automotive
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Volvo to sell only all-electric vehicles by 2030
Volvo Cars said it will only make and sell all-electric vehicles by 2030 as part of a broader transformation of the automaker that will include shifting sales online.
“The key to sustainability is electrification, said Volvo Cars CEO Håkan Samuelsson during a presentation Tuesday. “Together with investments in charging infrastructure that is the right way to go and the course we have chosen at Volvo.”
The announcement was tied to the launch of the C40 Recharge, a low-slung crossover based on the company’s CMA vehicle platform. While the C40 is the second vehicle under Volvo’s EV-focused Recharge brand, it is the first model designed from the beginning as a battery-electric only vehicle. All Volvo vehicles with fully electric and plug-in hybrid powertrains are housed under the Recharge brand. Like the XC40 Recharge, the C40 will have an infotainment system powered by Google’s Android operating system and the ability to handle over-the-air software updates.
Image Credits: Screenshot/Volvo
“It’s a car of firsts and it’s a car of the future,” CTO Henrik Green said, adding that the C40 will have two motors, a 78 kilowatt-hour battery and an estimated range of 420 km (260 miles) that will improve over time via software updates. C40 will go in production this fall and will be built alongside the XC40 Recharge at the Volvo Cars manufacturing plant in Ghent, Belgium, the company said.
Volvo, which is owned by China’s Geely Holdings, aims for 50% of its global sales to consist of fully electric cars, with the rest hybrids. By 2030, every car it sells should be fully electric, the company said.
The company is well on its way to its electrification goal, according to Samuelsson, noting that last year one car out of three sold in Europe was a Recharge model, a chargeable plug-in hybrid.
Volvo’s evolution isn’t just pinned to the powertrain.
“The future customer offer cannot just consist of an electric car,” Samuelsson said. “We also need to listen to our consumers, and they expect transparency and a seamless experience getting and having a car.”
Volvo will only sell its all-electric vehicles online and at preset prices. Customers will be able to subscribe or buy the vehicles, which will come with a customer care package. The vehicles will also have pre-selected configurations to shorten the time between ordering and receiving a vehicle.
Volvo’s move to become an all-electric brand is in sync with a growing number of automakers, including GM and Jaguar. Last month, GM committed to selling only electric vehicles by 2035 and becoming a carbon neutral operation globally by 2040. GM said in November it will spend $27 billion over the next five years on the development of electric vehicles and automated technology, a 35% increase that exceeds the automaker’s investment in gas and diesel and is an effort to bring products to market faster.
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EC roundup: BNPL startups, growth marketing tips, solid state battery market map, more
When I needed a new sofa several months ago, I was pleased to find a buy now, pay later (BNPL) option during the checkout process. I had prepared myself to make a major financial outlay, but the service fees were well worth the convenience of deferring the entire payment.
Coincidentally, I was siting on said sofa this morning and considering that transaction when Alex Wilhelm submitted a column that compared recent earnings for three BNPL providers: Afterpay, Affirm and Klarna.
I asked him why he decided to dig into the sector with such gusto.
Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.
“What struck me about the concept was that we had just seen earnings from Affirm,” he said. “So we had three BNPL players with known earnings, and I had just covered a startup funding round in the space.”
“Toss in some obvious audience interest, and it was an easy choice to write the piece. Now the question is whether I did a good job and people find value in it.”
Thanks very much for reading Extra Crunch this week! Have a great weekend.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
As BNPL startups raise, a look at Klarna, Affirm and Afterpay earnings
Pilot CEO Waseem Daher tears down his company’s $60M Series C pitch deck
Image Credits: Colin Hawkins (opens in a new window) / Getty Images
I avoid running Extra Crunch stories that focus on best practices; you can find those anywhere. Instead, we look for “here’s what worked for me” articles that give readers actionable insights.
That’s a much better use of your time and ours.
With that ethos in mind, Lucas Matney interviewed Pilot CEO Waseem Daher to deconstruct the pitch deck that helped his company land a $60M Series C round.
“If the Series A was about, ‘Do you have the right ingredients to make this work?’ then the Series B is about, ‘Is this actually working?’” Daher tells TechCrunch.
“And then the Series C is more, ‘Well, show me that the core business is really working and that you have unlocked real drivers to allow the business to continue growing.’”
Can solid state batteries power up for the next generation of EVs?
Image Credits: Bryce Durbin
A global survey of automobile owners found three hurdles to overcome before consumers will widely embrace electric vehicles:
- 30-minute charging time
- 300-mile range
- $36,000 maximum cost
“Theoretically, solid state batteries (SSB) could deliver all three,” but for now, lithium-ion batteries are the go-to for most EVs (along with laptops and phones).
In our latest market map, we’ve plotted the new and established players in the SSB sector and listed many of the investors who are backing them.
Although SSBs are years away from mass production, “we are on the cusp of some pretty incredible discoveries using major improvements in computational science and machine learning algorithms to accelerate that process,” says SSB startup founder Amy Prieto.
Dear Sophie: Which immigration options are the fastest?
Image Credits: Bryce Durbin/TechCrunch
Dear Sophie:
Help! Our startup needs to hire 50 engineers in artificial intelligence and related fields ASAP. Which visa and green card options are the quickest to get for top immigrant engineers?
And will Biden’s new immigration bill help us?
— Mesmerized in Menlo Park
Why F5 spent $2.2B on 3 companies to focus on cloud native applications
Image Credits: Jasmin Merdan / Getty Images
Founded in 1996, F5 has repositioned itself in the networking market several times in its history. In the last two years, however, it spent $2.2 billion to acquire Shape Security, Volterra and NGINX.
“As large organizations age, they often need to pivot to stay relevant, and I wanted to explore one of these transformational shifts,” said enterprise reporter Ron Miller.
“I spoke to the CEO of F5 to find out the strategy behind his company’s pivot and how he leveraged three acquisitions to push his organization in a new direction.”
DigitalOcean’s IPO filing shows a two-class cloud market
Image Credits: Who_I_am (opens in a new window) / Getty Images
Cloud hosting company DigitalOcean filed to go public this week, so Ron Miller and Alex Wilhelm unpacked its financials.
“AWS and Microsoft Azure will not be losing too much sleep worrying about DigitalOcean, but it is not trying to compete head-on with them across the full spectrum of cloud infrastructure services,” said John Dinsdale, chief analyst and research director at Synergy Research.
Oscar Health’s initial IPO price is so high, it makes me want to swear
Image Credits: Nigel Sussman (opens in a new window)
I asked Alex Wilhelm to dial back the profanity he used to describe Oscar Health’s proposed valuation, but perhaps I was too conservative.
In March 2018, the insurtech unicorn was valued at around $3.2 billion. Today, with the company aiming to debut at $32 to $34 per share, its fully diluted valuation is closer to $7.7 billion.
“The clear takeaway from the first Oscar Health IPO pricing interval is that public investors have lost their minds,” says Alex.
His advice for companies considering an IPO? “Go public now.”
If Coinbase is worth $100 billion, what’s a fair valuation for Stripe?
Image Credits: Nigel Sussman (opens in a new window)
Last week, Alex wrote about how cryptocurrency trading platform Coinbase was being valued at $77 billion in the private markets.
As of Monday, “it’s now $100 billion, per Axios’ reporting.”
He reviewed Coinbase’s performance from 2019 through the end of Q3 2020 “to decide whether Coinbase at $100 billion makes no sense, a little sense or perfect sense.”
Winning enterprise sales teams know how to persuade the Chief Objection Officer
Image Credits: Alla Aramyan (opens in a new window) / Getty Images
A skilled software sales team devotes a lot of resources to pinpointing potential customers.
Poring through LinkedIn and reviewing past speaker lists at industry conferences are good places to find decision-makers, for example.
Despite this detective work, GGV Capital investor Oren Yunger says sales teams still need to identify the deal-blockers who can spike a deal with a single email.
“I call this person the Chief Objection Officer.”
3 strategies for elevating brand authority in 2021
Image Credits: Klaus Vedfelt / Getty Images
Every startup wants to raise its profile, but for many early-stage companies, marketing budgets are too small to make a meaningful difference.
“Providing real value through content is an excellent way to build authority in the short and long term,” says Amanda Milligan, marketing director at growth agency Fractl.
RIBS: The messaging framework for every company and product
Image Credits: luchezar (opens in a new window) / Getty Images
The most effective marketing uses good storytelling, not persuasion.
According to Caryn Marooney, general partner at Coatue Management, every compelling story is relevant, inevitable, believable and simple.
“Behind most successful companies is a story that checks every one of those boxes,” says Marooney, but “this is a central challenge for every startup.”
Ironclad’s Jason Boehmig: The objective of pricing is to become less wrong over time
On a recent episode of Extra Crunch Live, Ironclad founder and CEO Jason Boehmig and Accel partner Steve Loughlin discussed the pitch that brought them together almost four years ago.
Since that $8 million Series A, Loughlin joined Ironclad’s board. “Both agree that the work they put in up front had paid off” when it comes to how well they work together, says Jordan Crook.
“We’ve always been up front about the fact that we consider the board a part of the company,” said Boehmig.
TC Early Stage: The premiere how-to event for startup entrepreneurs and investors
From April 1-2, some of the most successful founders and VCs will explain how they build their businesses, raise money and manage their portfolios.
At TC Early Stage, we’ll cover topics like recruiting, sales, legal, PR, marketing and brand building. Each session includes ample time for audience questions and discussion.
Use discount code ECNEWSLETTER to take 20% off the cost of your TC Early Stage ticket!
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Electric moped startup Revel launches an EV charging business
Revel, the shared electric moped startup, is building a DC fast-charging station for electric vehicles in New York City, the first in a new business venture that will eventually spread to other cities.
The company said Wednesday that this new “Superhub,” which is located at the former Pfizer building in Brooklyn, will contain 30 chargers and be open to the public 24 hours a day. This will be the first in a network of Superhubs opened by Revel across New York City, the company said.
Revel didn’t build the EV charging infrastructure in-house. Instead, it is using Tritium’s new RTM75 model for the first 10 chargers at its Brooklyn site, which will go live this spring. These chargers are designed to deliver 100 additional miles of charge to an electric vehicle in about 20 minutes, according to Revel.
The EV charging business has been couched by Revel as a mission to electrify cities. The move comes as a growing number of automakers, including legacy companies like GM, Ford and VW Group, along with new entrant Rivian and EV leader Tesla, add more electric vehicles to their portfolios.
Revel’s expansion into charging marks its first new product line since launching a shared fleet of electric mopeds in 2018. Revel, founded by Frank Reig and Paul Suhey, started with a pilot program in Brooklyn and later expanded to Queens, the Bronx and sections of Manhattan. It has been on a fast-paced growth track thanks to the $27.6 million in capital raised in October 2019 in a Series A round led by Ibex Investors. The equity round included newcomer Toyota AI Ventures and further investments from Blue Collective, Launch Capital and Maniv Mobility.
Several thousand mopeds are available to rent in New York City today. Revel expanded its shared moped business to other cities such as Austin, Miami and Washington, D.C in its first 18 months of operation. Last year, the company launched in Oakland and received a permit in July 2020 to operate in San Francisco.
Shared mopeds haven’t been successful everywhere. Revel pulled out of Austin in December. Reig said at the time that the COVID-19 pandemic, which has caused ridership to fall across shared micromobility services, along with the city’s deep-rooted car culture, was proven difficult to penetrate.
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Amazon begins testing customer deliveries using Rivian electric vans
Amazon has started making deliveries to customers in Los Angeles using electric vans designed and built by Rivian.
The electric vans, which are part of Amazon’s 2040 climate pledge, won’t go into series production until the end of the year, according to an update Wednesday by the company. Amazon declined to reveal how many electric vans were in the test fleet.
The customer deliveries are part of continuous testing being conducted by Amazon and Rivian to measure performance as well as safety durability in various climates and geographies. Road tests first started more than four months ago. The current fleet of vehicles was built at Rivian’s facility in Plymouth, Michigan and can drive up to 150 miles on a single charge. Rivian engineers will continue to refine the vehicles for the start of production at its Normal, Illinois factory.
Image Credits: Amazon
In the meantime, these electric vehicles will continue to pop up on delivery routes in up to 15 additional cities in 2021. Eventually, Amazon plans to deploy at least 100,000 electric vans — the size of its order with Rivian — over the next several years.
Amazon and Rivian began testing vehicles four months prior to making customer deliveries, as part of the testing and development process. Amazon is also starting to modify its buildings to accommodate the new fleet of vehicles and has installed thousands of electric vehicle charging stations at its delivery stations across North America and Europe, the company said.
“We’re loving the enthusiasm from customers so far–from the photos we see online to the car fans who stop our drivers for a first-hand look at the vehicle,” Ross Rachey, director of Amazon’s global Fleet and products, said in a statement. “From what we’ve seen, this is one of the fastest modern commercial electrification programs, and we’re incredibly proud of that.”
The exterior of Rivian-built electric vans share some of the same design features found in today’s gas-powered versions. There are a few more rounded edges and an overall sleeker look to the electric vans.
The real difference is in the electric architecture and the custom features that have been integrated into the vans, including highway driving and traffic assist features; exterior cameras that can provide a 360-degree view for the driver via a digital display; a larger interior floor space in the cabin to help with drivers getting to and from the cabin compartment; surround tail lights for better braking visibility; and three-level shelving and a bulkhead cargo compartment separating door. Amazon’s Alexa voice assistant is also an embedded feature.
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End-to-end operators are the next generation of consumer business
At Battery, a central part of our consumer investing practice involves tracking the evolution of where and how consumers find and purchase goods and services. From our annual Battery Marketplace Index, we’ve seen seismic shifts in how consumer purchasing behavior has changed over the years, starting with the move to the web and, more recently, to mobile and on-demand via smartphones.
The evolution looks like this in a nutshell: In the early days, listing sites like Craigslist, Angie’s List* and Yelp effectively put the Yellow Pages online — you could find a new restaurant or plumber on the web, but the process of contacting them was largely still offline. As consumers grew more comfortable with the web, marketplaces like eBay, Etsy, Expedia and Wayfair* emerged, enabling historically offline transactions to occur online.
More recently, and spurred in large part by mobile, on-demand use cases, managed marketplaces like Uber, DoorDash, Instacart and StockX* have taken online consumer purchasing a step further. They play a greater role in the operations of the marketplace, from automatically matching demand with supply, to verifying the supply side for quality, to dynamic pricing.
The key purpose of being end-to-end is to deliver an even better value proposition to consumers relative to incumbent alternatives.
Each stage of this evolution unlocked billions of dollars in value, and many of the names listed above remain the largest consumer internet companies today.
At their core, these companies are facilitators, matching consumer demand with existing supply of a product or service. While there is no doubt these companies play a hugely valuable role in our lives, we increasingly believe that simply facilitating a transaction or service isn’t enough. Particularly in industries where supply is scarce, or in old-guard industries where innovation in the underlying product or service is slow, a digitized marketplace — even when managed — can produce underwhelming experiences for consumers.
In these instances, starting from the ground up is what is really required to deliver an optimal consumer experience. Back in 2014, Chris Dixon wrote a bit about this phenomenon in his post on “Full stack startups.” Fast forward several years, and more startups than ever are “full stack” or as we call it, “end-to-end operators.”
These businesses are fundamentally reimagining their product experience by owning the entire value chain, from end to end, thereby creating a step-functionally better experience for consumers. Owning more in the stack of operations gives these companies better control over quality, customer service, delivery, pricing and more — which gives consumers a better, faster and cheaper experience.
It’s worth noting that these end-to-end models typically require more capital to reach scale, as greater upfront investment is necessary to get them off the ground than other, more narrowly focused marketplaces. But in our experience, the additional capital required is often outweighed by the value captured from owning the entire experience.
End-to-end operators span many verticals
Many of these businesses have reached meaningful scale across industries:
Image Credits: Battery Ventures (opens in a new window)
All of these companies have recognized they can deliver more value to consumers by “owning” every aspect of the underlying product or service — from the bike to the workout content in Peloton’s case, or the bank account to the credit card in Chime’s case. They have reinvented and reimagined the entire consumer experience, from end to end.
What does success for end-to-end operator businesses look like?
As investors, we’ve had the privilege of meeting with many of these next-generation end-to-end operators over the years and found that those with the greatest success tend to exhibit the five key elements below:
1. Going after very large markets
The end-to-end approach makes the most sense when disrupting very large markets. In the graphic above, notice that most of these companies play in the largest, but notoriously archaic industries like banking, insurance, real estate, healthcare, etc. Incumbents in these industries are very large and entrenched, but they are legacy players, making them slow to adopt new technology. For the most part, they have failed to meet the needs of our digital-native, mobile-savvy generation and their experiences lag behind consumer expectations of today (evidenced by low, or sometimes even negative, NPS scores). Rebuilding the experience from the ground up is sometimes the only way to satisfy today’s consumers in these massive markets.
2. Step-functionally better consumer experience versus the status quo
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Holographic startup Envisics partners with Panasonic to fast-track in-car AR tech
Envisics founder and CEO Dr. Jamieson Christmas launched the startup three years ago to “revolutionize” the in-car experience with its holographic technology. Now, it has a partner that could help it achieve that mission.
The U.K.-based holographic technology startup said Friday it reached an agreement with Panasonic Automotive Systems to jointly develop and commercialize a new generation of head-up displays for cars, trucks and SUVs. Panasonic Automotive Systems is a Tier 1 automotive supplier and a division of Panasonic Corporation of North America. The head-up displays are units integrated in the dash of a vehicle that project images onto the windshield to aid drivers with navigation and provide other alerts. The Panasonic HUDs, as they’re often called, will use Envisics holographic technology.
The deal, announced ahead of the virtual 2021 CES tech trade show, follows Envisics’ $50 million Series B funding round and news that its tech will be integrated in the upcoming Cadillac Lyriq electric vehicle. The funding round, which brought Envisics a valuation of more than $250 million, included investments from Hyundai Mobis, GM Ventures, SAIC Ventures and Van Tuyl Companies.
Envisics’ technology, the foundation of which came out of Christmas’ PhD studies at Cambridge University more than 15 years ago, electronically manipulates the speed of light. This process enables images to appear three-dimensional, Christmas explained in a recent interview. The company has secured more than 250 patents and has another 160 pending certification.
The company is solely focused upon the automotive application of holography, Christmas said, adding that its first generation is already integrated in more than 150,000 Jaguar Land Rover vehicles.
Christmas said this new agreement aims to combine Panasonic’s expertise in optical design and its global reach as a Tier 1 supplier with Envisics’ technology to bring holography into the mainstream. Mass production of vehicles using its technology is slated for 2023, according to the companies.
“This is very much about part of our business plan, you know the Series B funding round we undertook was about scaling the business and enabling us to move forward as we enter the market,” Christmas said. “Part of that was a commitment to engage in partnerships with Tier ones that we can then work with to deliver these products to market.
“This is the first of those agreements,” he added, suggesting that Envisics has a much larger aim.
What that means, Christmas said, will be head-up displays with high resolution, wide color gamut and large images that can be overlaid upon reality. The technology can also project information at multiple distances simultaneously.
“That really unlocks very interesting applications,” he said. “In the short term, it will be kind of relatively simple augmented reality applications like navigation, highlighting the lane you’re supposed to be in and some safety applications. But as you look forward into things like autonomous driving it unlocks a whole realm of other opportunities like entertainment and video conferencing.”
He added that it could even be used for night vision applications such as overlaying enhanced information upon a dark road to make it clear where the road is going and what obstacles might be out there.
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Extra Crunch roundup: 2 VC surveys, Tesla’s melt up, The Roblox Gambit, more
This has been quite a week.
Instead of walking backward through the last few days of chaos and uncertainty, here are three good things that happened:
- Google employee Sara Robinson combined her interest in machine learning and baking to create AI-generated hybrid treats.
- A breakthrough could make water desalination 30%-40% more effective.
- Bianca Smith will become the first Black woman to coach a professional baseball team.
Despite many distractions in our first full week of the new year, we published a full slate of stories exploring different aspects of entrepreneurship, fundraising and investing.
We’ve already gotten feedback on this overview of subscription pricing models, and a look back at 2020 funding rounds and exits among Israel’s security startups was aimed at our new members who live and work there, along with international investors who are seeking new opportunities.
Plus, don’t miss our first investor surveys of 2021: one by Lucas Matney on social gaming, and another by Mike Butcher that gathered responses from Portugal-based investors on a wide variety of topics.
Thanks very much for reading Extra Crunch this week. I hope we can all look forward to a nice, boring weekend with no breaking news alerts.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Full Extra Crunch articles are only available to members
Use discount code ECFriday to save 20% off a one- or two-year subscription
The Roblox Gambit
Image Credits: Nigel Sussman (opens in a new window)
In February 2020, gaming platform Roblox was valued at $4 billion, but after announcing a $520 million Series H this week, it’s now worth $29.5 billion.
“Sure, you could argue that Roblox enjoyed an epic 2020, thanks in part to COVID-19,” writes Alex Wilhelm this morning. “That helped its valuation. But there’s a lot of space between $4 billion and $29.5 billion.”
Alex suggests that Roblox’s decision to delay its IPO and raise an enormous Series H was a grandmaster move that could influence how other unicorns will take themselves to market. “A big thanks to the gaming company for running this experiment for us.”
I asked him what inspired the headline; like most good ideas, it came to him while he was trying to get to sleep.
“I think that I had ‘The Queen’s Gambit’ somewhere in my head, so that formed the root of a little joke with myself. Roblox is making a strategic wager on method of going public. So, ‘gambit’ seems to fit!”
8 investors discuss social gaming’s biggest opportunities
Image Credits: Erik Von Weber (opens in a new window) / Getty Images
For our first investor survey of the year, Lucas Matney interviewed eight VCs who invest in massively multiplayer online games to discuss 2021 trends and opportunities:
- Hope Cochran, Madrona Venture Group
- Daniel Li, Madrona Venture Group
- Niko Bonatsos, General Catalyst
- Ethan Kurzweil, Bessemer Venture Partners
- Sakib Dadi, Bessemer Venture Partners
- Jacob Mullins, Shasta Ventures
- Alice Lloyd George, Rogue
- Gigi Levy-Weiss, NFX
Having moved far beyond shooters and sims, platforms like Twitch, Discord and Fortnite are “where culture is created,” said Daniel Li of Madrona.
Rep. Alexandria Ocasio-Cortez uses Twitch to explain policy positions, major musicians regularly perform in-game concerts on Fortnite and in-game purchases generated tens of billions last year.
“Gaming is a unique combination of science and art, left and right brain,” said Gigi Levy-Weiss of NFX. “It’s never just science (i.e., software and data), which is why many investors find it hard.”
How to convert customers with subscription pricing
Image Credits: C.J. Burton (opens in a new window) / Getty Images
Startups that lack insight into their sales funnel have high churn, low conversion rates and an inability to adapt or leverage changes in customer behavior.
If you’re hoping to convert and retain customers, “reinforcing your value proposition should play a big part in every level of your customer funnel,” says Joe Procopio, founder of Teaching Startup.
What is up with Tesla’s value?
Image Credits: Bloomberg (opens in a new window) / Getty Images
Alex Wilhelm followed up his regular Friday column with another story that tries to find a well-grounded rationale for Tesla’s sky-high valuation of approximately $822 billion.
Meanwhile, GM just unveiled a new logo and tagline.
As ever, I learned something new while editing: A “melt up” occurs when investors start clamoring for a particular company because of acute FOMO (the fear of missing out).
Delivering 500,000 cars in 2020 was “impressive,” says Alex, who also acknowledged the company’s ability to turn GAAP profits, but “pride cometh before the fall, as does a melt up, I think.”
Note: This story has Alex’s original headline, but I told him I would replace the featured image with a photo of someone who had very “richest man in the world” face.
How Segment redesigned its core systems to solve an existential scaling crisis
Image Credits: piranka / Getty Images
On Tuesday, enterprise reporter Ron Miller covered a major engineering project at customer data platform Segment called “Centrifuge.”
“Its purpose was to move data through Segment’s data pipes to wherever customers needed it quickly and efficiently at the lowest operating cost,” but as Ron reports, it was also meant to solve “an existential crisis for the young business,” which needed a more resilient platform.
Dear Sophie: Banging my head against the wall understanding the US immigration system
Image Credits: Sophie Alcorn
Dear Sophie:
Now that the U.S. has a new president coming in whose policies are more welcoming to immigrants, I am considering coming to the U.S. to expand my company after COVID-19. However, I’m struggling with the morass of information online that has bits and pieces of visa types and processes.
Can you please share an overview of the U.S. immigration system and how it works so I can get the big picture and understand what I’m navigating?
— Resilient in Romania
The first “Dear Sophie” column of each month is available on TechCrunch without a paywall.
Revenue-based financing: The next step for private equity and early-stage investment
Image Credits: Hiraman (opens in a new window) / Getty Images
For founders who aren’t interested in angel investment or seeking validation from a VC, revenue-based investing is growing in popularity.
To gain a deeper understanding of the U.S. RBI landscape, we published an industry report on Wednesday that studied data from 134 companies, 57 funds and 32 investment firms before breaking out “specific verticals and business models … and the typical profile of companies that access this form of capital.”
Lisbon’s startup scene rises as Portugal gears up to be a European tech tiger
Image Credits: Westend61 (opens in a new window)/ Getty Images
Mike Butcher continues his series of European investor surveys with his latest dispatch from Lisbon, where a nascent startup ecosystem may get a Brexit boost.
Here are the Portugal-based VCs he interviewed:
- Cristina Fonseca, partner, Indico Capital Partners
- Pedro Ribeiro Santos, partner, Armilar Venture Partners
- Tocha, partner, Olisipo Way
- Adão Oliveira, investment manager, Portugal Ventures
- Alexandre Barbosa, partner, Faber
- António Miguel, partner, Mustard Seed MAZE
- Jaime Parodi Bardón, partner, impACT NOW Capital
- Stephan Morais, partner, Indico Capital Partners
- Gavin Goldblatt, managing partner, Portugal Gateway
How late-stage edtech companies are thinking about tutoring marketplaces
Image Credits: John Lund (opens in a new window)/ Getty Images
How do you scale online tutoring, particularly when demand exceeds the supply of human instructors?
This month, Chegg is replacing its seven-year-old marketplace that paired students with tutors with a live chatbot.
A spokesperson said the move will “dramatically differentiate our offerings from our competitors and better service students,” but Natasha Mascarenhas identified two challenges to edtech automation.
“A chatbot won’t work for a student with special needs or someone who needs to be handheld a bit more,” she says. “Second, speed tutoring can only work for a specific set of subjects.”
Decrypted: How bad was the US Capitol breach for cybersecurity?
Image Credits: Treedeo (opens in a new window) / Getty Images
While I watched insurrectionists invade and vandalize the U.S. Capitol on live TV, I noticed that staffers evacuated so quickly, some hadn’t had time to shut down their computers.
Looters even made off with a laptop from Senator Jeff Merkley’s office, but according to security reporter Zack Whittaker, the damages to infosec wasn’t as bad as it looked.
Even so, “the breach will likely present a major task for Congress’ IT departments, which will have to figure out what’s been stolen and what security risks could still pose a threat to the Capitol’s network.”
Extra Crunch’s top 10 stories of 2020
Image Credits: Catherine Falls Commercial (opens in a new window) / Getty Images
On New Year’s Eve, I made a list of the 10 “best” Extra Crunch stories from the previous 12 months.
My methodology was personal: From hundreds of posts, these were the 10 I found most useful, which is my key metric for business journalism.
Some readers are skeptical about paywalls, but without being boastful, Extra Crunch is a premium product, just like Netflix or Disney+. I know, we’re not as entertaining as a historical drama about the reign of Queen Elizabeth II or a space western about a bounty hunter. But, speaking as someone who’s worked at several startups, Extra Crunch stories contain actionable information you can use to build a company and/or look smart in meetings — and that’s worth something.
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Oxbotica raises $47M to deploy its autonomous vehicle software in industrial applications
While the world continues to await the arrival of safe, reliable and cost-effective self-driving cars, one of the pioneers in the world of autonomous vehicle software has raised some substantial funding to double down on what it sees as a more immediate opportunity: providing technology to industrial companies to build off-road applications.
Oxbotica, the Oxford, England startup that builds what it calls “universal autonomy” — flexible technology that it says can power the navigation, perception, user interfaces, fleet management and other features needed to run self-driving vehicles in multiple environments, regardless of the hardware being used — has picked up $47 million in a Series B round of funding from an interesting mix of strategic and financial investors.
Led by bp ventures, the investing arm of oil and gas giant bp, the round also includes BGF, safety equipment maker Halma, pension fund HostPlus, IP Group, Tencent, Venture Science and funds advised by Doxa Partners.
Oxbotica said it plans to use the capital to fuel a raft of upcoming deployments — several that will be coming online this year, according to its CEO — for clients in areas like mining, port logistics and more, with its lead investor bp an indication of the size of its customers and the kinds of projects that are in its sights.
The question, CEO Ozgur Tohumcu said in an interview, is “Where is the autonomy needed today? If you go to mines or ports, you can see vehicles in use already,” he said. “We see a huge transformation happening in the industrial domain.”
The funding and focus on industry are interesting turns for Oxbotica. The startup has been around since about 2014, originally as a spinout from Oxford University co-founded by academics Paul Newman and Ingmar Posner — Newman remains at the startup as its CTO, while Posner remains an AI professor at Oxford.
Oxbotica has been associated with a number of high-profile projects — early on, it provided sensor technology for Nasa’s Mars Rover, for example.
Over time, it has streamlined what it does to two main platforms that it calls Selenium and Caesium, covering respectively navigation, mapping, perception, machine learning, data export and related technology; and fleet management.
Newman says that what makes Oxbotica stand out from other autonomous software providers is that its systems are lighter and easier to use.
“Where we are good is in edge compute,” he said. “Our radar-based maps are 10 megabytes to cover a kilometer rather than hundreds of megabytes… Our business plan is to build a horizontal software platform like Microsoft’s.” That may underplay the efficiency of what it’s building, however: Oxbotica also has worked out how to efficiently transfer the enormous data loads associated with autonomous systems, and is working with companies like Cisco to bring these online.
In recent years Oxbotica has been synonymous with some of the more notable on-road self-driving schemes in the U.K. But, as you would expect with autonomous car projects, not everything has panned out as expected.
A self-driving pilot Oxbotica kicked off with London-based car service Addison Lee in 2018 projected that it would have its first cars on the road by 2021. That project was quietly shut down, however, when Addison Lee was sold on by Carlyle last year and the company abandoned costly moonshots. Another effort, the publicly backed Project Endeavour to build autonomous car systems across towns in England, appears to still be in progress.
The turn to industrial customers, Newman said, is coming alongside those more ambitious, larger-scale applications. “Industrial autonomy for off-road refineries, ports and airports happens on the way to on-road autonomy,” he said, with the focus firmly remaining on providing software that can be used with different hardware. “We’ve always had this vision of ‘no atoms, just software,’ ” he said. “There is nothing special about the road. Our point is to be agnostic, to make sure it works on any hardware platform.”
It may claim to have always been interested in hardware- and application-agnostic autonomy, but these days it’s being joined by others that have tried the other route and have decided to follow the Oxbotica strategy instead. They include FiveAI, another hyped autonomous startup out of the U.K. that originally wanted to build its own fleet of self-driving vehicles but instead last year pivoted to providing its software technology on a B2B basis for other hardware makers.
Oxbotica has now raised about $80 million to date, and it’s not disclosing its valuation but is optimistic that the coming year — with deployments and other new partnerships — will bear out that it’s doing just fine in the current market.
“bp ventures are delighted to invest in Oxbotica – we believe its software could accelerate the market for autonomous vehicles,” said Erin Hallock, bp ventures managing partner, in a statement. “Helping to accelerate the global revolution in mobility is at the heart of bp’s strategy to become an integrated energy company focused on delivering solutions for customers.”
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Chinese autonomous driving startup WeRide bags $200M in funding
WeRide, one of China’s most-funded startups developing autonomous driving capabilities, said on Wednesday that it has raised a $200 million strategic round from Chinese bus maker Yutong.
Mega investments aren’t uncommon at companies like WeRide developing the next-generation level 4 driving standard, which denotes that the car can handle the majority of driving situations independently without human intervention.
WeRide did not disclose its valuation for this round, which is the first tranche of its Series B round, a company spokesperson told TechCrunch.
The new funding will see WeRide joining hands with Yutong, a 57-year-old company, to make autonomous-driving minibuses and city buses as well as work together on R&D, vehicle platforms and mobility services. The partners have already jointly developed a front-loaded driverless minibus for mass-production. The model, which comes without a steering wheel, accelerator or brakes, is designed for operating in urban open roads, said WeRide.
Alliance Ventures, the strategic venture capital arm of Renault-Nissan-Mitsubishi, became WeRide’s strategic investor in 2018 following the completion of the startup’s Series A round, which was partially funded by the Chinese facial recognition giant SenseTime.
Autonomous driving startups in China are racing to showcase their progress, in part to attract funding for their cash-bleeding businesses. Alibaba-backed AutoX, for instance, began deploying driverless cars on the roads in Shenzhen in a bold move. WeRide and its rivals are testing various levels of autonomous driving vehicles in both the United States and major Chinese cities where local policies are supporting the futurist transportation tech.
“Capital’s attitude is shifting and increasingly bullish about autonomous driving and its commercial future following the COVID-19 pandemic [in China]. Many investments are happening in this space because investors don’t want to miss out on any potential leaders in autonomous driving,” the WeRide spokesperson said. “Our Series B round has attracted a lot of interest.”
WeRide’s competitors include Pony.ai in its backyard Guangzhou, AutoX and Deeproute.ai in Shenzhen, Momenta in Suzhou and Baidu in Beijing, to name a few.
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UK electric vehicle startup Arrival picks Charlotte for its North American headquarters
Arrival, the U.K. electric vehicle startup that plans to become a publicly traded company through a merger with special purpose acquisition company CIIG Merger Corp., has picked Charlotte for its North American headquarters.
The company said it will add 150 new employees to support the headquarters and invest about $3 million in office space in the South End neighborhood of Charlotte. Arrival said it will be hiring for a variety of corporate positions, including human resources, marketing, finance and administrative professionals.
Arrival was a secretive electric vehicle startup for nearly five years until January when it announced a $110 million investment from Hyundai and Kia. Over the past year, the company has shared more of its plans and partners, all culminating in its announcement last month to merge with a SPAC, or shell company, to become a publicly traded company.
Arrival’s aim is to produce electric vehicles that are competitive in price with traditional fossil fuel-powered vehicles and lower cost of ownership than other comparable EVs. Arrival says its modular electric “skateboard” platform, which can be used on a range of different vehicle types, along with its use of microfactories set up near major cities are how it will achieve its mission.
Arrival plans to produce commercial electric vehicles, beginning with van and bus models. The plan is to have four vehicles in the market by 2023, Arrival Automotive CEO Mike Ableson has previously said.
Arrival’s North American headquarters will be located less than 30 miles away from its first U.S. microfactory in Rock Hill, South Carolina. The company employs more than 1,200 people and has five engineering facilities and two microfactories globally.
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