eventbrite
Auto Added by WPeMatico
5 factors that can make or break a startup’s growth journey
The “health” of a startup’s growth can be a strong predictor of how large and valuable it can become. Our generation’s most valuable startups have all sustained a high rate of user/revenue growth over an extended period of time. As such, founders, employees and investors are all trying to figure out if their startup can achieve sustainable growth to create a large and enduring business over time.
Simply looking at top-line growth tells you relatively little. Two startups that are currently growing users or revenue 300% every year can each have different long-term prospects. It’s almost like looking at two people of the same age, height and weight, and projecting the same quality of life and longevity for both — there are many more factors that can help you make better predictions. Startups are similar, and it’s important to dig deeper into the health of a startup’s early growth and work to build the right foundation from an early stage.
Paid marketing can be a useful tool in your toolkit to accelerate an already humming flywheel. Just don’t let it be the only one.
Prior to becoming a VC at Defy, I founded two companies and was Eventbrite’s VP of growth for over six years from startup through IPO. Working across all stages from founding through to public company and advising many other startups along the way, I’ve landed on five critical factors for healthy and sustained growth that can be the difference between a startup failing, getting to a modest exit or building a valuable and enduring billion-dollar company.
Healthy engagement and retention are key
At its core, any successful product or service delivers more value to the user/customer than it costs to use (money or time). To see if your product is delivering true value, ask if it is achieving strong user engagement and customer retention. My friend and growth guru Casey Winters captures this well: “Product-market fit is retention that allows for sustained growth.”
Consumer startups can evaluate this via through cohort-based retention analysis of how frequently customers use the service, and how long they are retained for. SaaS businesses should be talking with customers often to gauge their happiness while also looking at logo retention as well as gross and net revenue retention — ideally, the business should show early signs of being a net-negative churn business, wherein revenue from existing customers actually grows over time, even after accounting for churned customers.
Many people incorrectly think “startup growth = customer acquisition.” In reality, retention is the most fundamental aspect underlying sustainable growth.
Customer obsession creates “pull” from the market
Customer obsession, plus organic pull from the market, are indicators of early product-market fit and signals of future growth potential.
Here are a couple ways to measure this:
See if a healthy percentage of the business is growing without paid spend, generally through word of mouth or some other form of virality. If your business is seeing more than 50% organic growth at a fast rate (200% to 300%+ year over year), you’re solving people’s needs well enough that they’re now sharing with others and creating a positive viral effect.
Powered by WPeMatico
4 months into lockdown, Eventbrite CEO Julia Hartz sees ‘exciting signs of recovery’
“Eventbrite is in the unique club that nobody wants to be in,” says CEO and co-founder Julia Hartz. “Which is the first affected and one of the most directly affected businesses of the COVID-19 era.”
Hartz, who co-founded the company with her husband Kevin Hartz and Renaud Visage, joined ExtraCrunch Live recently to discuss moving forward when your core business isn’t just threatened, but wiped out completely.
“You never as a founder — at least I never — ever wondered what would happen if the whole basis of our mission was tested,” she said.
The events world was one of the first industries to feel the pandemic’s impacts and will likely be among the last to be restored. For Eventbrite, which was built on a core business of in-person events and event ticketing, it meant making swift decisions to stay afloat.
External data show some bright spots. According to an operational update from Eventbrite, paid ticket volume on its platform increased 33% in May compared to April 2020. Eventbrite is down 82% in paid tickets in May 2020 compared to the same month year ago.
“A massive market and industry dislocation and disruption. I mean, we’re a living example of that,” she said. “It’s not a victory lap. Certainly, we’re seeing some really exciting signs of recovery, but it’s still very sobering.”
Hartz offered founders at all levels advice on how to work on culture during a crisis and offered tips on communication and transparency.
We also chatted about how open consumers are to paying for virtual events, how the company curates and moderates political events and how Eventbrite plans to address racial injustice beyond, in Hartz’s words, “episodic outrage.”
We pulled out a couple of highlights for you to peruse.
How she sees events changing in the next 18 months
Structurally, events are pivoting to in-person. So it’s not just pivoting online. A good example is the Beanstalk Music Festival in Colorado, a two-day music festival that pivoted to an in-person drive-in night concert. They were wildly successful in selling tickets to this new format.
It was a testament to the strength of their community and the pent-up demand to get together and listen to great music. But what we’re seeing beyond sort of those really creative uses of new types of space and venues that are outdoors are smaller events. Classes, workshops, seminars, small meetups are starting to come back. I think that as creators start to think about how to bring their community back in person, there’s a huge element of trust that exists in this new world.
We’re helping our creators establish that trust and be very upfront about what their event goers and attendees can expect in that moment as you bring yourself together in-person again.
When she knew the business would be materially impacted — and what she did next
Powered by WPeMatico
Join Eventbrite CEO Julia Hartz for a live Q&A: June 11 at 3 pm EST/Noon PDT/7 pm GMT
One of the earliest disruptions created by the novel coronavirus manifested in the form of event cancellations. Some of the world’s biggest tech conferences, like F8 and Google NEXT, got postponed and others turned to digital options to still connect. Even Disrupt is going digital this year.
It is an unprecedented time for the events world, so we are bringing someone right in the center of it to our Extra Crunch Live stage: Eventbrite CEO Julia Hartz. In fact, Extra Crunch members can ask their own questions directly to the CEO and are encouraged to do so live on the call.
Hartz is leading the publicly traded company as it grows more popular than ever with hundreds of millions of dollars in revenue. At the same time, the global slowdown of in-person event ticketing due to COVID-19 has had a material impact on Eventbrite’s business. What does that mean for employee morale? Collaboration with other companies? And overall culture at the business?
Eventbrite has swiftly transitioned to virtual events, with thousands of listings across categories like professional events, classes, health and wellness, science and tech, community and culture and more. Hartz also told Billboard that the company remains committed to serving independent music venues, which have been hit hard by the global health crisis, and hinted that Eventbrite may shift to a self-service ticket model.
The company reported that, since enhancing its online events service in 2019, and in the midst of social distancing, Eventbrite users are posting nearly 20k online events every day, with a 2,000+ percent year-over-year increase of online events taking place in April 2020 compared to April 2019. This announcement came after Eventbrite said it would cut $100 million in costs, which included layoffs.
We’ll talk with Hartz about how she is leading her company through a crisis and what the future holds for bringing people together. We’ll also discuss how widespread layoffs may impact the future of diversity in our workforces.
Hartz will also be asked to weigh in on advice for other founders hoping to emerge from COVID-19 from fundraising to strategy. As always, EC subscribers are invited to log onto the call to ask questions live.
Details are below for Extra Crunch subscribers; if you need a pass, get a cheap trial here.
Chat with you all in a week!
When, where, Zoom
Powered by WPeMatico
The Ticket Fairy is tech’s best hope against Ticketmaster
Ticketmaster’s dominance has led to ridiculous service fees, scalpers galore and exclusive contracts that exploit venues and artists. The moronic approval of venue operator and artist management giant Live Nation’s merger with Ticketmaster in 2010 produced an anti-competitive juggernaut. It pressures venues to sign ticketing contracts under veiled threat that artists would otherwise be routed to different concert halls. Now it’s become difficult for venues, artists and fans to avoid Ticketmaster, which charges fees as high as 50% that many see as a ripoff.
The Ticket Fairy wants to wrestle away from Ticketmaster control of venues while giving fans ways to earn tickets for referring their friends. The startup is doing that by offering the most technologically advanced ticketing platform that not only handles sales and check-ins, but acts as a full-stack Salesforce for concerts that can analyze buyers and run ad campaigns while thwarting scalpers. Co-founder Ritesh Patel says The Ticket Fairy has increased revenue for event organizers by 15% to 25% during its private beta focused on dance music festivals.
Now after 850,000 tickets sold, it’s officially launching its ticketing suite and actively poaching venues from Eventbrite as it moves deeper into esports and conventions. With a little more scale, it will be ready to challenge Ticketmaster for lucrative clients.
Ritesh’s combination of product and engineering skills, rapid progress and charismatic passion for live events after throwing 400 of his own has attracted an impressive cadre of angel investors. They’ve delivered a $2.5 million seed round for Ticket Fairy, adding to its $485,000 pre-seed from angels like Twitch/Atrium founder Justin Kan, Twitch COO Kevin Lin and Reddit CEO Steve Huffman.
The new round includes YouTube founder Steve Chen, former Kleiner Perkins partner (and Mark’s sister) Arielle Zuckerberg and funds like 500 Startups, ex-Uber angels Fantastic Ventures, G2 Ventures, Tempo Ventures and WeFunder. It’s also scored music industry angels like Serato DJ hardware CEO AJ Bertenshaw, Spotify’s head of label licensing Niklas Lundberg, and celebrity lawyer Ken Hertz, who reps Will Smith and Gwen Stefani.
“The purpose of starting The Ticket Fairy was not to be another Eventbrite, but to reduce the risk of the person running the event so they can be profitable. We’re not just another shopping cart,” Patel says. The Ticket Fairy charges a comparable rate to Eventbrite’s $1.59 + 3.5% per ticket plus payment processing that brings it closer to 6%, but Patel insists it offers far stronger functionality.
Constantly clad in his golden disco hoodie over a Ticket Fairy t-shirt, Patel lives his product, spending late nights dancing and taking feedback at the events his clients host. He’s been a savior of SXSW the past two years, injecting the aging festival that shuts down at 2am with multi-night after-hours raves. Featuring top DJs like Pretty Lights in creative locations cab drivers don’t believe are real, The Ticket Fairy’s parties have won the hearts of music industry folks.
The Ticket Fairy co-founders. Center and inset left: Ritesh Patel. Inset right: Jigar Patel
Now the Y Combinator startup hopes its ticketing platform will do the same thanks to a slew of savvy features:
- Earn A Ticket – The Ticket Fairy supercharges word of mouth marketing with a referral system that lets fans get a rebate or full-free ticket if they get enough friends to buy a ticket. Indeed, 30% of ticket buyers are now sharing a Ticket Fairy referral link, and Patel says the return on investment is $30 in revenue for each $1 paid out in rewards, with 10% to 25% of all ticket sales coming from referrals. A public leaderboard further encourages referrals, with those at the top eligible for backstage passes, free merch and bar tabs. And to prevent mass spamming, only buyers, partners and street teamers get a referral code.
- Creative Payment Options – The startup offers “FreeFund” tickets for free events that otherwise see huge no-show rates. Users pay a small deposit that’s refunded when they scan their ticket for entry, discouraging RSVPs from those who won’t come. Buyers can also pay on layaway with Affirm or LayBuy and then earn a ticket before their debt is due.
- Anti-Scalping – The Ticket Fairy offers identity-locked tickets that must be presented with the buyer’s ID on arrival, which means customers can’t scalp them. Instead, the startup offers a waitlist for sold-out events, and buyers can sell their tickets back to the company, which then redistributes them to a specific friend or whoever’s at the top of the waitlist at face value with a new QR code. Patel says client SunAndBass Festival hasn’t had a scalped ticket in five years of working with the ticketer.
- Clever Analytics – Never wasting an opportunity, The Ticket Fairy lets events collect contact info and demand before ticket sales start with its pre-registration system. It can create multiple variants of ticketing sites designed for different demographics, like rock versus dance fans for a festival, track sales and demographics in real time and relay instant stats about check-ins at the door. Integration of email managers like Mailchimp and sales pixels like Facebook plus the ability to instantly retarget people who abandoned their shopping via Facebook Custom Audience ads makes marketing easier. And all the metrics, budgets and expenses are automatically organized into financial reports to eliminate spreadsheet busywork.
Still, the biggest barrier to adoption remains the long exclusive contracts Ticketmaster and other giants like AEG coerce venues into in the U.S. Abroad, venues typically work with multiple ticket promoters who sell from the same pool, which is why 80% of The Ticket Fairy’s business is international right now. In the U.S., ticketing is often handled by a single company, except for the 8% of tickets artists can sell however they want. That’s why The Ticket Fairy has focused on signing up non-traditional venues for festivals, trade convention halls, newly built esports arenas, as well as concert halls.
“Coming from the event promotion background, we understand the risk event organizers take in creating these experiences,” The Ticket Fairy’s co-founder and Ritesh’s brother Jigar Patel explains. “The odds of breaking even are poor and many are unable to overcome those challenges, but it is sheer passion that keeps them going in the face of financial uncertainty and multi-year losses.” As competitors’ contracts expire, The Ticket Fairy hopes to swoop in by dangling its sales-boosting tech. “We get locked out of certain things because people are locked in a contract, not because they don’t want to use our system.”
The live music industry can be brutal, though. Events can have slim margins, organizers are loathe to change their process and it’s a sales-heavy process convincing them to try new software. But while the record business has been redefined by streaming, ticketing looks a lot like it did a decade ago. That makes it ripe for disruption.
“The events industry is more important than ever, with artists making the bulk of their income from touring instead of record sales, and demand from fans for live experiences is increasing at a global level,” Jigar concludes. “When events go out of business, everybody loses, including artists and fans. Everything we do at The Ticket Fairy has that firmly in mind – we are here to keep the ecosystem alive.”
Powered by WPeMatico
China’s secret startup advantage: liquidity
This year’s rush of IPOs from Chinese tech companies has dominated headlines, but what’s more interesting is how quickly they got there.
Traditionally, “going public” represented the gratifying culmination of sleepless nights and missed birthdays that went into building a company. The peak of a lengthy climb, where founders and VCs would finally see the fruits of their labor.
However, Chinese companies appear to be reaching that peak much quicker than their American peers, heading to the public markets only a few years after initial venture investments, and often with little operating history.
Analyzing twenty of the most high profile Chinese tech IPOs this year, the average time from first venture investment to IPO was only around three to five years. Take e-commerce platform Pinduoduo, which pulled in $1.6 billion less than three years after its Series A. Or the recent IPO of EV-manufacturer NIO, which raised a billion dollars just three-and-a-half years after its Series A and having just delivered its first car in June.
China IPO data for 2018 compiled from NASDAQ, Pitchbook, and Crunchbase
That’s less than half the average 10-year timeline for venture-backed US tech companies that went public in 2018, including Dropbox, Eventbrite, and DocuSign, which all IPO’d more than a decade after their initial investments.
Differences in market maturity, government involvement, and support from large tech incumbents all undoubtedly play a factor, but the speed to liquidity for the Chinese companies is still astounding.
Faster liquidity can push cycle of returns, fundraising, reinvestment
Speed to liquidity is a critical metric for the health of a startup ecosystem. It creates a positive cycle where faster liquidity can drive faster fundraising, faster reinvestment, faster startup building, and faster public liquidity again. An accelerated cycle could be especially appealing for funds with LPs that require faster returns due to cash commitments or otherwise.
It’s important to note that venture returns are a function of capital and time, so quicker exits will also drive higher returns for the same amount invested. For example, a $1 million investment with a $5 million exit after ten years would generate an Internal Rate of Return (a commonly used metric to evaluate VC performance) of 20%. If the same exit occurred after five years, the IRR would be 50%.
Liquidity is a key consideration as China’s influence on the flow of global venture capital intensifies. As China’s tech ecosystem sees more of its darlings mature and more consistently deliver smashing exits, investments in China will have to be a more serious consideration for VCs, even if only to minimize the sheer amount of time, resources, and painstaking energy needed to build a company in the U.S.
Powered by WPeMatico
Eventbrite’s IPO should encourage tech companies to get out while they still can
Eventbrite is having one hell of a debut on the New York Stock Exchange this morning.
Shares of the ticketing startup, founded back in 2006, have shot up over 50 percent in trading on the NYSE. After pricing its shares at $23 in its initial offering, investors have bid up the stock to a whopping $37, putting the company’s valuation at nearly $3 billion.
$EB prices $23, opens $36 pic.twitter.com/cYgCuqbmh8
—
(@hunterwalk) September 20, 2018
That’s well above where the ticketing company had hoped to be when it initially set terms for the public offering earlier this month.
The company started trading priced above its share price and nearly doubled its valuation. And if Eventbrite can do it, really almost any later-stage startup should be thinking about the public markets right now.
Performance for the San Francisco ticketing company has been… somewhat lackluster. As we noted when wrote about the company’s offering:
Eventbrite is not profitable and has been losing money since 2016. According to the documents, it posted losses of $40.4 million in 2016 and $38.5 million in 2017. In the first six months of 2018, the company has posted a net loss of $15.6 million. The company is making changes to make up for some of those losses — at the end of August, it announced a new pricing scheme for its customers using the “Essentials” package.
Its revenue is rising though, increasing from $133 million in 2016 to $201 million last year.
Since the beginning of the year tech public offerings have been on a tear. As The Wall Street Journal noted in July, 120 companies had raised $35.2 billion on U.S. exchanges at that point — the best showing for public markets since 2014 and the fourth busiest year since 1995, according to the financial data and analysis service Dealogic.
We’ve noted before that it’s a bit mind-boggling that investors and their portfolio companies wouldn’t be taking more advantage of these heady times. Nothing lasts forever (not even cold November rain) and certainly not markets that have been this bullish for this long.
Some of the reasoning is likely thanks to a market that’s still awash in private equity, sovereign wealth and late-stage dollars. SoftBank has hundreds of billions to invest; private equity firms are beginning to look at growth-stage companies the way that I look at banana cream pies from Cassell’s; and venture firms are beefing up big time to keep up with the Joneses (or in this case, the Blackstoneses).
However, the fun is certainly going to come to an end, and likely sooner rather than later. Early-stage investors are beginning to dole out their advice on lowering cash burn (something that happens every time they see the beginning of the end of the beginning of the end).
Low burn rates have gone out of fashion, but I expect we’ll be reminded very quickly at the beginning of the next downturn why they’re so valuable for early-stage startups.
— Sam Altman (@sama) September 19, 2018
With that in mind, later-stage companies should be looking for the exit signs wherever they can find them. Right now, that’s an IPO window that seems to be wide open.
Powered by WPeMatico
Eventbrite just made some pricing changes as it moves toward an IPO
Reaching event organizers to help them sell tickets isn’t cheap. Eventbrite — the 12-year-old, San Francisco-based ticketing company that announced plans last week to go public and sell $200 million worth of shares on the NYSE — has been losing money since 2016, posting losses of $40.4 million in 2016, $38.5 million for 2017 and $15.6 million so far this year.
Now the company is trying to make up for some of those losses by announcing a new pricing scheme. Today, it sent customers a note explaining that for those using its “Essentials” package (unlike its “Professional” package, whose bells and whistles include customer support, customer questions for attendees and more), reduced prices are coming for many of its customers. Specifically, payment processing fees are dropping from 3 percent to 2.5 percent. Fees for ticket are falling from .99 cents to .70 cents.
The moves don’t really mean that Eventbrite is charging less. In fact, instead of charging one percent of every ticket price as a service fee, Eventbrite will now take a 2 percent cut, which should add up for organizers that use the service for bigger events. It’s also removing a service fee cap of $19.99 that it used to institute no matter how much an event organizer was charging.
Asked about the pricing changes, a spokesperson sent us a fairly bland statement: “At Eventbrite we have always been committed to enabling event creators to deliver a diverse range of live experiences by offering a superior product at a fair price. The changes we announced today will mean lower ticket fees for the vast majority of our creators, and the millions of people that attend the events they plan, promote and produce each year. We succeed when our creators succeed and this change is indicative of a focus on ensuring we make the best decisions for the majority of our customers.”
It isn’t surprising that Eventbrite is looking for ways to fight rising acquisition costs owing to the competition it faces from all corners. In addition to platforms for smaller get-togethers like Paperless Post and competition for bigger events like Ticketmaster (which owns Live Nation), Eventbrite acknowledged in its S-1 filing that it could face competition from large internet companies like Facebook, Google and Twitter, too.
Eventbrite had reportedly filed confidentially for an IPO back in July. As noted on TechCrunch’s “Equity” podcast last week by Susan Mac Cormac, a partner at the global law firm Morrison Foerster, companies often file confidentially first if they are exploring other options, including, most notably, M&A.
“These unicorns,” says Mac Cormac, “it’s difficult for them to go public because they have such a huge valuation to begin with that M&A is often a better option. You don’t want to go out and have your stock fall 30, 40, 50 percent as sometimes happens.”
Partly through acquisitions, Eventbrite saw its revenue rise from $133 million in 2016 to $201 million last year. Last year, for example, Eventbrite acquired Ticketfly, a ticketing company that focused largely on the live entertainment industry and which had sold to the streaming music company Pandora in 2015 for a reported $335 million but Eventbrite was able to nab last year at the discounted price of $200 million.
Eventbrite has also made a broader international push in recent years, acquiring Ticketea, one of Spain’s leading ticketing providers, back in April, and acquiring Amsterdam-based Ticketscript back in January of last year. And those deals followed roughly half a dozen others.
Over the years, the company has raised roughly $330 million from investors, according to Crunchbase. Its biggest shareholders, shows its S-1, are Tiger Global Management, Sequoia Capital and T. Rowe Price. Collectively, the three entities own roughly half of Eventbrite’s pre-IPO shares.
Powered by WPeMatico
Rebuilding employee philanthropy from the bottom up
In tech circles, it would be easy to assume that the world of high-impact charitable giving is a rich man’s game where deals are inked at exclusive black tie galas over fancy hors d’oeuvre. Both Mark Zuckerberg and Marc Benioff have donated to SF hospitals that now bear their names. Gordon Moore has given away $5B – including $600M to Caltech – which was the largest donation to a university at the time. And of course, Bill Gates has already donated $27B to every cause imaginable (and co-founded The Giving Pledge, a consortium of billionaires pledging to donate most of their net worth to charity by the end of their lifetime.)
For Bill, that means he has about $90B left to give.
For the average working American, this world of concierge giving is out of reach, both in check size, and the army of consultants, lawyers and PR strategists that come with it. It seems that in order to do good, you must first do well. Very well.
Bright Funds is looking to change that. Founded in 2012, this SF-based startup is looking to democratize concierge giving to every individual so they “can give with the same effectiveness as Bill and Melinda Gates.” They are doing to philanthropy what Vanguard and Wealthfront have done for asset management for retail investors.
In particular, they are looking to unlock dollars from the underutilized corporate benefit of matching funds for donations, which according to Bright Funds is offered by over 60% of medium to large enterprises, but only used by 13% of employees at these companies. The need for such a service is clear — these programs are cumbersome, transactional, and often offline. Make a donation, submit a receipt, and wait for it to churn through the bureaucratic machine of accounting and finance before matching funds show up weeks later.
Bright Funds is looking to make your company’s matching funds benefit as accessible and important to you as your free lunches or massages. Plus, Bright Funds charges companies per seat, along with a transaction fee to cover the cost of payment processing, sparing employees any expense.
It’s a model that is working. According to Bright Fund’s CEO Ty Walrod, Bright Funds customers see on average a 40% year-over-year increase in funds donated through the platform. More importantly, Bright Funds not only transforms an employee’s relationship to personal philanthropy, but also to the company they work for.
Grassroots Giving
This model of bottoms-up giving is a welcome change from the big foundation model which has recently been rocked by scandal. The Silicon Valley Community Foundation was the go-to foundation for The Who’s Who of Silicon Valley elite. It rode the latest tech boom to become the largest community foundation in eleven short years with generous stock donations from donors like Mark Zuckerberg ($1.8 billion), GoPro’s Nicholas Woodman ($500 million), and WhatsApp co-founder Jan Koum ($566 million). Today, at $13.5 billion, it surpasses the 80+ year old Ford Foundation in endowment size.
However, earlier this year, their star fundraiser Mari Ellen Loijens (credited with raising $8.3B of the $13.5B) was accused of repeatedly bullying and sexually harassing coworkers, allegations that the Foundation had “known about for years” but failed to act upon. In 2017, a similar case occurred when USC’s star fundraiser David Carrera stepped down on charges of sexual harassment after leading the university’s historic $6 billion fundraising campaign.
While large foundations and endowments do important work, their structure relies too much on whale hunting for big checks, giving an inordinate amount of power to the hands of a small group of talented fund raisers.
This stands in contrast to Bright Funds’ ethos — to lead a grassroots movement in empowering individual employees to make their dollar of giving count.
Rebuilding charitable giving for the platform age
Bright Funds is the latest iteration of a lineup of workplace giving platforms. MicroEdge and Cybergrants paved the way in the 80s and 90s by digitizing the giving experience, but was mainly on-premise, and lacked a focus on user experience. Benevity and YourCause arrived in 2007 to bring workplace giving to the cloud, but they were still not turnkey solutions that could be easily implemented.
Bright Funds started as a consumer platform, and has retained that heritage in its approach to product design, aiming to reduce friction for both employee and company adoption. This is why many of their first customers were midsized tech startups with limited resources and looking for a turnkey solution, including Eventbrite, Box, Github, and Contently . They are now finding their way upmarket into larger, more established enterprises like Cisco, VMWare, Campbell’s Soup Company, and Sunpower.
Bright Funds approach to product has brought a number of innovations to this space.
The first is the concept of a cause-focused “fund.” Similar to a mutual fund or ETF, these funds are portfolios of nonprofits curated by subject-matter experts tailored to a specific cause area (e.g. conservation, education, poverty, etc.). This solves one of the chief concerns of any donor — is my dollar being put to good use towards the causes I care about? Passionate about conservation? Invest with Jim Leape from the Stanford Woods Institute for the Environment, who brings over three decades of conservation experience in choosing the six nonprofits in Bright Fund’s conservation portfolio. This same expertise is available across a number of cause areas.
Additionally, funds can also be created by companies or employees. This has proven to be an important rallying point for emergency relief during natural disasters, where employees at companies can collectively assemble a list of nonprofits to donate to. In 2017, Cisco employees donated $1.8 million (including company matching) through Bright Funds to Hurricanes Harvey, Maria, and Irma as well as the central Mexico earthquakes, the current flooding in India and many more.
The second key feature of their product is the impact timeline, a central news feed to understand where your dollars are going across all your cause areas. This transforms giving from a black box transaction to an ongoing dialogue between you and your charities.
Lastly, Bright Funds wants to take away all the administrative burden that might come with giving and volunteering — everything from tracking your volunteer opportunities and hours, to one-click tax reporting across all your charitable donations. In short, no more shoeboxes of receipts to process through in April.
Doing good & doing well
Although Bright Funds is focused on transforming the individual giving experience, it’s paying customer at the end of the day is the enterprise.
And although it is philanthropic in nature, Bright Funds is not exempt from the procurement gauntlet that every enterprise software startup faces — what’s in it for the customer? What impact does workplace giving and volunteering have on culture and the bottom line?
To this end, there is evidence to show that corporate social responsibility has a an impact on recruiting the next generation of workers. A study by Horizon Media found that 81% of millennials expect their companies to be good corporate citizens. A separate 2015 study found that 62% of millennials said they’d take a pay cut to work for a company that’s socially responsible.
Box, one of Bright Fund’s early customers, has seen this impact on recruiting firsthand (disclosure: Box is one of my former employers). Like most tech companies competing for talent in the Valley, Box used to give out lucrative bonuses for candidate referrals. They recently switched to giving out $500 in Bright Funds gift credit. Instead of seeing employee referrals dip, Box saw referrals “skyrocket,” according to Box.org Executive Director Bryan Breckenridge. This program has now become “one of the most cherished cultural traditions at Box,” he said.
Additionally, like any corporate benefit, there should be metrics tied to employee retention. Benevity released a study of 2 million employees across 118 companies on their platform that showed a 57% reduction in turnover for employees engaged in corporate giving or volunteering efforts. VMware, one of Bright Fund’s customers, has seen an astonishing 82% of their 22,000 employees participate in their Citizen Philanthropy program of giving and volunteering, according to VMware Foundation Director Jessa Chin. Their full-time voluntary turnover rate (8%) is well below the software industry average of 13.2%.
Towards a Brighter Future
Bright Funds still has a lot of work to do. CEO Walrod says that one of his top priorities is to expand the platform beyond US charities, finding ways to evaluate and incorporate international nonprofits.
They have also not given up their dream of becoming a truly consumer platform, perhaps one day competing in the world of donor-advised funds, which today is largely dominated by big names like Fidelity and Schwab who house over $85B of assets. In the short term, Walrod wants to make every Bright Funds account similar to a 401K account. It goes wherever you work, and is a lasting record of the causes you care about, and the time and resources you’ve invested in them.
Whether the impetus is altruism around giving or something more utilitarian like retention, companies are increasingly realizing that their employees represent a charitable force that can be harnessed for the greater good. Bright Funds has more work to do like any startup, but it is empowering the next set of donors who can give with the same effectiveness as Gates, and one day, at the same scale as him as well.
Powered by WPeMatico
Tall Poppy aims to make online harassment protection an employee benefit
For the nearly 20 percent of Americans who experience severe online harassment, there’s a new company launching in the latest batch of Y Combinator called Tall Poppy that’s giving them the tools to fight back.
Co-founded by Leigh Honeywell and Logan Dean, Tall Poppy grew out of the work that Honeywell, a security specialist, had been doing to hunt down trolls in online communities since at least 2008.
That was the year that Honeywell first went after a particularly noxious specimen who spent his time sending death threats to women in various Linux communities. Honeywell cooperated with law enforcement to try and track down the troll and eventually pushed the commenter into hiding after he was visited by investigators.
That early success led Honeywell to assume a not-so-secret identity as a security expert by day for companies like Microsoft, Salesforce, and Slack, and a defender against online harassment when she wasn’t at work.
“It was an accidental thing that I got into this work,” says Honeywell. “It’s sort of an occupational hazard of being an internet feminist.”
Honeywell started working one-on-one with victims of online harassment that would be referred to her directly.
“As people were coming forward with #metoo… I was working with a number of high profile folks to essentially batten down the hatches,” says Honeywell. “It’s been satisfying work helping people get back a sense of safety when they feel like they have lost it.”
As those referrals began to climb (eventually numbering in the low hundreds of cases), Honeywell began to think about ways to systematize her approach so it could reach the widest number of people possible.
“The reason we’re doing it that way is to help scale up,” says Honeywell. “As with everything in computer security it’s an arms race… As you learn to combat abuse the abusive people adopt technologies and learn new tactics and ways to get around it.”
Primarily, Tall Poppy will provide an educational toolkit to help people lock down their own presence and do incident response properly, says Honeywell. The company will work with customers to gain an understanding of how to protect themselves, but also to be aware of the laws in each state that they can use to protect themselves and punish their attackers.
The scope of the problem
Based on research conducted by the Pew Foundation, there are millions of people in the U.S. alone, who could benefit from the type of service that Tall Poppy aims to provide.
According to a 2017 study, “nearly one-in-five Americans (18%) have been subjected to particularly severe forms of harassment online, such as physical threats, harassment over a sustained period, sexual harassment or stalking.”
The women and minorities that bear the brunt of these assaults (and, let’s be clear, it is primarily women and minorities who bear the brunt of these assaults), face very real consequences from these virtual assaults.
Take the case of the New York principal who lost her job when an ex-boyfriend sent stolen photographs of her to the New York Post and her boss. In a powerful piece for Jezebel she wrote about the consequences of her harassment.
As a result, city investigators escorted me out of my school pending an investigation. The subsequent investigation quickly showed that I was set up by my abuser. Still, Mayor Bill de Blasio’s administration demoted me from principal to teacher, slashed my pay in half, and sent me to a rubber room, the DOE’s notorious reassignment centers where hundreds of unwanted employees languish until they are fired or forgotten.
In 2016, I took a yearlong medical leave from the DOE to treat extreme post-traumatic stress and anxiety. Since the leave was almost entirely unpaid, I took loans against my pension to get by. I ran out of money in early 2017 and reported back to the department, where I was quickly sent to an administrative trial. There the city tried to terminate me. I was charged with eight counts of misconduct despite the conclusion by all parties that my ex-partner uploaded the photos to the computer and that there was no evidence to back up his salacious story. I was accused of bringing “widespread negative publicity, ridicule and notoriety” to the school system, as well as “failing to safeguard a Department of Education computer” from my abusive ex.
Her story isn’t unique. Victims of online harassment regularly face serious consequences from online harassment.
According to a 2013 Science Daily study, cyber stalking victims routinely need to take time off from work, or change or quit their job or school. And the stalking costs the victims $1200 on average to even attempt to address the harassment, the study said.
“It’s this widespread problem and the platforms have in many ways have dropped the ball on this,” Honeywell says.
Tall Poppy’s co-founders
Creating Tall Poppy
As Honeywell heard more and more stories of online intimidation and assault, she started laying the groundwork for the service that would eventually become Tall Poppy. Through a mutual friend she reached out to Dean, a talented coder who had been working at Ticketfly before its Eventbrite acquisition and was looking for a new opportunity.
That was in early 2015. But, afraid that striking out on her own would affect her citizenship status (Honeywell is Canadian), she and Dean waited before making the move to finally start the company.
What ultimately convinced them was the election of Donald Trump.
“After the election I had a heart-to-heart with myself… And I decided that I could move back to Canada, but I wanted to stay and fight,” Honeywell says.
Initially, Honeywell took on a year-long fellowship with the American Civil Liberties Union to pick up on work around privacy and security that had been handled by Chris Soghoian who had left to take a position with Senator Ron Wyden’s office.
But the idea for Tall Poppy remained, and once Honeywell received her green card, she was “chomping at the bit to start this company.”
A few months in the company already has businesses that have signed up for the services and tools it provides to help companies protect their employees.
Some platforms have taken small steps against online harassment. Facebook, for instance, launched an initiative to get people to upload their nude pictures so that the social network can monitor when similar images are distributed online and contact a user to see if the distribution is consensual.
Meanwhile, Twitter has made a series of changes to its algorithm to combat online abuse.
“People were shocked and horrified that people were trying this,” Honeywell says. “[But] what is the way [harassers] can do the most damage? Sharing them to Facebook is one of the ways where they can do the most damage. It was a worthwhile experiment.”
To underscore how pervasive a problem online harassment is, out of the four companies where the company is doing business or could do business in the first month and a half there is already an issue that the company is addressing.
“It is an important problem to work on,” says Honeywell. “My recurring realization is that the cavalry is not coming.”
Powered by WPeMatico
Snapchat launches privacy-safe Snap Kit, the un-Facebook platform
Today Snapchat finally gets a true developer platform, confirming TechCrunch’s scoop from last month about Snap Kit. This set of APIs lets other apps piggyback on Snap’s login for sign up, build Bitmoji avatars into their keyboards, display public Our Stories and Snap Map content, and generate branded stickers with referral links users can share back inside Snapchat.
Snap Kit’s big selling point is privacy — a differentiator from Facebook. It doesn’t even let you share your social graph with apps to prevent a Cambridge Analytica-style scandal.
Launch partners include Tinder bringing Bitmojis to your chats with matches, Patreon letting fans watch creators’ Stories from within its app, and Postmates offering order ETA stickers you can share in Snapchat that open the restaurant’s page in the delivery app. Developers that want to join the platform can sign up here.
Snap Kit could help the stumbling public company colonize the mobile app ecosystem with its buttons and content, which might inspire Snapchat signups from new users and reengagement from old ones. “Growth is one of our three goals for 2018, so we absolutely hope it can contribute to that, and continue to strengthen engagement, which has always been a key metric for us” Snap’s VP of product Jacob Andreou tells me. That’s critical since Snapchat sunk to its lowest user growth rate ever last quarter under the weight of competition from Instagram and WhatsApp.
“There have been areas inside of our products where we’ve really set standards” Andreou explains. “Early, that was seen in examples like Stories, but today with things like how we treat user data, what we collect, what we share when people login and register for our service . . . Snap Kit is a set of developer tools that really allow people to take the best parts of our products and the standards that we’ve set in a few of these areas, and bring them into their apps.”
This focus on privacy manifests as a limit of 90 days of inactivity before your connection with an app is severed. And the login feature only requires you bring along your changeable Snapchat display name, and optionally, your Bitmoji. Snap Kit apps can’t even ask for your email, phone number, gender, age, location, who you follow, or who you’re friends with.
“It really became challenging for us to see our users then use other products throughout their day and have to lower their expectations. . . having to be okay with the fact that all of their information and data would be shared” Andreou gripes. This messaging is a stark turnaround from four years ago when it took 10 days for CEO Evan Spiegel to apologize for security laziness causing the leak of 4 million users’ phone numbers. But now with Facebook as everyone’s favorite privacy punching bag, Snapchat is seizing the PR opportunity.
“I think one of the parts that [Spiegel] was really excited about with this release is how much better our approach to our users in that way really is — without relying on things like policy or developer’s best intentions or them writing perfect bug free code, but instead by design, not even exposing these things to begin with.”
Yet judging by Facebook’s continued growth and recovered share price, privacy is too abstract of a concept for many people to grasp. Snap Kit will have to win on the merits of what it brings other apps, and the strength of its partnerships team. Done right, Snapchat could gain an army of allies to battle the blue menace.
Snapvengers Assemble
Snap’s desire to maintain an iron grip on its ‘cool’ brand has kept its work with developers minimal until now. Its first accidental brush with a developer platform was actually a massive security hazard.
Third-party apps promising a method to secretly screenshot messages asked users to login with their Snapchat usernames and passwords, then proceeded to get hacked, exposing some users’ risqué photos. Snap later cut off an innocent music video app called Mindie for finding a way to share to users’ Stories. Last year I wrote how A year ago I urged it to build a platform in my article “Snap’s anti-developer attitude is an augmented liability”, as it needs help to populate the physical world with AR.
2017 saw Snap cautiously extend the drawbridge, inviting in ads, analytics, and marketing developer partners to help brands be hip, and letting hacker/designers make their own AR lenses. But the real transition moment was when Spiegel said on the Q4 2017 earnings call that “We feel strongly that Snapchat should not be confined to our mobile application—the amazing Snaps created by our community deserve wider distribution so they can be enjoyed by everyone.”
At the time that meant Snaps on the web, embedded in news sites, and on Jumbotrons. Today it means in other apps. But Snap will avoid one of the key pitfalls of the Facebook platform: over-promising. Snap Deputy General Counsel for Privacy Katherine Tassi tells me “It was also very important to us that there wasn’t going to be the exchange of the friends graph as part of the value proposition to third party developers.”
How Snap Kit Works
Snap Kit breaks down to four core pieces of functionality that will appeal to different apps looking to simplify signup, make communication visual, host eye-catching content, or score referral traffic. Developers that want access to Snap Kit must pass a human review and approval process. Snap will review their functionality to ensure they’re not doing anything shady.
Once authorized, they’ll have access to these APIs:
- Login Kit is the foundation of Snap Kit. It’s an OAuth-style alternative to Facebook Login that lets users skip creating a proprietary username and password by instead using their Snapchat credentials. But all the app gets is their changeable, pseudonym-allowed Snapchat display name, and optionally, their Bitmoji avatar to use as a profile pic if the user approves. Getting that login button in lots of apps could remind people Snapchat exists, and turn it into a fundamental identity utility people will be loath to abandon.
- Creative Kit is how apps will get a chance to create stickers and filters for use back in the Snapchat camera. Similar to April’s F8 launch of the ability to share from other apps to Instagram and Facebook Stories, developers can turn content like high scores, workout stats and more into stickers that users can overlay on their Snaps to drive awareness of the source app. Developers can also set a deep link where those stickers send people to generate referral traffic, which could be appealing to those looking to tap Snap’s 191 million teens.
- Bitmoji Kit lets developers integrate Snapchat’s personalized avatars directly into their app’s keyboard. It’s an easy path to making chat more visually expressive without having to reinvent the wheel. This follows the expansion of Friendmoji that illustrate you and a pal rolling out to the iOS keyboard. But Bitmoji Kit means developers do the integration work instead of having to depend on users installing anything extra.
- Story Kit allows developers to embed Snapchat Stories into their apps and websites. Beyond specific Stories, apps can also search through public Stories submitted to Our Story or Snap Map by location, time, or captions. A journalism app could surface first-hand reports from the scene of breaking news or a meme app could pull in puppy Snaps. The company will add extra reminders to the Our Story submission process to ensure users know their Stories could appear outside of Snapchat’s own app.
One thing that’s not in Snap Kit, at least yet, is the ability to embed Snapchat’s whole software camera into other apps which TechCrunch erroneously reported. Our sources mistakenly confused Creative Kit’s ability to generate stickers as opposed to sharing whole stories, which Andreou called “an interesting first step” for making Snapchat the broadcast channel for other apps.
Additional launch partners include bringing Bitmoji to Quip’s word processor, RSVP stickers from Eventbrite, GIF-enhanced Stories search in Giphy, Stories from touring musicians in Bands In Town, storytelling about your dinner reservation on Quandoo, music discovery sharing from SoundHound, and real-time sports score sharing from ScoreStream.
While other platforms have escaped their host’s control, like Facebook’s viral game spam outbreak in 2009 or Twitter having to shut down errant clients, Snapchat’s approval process will let it direct the destiny of its integrations.
Bitmoji Kit in Tinder
When asked why Snapchat was building Snap Kit, Andreou explained that “We think that giving people more tools to be able to express themselves freely, have fun and be creative, both on Snapchat and other apps is a good thing. We also think that helping more people outside of Snapchat learn about our platform and our features is a good thing. And most importantly, being able to do this in a way that doesn’t compromise our users’ privacy is very good thing.”
Without much data sharing, there’s a lot less risk here for Snapchat. But the platform won’t have the same draw that Facebook can dangle with its massive user base and extensive personal info access. Instead, Snapchat will have to leverage the fear of being left out of the visual communication era and tout itself as the catalyst for apps to evolve. The biggest driver of the platform might be youngins demanding their Bitmoji everywhere.
Snap needs all the help it can get right now. If other apps are willing to be a billboard for it in exchange for some of its teen-approved functionality, Snapchat could find new growth channels amidst stiff competition. Platforms can entrench apps. And after its user count shrunk in March, Snap has to find a way to keep from disappearing
Powered by WPeMatico