now counts Bruce Armstrong, from Khosla Ventures, and Hemant Bheda, Arevo’s co-founder, as directors (along with Vu).
“Arevo’s new platform enables fabrication of high-strength, low-weight carbon fiber parts, currently not possible with today’s standard techniques,” said Trae Vassallo, founding partner at Defy. “We are thrilled to be working with the team to help scale up this incredibly impactful technology.”
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