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Extra Crunch roundup: Pre-pitch tactics, Warby Parker S-1, Israel’s fintech ecosystem
Forget what you’ve heard: There are many shortcuts to success.
Tapping into someone else’s experience is a tried-and-true method, which is why two-time Y Combinator participant Chris Morton wrote a guest post for Extra Crunch with advice for founders hoping to be accepted by the famed accelerator.
Morton, who has also reviewed thousands of YC applications, shares his thoughts on when to submit an application, what to do if you miss the deadline and whether you’ll need to relocate if accepted.
“Remember that your application should be good enough to get an interview, not win a prize,” says Morton. “Go back to work instead of spending more time perfecting an application.”
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Use discount code ECFriday to save 20% off a one- or two-year subscription
Image Credits: Robert Katai under a license.
In an interview with reporter Anna Heim, Romania-based marketer Robert Katai discussed some of the methods he uses to help clients refine their content and branding strategies.
“Today, content creation is free — everybody can do it. The hard part is how you distribute and amplify that.”
Katai also shared his impressions of Romania’s startup ecosystem, suggestions for maintaining top-of-mind status with customers, and reinforced the often-overlooked need to continually repurpose content to grab mindshare.
Like our other growth marketing interviews, there’s no paywall.
Thanks very much for reading Extra Crunch this week! I hope you have a fantastic weekend.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Why global investors are flocking to back Latin American startups
Image Credits: Bryce Durbin / TechCrunch
Latin America’s increasingly dynamic venture capital scene has been making headlines of late. To learn more about why investors are so enthusiastic, senior reporter Mary Ann Azevedo spoke to several who are actively engaged with the region:
- Shu Nyatta, managing partner, SoftBank
- Ethan Choi, partner, Accel
- Julie Ruvolo, director of venture capital, LAVCA
- Bill Cilluffo, partner, QED Investors
- Ana Cristina Gadala-Maria, principal, QED Investors
- Ross Darwin, principal, Owl Ventures
“I am not surprised by all the activity,” Mary Ann writes. “However, I am a bit taken aback by the sheer number of rounds, the caliber of firms leading them and the sky-high valuations.
“It seems that the region is finally, and deservedly, being taken seriously. This is likely just the beginning.”
Corporate venture capital follows the same trend as other VC markets: Up
Image Credits: Nigel Sussman (opens in a new window)
Corporations are not remaining on the sidelines of the fiery 2021 venture capital game, Alex Wilhelm and Anna Heim note in The Exchange.
After parsing data from CB Insights and Stryber and chatting with a handful of investors, Alex and Anna concluded that the corporate venture capital market looks a lot like other VC markets.
“Perhaps this should not be a surprise,” they write. “We’ve seen non-venture funds flow into the later stages of startup land, pushing VCs toward earlier-stage and more venture-y deals. Why would CVCs be immune to the same trend?”
Ramp and Brex draw diverging market plans with M&A strategies
Image Credits: Bryan Mullennix (opens in a new window) / Getty Images
Corporate spending management startup Brex raised a $300 million Series C and acquired Buyer just a week after rival Brex announced it had acquired Israeli fintech Weav.
Ryan Lawler and Alex Wilhelm dug into the Ramp-Brex rivalry, and what those acquisitions say about their diverging strategies.
“From a high level, all of the recent deal-making in corporate cards and spend management shows that it’s not enough to just help companies track what employees are expensing these days,” they write.
“As the market matures and feature sets begin to converge, the players are seeking to differentiate themselves from the competition.”
Boston’s startup market is more than setting records in scorching start to year
Image Credits: Nigel Sussman (opens in a new window)
Alex Wilhelm and Anna Heim interviewed VCs and corralled data to present a detailed picture of Boston’s startup funding scene.
“Boston is benefiting from larger structural changes to at least the U.S. venture capital market, helping close historical gaps in its startup funding market and access funds that previously might have skipped the region,” they write.
“And local university density isn’t hurting the city’s cause, either, boosting its ability to form new companies during a period of rich investment access.”
Europe’s quick-commerce startups are overhyped: Lessons from China
Image Credits: Andrew Holt (opens in a new window) / Getty Images
Half of the companies offering instant grocery delivery in Europe were founded last year as the pandemic reshaped most aspects of our existence.
To date, they’ve raised about $2 billion, but Picus Capital’s Alexander Kremer says startup lessons from China suggest that “instant delivery is not the magic bullet to crack the dominance” of old-school grocery players.
“If the performance of online grocery platforms in China (a market five to seven years ahead of Europe in terms of online retail) is anything to go by, a range of B2C business models would be more likely to displace the traditional grocery retailers.”
D2C specs purveyor Warby Parker files to go public
Image Credits: Nigel Sussman (opens in a new window)
For The Exchange, Alex Wilhelm examines the S-1 filing from Warby Parker, “a consumer hardware company with two main sales channels, largely attractive economics, falling losses and rising adjusted profitability. You could even argue that it handled the pandemic well, despite COVID-19’s negative impact on its operations.”
But how are its growth prospects?
Dear Sophie: Can I still get a green card through marriage if I’m divorcing?
Image Credits: Bryce Durbin/TechCrunch
Dear Sophie,
I received a conditional green card after my wife and I got married in 2019. Recently, we have made the difficult decision to end our marriage. I want to continue living and working in the United States.
Is it still possible for me to complete my green card based on my marriage through the I-751 process or do I need to do something else, like ask my employer to sponsor me for a work visa?
— Better to Have Loved and Lost
Using AI to reboot brand-client relationships
Image Credits: Getty Images under an alashi (opens in a new window)license.
Marketing automation can help boost key metrics, but it can also be a disservice to brands by perpetually devaluing goods and services, ShareThis’ Michael Gorman writes in a guest column.
Companies with a narrow focus on driving conversions are missing the bigger picture: AI can help create richer experiences that identify consumer actions and intent while also improving customer experiences.
“We live in a world rich with data, and insights are growing more vibrant every day,” he writes.
Israel’s maturing fintech ecosystem may soon create global disruptors
Image Credits: Thitima Thongkham (opens in a new window) / Getty Images
Fintech startups based in Israel raised more than $1.8 billion in 2019, but in Q1 2021, companies in the category raised $1.1 billion.
Facilitating a wide range of services, more than a dozen fintech unicorns have already emerged in a country that has a population slightly smaller than Los Angeles County, many of them started by entrepreneurs who lacked financial backgrounds.
“So what is it about Israeli-founded fintech startups that stand out from their scaling neighbors across the pond?” asks Flint Capital’s Tel Aviv-based investor, Adi Levanon.
Forbes jumps into hot media liquidity summer with a SPAC combo
Image Credits: Nigel Sussman (opens in a new window)
For The Exchange, Alex Wilhelm takes stock of Forbes’ SPAC combination during a week when POLITICO was snatched up for more than $1 billion by Axel Springer and just a few months after BuzzFeed went public via a blank-check company.
“Is it the most exciting debut? No,” he writes.
“But it does highlight that with enough sheer gumption, one can take a magazine business into the digital age and keep aggregate revenue growing. That’s worth something.”
Are B2B SaaS marketers getting it wrong?
Image Credits: mevans (opens in a new window) / Getty Images
Technical jargon is one of the most annoying aspects of technology marketing.
Sadly, it tends to perpetuate itself: Marketers are terrified of making a wrong move, so they tend to copy what everyone else is doing.
If you want to attract customers and drive higher conversions, cut the jargon.
“Do everything you can to be immediately understood and you’ll have a much better chance of cutting through the noise and pushing clear and persuasive benefits in a way no prospect can resist,” advises Konrad Sanders, CEO of The Creative Copywriter.
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Forbes jumps into hot media liquidity summer with a SPAC combo
What a busy week in the world of media liquidity.
That’s a sentence you don’t get to write often. Regardless, news broke this week that Axel Springer is buying U.S. political journalism outfit POLITICO. The transaction was expected, but the eye-popping roughly $1 billion price tag still has tongues wagging. We even got on the podcast to chat about it.
And Forbes announced that it is going public via a SPAC. The business publication’s news follows BuzzFeed’s journey to the public markets through a blank-check company. Hot media liquidity summer? Something like that.
The Exchange explores startups, markets and money.
Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.
That TechCrunch is in the process of being sold to private equity, of course, is not something that we should forget. Shoutout to the Verizon bankers who found a way to get rid of us while also deleveraging Verizon’s debt profile. Ten points.
I want to take a quick tour of the Forbes SPAC deck this morning. Our notes on BuzzFeed’s are here, in case you want to run comparisons. This will be easy and fun. Perfect Friday morning fare. Into the data!
What’s it worth?
In corporate-speak, Forbes Global Media Holdings is merging with blank-check company Magnum Opus Acquisition Limited. The transaction will close either Q4 2021 or Q1 2022, Forbes estimates.
The deal itself is somewhat modest in scale compared with other SPAC deals we’ve recently looked into. Forbes reports that it will sport “an implied pro forma enterprise value of $630 million, net of tax benefits,” after its completion. Some $600 million in gross proceeds will be derived from Magnum Opus funds “and $400 million of additional capital through a private placement of ordinary shares of the combined company,” Forbes writes.
The company will sport an equity valuation of $830 million after the deal closes, per its own calculations. That number will change some depending on redemptions ahead of the combination. The gap between the large dollars going into the deal and the modest final valuation of the public Forbes entity is due to some $440 million in secondary transactions for existing Forbes shareholders.
In case you’d prefer all of that in table form, here’s the Forbes investor deck:
Image Credits: Forbes SPAC deck
Is $830 million a fair price? Let’s dig into Forbes’ results.
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Extra Crunch roundup: Unpacking BuzzFeed’s SPAC, curb your meeting enthusiasm, more
Meetings should have a clear purpose, but instead, they’ve become a way to measure status and reinforce what is colloquially referred to as CYA culture.
There’s a kernel of truth in every joke, so whenever someone quips, “This meeting could have been an email!” you can bet that some small part of them meant it sincerely.
Few people know how to run meetings effectively and keep conversations on track. Making matters worse, attendees often don’t bother to prepare, which makes a boring session even less productive.
And then there’s the complication of workplace politics: How secure do you feel declining an invitation from a co-worker — or a manager?
“Every time a recurring meeting is added to a calendar, a kitten dies,” says Chuck Phillips, co-founder of MeetWell. “Very few employees decline meetings, even when it’s obvious that the meeting is going to be a doozy.”
Full Extra Crunch articles are only available to members.
Use discount code ECFriday to save 20% off a one- or two-year subscription.
Changing your meeting culture is difficult, but given that 26% of workers plan to look for a new job when the pandemic ends, startups need to do all they can to retain talent.
Aimed at managers, this post offers several testable strategies that will help you boost productivity and say goodbye to poorly run, lazily planned meetings.
“Declining a bad meeting should never be taboo, and you should reiterate your trust in the team and challenge them to spend their and others’ time with more intention,” Phillips says. “Help them feel empowered to decline a bad meeting.”
Thanks very much for reading Extra Crunch, and have a great weekend.
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Why Amazon should pay attention to Shein
Image Credits: Shein
In the last year, online apparel shopping app Shein grew active daily users by 130%, reports Apptopia.
Each day, thousands of new products arrive on the app’s virtual shelves. Items are rapidly designed and prototyped before Shein’s contractors put them into production in Guangzhou factories — two weeks later, those SKUs arrive in fulfillment centers around the globe.
TechCrunch reporter Rita Liao examined how the company’s agile supply chain has become hot talk among e-commerce experts, but beyond a strong logistics game and data-driven product development, Shein’s close relationships with suppliers are integral to its success.
She also tried to answer a question many are asking: Is Shein a Chinese company?
“It’s hard to pin down where Shein is from,” answered Richard Xu from Grand View Capital, a Chinese venture capital firm.
“It’s a company with operations and supply chains in China targeting the global market, with nearly no business in China.”
Inside GM’s startup incubator strategy
Image Credits: Chevrolet
GM Vice President of Innovation Pam Fletcher is in charge of the company’s startups that tackle “electrification, connectivity and even insurance — all part of the automaker’s aim to find value (and profits) beyond its traditional business of making, selling and financing vehicles,” Kirsten Korosec writes.
Fletcher joined TechCrunch at a virtual TC Sessions: Mobility 2021 event to discuss what it’s like to launch a slew of startups under the umbrella of a 113-year-old automaker.
Investor Marlon Nichols and Wonderschool’s Chris Bennett on getting to the point with a pitch deck
Image Credits: MaC Venture Capital / Wonderschool
MaC Venture Capital founding managing partner Marlon Nichols and Wonderschool CEO Chris Bennett joined Extra Crunch Live to tear down the company’s early deck.
“The first thing that jumped out at all of us was just how bare-bones the presentation is: white text on a blue background, largely made up of bullet points,” Brian Heater writes before noting the CEO admitted that “not much changed aesthetically between that first pitch and the Series A deck.”
“It aligned with what we were valuing at the time,” Bennett says. “We were really focused on getting the product-market fit and really trying to understand what our customers needed. And we’re really focused on building the team.”
Dear Sophie: What options would allow me to start something on my own?
Image Credits: Bryce Durbin/TechCrunch
Dear Sophie,
I’ve been working on an H-1B in the U.S. for nearly two years.
While I’m grateful to have made it through the H-1B lottery and to be working, I’m feeling unhappy and frustrated with my job.
I really want to start something of my own and work on my own terms in the United States. Are there any immigration options that would allow me to do that?
— Seeking Satisfaction
Investors’ thirst for growth could bode well for SentinelOne’s IPO
Image Credits: Nigel Sussman (opens in a new window)
Alex Wilhelm calls SentinelOne’s looming debut “fascinating.”
“Why? Because the company sports a combination of rapid growth and expanding losses that make it a good heat check for the IPO market,” he writes. “Its debut will allow us to answer whether public investors still value growth above all else.”
Alex delves into an early dataset from SentinelOne and why public market investors still appear to value growth above anything else.
Before an exit, founders must get their employment law ducks in a row
Image Credits: Jenny Dettrick (opens in a new window) / Getty Images
Guest columnist Rob Hudock, a litigator who focuses on helping companies recruit the best talent available while avoiding distracting workplace issues or lawsuits, lays out the importance of putting out any employment-related fires before an exit.
“Inattention to employment issues can have a significant impact on deals — from preventing closings and reducing the deal value to altering the deal terms or significantly limiting the pool of potential buyers,” he writes.
“Fortunately, such issues typically can be resolved well in advance with a little forethought and legal guidance.”
Practice agile, iterative change to refine products and build company culture
Image Credits: John M Lund Photography Inc (opens in a new window) / Getty Images
Building an excellent product and a standout company culture require the same process, Heap CEO Ken Fine writes in a guest column.
“At Heap, the analytics solution provider I lead, a defining principle is that good ideas should not be lost to top-down dictates and overrigid hierarchies,” he writes. “The best results come when you approach leadership like you would create a great product — you hypothesize, you test and iterate, and once you get it right, you grow it.”
Here, he lays out his method that argues in favor of iterative change, not “one-and-done decrees.”
a16z’s new $2.2B fund won’t just bet on the crypto future, it will defend it
Image Credits: Nigel Sussman (opens in a new window)
The big news on Thursday was the announcement of Andreessen Horowitz’s new cryptocurrency-focused fund. Most focused on the eye-popping $2.2 billion figure, but Alex Wilhelm dug a bit deeper into the announcement to note that a16z isn’t just pumping a ton of money into the crypto space, it’s putting on gloves to fight for it.
Alex writes that “a16z intends to run defense for crypto in the American, and perhaps global, market. Crypto-focused startups are likely unable to tackle the regulation of their market on their own because they’re more focused on product work in a particular region of the larger crypto economy. The wealthy and connected investment firm that backs them will take on the task for its chosen champions.”
5 takeaways from BuzzFeed’s SPAC deck
Image Credits: Nicholas Kamm / AFP / Getty Images
Alex Wilhelm dives headfirst into BuzzFeed’s announcement that it plans to go public via a blank check company.
He looked at its historical and anticipated revenue growth (the latter is very sunny, which is not atypical for SPAC presentations), what makes up that revenue (more “commerce” as time goes on), its long-term profitability projections, as well as fun stuff, like the Pulitzer Prize-winning BuzzFeed News.
Admit it. You’re curious.
3 issues to resolve before switching to a subscription business model
Image Credits: SaskiaAcht (opens in a new window) / Getty Images
Moving from a pay-as-you-go model to a subscription service is more than just putting a monthly or yearly price tag on a product, CloudBlue’s Jess Warrington writes in a guest column.
“Executives cannot just layer a subscription model on top of an existing business,” Warrington writes. “They need to change the entire operation process, onboard all stakeholders, recalibrate their strategy and create a subscription culture.”
Warrington says that in his role at CloudBlue, companies often approach him for “help with solving technology challenges while shifting to a subscription business model, only to realize that they have not taken crucial organizational steps necessary to ensure a successful transition.”
Here’s how to avoid that situation.
Veo CEO Candice Xie has a plan for building a sustainable scooter company, and it’s working
Image Credits: Bryce Durbin
Rebecca Bellan interviewed Veo CEO Candice Xie about the micromobility startup’s “old-fashioned way” of doing business.
“I understand people are eager to prove their unit economics, their scalability and also improve their matrix to the VC to raise another round,” Xie says. “I would say that’s OK in the consumer industry, like consumer electronics or SaaS.
“But we are in transportation. It is a different business, and transportation takes years of collaboration and building between private and public partners. … So I don’t see it happening from day one, turning over a billion-dollar company, while simultaneously having it all make sense for the cities and users.”
5 companies doing growth marketing right
Image Credits: jayk7 (opens in a new window) / Getty Images
All companies want more or less the same thing: growth. But how do you accomplish it?
Ideally, don’t start from scratch.
The race to grow faster is more pressing than ever before. … “[F]orward-thinking entrepreneurs and growth marketers simply must make time to study their competition, learn best practices and apply them to their own business growth,” Mark Spera, the head of growth marketing at Minted, writes in a guest column.
“Of course, you should still run your own experiments, but it’s just more capital-efficient to emulate than to trial-and-error from scratch. Here are five companies with growth strategies worth emulating — including the most important lessons you can begin applying to your business today.”
Musculoskeletal medical startups race to enter personalized health tech market
Image Credits: ChrisChrisW (opens in a new window) / Getty Images
With more than 50 million Americans suffering from chronic pain and musculoskeletal (MSK) medical problems, a number of startups are offering patients new products “that don’t resemble the cookie-cutter status quo,” reports Natasha Mascarenhas.
Startups hoping to enter this space have an uphill climb. Setting aside regulations that cover aspects like product packaging and marketing, they must compete with well-entrenched competition from Big Pharma as they try to partner with health insurance companies.
Natasha profiles three companies that are each taking a different approach to personalized health: Clear, Hinge Health and PeerWell.
Like the US, a two-tier venture capital market is emerging in Latin America
Image Credits: Nigel Sussman (opens in a new window)
In the second part of an Exchange series looking at the global early-stage venture capital market, Alex Wilhelm and Anna Heim unpacked the scene in Latin America, discovering it looked a lot like the situation in the United States: slow Series A rounds, fast B rounds.
“Mega-rounds are no longer an exception in Latin America; in fact, they have become a trend, with ever-larger rounds being announced over the last few months,” they write.
Despite that, the funds aren’t being equitably distributed, and the region still lags behind its peers: Brazil has the most $1 billion startups in Latin America, with 12. The U.S., meanwhile, has 369, and China has 159.
But the Latin American market remains hot, if not quite as scorching as the U.S. and China.
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BuzzFeed uses AI to create romantic partners in its latest quiz
A new BuzzFeed quiz is the first in what Director of Product for Quizzes Chris Johanesen said he’s hoping will be a series of “stunt-y experiments” that the publisher launches this year.
The quiz, timed for Valentine’s Day weekend, promises to “create your perfect boyfriend (or girlfriend) using AI technology.” Johanesen said it’s designed to “poke fun at the situation we’re all in” (quarantine, obviously), as well as the “weird world of online dating.”
To take the quiz, you answer a series of multiple-choices questions about what you’re looking for in your ideal romantic partner.
The questions will probably feel familiar to anyone who’s taken a quiz on BuzzFeed or elsewhere online, but the answer should be a lot more unique: Johanesen noted that in a normal online quiz, there might be “12 or 20 different results that are written, and that’s pretty much it.” With this one, “you could retake it dozens of times and never get the same results.”
Johanesen explained that the BuzzFeed team generated an enormous variety of different profile images using StyleGAN technology. For the text, BuzzFeed staff contributed personality traits, text messages quotes, hobbies and “weird, dark stuff” that the quiz combines algorithmically.
“I think we’re mostly trying to embrace the absurdity of it,” he added. (I saw this myself when I tried out a demo earlier this week and was assigned a girlfriend who wanted to show off her “collection of scabs.”) “We try to match it a little bit to some of your inputs so that it’s not totally random. … An early version was more realistic, but it wasn’t as fun.”
Looking ahead, Johanesen said he’s hoping to create more quizzes that are “more generative,” where a writer might come up with a concept but they don’t have to “handwrite every single option.” Still, it sounds like this approach requires significant editorial work, which Johanesen doesn’t expect to change.
“We could definitely use machine learning models to write a quiz, but it probably wouldn’t be very good,” he said. Instead, the team is interested in “that intersection of what technology can do that humans can’t, and what humans can do that technology can’t.”
More broadly, he noted that BuzzFeed is experimenting to find new ways to refresh the quiz format, for example with the Quiz Party feature and Quiz Streaks.
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Bustle CEO Bryan Goldberg explains his plans for taking the company public
Bustle Digital Group — owner of Bustle, Inverse, Input, Mic and other titles — could eventually join the ranks of startups going public via a special purpose acquisition company (SPAC).
During an interview about the state of BDG and the digital media industry at the end of 2020, founder and CEO Bryan Goldberg laid out ambitious goals for the next few years.
“Where do I want to see the company in three years? I want to see three things: I want to be public, I want to see us driving a lot of profits and I want it to be a lot bigger, because we’ve consolidated a lot of other publications,” he said.
He added that those goals connect, because by going public, BDG can raise “hundreds of millions dollars,” which Goldberg wants to use to “buy a lot of media companies.”
That might seem like bluster after a year in which many digital media companies (including BDG) had to make serious cuts. But Goldberg said that the company would be profitable in 2020, with revenue that’s “a little bit under $100 million.” And it won’t be the first digital media company to take a similar route — Group Nine created a SPAC that went public last week.
“I want to prove that we can be highly profitable,” he said. “A lot of startups don’t have that goal. A lot of VCs tell their startups: Don’t worry about profits, don’t worry about losing money. I don’t believe in that.”
In addition to his plans to go public, Goldberg also discussed how acquisitions have helped Bustle’s business, his joint venture to purchase W Magazine and digital media’s “overcapitalization” problem. You can read our full conversation, edited for length and clarity, below.
TechCrunch: The last time I caught up with someone at BDG, it was with [the company’s president Jason Wagenheim] and that was when you guys were dealing with the initial fallout [from the pandemic]. Now we’re a lot further into whatever this new world is, so what is your sense of where BDG is now, versus where it was in the early days of the pandemic?
Bryan Goldberg: It might be the craziest, most eventful six months for many of us in our lives. And certainly, for those of us in this industry, the difference between April and October, it’s really hard to fathom, it’s complete night and day. April was a very frightening time for everyone, personally and professionally across the country, across the world.
From an advertising standpoint, it was a really scary time, because we have clients across every industry, and every industry was impacted differently. We have clients who were greatly impacted — theme parks, car makers, hotel companies, airlines — and then we had clients who were not as badly affected, such as a lot of CPG clients, who everybody depended upon so much during the pandemic.
There was a huge pause in our business in in March, April and May. For a lot of clients, tossing advertising was a sort of knee-jerk reaction to the sudden shock of COVID, and so we saw a huge negative impact in our second quarter. What we started to see in the third quarter, and especially now in the fourth quarter, is now that the shock of COVID is behind us, the macro trends that were catalyzed by COVID are now moving into the forefront.
The story of media is no longer about the shock of COVID. The story of media is now about all of the changes to our world, and changes to our industry that were brought about as a consequence of COVID.
The good news for our company, and the good news for other digital media companies, is it looks like the future is being accelerated. It looks like people are watching less television, and so advertisers are moving their budgets into digital faster than they would have had it not been for COVID. Even things like live sports, [their] TV ratings are way down. And a lot of advertisers are saying, “Is there efficacy anymore in cable television or broadcast television?” And the magazine industry was heavily impaired, simply because magazines are a physical medium, and people didn’t want to pass around magazines or read magazines at the dentist’s office, so we probably saw some print budget move into digital as well.
Industry analysts now are going to take up their estimates of what digital revenue is going to look like in 2021, 2022 and beyond. I also think we’ve seen a world in which a lot of brand advertisers are starting to think about what happens when they start to spend beyond Facebook and Google. For most of the last three years, there’s been so much talk about the duopoly, the idea that Facebook and Google are going to eat almost every last dollar of advertising. What we’ve seen in the last three months is advertisers saying that this needs to be the moment in which they learn how to deploy advertising spend digitally beyond Facebook or Google.
No, it doesn’t mean they’re all pulling out of Facebook — Facebook and Google are doing just fine. But there are still tens of billions of dollars that need to be deployed outside of Facebook and Google. And you’re seeing winners such as Snapchat, Pinterest. Both had incredibly strong earnings. They’re benefiting from the same thing that benefits Bustle Digital Group and a lot of other digital media players who aren’t Facebook and Google, which is you’re seeing big ad spenders finally deciding that now’s the time to find other ways to deploy advertising spend.
I think those are the two big trends: Dollars moving to digital out of TV faster than we thought, and major advertisers using now as a time to find other channels beyond Facebook and Google.
So when you look at how that is impacting Bustle’s business, has it returned to pre-COVID levels?
For us, when we reflect upon the year 2020, we see that we had a great first quarter, we see that we’re having an incredible fourth quarter, and we have a big, epic crater in the second and third quarters. So when we look at the year, we basically have to say to ourselves, if it were not for that crater in the second and third quarters, what would this year have looked like? We would have had revenue well in excess of $100 million. Now, we’re gonna have revenue a little bit under $100 million.
But when we think about how we prepare for 2021 and set goals for 2021, we have to set goals for 2021 as though COVID had never happened, we have to set goals for 2021 without using Q2 and Q3 as a sort of excuse for lowering expectations. Because the fourth quarter, the quarter we’re currently in, has exceeded our wildest expectations.
People sort of sat up and took notice of the company because you had a pretty aggressive acquisition strategy. I imagine that strategy had to change a little bit in 2020. To what extent do you feel that ambition is something that you can pick up again?
So to be clear, not only do we feel great about our strategy, our strategy was critical in helping our company survive and ultimately thrive in the wake of the virus. You know, we made two acquisitions [in 2019] — in the science and technology category, we bought Inverse, which is a science and technology publication, and then Josh Topolsky launched a tech-and-gadget publication for us called Input Magazine that’s growing very quickly.
It’s critical that we had that strategy, because no single advertiser category has performed better for us in 2020 than tech — we more than tripled our revenue from technology clients this year, because technology has thrived through COVID. Had we not had an acquisition strategy, had we not diversified into tech media publishing, we certainly would not have had the outcome we had in 2020. That’s just the reality.
Categories like beauty, fashion, retail were very hard hit. Those have traditionally been our bread and butter, and they’re going to be great again, in 2021. But this spring, beauty companies weren’t doing so well, because people weren’t leaving the house. So the strategy worked, in part, because we diversified the categories in which we created content, which allowed us to diversify the advertiser base. And we’re gonna continue full speed ahead in 2021.
Now, you know, we did six acquisitions in 2019. I don’t know if we’ll do six acquisitions in 2021. But I want to do a lot more than one acquisition in 2021.
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BuzzFeed’s new MoodFeed recommends content based on how you’re feeling
BuzzFeed is offering readers a new approach to finding content that fits the way they’re feeling right now.
It’s not the boring old approach of following a link on social media or search, or of typing BuzzFeed.com into your browser. Instead, on MoodFeed, readers can identify their mood, then they’ll get a list of articles that match those feelings.
There are currently six options — curious, stressed, bored, nostalgic, joyful or hungry. If you select “curious,” you’ll see a list of BuzzFeed posts about strange facts, life hacks and the like. If, on the other hand, you go with “nostalgic,” you’ll get lots of headlines about pop culture history. And if you’re not sure, you can just give the mood wheel a spin and see what it lands on.
Talia Halperin, BuzzFeed’s vice president of brand management, described this as an experiment in “getting our audience engaged and excited in a non-traditional way.” The team apparently created these recommendations by first identifying the main mood options, then “reverse-engineering” which articles would be a good fit.
And while BuzzFeed’s never offered this kind of interface before, Halperin argued that the broader strategy is one that the organization uses “all the time, in a curated, audience-focused way” — when the team is sharing and promoting articles, it’s thinking about moods and associated identities.
In fact, the BuzzFeed team has actually built AI tools to help with this process, automating the ability to identify which BuzzFeed stories should be posted on which BuzzFeed pages, when “evergreen” stories should be re-promoted and at what time headlines should be shared.
In the case of MoodFeed, Halperin made it sound like this is very much an experiment, with the company still figuring out things like “how often we should refresh it, what our strategy is around that.”
At the same time, she said there’s plenty of room for expansion.
“This could scale in a really interesting way,” she added. “You may have noticed that there are only six moods, but of course, there are several different moods that come along with certain events [so we’re interested] in really being able expand to expand the moods at different times of the year.”
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Canada’s True North conference is not your typical tech event
From the venue and the flashy event website, Waterloo, Ontario’s True North conference (in its second year) doesn’t seem all that distinct from a laundry list of other major tech events that take place each year across North America. But from the moment its main stage programming kicked off on the first day, it was clear this wasn’t your typical gathering place for the tech industry faithful.
The main stage track kicked off with Communitech CEO Iain Klugman. The event is produced by Communitech, an entrepreneurial support and resource organization founded in 1997 to foster the Waterloo region’s technology industry. Communitech sprung out of BlackBerry and the University of Waterloo and the world-class innovation community that surrounds both.
Klugman, a former communications executive and current board member at a number of Communitech-fostered startups and academic institutions, sounded a cautionary and urgent note that continued throughout the day.
Tech conferences, in general, tend to dwell on optimism and enthusiasm, with brief forays into dark alleys of negative consequences. Not this one.
Communitech CEO Iain Klugman speaking at True North 2019 in Waterloo.
Klugman’s talk touched on opportunity, but it was the opportunity to discuss among a group of peers with influence in the technology industry how they should undertake together “to set things right.” Last year’s event had a similar outcome, resulting in the “Tech for Good Declaration,” which True North describes as “the Canadian tech industry’s living document,” and includes a number of principles designed to help guide technology development with community good in mind.
Rather than changing focus for year two, True North’s organizers seem to have doubled down: Klugman’s opening talk included references to surveillance capitalism and breaches of trust, and included this cheerful analogy: “Technology is like fuel. It can warm our homes or it can burn them to the ground, so we decide which one it will do.”
As a whole, the event is about the “tough choices” faced by the collective “we” of the tech industry, according to Klugman.
True North’s official keynote perfectly took the baton from the intro, as New York Times columnist and longtime political commentator Thomas Friedman took the stage. Friedman, a somewhat controversial figure owing to some of his past political stances, launched into a talk informed by his most recent book, “Thank You for Being Late,” and talked about what we’re seeing now in human history as a moment of intersection of three different forces accelerating in a “nonlinear manner” all at once, including technological development outpacing humanity’s ability to adapt to those changes.
NYT columnist and author Thomas Friedman at True North 2019 in Waterloo.
Friedman’s talk ended with him positing that humans spend most of their time today in the essentially “god-less” realm of “cyberspace,” a realm “where we’re all connected but no one’s in charge,” while at the same time we’ve achieved better than ever ability to act with god-like power to control and manipulate our environment. He chided the essential disconnect of powerful forces that act with supreme mastery over technology but with no grounding in sociopolitical understanding (specifically naming Mark Zuckerberg) and those who have the inverse problem (the U.S. Congress, in Friedman’s view).
Overall, Friedman’s views are grounded in what he describes as a place of optimism. But the takeaway is more that humanity is currently at a state where it’s overwhelmed on a number of fronts and out of its depth in terms of having a capacity to cope.
In the afternoon, Robert Mazur (longtime undercover agent and the subject of biopic “The Infiltrator”) discussed his experience tracking down and prosecuting money launderers operating more or less with the blessing of large financial institutions, precisely because their systems were designed around incentive systems that encouraged them but didn’t have protections in place to prevent bad actors from taking advantage. Mazur further elaborated that current telecom industry structure actually makes it even easier than ever to launder large sums relatively unchecked. In essence, it was a warning to be mindful of how the products you build can be exploited by the most malicious actors.
Former Information and Privacy Commissioner for Ontario and creator of the concept of “Privacy by Design” Ann Cavoukian came next, decrying the current state of data “centralized in huge honeypots of information,” including Google (her example).
Former Ontario Information and Privacy Commissioner Ann Cavoukian.
This centralization, she noted is a huge risk in terms of presenting opportunities for tracking, misuse, leaks and more. It’s “taking away our agency as individuals,” she said, and the solution is moving to true decentralization of data.
“Privacy […] is freedom, and is about you making decisions relating to your personal information; not the state, not corporations — you,” she said. “It’s not about secrecy, it’s about control [and] privacy is a necessary condition for societal well-being.”
Cavoukian wrapped her talk by noting the sheer volume of privacy breaches that have leaked consumer information to date, and about the importance of encryption in keeping this safe. Overall, her talk was a blueprint for tech companies looking to incorporate data privacy and good stewardship into the DNA of their products from day one.
Kelsey Leonard, Tribal Co-Lead on the Mid-Atlantic Regional Planning Body of the U.S. National Ocean Council, provided a talk on the implications of digital rights and the continued digital divide as it pertains to Indigenous communities globally. Leonard pointed out that Indigenous nations in North America are the least connected in the world, something she noted continues the ongoing colonialism, and even can potentially contribute to “ongoing genocide of Indigenous peoples.”
Kelsey Leonard, advocate for Indigenous Data Governance and Sovereignty, speaks at True North 2019 in Waterloo.
Indigenous people are also systematically disenfranchised from data ownership and data control, by virtue of their being left out of advanced STEM education and formalized degrees, she said. Leonard also noted that platforms contain reinforcement of what she calls “digital colonialism,” in that Indigenous names are often flagged as fake by algorithms designed to enforce real-name policies, and Indigenous languages are often mistranslated (specifically as Estonian, she said).
This worsens existing Indigenous language and culture erasure. Leonard said a language is lost every two weeks on average, according to recent research. What’s required then is to add protection measures specific to digital platforms to help counter this institutional digital colonization and enforce Indigenous Sovereign Data.
To close day one, Recode founder and legendary Silicon Valley reporter Kara Swisher summarized a lot of her recent work as a New York Times columnist. Basically, that means she called on the industry to stop messing around and start fixing stuff.
Kara Swisher speaks at the True North 2019 conference in Waterloo, Ontario.
Swisher said we’re coming to a “reckoning” for tech in terms of media coverage, and the overwhelmingly positive coverage it’s received over the past many years. She emphasized that we’re only at the beginning of the impact technology will have on society, and laid out a number of current areas of innovation and investment that will continue to upset societal norms, including autonomous driving, artificial intelligence and more.
Regarding media specifically, Swisher noted that she marked a significant shift when BuzzFeed started A/B testing to amplify and extend the attention-capture possible around specific “news” items, citing the famous Katy Perry Left Shark incident of 2015. This, combined with our “continuous partial attention,” which is tied to our inability to totally disengage from our smartphones, is combining to have effects on how we think and work in the world, Swisher said.
She added that, today, many of her new big concerns are around AI, and that “everything that can be digitized will be digitized.” Not only that, she continued, but “almost everything can be,” which will be massively disruptive to peoples’ lives, with effects including a future where most people will have a very high number of different jobs over the course of their lives, requiring continuous education and retraining. “We have to think really hard about what good AI is and what problematic AI is,” she said.
Thompson Reuters Foundation CEO Antonio Zappulla at True North 2019 in Waterloo discussed using technology to help fight human trafficking.
Across other stages, too, the themes of technology’s dangers and how to avert it prevailed across programming. Take Some Risk founder Duane Brown gave a talk on opting out of the always-connected lifestyle and becoming “digitally exhausted.” MedStack founder and CEO Balaji Gopalan talked about the risks inherent in dealing with private patient data in healthcare. Other topics included sustainable energy for Africa, using big data to counter human trafficking and ensuring we steer away from encouraging consumerization in this generation of connected kids.
The event’s central theme was the deceptively simple (and frankly over-uttered) phrase “tech for good,” but the programming and content revealed a level of sophistication and sincerity on the topic that exceeds the low bar often found in tech industry marketing materials and staged events. Overall, it felt introspective, contrite and contemplative — a self-reflection from a community genuine about shoring up its ethical shortcomings. In other words, refreshing.
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BuzzFeed teams up with Eko to create interactive recipes and other videos
BuzzFeed and Eko have been working together to create a wide range of interactive videos, which they began launching in the past week or so — starting with this Tasty potato recipe that allows you to customize your ingredients, revealing a bit about your personality in the process.
There’s also an interactive Tarot reading, a video quiz that determines which kind of dog you are and this customizable ramen video.
I spoke with BuzzFeed and Eko executives last week to learn more about how they’re working together, and where it might go next.
These videos — usually brief and based on existing BuzzFeed formats — feel pretty different from previous Eko showcases like “That Moment When,” which is more of a comedic, Choose Your Own Adventure-style story.
Eko’s Chief Creative Officer Alon Benari acknowledged that in the past, the company usually “started from a traditional video and injected interactivity into it.” But while “this is one of the first projects where we did the other path” — namely, taking an interactive format like a quiz and introducing video — the focus is still on “bringing together the best of both worlds.”
“This isn’t a direction change,” added Vice President of Business Development Ivy Sheibar. “We have a full pipeline of what you would consider coming more from traditional video.”
As for BuzzFeed, Chief Marketing Officer Ben Kaufman suggested that this is a natural extension of the publisher’s strategy to experiment with new formats. By offering this kind of interactivity, BuzzFeed can tailor videos to their viewers’ needs and interests (for example, by customizing video recipes based on dietary restrictions) while also “allowing our audience to engage with our videos and create data feedback loops.”
In addition to providing the technical platform to create these videos, Kaufman said Eko’s team shared important insights from years of experience with interactivity.
“One of the things they trained us on was what the meaning of a meaningful choice was — [a choice] where actually as an audience member you would take that to heart and makes you feel like, ‘This video is really made for me,’ ” he said.
Kaufman added that as BuzzFeed and Eko continue rolling out different types of interactive videos, “Our goal in the next few weeks is to crack this, to build a real deep audience connection, see what they are loving and go heavy into scaling that.”
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Extend Fertility banks $15M Series A to help women freeze their eggs
Fertility services are raising venture cash left and right. Last week, it was Dadi, a sperm storage startup that nabbed a $2 million seed round. This week, it’s Extend Fertility, which helps women preserve their fertility through egg freezing.
Headquartered in New York, the business has secured a $15 million Series A investment from Regal Healthcare Capital Partners to expand its fertility services, which also include infertility treatments, such as in vitro and intrauterine insemination. The company has also appointed Anne Hogarty, the former chief business officer at Prelude Fertility and vice president of international business at BuzzFeed, to the role of chief executive officer. Hogarty replaces Extend Fertility co-founder Ilaina Edison, who had held the C-level title since the business launched in 2016. Edison will remain on the startup’s board of directors.
Extend Fertility, in its New York cryopreservation and embryology lab and treatment center, completed 1,000 egg-freezing cycles in 2018.
“A lot of amazing things have happened for women over the last century,” Hogarty told TechCrunch earlier this week. “Now, women are permitted and encouraged to seek higher education, pursue a career, follow their dreams and end up with a partner who’s the right partner, not just any partner. Doing all those things has pushed the window for when women want to start a family from their 20s to their 30s and unfortunately, one thing that has not changed in that time is the biological clock.”
Hogarty explained Extend’s fertility services are more affordable than other options because the service was built specifically with egg freezing in mind, and the company later expanded to offer infertility treatments, whereas other services were established to provide IVF and other infertility treatments and integrated cryopreservation tools later.
“We are really purpose-built to be an egg-freezing-first company, where many legacy institutions that were providing infertility services have legacy costs that come with … inefficiencies bred over decades and outmoded technology in their labs that may not be the most efficient and effective,” she said. “We have a state of the art lab with the latest equipment.”
“It’s the classic innovator dilemma,” she added. “Infertility services are extraordinarily expensive and reproductive endocrinology is a new area of medicine. There are a lot of people and institutions that have been taking inordinate amounts of money for their infertility services so they weren’t looking to serve this population of women looking to preserve their fertility.”
One egg-freezing cycle with Extend costs women $5,500, and additional cycles come at a sticker price of $4,000. Each cycle includes a fertility assessment, private consultation, anesthesia and any monitoring a patient may need during their cycle. The costs don’t include medication, however. Extend can prescribe medications — which typically cost between $2,000 and $5,000 for fertility patients — but they still need to go through a third party to get their prescriptions filled and paid for.
For reference, FertilityIQ, an online platform for researching fertility care providers and treatments, says the typical cost per cycle for egg freezing is more than $17,000 in New York City or $15,600 in San Francisco. Most egg-freezing services, including Extend, do not accept insurance, as most insurance providers don’t cover the steep costs of fertility or infertility treatments.
Some companies, however, are beginning to offer benefits that cover these costs. Facebook and Apple, for example, began subsidizing egg-freezing procedures for employees in 2014. Spotify and eBay, for their part, will pay for an unlimited number of IVF cycles.
Hogarty said Extend’s price point makes it one of the lowest-cost players in the market.
“We want as many women as possible to benefit from the advances from egg-freezing technology,” she said.
Extend Fertility, which has previously raised $10 million, plans to use the latest investment to open labs in new markets and expand its infertility services.
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BuzzFeed News launches a paid membership program (and yes, there’s a tote bag)
BuzzFeed News is giving readers a new way to support its journalism — by paying a monthly or yearly fee.
BuzzFeed might not seem like the most obvious publication to ask readers for financial support, as it doesn’t really have the high-minded appeal of (say) NPR or The New Yorker. However, the company has been working to establish a separate identity for its team focused on real journalism (as opposed to the quizzes and other entertainment for which BuzzFeed is known). In fact, it launched a separate website for BuzzFeed News a few months ago.
In August, BuzzFeed News started giving readers a way to make one-off donations of between $5 and $100. It says the average donation was more than $20, with some readers asking for a way to support the organization on an ongoing basis.
So today, it’s launching a recurring membership program. For $5 a month, readers will receive members-only emails highlighting the latest scoops and taking them behind the scenes of BuzzFeed reporting. For $100 a year, they’ll also receive a BuzzFeed News tote bag.
The memberships are available internationally, but you can only get a tote bag if you’re in the United States.
BuzzFeed reportedly missed its revenue target last year by as much as 20 percent, so it’s not surprising that the company is looking beyond advertising for ways to make money. However, in an email to the BuzzFeed team, Global News Director Lisa Tozzi said, “A membership program takes time to build, and we don’t expect it to be a huge portion of BuzzFeed’s revenue in 2019. That’s why we’re investing in it now and hope to see it contribute more to our work over time.”
And if you’re worried that this might be setting the stage for a paywall or meter on BuzzFeed News stories, Tozzi said flatly, “This is not a prelude to any sort of paywall.”
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