Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

We’re pleased to kick off this week’s newsletter by sharing an important new project: The TechCrunch List. It’s a database of investors who have shown a commitment to first checks and leading rounds from seed through growth, based on founder recommendations we’ve received as well as learnings from our own research.

Our goal is to quickly help founders talk to the investors who are serious about writing them checks when they need it most. You can filter by industry vertical, round size and location to find the best people for you. Today you’ll see 391 investors based on more than 1,200 recommendations across 23 main verticals. Since launch on Tuesday, we’ve received another 600 recommendations and counting fast, so we’ll be providing another big update next week.

My colleague Danny Crichton, who leads the project, has written up an FAQ for people who want to know more about the methodology, or how they might submit a recommendation. For Extra Crunch subscribers, he also put together a list of the 11 investors who have had the most positive recommendations, and an explainer about why certain investors earn great ‘founder NPS’ scores.

Now stop reading this for a minute and check it out.

Image Credits: Dani Padgett / StrictlyVC

Brad Feld on how to influence your odds of success

Connie Loizos caught up with long-time VC Brad Feld of Foundry Group, who has a new book out about startup ecosystems. Some of it is theoretical, as you can read about in the full interview, but Feld connects his points to more tactical advice. Here’s a great example:

TC: Your new book talks about complex systems. How do founders balance the need to manage these complex systems with the fact that controlling these complex systems is sometimes out of their hands?

BF: The first step is getting rid of the notion that you can control the systems, and instead focus on what you can influence [because] in the context of what you can influence, that starts to become a place to focus where you put your energy.

An example of this would be in the current moment. If you have existing investors, and if you have not asked your existing investors directly how much money they have reserved for you for future financings and what you need to do to get that money from them, you’re not focusing on what you can influence.

The worst thing your investor can do is say, ‘I’m not going to tell you that.’ But if your investor is really on your side and wants to see you be successful, it’s likely your investor will say, ‘All right, well, you know . . .’ There might be some wishy-washy [talk] and [dollar] ranges and non-committal language, but you’ll at least have a frame of reference whether that’s zero dollars, a little bit of money, or a lot of money. And you can start to understand, ‘Well, what do we need to do given this moment?’

Edtech goes back to school

Natasha Mascarenhas surveyed eight leading edtech investors for Extra Crunch about the latest changes happening in the space, especially as its importance has grown during the pandemic. “Investors differed on which subcategories benefitted the most,” she writes, “but it’s clear that the pandemic didn’t lift up the entirety of the edtech space. One investor noted that the pandemic made them even less interested in ISAs, while other venture capitalists noted how valuable the financing instrument is now, more than ever before.” She also took a look at a flurry of acquisitions happening globally in the vertical.

(Photo by Pat Greenhouse/The Boston Globe via Getty Images)

A pledge to support international students

The Trump administration backed down from forcing international students to leave the country if their courses went online-only this week, shortly after being sued by some leading universities and 17 state attorneys general. Following the push against most worker visas and other anti-immigration measures, everyone affected expects more problems. To that end, resident TechCrunch immigration legal expert Sophie Alcorn cofounded a new effort to support international students. Here’s more detail:

We proudly announce the Community for Global Innovation (CFGI), a movement centralizing how companies and individuals around the world can stand in solidarity with international students and the belief that everybody deserves a chance to succeed. CFGI is a constellation of top startups, VCs, professionals, nonprofits, international students and grads. We pledge to support international students, create awareness and effect change.

Through the platform, companies take the CFGI Pledge to support international students: ‘If you’re international, no problem. In our team, everybody has a chance.’ We also teamed up with Welcoming America, a leading U.S. nonprofit, accepting donations to make the U.S. more inclusive toward immigrants and all residents. We’re actively seeking the support of volunteers, corporate donors and community members such as international startup founders who know it’s time to share their stories.

An immersive chat future

Podcasting, social audio and virtual reality are combining into a potentially new trend, Lucas Matney writes for Extra Crunch this week. “As audio-centric platforms garner investor interest, virtual reality founders of old are trying to push 3D audio as the next evolution, presenting the tech in a way that looks entirely different from today’s voice chat platforms. Though some of these efforts have been in the works for a while, the fledgling platforms are a lot more interesting, as social efforts like Clubhouse take flight and investors continue to eat up audio startups.” Top early examples so far include High Fidelity and Teooh. 

Around TechCrunch

Ready, set, network! CrunchMatch is now open for Early Stage 2020

Everything you could possibly want to learn about fundraising will be covered at TC Early Stage

Marketing, PR and brand building, oh my! TechCrunch Early Stage goes down July 21 and 22

Here’s your chance to meet with Sequoia’s partners at TC Early Stage

Sign up for next week’s Pitchers & Pitches competition on 7/23

TechCrunch talks virtual events and event technology

Learn how to build a company that puts profits and users first, and VCs last, at Disrupt 2020

Bumble founder Whitney Wolfe Herd is coming to Disrupt 2020

Emily Heyward will teach you how to make your brand awesome at TC Early Stage

Across the week

TechCrunch

US beat China on App Store downloads for first time since 2014, due to coronavirus impact

China Roundup: Tech giants take stance on Beijing’s data control in Hong Kong

Legal clouds gather over US cloud services, after CJEU ruling

India smartphone shipments slashed in half in Q2 2020

Equity Monday: India’s digital economy attracts ample attention, three funding rounds and earnings season

Extra Crunch

Extension rounds help some startups play offense during COVID-19

How Thor Fridriksson’s ‘Trivia Royale’ earned 2.5M downloads in 3 weeks

Investors are browsing for Chromium startups

As companies accelerate their digital transitions, employees detail a changed workplace

An unsurprising wave of video-focused startups is trying to make video calls better

#EquityPod

From Alex Wilhelm:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week was full of news of all sorts, but as we recorded, both Danny and Natasha “not Tash” Mascarenhas were still locked out of their Twitter accounts after a proletariat revolution on the social platform saw the ruling Blue Checkmark Class forced into silence. That’s not really what happened, but it sounds better than what actually went down at Big Social.

Anyway, Twitter accounts or not, the three of us gathered to parse through a wave of news:

• The new TechCrunch List that Danny spent a very long time compiling has arrived! It’s live! You can find it here. It is good.
• And, if you want to know which VCs were even more fêted by founders, head here. (If you are irked that you did not make either list, please email Danny, not the show!)
• Moving on, Google is putting billions into Reliance Jio after every other company in the world did the same. Google is buying a bit less of the Indian telecom than the search giant, but between the two of them it’s been more than $10 billion in dealmaking. Perhaps Reliance Jio is done raising money? At last?
• Udemy is hunting up more capital at a higher valuation, reports say, providing Natasha with the perfect moment to let us know what is going with edtech.
• Turning to funding rounds, I was hyped about the Macro round that TechCrunch covered this week, Danny wanted to chat about The Browser Company’s similarly sized $5 million round and Natasha talked us through LiteBoxer’s combined $6 million in new capital.
• Closing, we talked about IPOs for a hot second. The IPO window is open, and now that nCino and GoHealth have gone public, we want to know who is next.

It was a lovely time and there is a bit of show news. Namely that Equity is coming back to YouTube either this week or the next. So if you want to see us talk, soon you will be able to! Again!

Oh, and follow the show on Twitter. If you can, that is.

Equity drops every Monday at 7:00 a.m. PT and Friday at 6:00 a.m. PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

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Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

You could almost hear the internet cracking apart this week as international businesses pulled away from Hong Kong and the US considered a ban on TikTok. Software can no longer eat the entire world like it had attempted last decade. Startups across tech-focused industries face a new reality, where local markets and efforts are more protected and supported by national governments. Every company now has a smaller total addressable market, whether or not it succeeds in it.

Facebook, for example, appears to be getting an influx of creators who are worried about losing TikTok audiences, as Connie Loizos investigated this week. This might mean more users, engagement and ultimately revenue for many consumer startups, and any other companies that rely on paid marketing through Facebook’s valuable channels. But it means fewer platforms to diversify to, in case you don’t want to rely on Facebook so much for your business.

As trade wars look more and more like cold wars, it also means that Facebook itself will have a more limited audience than it once hoped to offer its own advertisers. After deciding to reject requests from Hong Kong-based Chinese law enforcement, it seems to be on the path to getting blocked in Hong Kong like it is on the mainland. But as with other tech companies, it doesn’t really have a choice — the Chinese government has pushed through legal changes in the city that allow it to arrest anyone in the world if it claims they are organizing against it. Compliance with China would bring on government intervention in the US and beyond, among other reasons why doing so is a non-starter. 

This also explains why TikTok itself already pulled out of Hong Kong, despite being owned by mainland China-based Bytedance. The company is still reeling from getting banned in India last week and this maneuver is trying to the subsidiary look more independent. Given that China’s own laws allow its government to access and control private companies, expect many to find that an empty gesture.

Startups should plan for things to get harder in general. See: the next item below.

(Photo by Alex Wong/Getty Images)

Student visas have become the next Trump immigration target

International students will not be allowed to stay enrolled at US universities that offer only remote classes this coming academic year, the Trump administration decided this past week. As Natasha Mascarenhas and Zack Whittaker explore, many universities are attempting a hybrid approach that tries to allow some in-person teaching without creating a community health problem.

Without this type of approach, many students could lose their visas. Here’s our resident immigration law expert, Sophie Alcorn, with more details on Extra Crunch:

International students have been allowed to take online classes during the spring and summer due to the COVID-19 crisis, but that will end this fall. The new order will force many international students at schools that are only offering remote online classes to find an “immigration plan B” or depart the U.S. before the fall term to avoid being deported.

At many top universities, international students make up more than 20% of the student body. According to NAFSA, international students contributed $41 billion to the U.S. economy and supported or created 458,000 jobs during the 2018-2019 academic year. Apparently, the current administration is continuing to “throw out the baby with the bathwater” when it comes to immigration.

Universities are scrambling as they struggle with this newfound untenable bind. Do they stay online only to keep their students safe and force their international students to leave their homes in this country? Or do they reopen to save their students from deportation, but put their communities’ health at risk?

For students, it means finding another school, scrambling to figure out a way to depart the States (when some home countries will not even allow them to return), or figuring out an “immigration plan B.”

Who knows how many startups will never exist because the right people didn’t happen to be at the right place at the right time together? What everyone does know is that remote-first is here to stay.

Image Credits: CapitalG (opens in a new window)

No Code goes global

A few tech trends seem unstoppable despite any geopolitics, and one seems to be the universal human goal of making enterprise software suck less. (Okay, nearly universal.) Alex Nichols and Jesse Wedler of CapitalG explain why now is the time for no code software and what the impact will bel, in a very popular article for Extra Crunch this week. Here’s their setup:

First, siloed cloud apps are sprawling out of control. As workflows span an increasing number of tools, they are arguably getting more manual. Business users have been forced to map workflows to the constraints of their software, but it should be the other way around. They need a way to combat this fragmentation with the power to build integrations, automations and applications that naturally align with their optimal workflows.

Second, architecturally, the ubiquity of cloud and APIs enable “modular” software that can be created, connected and deployed quickly at little cost composed of building blocks for specific functions (such as Stripe for payments or Plaid for data connectivity). Both third-party API services and legacy systems leveraging API gateways are dramatically simplifying connectivity. As a result, it’s easier than ever to build complex applications using pre-assembled building blocks. For example, a simple loan approval process could be built in minutes using third-party optical character recognition (a technology to convert images into structured data), connecting to credit bureaus and integrating with internal services all via APIs. This modularity of best-of-breed tools is a game changer for software productivity and a key enabler for no code.

(opens in a new window)

Finally, business leaders are pushing CIOs to evolve their approach to software development to facilitate digital transformation. In prior generations, many CIOs believed that their businesses needed to develop and own the source code for all critical applications. Today, with IT teams severely understaffed and unable to keep up with business needs, CIOs are forced to find alternatives. Driven by the urgent business need and assuaged by the security and reliability of modern cloud architecture, more CIOs have begun considering no code alternatives, which allow source code to be built and hosted in proprietary platforms.

Photo: Jason Alden/Bloomberg

Palantir has finally filed to go public

It’s 16 years old, worth $26 billion and widely used by private and public entities of all types around the world, but this employer of thousands is counted as a startup tech unicorn, because, well, it was one of the pioneers of growing big, raising bigger, and staying private longer. Aileen Lee even mentioned Palantir as one of the 39 examples that helped inspire the “unicorn” term back in 2013. Now the secretive and sometimes controversial data technology provider is finally going to have its big liquidity event — and is filing confidentially to IPO, which means the finances are still staying pretty secret.

Alex Wilhelm went ahead and pieced together its funding history for Extra Crunch ahead of the action, and concluded that “Palantir seems like the Platonic ideal of a unicorn. It’s older than you’d think, has a history of being hyped, its valuation has stretched far beyond the point where companies used to go public, and it appears to be only recently growing into its valuation.”

It also appears to be one of the unicorns that has seen a lot of upside lately. It has been in the headlines recently for cutting big-data deals with governments for pandemic work, on top of a long-standing relationship with the US military and other arms of the government. As with Lemonade, Accolade and a range of other IPOing tech companies that we have covered in recent weeks, it is presumably in a positive business cycle and primed to take advantage of an already receptive market.

(Photo by Kimberly White/Getty Images for TechCrunch)

Meaningful change from BLM

In an investor survey for Extra Crunch this week, Megan Rose Dickey checked in with eight Black investors about what they are investing in, in the middle of what feels like a new focus on making the tech industry more representative of the country and the world. Here’s how Arlan Hamilton of Backstage Capital responded when Megan asked what meaningful change might come from the recent heightened attention on the Black Lives Matter movement.

I happen to be on the more optimistic side of things. I’m not at a hundred percent optimistic, but I’m close to that. I think that there’s an undeniable unflinching resolve right now. I think that if we were to go back to status quo, I would be incredibly surprised. I guess I would not be shocked, unfortunately, but I would be surprised. It would give me pause about the effectiveness of any of the work that we do if this moment fizzles out and doesn’t create change. I do think that there is going to be a shift. I can already feel it. I know that more people who are representative of this country are going to be writing checks, whether through being hired, or taken through the ranks, or starting their own funds, and our own funds. I think there’s more and more capital that’s going to flow to underrepresented founders. That alone, I think, will be a huge shift.

Around TechCrunch

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Kerry Washington is coming to Disrupt 2020

Amazon’s Alexa heads Toni Reid and Rohit Prasad are coming to Disrupt

Ade Ajao, Maryanna Saenko, Charles Hudson, Ulili Onovakpuri and Melissa Bradley are coming to Disrupt

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Across the week

TechCrunch

14 VCs discuss COVID-19 and London’s future as a tech hub

Societal upheaval during the COVID-19 pandemic underscores need for new AI data regulations

PC shipments rebound slightly following COVID-19-fueled decline

Here’s a list of tech companies that the SBA says took PPP money

Equity Monday: Uber-Postmates is announced, three funding rounds and narrative construction

Regulatory roadblocks are holding back Colombia’s tech and transportation industries

Extra Crunch

In pandemic era, entrepreneurs turn to SPACs, crowdfunding and direct listings

Four views: Is edtech changing how we learn?

VCs are cutting checks remotely, but deal volume could be slowing

GGV’s Jeff Richards: ‘There is a level of resiliency in Silicon Valley that we did not have 10 years ago’

Logistics are key as NYC startup prepares to reopen office

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

We wound up having more to talk about than we had time for but we packed as much as we could into 34 minutes. So, climb aboard with Danny, Natasha and myself for another episode of Equity.

Before we get into topics, a reminder that if you are signing up for Extra Crunch and want to save some money, the code “equity” is your friend. Alright, let’s get into it:

• Robinhood is back in the news this week after a New York Times piece dug into its history, product decisions and more. Tidbits galore are to be had, but the Equity crew wanted to debate the morality of providing exotic financial tooling to less-experienced users.
• We followed that debate with a dive into immigration, the latest news from the government and our takes on the matter. TechCrunch has covered the recent news, and provided some context on the broader concept. Our takeaway is that doing self-defeating things for no reason isn’t brilliant for the country as a whole.
• Postmates has a home! After winding up somewhere in the middle of the pack of the on-demand cohort a few years back, the rise of DoorDash put Postmates  in a pickle. Happily, Uber was on hand to de-brine the unicorn for $2.65 billion in stock. That’s a bit more money than Postmates’ last valuation. What we want to know next is how the sale price impacted common stockholders. Email us if you know.
• Palantir has filed to go public, but privately, so that’s really all there is to say about that. Unless you need a history lesson.
• Finally, funding rounds. We had three this week: MonkeyLearn raising $2.2 million for no-code AI, Quaestor raising $5.8 million for startup financial tooling and $4.5 million for Mmhmm, which is both timely and neat.

Whew! Past all that we had some fun, and, hopefully, were of some use. Hugs and chat Monday!

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Hundreds of tech-oriented startups worth a billion or more dollars had envisioned successful public offerings before the pandemic hit. But new tech listings slowed to nearly nothing this spring as companies have tried to adjust to the profound changes sweeping the world.

Today, more and more companies are back to their previous plans, with Lemonade and Accolade finding an enthusiastic public this week, following Agora’s pop last Friday, as Alex Wilhelm has been covering.

The first big tech IPO this week was in online insurance, the second in health, and despite both being in promising markets, the valuations are quite a bit higher than their business realities to date. Here’s more, from his analysis on Extra Crunch:

Lemonade is being valued at more than 15x the value of its annualized Q1 revenue despite not sporting the gross margins you might expect investors to demand for it to merit that SaaS valuation. And Accolade only expects to grow by about 20% in Q2 2020 compared to its year-ago results while probably losing more money.

But who cares? The IPO market is standing there with open arms today (there’s always another IPO cliché lurking).

The read of this is impossibly simple: However open we thought that the IPO market was before, it is even more welcoming. For companies on the sidelines, like Palantir, Airbnb, DoorDash and Asana, you have to wonder what they are waiting for. Sure, you can raise more private capital like Palantir and DoorDash have, but so what; if you want to defend your valuation, isn’t this the market that was hoped for?

He also takes a look at a few more companies getting ready to file, including banking software company nCino and GoHealth, an insurance portal that was bought by a private equity firm last year, as well as gaming company DoubleDown Interactive. The general trend seems to be that initial stock pricing has stayed more conservative than how public markets are feeling.

Startup survey shows remote is new normal already

“Early-stage startups are confident of re-opening their offices in the wake of the COVID-19 within the next six months,” writes Mike Butcher for TechCrunch this week. “But there will be changes.” Here’s more from our UK-based editor-at-large:

An exclusive survey compiled by Founders Forum, with TechCrunch, found 63% of those surveyed said they would only re-open in either 1-3 months or 3-6 months — even if the government advises [sic] that it is safe to do so before then. A minority have re-opened their offices, while 10% have closed their office permanently. The full survey results can be found here.

However, there will clearly be long-term impact on the model of office working, with a majority of those surveyed saying they would now move to either a flexible remote working model (some with permanent offices, some without), but only a small number plan a “normal” return to work. A very small number plan to go fully “remote.” Many cited the continuing benefits of face-to-face interaction when trying to build the team culture so crucial with early-stage companies.

Title insurance is getting the tech competition it deserves

A lot of people are thinking harder about homeownership as they wait out quarantines — but real estate is still an old-fashioned industry, layered with complexities and surprising costs that can keep a dream purchase out of reach. Title insurance is a great example. A one-time cost to protect buyers and sellers during the closing process, it can extend the purchase process by a month or two, in addition to potentially adding thousands of dollars in costs. But various new regulations and rulings have combined with the larger trends in SaaS to open up the market. Here’s more, in a detailed guest post for Extra Crunch from Ashley Paston of Bain Capital Ventures:

In a very short period of time, we’ve seen startups take advantage of this new, more competitive landscape by offering solutions to streamline the task of getting title insurance. Qualia, for example, offers an end-to-end platform that connects all parties involved in a real estate transaction, so title agents can manage and coordinate all aspects of the process in real time. San Francisco-based States Title, for example, uses a predictive underwriting engine that produces nearly instantaneous title assessment, dramatically reducing the cost and time required to issue a policy. Qualia and States Title are among several companies hoping to revolutionize title insurance and they reflect the two emerging meta-trends.

The first trend, enablement, consists of companies developing technology designed to integrate with incumbent real estate businesses… The second trend, disruption, consists of companies displacing incumbent real estate business altogether.

Image Credits: Black Innovation Alliance

Tech diversity stays in focus

The tech industry has talked about making its opportunities available to all for many years, and struggled to deliver. But more than a month after George Floyd was killed, this time is still feeling different. One example is .fm, a viral sort of insidery prank from last weekend that a diverse small group of friends in tech created and turned into a successful grassroots fundraiser for racial justice organizations (it was not a VC fundraising stunt). “In one fell swoop,” veteran product leader Ravi Mehta wrote for TechCrunch, “the team chastised Silicon Valley’s use of exclusivity as a marketing tactic, trolled thirsty VCs for their desire to always be first on the next big thing, deftly leveraged the virality of Twitter to build awareness and channeled that awareness into dollars that will have a real impact on groups too often overlooked.”

Meanwhile, a group of Black startup founders and the Transparent Collective created a public spreadsheet to provide a comprehensive list of every VC who has backed a Black founder in the US, and the umbrella Black Innovation Alliance launched to help hundreds of related Black-focused tech and entrepreneurship organizations connect and support each other. Efforts like these, combined with a real generational willingness to address the structural problems, are what can make the difference finally.

Why AR has mostly failed (so far)

Augmented reality concepts may become a core part of how people live in the future, but the first wave of companies in the space have not fared well. Here’s why, from Lucas Matney on Extra Crunch:

The technology was almost there in a lot of cases, but the real issue was that the stakes to beat the major players to market were so high that many entrants pushed out boring, general consumer products. In a race to be everything for everybody, the industry relied on nascent developer platforms to do the dirty work of building their early use cases, which contributed heavily to nonexistent user adoption.

Instead, he says success will come from nailing the use-cases first, and not messing around with complex developer platforms and expensive hardware.

Around TechCrunch

Hear Charles Hudson explain how to sell an idea (without a product) at Early Stage

Get your pitchdeck critiqued by Accel’s Amy Saper and Bessemer’s Talia Goldberg at Early Stage

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Across the week

TechCrunch

Global app revenue jumps to $50B in the first half of 2020, in part due to COVID-19 impacts

Let’s stop COVID-19 from undoing diversity gains

Strap in — a virtual Tour de France is coming this weekend

US suspends export of sensitive tech to Hong Kong as China passes new national security law

India bans TikTok, dozens of other Chinese apps

Extra Crunch

Top LA investors discuss the city’s post-COVID-19 prospects

13 Boston-focused venture capitalists talk green shoots and startup recovery

How $20 billion health care behemoth Blue Shield of California sees startups

From napkin notes to term sheets: A chat with Inspired Capital’s Alexa von Tobel

Where to open a game studio

Are virtual concerts here to stay?

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Before we dive in, don’t forget that the show is on Twitter now, so follow us there if you want to see discarded headline ideas, outtakes from the show that got cut, and more. It’s fun!

Back to task, listen, we’re tired too. But we didn’t let that stop us from packing this week’s Equity to the very gills with news and notes and jokes and fun. Hopefully you can chuckle along with myself and Natasha and Danny and Chris on the dials as we riffed through all of this:

• Journalism, venture capitalists, and not being a colossal jerk: Listen in for more, but there’s once again a brouhaha in the world of technology twitter and media twitter concerning whether journalists should write more positive things about tech companies (no), and if venture capitalists are a bit too thin-skinned for their net worth (yes).
• Lemonade’s IPO went kaboom out of the gate, more than doubling in value. But the CEO isn’t too worried. I spoke with him before we recorded and he was more interested in getting a bedrock of solid, long-term investors than extracting every possible dollar in their raise. And Lemonade had a bunch of money already, so it wasn’t a huge concern.
• We also spent a minute on the possible Uber-Postmates deal, that could get announced early next week. That or Postmates really is serious about going public. We’ll see.
• Next up we had to talk about Mirror, Lululemon, and what’s up with home fitness. Is the trend here to stay? Natasha thinks so, and the rest of the crew are pretty bullish as well. Especially as it is not like we are going to get back to life anytime soon.
• After that it was time to get to a few funding rounds, including the latest from Neo.Tax, and a check-in on the early-stage Lessonbee, which sounds really cool.
• We also crammed in a quick word on Contrary Capital and startup mafias, the Envision accelerator, Discord’s latest $100 million round, and we closed with the Final Luckin Letdown.
• Whew!

Right, that’s our ep. Hugs from the team and have a lovely weekend. You are all tremendous and we appreciate you spending part of your day with the four of us.

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Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

While the US tech industry relentlessly tries to do business with the rest of the world, this week it became further embroiled in national politics. High-skill immigration visas have been suspended until the end of the year by the Trump administration, precluding thousands of present and future startup employees and founders from coming to the US and building companies here.

Instead, the suspension is another accelerant to the global remote work trend that had already been a thing for many of us this decade, that has just been pushed to the mainstream because of the pandemic. For anyone trying to find great people to hire, the next funding check, or new markets, virtual solutions are often the only solutions available today.

Our resident immigration law expert, Sophie Alcorn, has been covering the issue in-depth this week, including an explainer about the crucial role of immigration in the economy for TechCrunch, and for Extra Crunch, an overview of what you can do if you’re affected. For subscribers, she also wrote about the impact of the Supreme Court overturning Trump’s termination of DACA.

On a personal note, our global editorial staff is looking forward to resuming our global events schedule as soon as possible regardless of these national political issues. We’re here for the startup world. In the meantime, here’s Alex Ames on how we’re connecting virtual Disrupt attendees this year.

Image Credits: Nigel Sussman (opens in a new window)

New York tech after the pandemic

The big industries and big-city amenities that have made New York City what it is are going to help power it forward even as more people and jobs appear to be heading away from city centers. At least that’s my takeaway from reading the 11 investors who Anthony Ha talked to this week in an Extra Crunch survey about the future of the startup hub. First, even if you can work from anywhere, millions of people will prefer that place to be New York — with the big-city housing supply, networking opportunities and amenities to attract people like before. Second, many key industries like finance, real estate, enterprise software, health care, media and other consumer products are not dying but being reinvented, and appear to be maintaining their centers in the city. Here’s Alexa von Tobel of Inspired Capital:

I’ve seen NYC grow into the powerful startup hub it’s become over the last decade, and I think that momentum will continue. Now that we’ve learned high productivity is indeed possible remotely, we expect to see companies maintain some element of a remote workforce within their broad hiring plans. But for startups in their earliest stages, I think there’s still a power to sitting side by side as you build a business. When founders are making their first hires and inking their first deals, NYC remains an incredible place to do that.

Some of those industry reinventions are more exciting than others. In a separate survey, Anthony talked to 5 investors who have tended to focus on advertising and marketing tech… the good news is that advertising and marketing costs are dropping and tech-driven efficiency is improving for the world. For founders in the space, though, the challenges have only grown as the pandemic has forced more ad budget cuts on top of shifts to the largest platforms. As John Elton of Greycroft put it:

Only the next technology breakthrough will provide fertile ground for the next wave of innovation, just as mobile and internet breakthroughs gave rise to today’s giants. Perhaps machine learning is that type of breakthrough, so we are looking at companies that use machine learning to dramatically improve what is possible in the space. The issue there is the scaled players are also very good at machine learning, so it may not be a technology that provides the same opportunity as prior disruptions.

TIm O’Reilly

O’Reilly talks investing beyond the VC financial bubble

Tim O’Reilly has been going a different route from much of Silicon Valley in recent years. While his publishing company, series of conferences, essays and investments have helped to shape the modern internet for decades, he says that venture capital has gone wrong. Here’s more from an interview on with Connie Loizos on TechCrunch this week:

[I]’ve been really disillusioned with Silicon Valley investing for a long time. It reminds me of Wall Street going up to 2008. The idea was, ‘As long as someone wants to buy this [collateralized debt obligation], we’re good.’ Nobody is thinking about: Is this a good product? So many things that what VCs have created are really financial instruments like those CDOs. They aren’t really thinking about whether this is a company that could survive on revenue from its customers. Deals are designed entirely around an exit. As long as you can get some sucker to take them, [you’re good]. So many acquisitions fail, for example, but the VCs are happy because — guess what? — they got their exit.

His firm, O’Reilly AlphaTech Ventures, has instead been focused in recent years on funding founders who are creating a product that is valued by customers and generates sustainable cash flow, on terms that incentivize organic growth.

They wrote your first check

Last week we launched a new effort to highlight investors who were the first to back your big and (increasingly) successful idea. It’s gotten a great response so far. From Danny Crichton:

Well, the TechCrunch community came through, since in just a few days, we’ve already received more than 500 proposals from founders recommending VCs who wrote their first checks and who have been particularly helpful in fundraising and getting a round closed.

If you haven’t submitted a recommendation, please help us using the form linked here.

The short survey takes five minutes, and could save founders dozens of hours armed with the right intel. Our editorial team is carefully processing these submissions to ensure their veracity and accuracy, and the more data points we have, the better the List can be for founders.

Check out Danny Crichton’s full post on TechCrunch for answers to questions that we’ve gotten frequently so far.

Across the week

TechCrunch:

A look at tech salaries and how they could change as more employees go remote

Apple will soon let developers challenge App Store rules

China’s GPS competitor is now fully launched

GDPR’s two-year review flags lack of ‘vigorous’ enforcement

The Exchange: IPO season, self-driving misfires and a fintech letdown

Extra Crunch:

What went wrong with Quibi?

Four perspectives: Will Apple trim App Store fees?

4 enterprise developer trends that will shape 2021

Ideas for a post-COVID-19 workplace

Plaid’s Zach Perret: ‘Every company is a fintech company’

Volcker Rule reforms expand options for raising VC funds

Around TechCrunch

Register for next week’s Pitches & Pitchers session

Join GGV’s Hans Tung and Jeff Richards for a live Q&A: June 30 at 3:30 pm EDT/12:30 pm PDT

Airtable’s Howie Liu to join us at Disrupt 2020

Zoom founder and CEO Eric Yuan will speak at Disrupt 2020

How to supercharge your virtual networking at Disrupt 2020

#EquityPod

From Alex Wilhelm:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week was a bit feisty, but that’s only because Danny Crichton and Natasha Mascarenhas and I were all in pretty good spirits. It would have been hard to not be, given how much good stuff there was to chew over.

We kicked off with two funding rounds from companies that had received a headwind from COVID-19:

• Away raises new capital, reported to be $30 million to $40 million after revenue declines
• Sonder raises $170 million at a higher $1.3 billion valuation after seeing its hospitality business recover

Those two rounds, however, represented just one side of the COVID coin. There were also companies busy riding a COVID-tailwind to the tune of new funds:

• Hopin raised a $40 million Series A as its virtual events business accelerated
• DoNotPay raised an $18 million round at an $80 million valuation

But we had room for one more story. So, we talked a bit about Robinhood, its business model and the recent suicide of one of its users. It’s an awful moment for the family of the human we lost, but also a good moment for Robinhood to batten the hatches a bit on how its service works.

How far the company will go, however, in limiting access to certain financial tooling, will be interesting to see. The company generates lots of revenue from its order-flow business, and options are a key part of those incomes. Robinhood is therefore balancing the need to protect its users and make money from their actions. How they thread this needle will be quite interesting.

All that and we had a lot of fun. Thanks for tuning in, and follow the show on Twitter!

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Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

Which startups investors are actually first to backing the best companies? If you know this information before fundraising, you can avoid pitching investors who were always going to tell you that you’re “too early” anyway. The problem is that everyone claims credit for success, and by the time you pick through databases, investor sites, blogs, tweets and news clippings, you have no real idea who made what call when.

That’s why our solution is to just ask founders about who really made it happen. Our new product, The TechCrunch List, will feature the investors who wrote the first checks, to help any founder find the help they need when they need it. Here’s more, from Arman Tabatabai and Danny Crichton:

Over the next few weeks, we’re going to be collecting data around which individual investors are actually willing to write the proverbial “first check” into a startup’s fundraising round and help catalyze deals for founders — whether it be seed, Series A or otherwise (i.e. out of your Series A investors, the first person who was willing to write the check and get the ball rolling with other investors). Once we’ve collected, cleaned and analyzed the data, we’ll publish lists of the most recommended “first check” investors across different verticals, investment stages and geographies, so founders can see which investors are potentially the best fit for their company….

In all, The TechCrunch List will publish the most recommended “first check” writers across 22 different categories, ranging from D2C & e-commerce brands to space, and everything in between. Through some data analysis around total investments in each space, we believe our 22 categories should cover the entirety or majority of the venture activity today.

To make this project a success and create a useful resource for founders, we need your help. We want to hear from company builders and we want to hear from them directly. We will be collecting endorsements submitted by founders through the form linked here.

(Photo by Steven Damron used under Creative Commons).

Valley dealflow has continued through the pandemic

Despite much discussion about investors pulling back en masse from startup investing, a new survey out from Silicon Valley tech law firm Fenwick & West about activity in the region over April says that valuations went up, markdown rounds did not grow as a percentage of deals, and the overall pace of deals actually increased. The catch, Connie Loizos writes for TechCrunch, is that much of this was due to later-stage rounds, and of course, it is generalized across industries that have been variously propelled or pummeled by the pandemic.

Alex Wilhelm then looks at a couple additional reports for Extra Crunch, from Docsend and NFX. They appear to show ongoing investor activity growth since April, as well as growing founder optimism — but early stage did in fact appear to be more turbulent, as, ahem, one might expect if one has experience in early-stage fundraising. He separately notes that the latest tracking data sources appear to show a decline in startup layoffs. Both are, by the way, written as part of The Exchange, his new daily column about the latest trends in the startup world for EC subscribers (use code EXCHANGE to get 25% off a subscription).

Image Credits: Klaud Vedfelt (opens in a new window) / Getty Images (Image has been modified)

Beyond Valley dealflow (and its problems)

Juneteenth has been celebrated since 1866 to mark the end of slavery after the American Civil War. But this year, it is being taken up by tech companies as an official holiday to help show their concern for structural discrimination in the wake of the George Floyd killing and ensuing global protests. What does it really mean though? Here’s Megan Rose Dickey for TechCrunch:

Recognition of such a historic day is good. But the way these companies are publicly announcing their plans, seeking press as they do, suggests their need for some affirmative pat on the back. It’s perfectly acceptable to do the right thing and not get credit for it. It shows humility. It shows that a company is more interested in doing right by its workers than it is in saving face….

Instead, as Hustle Crew founder Abadesi Osunsade has said, tech companies need to go beyond one-off actions and form habits around racial justice work. Forming habits around hiring Black people, promoting Black employees, paying Black employees fairly, funding Black founders and making room for Black people in leadership positions is what will lead to concrete change in this industry.

Meanwhile, given the ongoing issues in fundraising, Delali Dzirasa of Fearless writes about other resources Black entrepreneurs can use to get their companies off the ground, including equity crowdfunding, mentor programs, 8(a) programs, SBA resources, and your local commercial banker.

Image Credits: PipeCandy

Online winners and also-rans during the pandemic

Two marketing experts shared fresh data on what categories are winning and losing during the pandemic for Extra Crunch this week, perhaps revealing where some of the founder and investor enthusiasm is coming from? First, here’s Ethan Smith of Graphite, who provides an overview of how money is being spent online during the pandemic using data from Branch through mid-May:

The good news for vendors overall is that people are still shopping online, but they’re buying different things and in different volumes than they used to. Kid/pet-oriented mobile activity and associated purchases have skyrocketed. We’ve also seen spikes in the purchase of activewear, fashion items, shoes and arts and crafts items, as people wait out the lockdown and prepare for what they hope will be a summer of freedom.

To dig into the direct-to-consumer category in more detail, here’s Ashwin Ramasamy of PipeCandy, who uses a mix of data sources to look at subcategory trends versus what the year might have looked like without a pandemic:

Kids, cookware and kitchen tools, apparel, fine jewelry, fashion, women’s health, mattresses, furniture and skincare actually deviated negatively from the forecast. This is not to say that these categories declined. We are actually saying that these categories didn’t keep up with the growth trends they orchestrated in 2019. That said, the devil is in the details. For instance, within furniture, there is a category of D2C brands that sell shelves and office furniture. Consumers did invest in them heavily, presumably to allow participants in the Zoom call to absorb more the titles of the books stacked in those shelves than from the calls themselves. Wine/spirits, grocery, fitness, baby care, pets and nutraceuticals did better than anticipated. Basically, anything that helped numb the reality (alcohol), sweeten the reality (food), distract from the reality (baby care and pets), survive the reality (fitness) or hallucinate an alternative reality (nutraceuticals) did well. I will leave you with another interesting conclusion we arrived at, through further research that is currently underway: The spotlight category in e-commerce is not direct to consumer — it is the mid-market and large pure-play e-commerce companies. It is one segment where the compounded quarterly growth rate of active companies is better than the 2019 average.

Around TechCrunch

Founders can reap long-term benefits after exhibiting in Disrupt’s Startup Alley

Extra Crunch Live: Join Superhuman’s Rahul Vohra for a live discussion of email, SaaS and buzzy businesses

Learn how to give your brand a distinct voice from Slack’s Head of Brand Communications Anna Pickard at TC Early Stage

New sessions announced at TC Early Stage from Dell, Perkins Coie and SVB

HappyFunCorp’s Ben Schippers and Jon Evans will talk tech stacks at TC Early Stage

Across the week

TechCrunch:

Where are all the robots?

Despite pandemic setbacks, the clean energy future is underway

TikTok explains how the recommendation system behind its ‘For You’ feed works

Chris Sacca advises new fund managers to strike right now

Extra Crunch:

What’s next for space tech? 9 VCs look to the future

How Liberty Mutual shifted 44,000 workers from office to home

Superhuman’s Rahul Vohra says recession is the ‘perfect time’ to be aggressive for well-capitalized startups

Investors based in San Francisco? That’s so 2019

How Reliance Jio Platforms became India’s biggest telecom network

4 months into lockdown, Eventbrite CEO Julia Hartz sees ‘exciting signs of recovery’

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Your humble Equity team is pretty tired but in good spirits, as there was a lot to talk about this week…

• Epic Games is looking to raise a huge stack of cash (Bloomberg, VentureBeat) at a new, higher valuation. We were curious about how its lower-cut store could help it gain inroads with developers big and small. That part of the chat, the take-rate of the Fortnite parent company on the work of others was very cogent to the other main topic of the day:
• Apple vs. DHH. So Hey launched this week, and the new spin on email quickly overshadowed its product launch by getting into a spat with Apple about whether it needs to add the ability to sign up for the paid service on iOS, thus giving Apple a cut of its revenue. DHH and crew do not agree. Apple is under fire for anti-competitive practices at home and abroad — of varying intensity, and from different sources — making this all the more spicy.
• Upgrade raises $40 million for its credit-focused neobank.
• Degreed raises $32 million for its upskilling platform.
• And, at the end, our take on the current health of the startup market. There have been a sheaf of reports lately about what is going on in startup land. We gave our take.

And that’s that. Have a lovely weekend and catch up on some sleep.

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Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

Many in the tech industry saw the threat of the novel coronavirus early and reacted correctly. Fewer have seemed prepared for its aftereffects, like the outflow of talented employees from very pricey office real estate in expensive and troubled cities like San Francisco.

And few indeed have seemed prepared for the Black Lives Matter protests that have followed the death of George Floyd. This was maybe the easiest to see coming, though, given how visible the structural racism is in cities up and down the main corridors of Silicon Valley.

Today, the combination of politics, the pandemic and the protests feels almost like a market crash for the industry (except many revenues keep going up and to the right). Most every company is now fundamentally reconsidering where it will be located and who it will be hiring — no matter how well it is doing otherwise.

Some, like Google and Thumbtack, have been caught in the awkward position of scaling back diversity efforts as part of pandemic cuts right before making statements in support of the protesters, as Megan Rose Dickey covered on TechCrunch this week. But it is also the pandemic helping to create the focus, as Arlan Hamilton of Backstage Capital tells her:

It is like the world and the country has a front-row seat to what Black people have to witness, take in, and feel all the time. And it was before they were seeing some of it, but they were seeing it kind of protected by us. We were kind of shielding them from some of it… It’s like a VR headset that the country is forced to be in because of COVID. It’s just in their face.

This also putting new scrutiny on how tech is used in policing today. It is renewing questions around who gets to be a VC and who gets funding right when the industry is under new pressure to deliver. It is highlighting solutions that companies can make internally, like this list from BLCK VC on Extra Crunch.

As with police reforms currently in the national debate, some of the most promising solutions are local. Property tax reform, pro-housing activism and sustainable funding for homelessness services are direct ways for the tech industry to address the long history of discrimination where the modern tech industry began, Catherine Bracy of TechEquity writes for TechCrunch. These changes are also what many think would make the Bay Area a more livable place for everyone, including any startup and any tech employee at any tech company (see: How Burrowing Owls Lead To Vomiting Anarchists).

Something to think about as we move on to our next topic — the ongoing wave of tech departures from SF.

Where will VCs follow founders to now?

In this week’s staff survey, we revisit the remote-first dislocation of the tech industry’s core hubs. Danny Crichton observes some of the places that VCs have been leaving town for, and thinks it means bigger changes are underway:

“Are VCs leaving San Francisco? Based on everything I have heard: yes. They are leaving for Napa, leaving for Tahoe, and otherwise heading out to wherever gorgeous outdoor beauty exists in California. That bodes ill for San Francisco’s (and really, South Park’s) future as the oasis of VC.

But the centripetal forces are strong. VCs will congregate again somewhere else, because they continue to have that same need for market intelligence that they have always had. The new, new place might not be San Francisco, but I would be shocked just given the human migration pattern underway that it isn’t in some outlying part of the Bay Area.

And then he says this:

As for VCs — if the new central node is a bar in Napa and that’s the new “place to be” — that could be relatively more permanent. Yet ultimately, VCs follow the founders even if it takes time for them to recognize the new balance of power. It took years for most VCs to recognize that founders didn’t want to work in South Bay, but now nearly every venture firm of note has an office in San Francisco. Where the founders go, the VCs will follow. If that continues to be SF, its future as a startup hub will continue after a brief hiatus.

It’s true that another outlying farming community in the region once became a startup hub, but that one had a major research university next door, and at the time a lot of cheap housing if you were allowed access to it. But Napa cannot be the next Palo Alto because it is fully formed today as a glorified retirement community, Danny.

I’m already on the record for saying that college towns in general are going to become more prominent in the tech world, between ongoing funding for innovative tech work and ongoing desirability for anyone moving from the big cities. But I’m going to add a side bet that cities will come back into fashion with the sorts of startup founders that VCs would like to back. As Exhibit A, I’d like to present Jack Dorsey, who started a courier dispatch in Oakland in 2000, and studied fashion and massage therapy during the aftermath of the dot-com bubble. His success with Twitter a few years later in San Francisco inspired many founders to move as well.

Creative people like him are drawn to the big, creative environments that cities can offer, regardless of what the business establishment thinks. If the public and private sectors can learn from the many mistakes of recent decades (see last item) who knows, maybe we’ll see a more equal and resilient sort of boom emerge in tech’s current core.

Insurance provider Lemonade files for IPO with that refreshing common-stock flavor

There are probably some amazing puns to be made here but it has been a long week, and the numbers speak for themselves. Lemonade sells insurance to renters and homeowners online, and managed to reach a private valuation of $3.5 billion before filing to go public on Monday — with the common stockholders still comprising the majority of the cap table.

Danny crunched the numbers from the S-1 on Extra Crunch to generate the table, included, that illustrates this rather unusual breakdown. Usually, as you almost certainly know already, the investors own well over half by the time of a good liquidity event. “So what was the magic with Lemonade?” he ponders. “One piece of the puzzle is that company founder Daniel Schreiber was a multi-time operator, having previously built Powermat Technologies as the company’s president. The other piece is that Lemonade is built in the insurance market, which can be carefully modeled financially and gives investors a rare repeatable business model to evaluate.”

(Photo by Paul Hennessy/NurPhoto via Getty Images)

Adapting enterprise product roadmaps to the pandemic

Our investor surveys for Extra Crunch this week covered the space industry’s startup opportunities, and looked at how enterprise investors are assessing the impact of the pandemic. Here’s Theresia Gouw of Acrew Capital, explaining how two of their portfolio companies have refocused in recent months:

A common theme we found when joining our founders for these strategy sessions was that many pulled forward and prioritized mid- to long-term projects where the product features might better fit the needs of their customers during these times. One such example in our portfolio is Petabyte’s (whose product is called Rhapsody) accelerated development of its software capabilities that enable veterinarians to provide telehealth services. Rhapsody has also incorporated key features that enable a contactless experience when telehealth isn’t sufficient. These include functionality that enables customers to check-in (virtual waiting room), sign documents, and make payments from the comfort and safety of their car when bringing their pet (the patient!) to the vet for an in-person check-up.

Another such example would be PredictHQ, which provides demand intelligence to enterprises in travel, hospitality, logistics, CPG, and retail, all sectors who saw significant change (either positive or negative) in the demand for their products and services. PredictHQ has the most robust global dataset on real-world events. Pandemics and all the ensuing restrictions and, then, loosening of restrictions fall within the category of real-world events. The company, which also has multiple global offices, was able to incorporate the dynamic COVID government responses on a hyperlocal basis, by geography, and equip its customers (e.g., Domino’s, Qantas, and First Data) with up to date insights that would help with demand planning and forecasting as well as understanding staffing needs.

Around TechCrunch

Extra Crunch Live: Join Superhuman CEO Rahul Vohra for a live Q&A on June 16 at 2pm EDT/11 AM PDT
Join us for a live Q&A with Plaid CEO Zach Perret June 18 at 10 a.m. PDT/1 p.m. EDT
Two weeks left to save on TC Early Stage passes
Learn how to ‘nail it before you scale it’ with Floodgate’s Ann Miura-Ko at TC Early Stage SF
How can startups reinvent real estate? Learn how at TechCrunch Disrupt
Stand out from the crowd: Apply to TC Top Picks at Disrupt 2020

Across the Week

TechCrunch

Theaters are ready to reopen, but is America ready to go back to the movies?
Edtech is surging, and parents have some notes
When it comes to social media moderation, reach matters
Zoom admits to shutting down activist accounts at the request of the Chinese government

Extra Crunch

TechCrunch’s top 10 picks from Techstars’ May virtual demo days
Software’s meteoric rise: Have VCs gone too far?
Recession-proof your software engineering career
The complicated calculus of taking Facebook’s venture money
The pace of startup layoffs may be slowing down

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

After a pretty busy week on the show we’re here with our regular Friday episode, which means lots of venture rounds and new venture capital funds to dig into. Thankfully we had our full contingent on hand: Danny “Well, you see” Crichton, Natasha “Talk to me post-pandemic” Mascarenhas, Alex “Very shouty” Wilhelm and, behind the scenes, Chris “The Dad” Gates.

Make sure to check out our IPO-focused Equity Shot from earlier this week if you haven’t yet, and let’s get into today’s topics:

• Instacart raises $225 million. This round, not unexpected, values the on-demand grocery delivery startup at $13.7 billion — a huge sum, and one that should make it harder for the well-known company to sell itself to anyone but the public markets. Regardless, COVID-19 gave this company a huge updraft, and it capitalized on it.
• Pando raises $8.5 million. We often cover rounds on Equity that are a little obvious. SaaS, that sort of thing. Pando is not that. Instead, it’s a company that wants to let small groups of individual pool their upside and allow for more equal outcomes in an economy that rewards outsized success.
• Ethena raises $2 million. Anti-harassment software is about as much fun as the dentist today, but perhaps that doesn’t have to be the case. Natasha talked us through the company, and its pricing. I’m pretty bullish on Ethena, frankly. Homebrew, Village Global and GSV took part in the financing event.
• Vendr raises $4 million. Vendr wants to help companies cut their SaaS bills, through its own SaaS-esque product. I tried to explain this, but may have butchered it a bit. It’s cool, I promise.
• Facebook is getting into the CVC game. This should not be a surprise, but we were also not sure who was going to want Facebook money.
• And, finally, Collab Capital is raising a $50 million fund to invest in Black founders. Per our reporting, the company is on track to close on $10 million in August. How fast the fund can close its full target is something we’re going to keep an eye on, considering it might get a lot harder a lot sooner. 

And that is that; thanks for lending us your ears.

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The tech industry has generally wished that structural discrimination would go away, while pretending that it already has. But technology can be used by anyone for anything. And so, the world has watched video after video of police brutality against Black people in a real-time stream that plays through the closing days of quarantine, culminating in the death of George Floyd and ongoing protests. As employees have left their remote offices to hit the streets, even executives at the largest tech companies —who would usually avoid such complications — have expressed their support officially, online.

What can we expect to change now? After all, diversity and inclusion programs have been getting cut during the pandemic, and stats on employee diversity and VC partner/portfolio demographics have not seemed to be improving quickly over the past decade, at least in aggregate.

First up, a group of Black tech leaders in the Bay Area, including TechCrunch’s Megan Rose Dickey, has put forward a widely-signed petition that specifies five goals including local support and accountability, and commitment to hiring and investing in Black employees and founders.

On the ground in the startup world, a considerable range of investors say they are setting aside dedicated time and resources for Black founders.

Specific proposals for changes to the status quo strike at the heart of of tech as we know it.

To address existing systemic bias, algorithmic and otherwise, contributor Will Walker writes that tech companies like Amazon, Yelp and Grubhub should find ways to feature and favor Black-owned businesses — even if that means re-writing the recommendation algorithms.

And to address systemic bias in who gets funding, Connie Loizos writes that legislation could be the best answer:

Consider that already, most VCs today sign away their rights to invest in firearms or alcohol or tobacco when managing capital on behalf of the pension funds, universities and hospital systems that fund them. What if they also had to agree to invest a certain percentage of that capital to founding teams with members from underrepresented groups? We aren’t talking about targets anymore, but actual mandates. Put another way, rather than wait for venture firms to organically develop into less homogeneous organizations — or to invest in fewer founders who share their gender and race and educational background — alter their limited partner agreements.

Perhaps tech leaders are responding so strongly today because they realize what’s at stake for them if change does not happen faster?

The future of work, according to the people trying to invest in it

Meanwhile, the very nature of work as we know it is being re-evaluated. Megan caught up with top investors in a very popular investor survey for Extra Crunch this week, to better understand the problems and solutions. Here’s what Ann Muira-Ko of Floodgate Capital thinks will create unicorns, as a sample:

• How do you enable solopreneurs to build businesses that are fully tech-enabled? We think of this as the ironman suit for the solopreneur. What financial products and software products can solopreneurs use to provide consumers or their customers with the tech-enabled experiences they have come to expect?
• How does reputation follow someone? A resume or LinkedIn profile measures where you’ve worked and for how long. With people working more jobs at varied locales, measuring expertise will become a new challenge.
• How does an organization maintain knowledge? If a company is reliant on its people to share its history and knowledge base, how can that be disseminated without relying on internal experts (who are on the decline)?
• How should productivity tools (calendars & communication) and enterprise systems (CRM, HR, Finance, etc.) adapt to a multi-modal (work from anywhere) work environment? HR is perhaps the most out-of-date, but every tool will require better integration.

If you’re more interested in the cybersecurity aspects of remote work, you will want to check out security editor Zack Whittaker’s set of investor surveys this week, including this industry overview and this pandemic-focused one.

Data shows investors are in fact busy looking for deals

Are VCs actually open for business during the pandemic? Docsend, a key inside data source, has a new report out this week that shows investor interest has boomed in April. Here’s CEO Russ Heddleston on TechCrunch, talking about the activity on its document management platform:

After the initial decline in March, founders and VCs both bounced back fairly quickly. In fact, the next week VC interest increased 10% while the number of Founder Links Created increased by 12%. However, for the following few weeks the number of links created by founders either stayed flat or dropped. But that isn’t the case for VCs. Demand for pitch decks rose steadily all the way through the week of April 20th, which was 25% up year-over-year. In fact, seven of the top 10 best days for Pitch Deck Interest in 2020 were in the month of April.

The fundraising inactivity has been on the part of the founders! Meanwhile, in a separate article for Extra Crunch, he shares that investors are spreading themselves broadly.

In the recent weeks, as we’ve had higher than average supply and demand, we’ve watched as the average time spent reviewing a deal has declined. In fact, we’re at nearly a two-year low. The only other period when time spent dropped below where it is now was in early 2018 (which not coincidentally was also when demand was at its highest). Twice in 2018 we saw time spent go below three minutes and we’re currently at 3 minutes and 7 seconds.

How a growth marketer helped his high school brother win at TikTok

In a fascinating oral history of sorts for Extra Crunch, Adam Guild explains how he helped his young brother Topper get more than 10 million followers in under five months. Here’s a free excerpt:

At first, figuring out which content would go viral seemed random. There was no correlation between likes, comments, shares or engagement rate.

What made the difference in his successful content? Topper needed to find out to maximize growth, so he went through his TikTok analytics insights and noticed a trend: his most popular videos weren’t the ones with the highest engagement rates. They were the ones with the highest average view durations.

“I wanted to test if this guess was right,” said Topper, “so I posted a few videos with a longer length and teased people in the captions to watch until the end.”

It worked; his videos started getting more views, but it wasn’t a perfect correlation. Some videos with high view durations weren’t taking off.

When Topper asked me for advice, I suggested that the key metric to nail was actually average session duration. That’s what YouTube optimizes for, so it would make sense that TikTok would do the same. This metric measures how long people actually stay on the platform — not on the video — and it can be increased by single videos.

He posted another video to test: one that encouraged viewers to rewatch repeatedly because it had a cliffhanger ending — Topper poured hundreds of Mentos into a massive container of Coke before cutting out the ending.

That video was his most viewed yet, scoring more than 175,000,000 views. He decided to use that lesson in future videos by creating content that helped get viewers addicted to TikTok while also being fun to watch.

Around TechCrunch

Join us to watch five startups pitch off at Pitchers and Pitches on June 10th

Join Eventbrite CEO Julia Hartz for a live Q&A: June 11 at 3 pm EST/Noon PDT/7 pm GMT

Across the week

TechCrunch:

LinkedIn introduces new retargeting tools

The coronavirus has hastened the post-human era

Zynga acquires Turkey’s Peak Games for $1.8B, after buying its card games studio for $100M in 2017

Huawei’s terrible week

Extra Crunch:

Is Zoom the next Android or the next BlackBerry?

The IPO window is open (again)

Unpacking ZoomInfo’s IPO as the firm starts to trade

SaaS earnings rise as pandemic pushes companies more rapidly to the cloud

What grocery startup Weee! learned from China’s tech giants

#EquityPod

From Alex Wilhelm:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

This week, however, the Equity crew (Danny, Natasha, Chris, and Alex) agreed it felt silly to drum up false enthusiasm for funding rounds and startups. Instead, we talked about a more critical topic: systemic racism in the United States. Venture firms and tech executives across the country are pledging to be better following the brutal murder of George Floyd and police brutality.

Better is long overdue.

What follows are the resources we mentioned — and a few more — on the show itself. We’ll be back. Now is the time for sustained momentum and change.

Donations

• The NAACP Legal Defense and Educational Fund
• Black Visions Collective
• The Anti Police-Terror Project
• Committee to Protect Journalists
• The Marshall Project
• Official George Floyd Memorial Fund

How to be a better ally

• More resources on how to support Black Lives Matter
• How to make this moment the turning point for real change
• For those who can’t protest, here are ways to support the movement
• Understand the model minority myth
• The social contract
• Resources fo Non-black individuals and people of color

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

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Editor’s note: Get this free weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT). Subscribe here.

Most tech companies base compensation on an employee’s local cost of living, in addition to their skills and responsibilities. The pandemic-era push to remote work seems to be reinforcing that — if you only skim the headlines. For example, Facebook said last week that it would be readjusting salaries for employees who have relocated away from the Bay Area.

But Connie Loizos caught up with a few well-placed people who see something else happening. First, here’s Matt Mullenweg, CEO of Automattic (WordPress), which has been almost entirely remote for its long and successful history.

“Long term, I think market forces and the mobility of talent will force employers to stop discriminating on the basis of geography for geographically agnostic roles,” he told Connie for TechCrunch. 

Mullenweg went on to detail how the process was still complicated, and that his company did not yet have a universal approach. But ultimately, he thinks that for “moral and competitive reasons, companies will move toward globally fair compensation over time with roles that can be done from anywhere.”

Connie also talked to Jon Holman, a tech recruiter who is living and breathing the new world, in a separate article for Extra Crunch. The market forces will ultimately favor talent, he concurs, and companies that want talent will pay according to what they can afford. “If a good AI or machine learning engineer is working elsewhere and demand for those skills still exceeds supply,” Holman explained, “and his or her company pays less than for the same job in Palo Alto, then that person is just going to jump to another company in his or her own geography.”

Taking stock of the future of retail

Our weekly staff survey for Extra Crunch is about retail — will it exist? how? A few of our staffers who cover related topics weighed in:

• Natasha Mascarenhas says retailers will need to find new ways to sell aspirational products — and what was once cringe-worthy might now be considered innovative.

• Devin Coldewey sees businesses adopting a slew of creative digital services to prepare for the future and empower them without Amazon’s platform.

• Greg Kumparak thinks the delivery and curbside pickup trends will move from pandemic-essentials to everyday occurrences. He thinks that retailers will need to find new ways to appeal to consumers in a “shopping-by-proxy” world.

• Lucas Matney views a revitalized interest in technology around the checkout process, as retailers look for ways to make the purchasing experience more seamless (and less high-touch).

We also ran two investor surveys this week, with Matt Burns producing one on manufacturing and Megan Rose Dickey and Kirsten Korosec following up on their autonomous vehicles series.

How to think about strategic investors (in a pandemic)

Maybe you could use some more money, distribution and partnerships these days? Those are the eternal lures of corporate venture funding sources, but each strategic VC has a different mandate. Some are there to help the parent company, some are just there to make money… and some may be on thin ice themselves given the way that they get money to invest.

If you’re taking a fresh look at getting strategic funding now, check out this set of overview articles from Bill Growney, a partner at top tech law firm Goodwin, and Scott Orn of Kruze Consulting. The first, for TechCrunch, goes over how corporate funds are typically structured (and motivated). The second, for Extra Crunch, covers questions for startup founders to anticipate and other recommendations for dealing with this type of VC.

Calm chooses a more enlightened path to growth

It is high times for meditation and “mindfulness” apps, as people look for ways to adjust to pandemic life. Sarah Perez, our resident app expert, took a look at a new app store analysis on TechCrunch, shredded some of the top-ranked companies for opportunistic marketing, and came away with a positive feeling about the global market leader.

Calm, meanwhile, took a different approach. It launched a page of free resources, but instead focused on partnerships to expand free access to more users, while also growing its business. Earlier this month, nonprofit health system Kaiser Permanente announced it was making the Calm app’s Premium subscription free for its members, for example — the first health system to do so.

The company’s decision to not pursue as many free giveaways meant it may have missed the easy boost from press coverage. However, it may be a better long-term strategy as it sets up Calm for distribution partnerships that could continue beyond the immediate COVID-19 crisis.

Mindfulness pays. On that note, subscribers can read her excellent This Week In Apps report every Saturday over on Extra Crunch.

Around TechCrunch

TechCrunch’s Early Stage, Mobility and Space events will be virtual, too

Win a Wild Card to compete in Startup Battlefield at Disrupt 2020

Extra Crunch Live: Join Initialized’s Alexis Ohanian and Garry Tan for a live Q&A on Tuesday at 2pm EDT/11am PDT

Join GGV’s Hans Tung and Jeff Richards for a live Q&A: June 4 at 3:30 pm EDT/12:30 pm PD

Across the week

TechCrunch

AI can battle coronavirus, but privacy shouldn’t be a casualty

Living and working in a worsening world

How to upgrade your at-home videoconference setup: Lighting edition

Equity Morning: Remote work startup fundings galore, plus a major court decision

Extra Crunch

API startups are so hot right now

Investors say emerging multiverses are the future of entertainment

Dear Sophie: Can I work in the US on a dependent spouse visa?

Fintech regulations in Latin America could fuel growth or freeze out startups

The secret to trustworthy data strategy

#EquityPod

From Natasha:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines. This week’s show took a break from regularly scheduled programming. Our co-host Alex Wilhelm, who usually leads us through the show, was on some much-deserved vacation, so Danny Crichton and Natasha Mascarenhas took the reigns and invited Floodgate Capital’s Iris Choi to join in on the fun. It’s Choi’s fourth time being on the podcast, which officially makes her our most tenured guest yet (in case the accomplished investor needs another bullet point on her bio page).

This week’s docket features scrappiness, a seed round and a Startup Battlefield alumnus.

Here’s what we chewed through:

• LeverEdge raised seed funding to get you and your friends a volume discount on student loans. Fintech has been booming for years now, and startups often crop up around the painful world of student loans. Yet this startup still caught our eye, and it has a little something to do with its choice to use collective bargaining power as its modus operandi.
• Stackin’ raised a $12.6 million Series B for a text-messaging service that connects millennials to money tips, and eventually other fintech apps. According to CEO Scott Grimes, Stackin’ wants to be the “pipes that port people around fintech.” We get into if the world needs a fintech app marketplace and how it targets younger users.
• D-ID, a Startup Battlefield alumnus, digitally de-identifies faces in videos and still images and just raised $13.5 million. We’re all worried about our privacy concerns, so the funding news was a refreshing change of pace from the usual headlines we see around surveillance. Now the company just needs to find a successful use case beyond the goodness in people’s hearts.
• ByteDance, the Chinese parent company that owns TikTok, hit $3 billion in net profit last year, reports Bloomberg. TikTok also recently snagged former Disney executive Kevin Mayer for its CEO. This one, as you can expect, made for an interesting conversation around privacy and bandwidth. We even asked Choi to weigh in on Donald J. Trump’s recent tweet threatening to regulate social media companies, as Floodgate was an early angel investor in Twitter.
• We ended with a roundtable of sorts on how the future of work will look and feel in our new world, from college campuses to offices. We get into the vulnerability that comes with being on Zoom, the ever-increasing stupidity of “manels” and how tech talent might be flocking to smaller cities but investors aren’t just yet.

And that was the show! Thanks to our producer Chris Gates for helping us put this together, thanks to you all for listening in on this quirky episode and thanks to Iris Choi for always bringing a fresh, candid perspective. Talk next week.

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Editor’s note: Get this weekly recap of TechCrunch news that any startup can use by email every Saturday morning (7am PT), just subscribe here.

Commercial real estate, the traditional heart of most cities, may have lost its reason to exist in the last few months. The world is about to find out what the situation is as more locations start to reopen.

First up in our ongoing coverage of the topic, Connie Loizos caught up with a couple proptech investors this week for TechCrunch, who saw existing trends accelerating — with many medically focused additions.

Brendan Wallace of Fifth Wall is looking for more aggressive pickup of smart tech in general, along the lines of what you already see in some other countries. “He notes sensors that can determine how many people are in a room or pass through a turnstile. He points to facial recognition tech that can help keep points of physical contact to a minimum. He imagines that more companies might embrace robots to patrol buildings and, possibly, to clean them, too.”

Darren Bechtel of Brick and Mortar saw tech remaking the construction site, with growing practices like using large-scale pre-fabricated components: “If you’re limited by how many people can work in the field, and you have to put in controls for people not working on top of each other, the question becomes: how can you do the work in a more controlled environment, with a next-gen HVAC system [to purify the air] and markings on the floor?…. People are now saying, ‘How much can we prepare off-site?’”

Buildings are also going to be focused on health features, Connie wrote. “[B]oth Wallace and Bechtel mentioned advanced air purifiers and air handling units used to recondition and circulate air as part of a heating, ventilating and air-conditioning plan. Both say it will likely become a growing area of interest for building owners and developers.”

What about beyond the buildings? A few writers here put together some thoughts in a post for Extra Crunch. Here’s Danny Crichton’s view from Brooklyn:

Few of us can live in the dreary confines of a suburban enclave our entire workweek. And so I expect to see a revitalization of the classic Main Street clusters that once dotted towns across America as people appreciate the close proximity of amenities that they need throughout their day and remote work makes it possible to skip the commute to the central business district.

It’s not going to be a simple transition, of course. The built environment alone will probably take decades to fully transition. But the spirit of Jane Jacobs lives on and will move beyond the downtown core neighborhoods she observed to spread to medium and perhaps even small towns across the country and throughout the world.

If you want more on the topic, check out our recent investor survey with six other top proptech investors from late March (for subscribers).

Just want to settle down at home and get to work? Check out Darrell Etherington’s TechCrunch guide to setting up a pro-grade videoconference studio.

The $100M ARR club continues to grow, despite everything

When Alex Wilhelm rejoined TechCrunch late last year, he kicked things off with a list of companies that he called “the $100M ARR club” to signify unicorns that were also generating a lot of revenue. It was a clever way of organizing which of the hundreds of highly valued companies heading towards IPOs were most set up for success, and our readers agreed.

But, with entire market categories whipsawed by the pandemic, it has been hard to find companies willing to share numbers lately. He still found a few, as he wrote up for Extra Crunch this week: ActiveCampaign, Recorded Future and ON24. Here’s a vignette from the CEO of ActiveCampaign:

While we had the CEO’s attention, TechCrunch wanted to know if ActiveCampaign was taking incoming fire from COVID-19 and its related economic and labor disruptions. As some other SMB-focused software companies have told us, the answer is no. Here’s [Jason] VandeBoom:

We anticipate continued growth in 2020 and are already seeing further acceleration to support this. The past four months have been the best in company history and we’ve seen monthly trials double in that timeframe and new customer acquisition numbers at 4500, 5500, 6000 and 7000 respectively from January to April.

He did hedge those results a little, adding that while his firm has “seen some acceleration from COVID-19 and the digital transformation that it is inspiring,” the CEO is more convinced that “the need for customer experience is what is fueling the majority of this growth.”

This week in China trade news….

The already basic trade agreement between the Trump administration and the Chinese government from last year looks ready to blow up; the administration banned selling more tech to Huawei; TSMC plans to open a factory in Arizona following urging from the US government; Foxconn profits crashed… Danny Crichton has a clear takeaway on TechCrunch for startups about the latest headlines:

[T]he world of semiconductors, of internet infrastructure, of the tech ties that have bound the U.S. and China together for decades — they are frayed and are almost gone. It’s a new era in supply chains and trade, and an open world for new approaches to these huge existing industries.

If your company is not already planning for a more chaotic, multi-polar world than what most of us can remember living through, it may already be too late.

(Photo by CHRISTOPHE ARCHAMBAULT/AFP via Getty Images)

Investor survey: hospitals to increase tech focus after pandemic

Sarah Buhr talked to top investors in the healthcare B2B and infrastructure businesses for one of our investor surveys this week on Extra Crunch. They generally seemed to agree that the pandemic was going to push the system wholesale towards better technology. Here’s Bilal Zuberi of Lux Capital:

While a lot of our healthcare infrastructure will take a little bit of time recovering from the stress COVID placed on it, we anticipate this to provide a push to the system to adopt new technologies that enable distributed health, build resiliency in our delivery networks and deploy data-enabled healthcare. Hospital balance sheets might struggle in the short term to buy new technologies, but payers as well as large businesses might participate in infrastructure development and deployment in a bigger way. We anticipate selling to hospitals to be difficult in the short term, as they try to recover from the revenue shortfall they experienced during COVID-19, but will generally emerge more interested in adopting new technologies, digital and remote health solutions and automation in various functions. Needless to say, a wide-scale digital transformation of our healthcare industry is underway, and there is no looking back.

Don’t miss our other survey this week, on how the mobility investors are viewing the pandemic.

Protecting your equity as a startup employee

Wouter Witvoet of fintech startup SecFi wrote a guest post for TechCrunch going over some key points for anyone working at a startup right now (or recently). As an occasional startup founder and/or employee myself, I’d like to recommend this one for special consideration: “Negotiate for equity during a pay cut or furlough.”

Startups typically offer equity as a means of deferred compensation and as a way to incentivize employees to own a piece of the company they are building. The compensation is deferred as most startups are cash-strapped and cannot afford to pay you what a larger company may be able to.

If your company is now asking you to take a pay cut, or even take no pay during this time, you should consider asking for additional equity to make up for the lost compensation. While not all companies may be amenable to offering more equity, there is no cash outlay from the company’s standpoint, so it’s an efficient way for your company to compensate you for your sacrifice while preserving their cash.

In addition, offering more equity shows a commitment from management to their employees during this difficult time. It may be the win-win scenario for your company and yourself in the long-run so it’s worth having the conversation with management to discuss if this is available for you.

At first it seems weird when you consider typical venture dynamics. The founders have probably already lost leverage against the company’s investors. These investors have probably already lost leverage against their LPs. So nobody is naturally included to give up even more. And the employees were already last in line on the cap table and first to go, so why should founders do anything different?

Tactically, the best employees will be attracted go work at bigger more stable companies as the pandemic recession stretches on — and you might not have the cash to afford the effort to rehire. Strategically, now is the time to build the esprit de corp that will carry your company forward into better times… a few extra basis points for the team now could help deliver a priceless return.  

Across the week

TechCrunch

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AngelList wants to improve comparing VC fund performance with new metrics and calculator

Seven viral futures

Where to shop online that isn’t Amazon, Target or Walmart

Extra Crunch

4 edtech CEOs peer into the industry’s future

Sequoia’s Roelof Botha is more optimistic about startups today than he was a year ago

These best practices maximize the value of your online events

Fintech startups amass war chests for the economic downturn

Around TechCrunch

Give the gift of Extra Crunch membership to anyone

Extra Crunch Live: Join Alexia and Niko Bonatsos for a Q&A May 19th at 2 pm EDT/11 am PDT

Extra Crunch Live: Join Revolution’s Steve Case and Clara Sieg on May 21 at 3pm ET/12pm PT

#EquityPod

From Alex:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Are you a regular Equity listener? Take our survey here! We talk about it on the show.

From home once again this week, Danny, Natasha, Alex and Chris got together to pull the show together. But unlike last week’s episode (catch up here if you are behind), this week’s show features a game that actually worked. It’s at the end, as you’ll see.

But before that piece of the puzzle, there was a bunch of news to go over. We had to leave SaaS valuations, the Liftoff List, Brex and FalconX on the floor, but there was still so much good stuff to cover:

• Slice raised $43 million from KKR, making us all rather hungry — and curious. Where does Slice fit into the food-delivery market, and does its restaurant-friendly model give it enough room to grow revenue so that its new valuation makes sense?
• The Uber Eats-Grubhub deal was an unavoidable topic this week, given that it has the chance to remake the food delivery landscape. What room would be left in the market for Postmates? And would it pass regulatory scrutiny? We’re curious.
• Sticking to the on-demand theme, Instacart has grown bonkers-quick in the last few months, even making some money in the process. We’re impressed.
• It’s not the only thing out there growing like hell — Shopify is also putting up insane numbers, as reflected in its share price. TechCrunch took a look back through its history the other day.
• The secondary markets saw some consolidation this week, which brought back some fond memories.
• Quizlet raised $30 million at a $1 billion valuation, causing some consternation among the hosts. And Vise raised a more modest $14.5 million in a round that Danny covered.

Then we played our game. Please hold us to account. And if you have listened to the show for a while, take our survey! It’s right after this next sentence.

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

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Editor’s note: Get this weekly recap of TechCrunch news that any startup can use every Saturday morning by email (7am PT). Subscribe here.

A specific type of small startup has a window to raise crowdfunding in a somewhat less regulated way than normally required in the U.S., based on a temporary set of rule changes by the Securities and Exchange Commission announced this week. Excited yet?

The new terms are generally geared towards the millions of mom-and-pop businesses that were the intended recipients of the PPP grants, who did not actually receive those grants as needed, as Jon Shieber covered on TechCrunch this week. However, this grim fall-back measure to stave off disaster for a key part of the economy is also a way for small startups to start creating jobs a little faster, potentially. One of the main adjustments: if you’re looking to raise between $107,000 and $250,000, you don’t need to have your financial statements reviewed first by an outside auditor. Instead, the SEC says you just need “[f]inancial statements of the issuer and certain information from the issuer’s Federal income tax returns, both certified by the principal executive officer.”

The catch is you still have to follow a long list of other do’s and don’ts provided by the SEC, such as being in business least six months prior, and clear disclosures to investors about your financial reliance on this “relief.” The temporary permissiveness is set to expire by August 31.

Investors bet big on robotic automation during the pandemic

Automation will happen at an even more foundational level than one might guess as supply chains try to resolve huge new types of kinks. Here’s how Shahin Farshchi of Lux Capital describes it, in a sample from one of our investor surveys on Extra Crunch this week.

COVID-19 revealed that our just-in-time manufacturing and logistics infrastructure cannot react to unexpected change. We expect the best practices of tech companies: rapidly adopting new tools and quickly iterating on their products and processes to become common in the realm of manufacturing and logistics. Engineers will be handed credit cards to try the latest tools, building on open source will be widely embraced, and making bets on products from startups will become the norm in this industry which has its roots in the industrial revolution.

Where are the opportunities? Here’s DCVC’s Kelly Chen:

Despite the storm, we are optimistic about a number of things:

• As the crisis spotlighted, global supply chains are a delicate balance of factors that can easily be disrupted. In addition to growing labor costs, regulatory uncertainty, and higher international shipping costs, we believe companies will increasingly innovate on domestic manufacturing channels. “Bring manufacturing home” is a cry reverberating across many industries in many countries.
• Online commodity retail is finally getting a kick in the tail. Last year, 4% of groceries were ordered online. In a recent large survey after COVID-19, a third of respondents ordered groceries online, many for the first time. The traditional two-day delivery will benefit, but we think momentum will shift to micro-fulfillment, where large hubs will service distributed local warehouses that are much closer to the customer, auto-fulfilling orders within hours.
• Separate from fulfillment, we believe the hundreds of thousands of new manual delivery jobs will endure. We predict it will be years before tech allows for scalable automated door-to-door delivery.
• As employers explore tech to automate labor in tough times, they find that humans are incredibly difficult to replace. At DCVC, we like tech that automates the kind of tasks that could never be done at human scale — things that scale the value of human skills, not replace them.

We also published a survey on media startup investing this week, and another on gaming technology infrastructure.

The benefits of a commercial real estate collapse in SF

Full-time CTO and long-time TechCrunch columnist Jon Evans has a fun muse for any reader who is looking to stay in the Bay Area and also pay less for housing. What is going to happen to all of the commercial real estate that is getting rendered obsolete as many companies go big on remote? Presumably a lot more housing stock. Here’s a taste of the full thing over on TechCrunch:

Consider San Francisco, everyone’s favorite overpriced, overcrowded, inequality poster child. It has roughly 150 million square feet of combined office and retail space at the moment. If the COVID-19 lockdown-then-recession eventually eats 20% of that — which is plausible between the retailpocalypse and what I will christen the “officepocalypse,” i.e. the revealed cost savings of working from home — that’s 30 million square feet of empty space.

If converted to housing, this could increase the city’s total housing stock by well over 10%. That would drive prices and rents, already pressured by the recession, way down — while presumably still remaining simultaneously profitable, since current prices are so high. Needless to say this conversion would also create a lot of jobs. (Although, in some cases, no conversion will be required.)

The rebirth of the vertical B2B marketplace startup

It was one of those seemingly guaranteed winners of the dot-com bubble, that got torched along with most other ideas around back then. Today, marketplaces for businesses in complex supply chains are back in vogue, Shieber writes for Extra Crunch this week. The original thesis was that “thousands of small businesses were making specialized products consumed by larger businesses in huge industries, but the reach of smaller players was limited by their dependence on a sales structure built on conferences and personal interactions.”

The opportunity has been clarified over the course of the past decade.

The first sign of life for the directory model came with the success of GoodRX back in 2011. The company proved that when information about pricing in a previously opaque industry becomes available, it can unleash a torrent of new demand.

“GoodRX did this to huge success,” said Shaun Maguire, a partner at Sequoia Capital, who invested in Knowde, a marketplace that follows a similar model. “The idea of crawling the public internet and creating structured data and winning SEO or doing SEO for the first time for something so you get a lot of traffic from buyers so you have something to offer sellers so you can get the sellers to cooperate with you… that playbook can be taken to many different industries.”

Across the week

TechCrunch:

This early Facebook investor wants to find smart students a job at the next Facebook

We need more video games that are social platforms first, games second

Tech for good during COVID-19: Sky-high gifts, extra help and chips

Data shows which tech roles might be most vulnerable amid layoffs

Latin America Roundup: Big rounds, big mergers and a $3.8M pandemic fund from Nubank

Extra Crunch:

AR is the answer to plummeting retail sales during lockdown

TechCrunch’s top 16 picks from Techstars April virtual demo days

Longtime VC Todd Chaffee of IVP says late-stage scene is now ‘M&A world’

As private investment cools, enterprise startups may try tapping corporate dollars

The great unicorn retreat

Around TechCrunch

Student Discount: Join Extra Crunch for $50 per year

Extra Crunch Live: Join Kirsten Green for a Q&A next Tuesday at 8 a.m. ET/11 a.m PST/6 p.m. GMT

Hear how to build a sales team at Disrupt SF 2020

Grab your Disrupt Digital Pro Pass today for Disrupt SF 2020

#EquityPod

From Alex Wilhelm:

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Every week we write this post with some opening line akin to wow, what a week, huh? This is yet another one of those weeks. Perhaps this is just life now, and every week will stretch before us, similar to what Gandalf said after killing that Balrog, that “every day was as long as the life age of the Earth.”

Anyhoo, we recorded Equity to try and make a little sense of the week as there was a lot going on. So, Natasha, Danny, and Alex once again gathered to parse it all. Here’s a rough digest of the topics from this episode:

• Techstars’ virtual demo days. Natasha and Alex are listening in to as many Techstars  virtual demo confabs as they can along with other TC staff, pulling out favorites as we go. Today we dug into what is working, and what isn’t with virtual demo days.
• While VC Twitter might make it seem like every firm is open for business, that is not the reality. We talk about signaling risk, external signs a firm is investing, and throw pro rata chat around in between.
• Peanut, a social network for women, raised $12 million and that is the good news we needed this week. Think of it as a better, cleaner and more intimate version of your favorite Facebook group. About 1.6 million are on the platform.
• Every Mother raised a small sum to bring safety and community to pre and post natal workouts for mothers.
• Robinhood’s Series F. The new Robinhood  round values the company at around $8.3 billion, a huge number but one that wasn’t as high as we might have expected, given how much its valuation used to grow between new funding events.
• Airbnb cut 1,900 people in a devastating round of layoffs for the travel and hospitality company. We discuss o-founder and CEO Brian Chesky’s detailed blogpost about the cuts, and whether it is better to be a public or a private company during this pandemic.
• Uber cut staff this week, and pumped money into a massive Lime downround that may see it offload its own micromobility business onto the smaller company. Not a good week for Uber, not a good week for Lime.

We didn’t get to chat API funding rounds or the unicorn retreat, or even really riff on earnings. There’s so much going on! But, we’ll be back Monday morning so sit tight.

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