Consumers Worried About Privacy Rights During and After Pandemic Response

As governments across the world look towards curbing the spread of COVID-19 and plug holes in the health care system, a debate has resurfaced over the issue of privacy. This is because medical data companies, governments, and international agencies accessing this information is now a real issue.

Stances on Pandemic Privacy

This has brought to the fore issues on what part of an individual’s personal data should be put in the public’s purview. According to a survey by cybernews, Americans truly value their privacy. Most would oppose intrusive technological measures such as tracking apps to contain the spread of the virus. Even when faced with a major global health threat like the coronavirus.

These concerns stem from the fear such measures will open the doors to greater government surveillance. Especially in the long term, even after the pandemic is over.

In the survey, taken earlier this month, there is a huge support for upholding personal privacy. In fact, 89% of the respondents say they either support or strongly support privacy rights. Over half also (52%) believe retaining their personal privacy is more important than surrendering it to the authorities. Even if it is in order to fight the spread of the pandemic.

Fear of the government’s overreach and intrusions into private data has also prompted almost two thirds (65%) to disapprove of the government collecting their data or using facial recognition to track their whereabouts.

The Survey in Context

The survey was conducted to gauge sentiments among Americans as governments across the world are deploying advanced surveillance methods to track and quell the spread of the COVID-19 pandemic. In this case countries like Singapore, Spain and Poland are introducing or preparing to introduce mandatory geolocation and surveillance applications to track COVID-19.

The survey quizzed Americans on four hypothetical scenarios. In the first scenario, almost half (43.19%) say they oppose allowing apps to monitor their geolocations. This is even if they get lower insurance premium rates when they obey the government lockdown. Respondents in favor (27.33%) of the monitoring is almost the same as those who are not sure (29.48%).

The second scenario is whether to grant permission to a state-sponsored app to display your location to others in your city if you contracted COVID-19. Again a majority were in the nay (47.97%). Surprisingly more than a quarter (30.36%) say they will consent while 21.67% didn’t make up their mind.

The third scenario is on the possibility of granting permission to a state-sponsored app to analyze location data transmitted by your phone to determine how many people were abiding by lockdown orders. Again the majority (41.99%) say they will not give permission. However, 36.25 % say they will allow the app to track their whereabouts.

In the fourth scenario, the government makes it mandatory to track people’s locations in an affected area. In this case, 36.89% are on the fence; they are neither negative or positive. Those who viewed it negatively accounted for 29.64% of the respondents, while 16.49% are adamantly against it. Only 9.40 say they are positive, while 7.57% are very positive.

Where do Americans Stand on Personal Privacy

Across the board, the survey indicates Americans strongly value their privacy above everything else. More than half of Americans (52%) believe retaining their personal privacy is more important than surrendering it to the authorities in order to fight the spread of the pandemic. Furthermore, almost two thirds (65.42%) disapprove of the government collecting their data or using facial recognition to track their whereabouts.

The source of distrust seems to stem from fear the government will use these tracking measures for greater surveillance after the pandemic. With an overwhelming 73.7 % saying they are either worried or very worried the pretense of encroaching on private data over the pandemic could be a precursor for greater government surveillance. For the optimists among the respondents, only less than 10% say they are not worried at all.

Even though these scenarios are hypothetical, they point to the need for businesses to be open to any scenario. This is because the COVID-19 pandemic is introducing unchartered waters. Despite the sentiments of small business owners, you have the duty to protect the privacy of your customers. You also have to adhere to state and federal regulations if they become law.

What you can do as a business is to get up to speed on any laws. As well as the possible effects it might have in the event such surveillances become mandatory? This will help you be upfront with your customers and provide information on how those measures can affect them.

Despite what sentiments your customers have towards privacy, you would be showing you have gone out of your way to explain and help your customers navigate the intricacies of any legislation or regulations.

Image: Depositphotos.com

This article, "Consumers Worried About Privacy Rights During and After Pandemic Response" was first published on Small Business Trends

How this startup built and exited to Twitter in 1,219 days

By the summer of 2016, Marie Outtier had spent eight years as a consultant advising media agencies and martech companies on marketing growth strategy.

Pierre-Jean “PJ” Camillieri started as a music software engineer before joining one of Apple’s consumer electronics divisions. Inspired by Siri, he left to start Timista, a smart lifestyle assistant.

When the two joined forces to co-found Aiden.ai, the combination was potent — one was a consummate marketer, the other, a specialist in machine learning. Their goal: create an AI-driven marketing analyst that offered actionable advice in real time.

Humans who manage ad campaigns must analyze vast amounts of numbers, but Outtier and Camillieri envisioned a tool that could make optimization recommendations in real time. Analytics are vast and unwieldy, so theirs was a no-brainer proposition with a market crying out for solutions.

The company’s first office was at Bloom Space in Gower Street, London. It was just a handful of hot desks and a nearby sofa shared with four other startups. That summer, they began in earnest to build the company. A few months later, they had a huge opportunity when the still 100% bootstrapped company was selected for Techcrunch Disrupt’s Startup Battlefield competition.

Interviewed by TechCrunch, they explained their proposition: Marketers wanted to know where a digital marketing campaign was getting the most traction: Twitter or Facebook. You might need to check several dashboards across multiple accounts, plus Google analytics to compile the data — and even if you conclude that one platform is outperforming the other, that might change next week as users shift attention to Instagram, potentially wasting 60% of ad spend.

Aiden was intended to feel like just another co-worker, relying on natural language processing to make the exchange feel chatty and comfortable. It queried data from multiple dashboards and quickly compiled it into flash charts, making it easy to find and digest.

Eventually, instead of managing 10 clients, marketing analysts would be able to manage 50 using dynamic predictions as well as visualizations. Aiden incorporated Outtier’s expertise into its algorithms so it could suggest how to tweak a Facebook campaign and anticipate what was going to happen.

Was appearing at Disrupt a significant moment? “It was a big deal for us,” says Outtier. “The exposure gave us ammunition to raise our first round. And being part of the Disrupt Battlefield alumni gave us many meaningful networking and PR opportunities.”

A few weeks later the company had raised a seed round of $750,000. But not without difficulty. By this time Outtier was in the latter stages of pregnancy. Raising money under these circumstances was difficult, but, she says, “it can be done. It’s tougher than ‘normal circumstances.’ It’s a bit like running a marathon, but with a fridge on your back.”

Smart home startup Josh.ai raises $11 million to offer a home assistant alternative to Alexa

Directly taking on Google and Amazon generally seems to be an ill-advised strategy for a young startup. It’s even more complicated when you’re competing on the home assistants front, a technically complex, capital-intensive future platform into which both tech giants have dumped substantial sums.

Over the past few years, the small smart home startup Josh.ai has attempted to do just that, capitalizing on public distrust of the big voice platforms to sell an intelligent assistant to users weary of sticking a Google or Amazon-owned microphone in their homes. The company has built its business catering to customers seeking professionally installed pricey outfits in their home, costing upwards of $10,000 on the high end.

The company just secured its largest funding round to date, an $11 million Series A round, which brings the startup’s total funding to $22 million. A spokesperson for Josh.ai said their investors have asked not to be named, though he confirmed the round was led by corporate investors.

For people with an Echo Dot or Google Mini in their home, Josh.ai’s approach feels familiar. The platform boasts a number of third-party integrations, so you can use the platform to switch off lights, turn on devices, play music and answer some simple commands. Basically, the bulk of home-centric commands popular on Google Assistant and Alexa.

The startup recently introduced Josh Micro, its own take on the Echo Dot. It has a futuristic vibe and, because it’s installed by professionals, users are privy to a sleek look with wires neatly tucked away inside walls. CEO Alex Capecelatro says their competitors in the professionally installed space have been pushing wall-mounted screens with UIs that often aren’t updated and don’t age well. He hopes their more low-key display-free devices can keep less focus on the hardware and more attention on their software.

“Our philosophy is that you shouldn’t be talking to a puck, it should feel fully immersive,” he says.

Capecelatro had originally seen the best path to existing alongside Google and Amazon as working with them and leveraging their platforms, but he soon found that not working with them proved to be the startup’s biggest asset.

“In terms of direction, what became really clear in the past three years was the importance of privacy,” Capecelatro told TechCrunch. “A lot of our clients are just people who care about their privacy; it’s part of every conversation.”

On the tech side, Capecelatro says the startup’s platform is designed around its own natural language processing stack, so most voice requests can be processed locally, though the startup does leverage tech built by Google and Microsoft to handle speech-to-text processes. While the company uses anonymized data to improve its services, the startup has also introduced specific software features to keep privacy-focused users satisfied including their own take on a smart home incognito mode.

There are few silver bullets in smart home tech, and robust third-party support often leaves room for uncertainty, which in Josh’s case can mean the difference between lights turning on or staying off. Capecelatro says ensuring smooth compatibility with supported devices has been a pretty big focus for their engineering team.

“The more things we work with, the more things we have to QA and the more things that could be impacted,” he says.

While Capecelatro says that around 80-85% of their business goes to single-family homes, he says the startup is starting to find business in commercial sectors, outfitting hotels and condo buildings.

“The reality is we’ve found that the professional installed space is a really big market that the consumer companies don’t really think about,” Capecelatro says. “I think for us the likely future is that we’ll focus on areas where you have a professional installer in a non-residential arena.”

The company says the pandemic has actually given their business a bump, with April being their best month of sales to date as homeowners stuck in their houses look to finally act on long-considered home improvement projects.

10 US Cities Hit Hardest by Coronavirus Unemployment

A staggering 22 million jobs have been lost in the United States during the COVID-19 pandemic so far. To identify which cities are most susceptible to rising unemployment, WalletHub has released a new report.

‘Cities with the Biggest Growth in Unemployment to COVID-19’ identifies where businesses and workers have been worse affected by the pandemic. WalletHub, the personal finance website, compared the unemployment rates of 180 cities across the US. The data compared the unemployment rates in March 2020 to those in March 2019 and January 2020.

10 Cities Hit Hardest by Coronavirus Unemployment

The research found that the ten most affected cities for unemployment during coronavirus are:

1. Seattle, WA
2. Hialeah, FL
3. North Las Vegas, NV
4. Miami, FL
5. Henderson, NV
6. Las Vegas, NV
7. Aurora, CO
8. Denver, CO
9. Cleveland, OH
10. Colorado Springs, CO
11. Reno, NV
12. Dover, DE
13. Orlando, FL
14. Port St. Lucie, FL
15. Salt Lake City, UT
16. Long Beach, CA
17. Santa Clarita, CA
18. Los Angeles, CA
19. Chicago, IL
20. Fort Lauderdale, FL

Unemployment Risen Sharply Since January 2020

One of the worse hit cities Seattle, has seen an 86.92% change in unemployment between March 2020 and March 2019. Between March 2020 and January 2020, the changes to unemployment have been shocking. Hialeah, for example, has witnessed a 145.91% change in unemployment figures during this period.

The report notes how many of the jobs lost in recent weeks have been in non-essential industries. Businesses operating in non-essential industries including tourism, dining and entertainment, have been forced to closed during the pandemic. Even those that have remained open have had to lay off employees and have been hit hard by the shock impact to the economy.

Picking Up After Lockdown Will Be Difficult

The research confirms just how difficult it will be for small businesses in these cities to pick up when lockdown is lifted. The findings highlight the importance of providing local businesses with financial support.

As Jill Gonzalez, WalletHub analyst, commented in a Q&A session:

“Cities can minimize the increase in their unemployment rates by providing support to local industries hit hardest by the COVID-19 pandemic, such as tourism, retail or entertainment. Though cities don’t have control over when these businesses can reopen, they could provide tax breaks (similar to what the federal government is doing) in order to incentivize businesses to keep employees on the payroll.

“Some major city mayors are also drawing money from reserve funds or reallocating money that would have been used for less-essential purposes in order to help workers. Mayors can also use their influence to lobby Congress to provide aid to struggling local communities, which several major city mayors have done so far,” Gonzalez continued.

For small businesses, it is important they are informed about the support available to them. It is vital small businesses take advantage of incentives available to help keep staff on the payroll. By getting such support, small businesses will be better equipped to pick up the pieces when shutdown is lifted.

Image: Depositphotos.com

This article, "10 US Cities Hit Hardest by Coronavirus Unemployment" was first published on Small Business Trends

Plantible raises $4.6 million seed round for an egg white replacement that isn’t aquafaba

When California announced a statewide lockdown, Tony Martens and Maurits van de Ven decided to stay put instead of heading home to Amsterdam.

So, the co-founders of Plantible bought two trailers and started living at their HQ: a two-acre duckweed farm in San Diego.

Plantible uses duckweed, a tiny aquatic leaf, to extract a plant-based protein ingredient that will eventually allow food companies to make animal-based products into plant-based products. The offering would be attractive to companies that make baked goods or protein powder, and thus use lots of egg whites as part of their creation process.

The startup is selling a whey or dairy protein replacement, and is still working on FDA approval.

“We are firm believers that whatever is in nature should be sufficient to provide humanity the ingredients they need,” said Martens from the office trailer.

The startup recently did a series of trials with companies, and Martens says that Plantible validated it can be a replacement with baking ingredient companies and plant-based meat sellers. But the startup is not limited to current use cases.

“If the sector we had our eyes on is taking a while, but sports nutrition is taking off really fast, we’ll go there,” said Martens. “We need to prove the feasibility of our company.”

The trailers where Plantible co-founders have sheltered in place amid COVID-19 lockdowns.

Plantible is entering a crowded space. Recently, aquafaba, the liquid made from a can of chickpeas, has regained popularity amid other quarantine cooking hacks. Martens says that aquafaba might recreate foaminess, but it doesn’t recreate gelation (or the sizzle and fry look that comes when you pour a real egg white into a hot pan). Plantible claims to offer an egg-white replacement with no compromises on texture or nutrition.

The startup also has some increasingly well-funded alternative protein competitors. Plantible’s closest venture-backed competitors are Clara Foods and FUMI Ingredients, as both try to create egg-white replacements. Clara Foods uses yeast, instead of chickens, to make egg whites, and similarly sells to businesses that use egg whites in large quantities for items like macaroons, angel food cake and protein powders. It has the backing of Ingredion, a global ingredients solution company.

Plantible needs to have a faster, cheaper and more scalable operation to beat its competitors. From a supply perspective, Plantible is in a good place. Duckweed doubles in mass every 48 hours and grows year-round. Plus, it is more digestible than pea, soy or algae, the company claims.

The real expense comes from the extraction process.

Right now, Martens admits, Plantible is “lab scale, and lab scale is really expensive.”

To bring costs down, the company just raised a $4.6 million seed round, co-led by Vectr Ventures and Lerer Hippeau. Other participants include eighteen94 Capital (Kellogg Company’s venture capital fund) and FTW Ventures.

Plantible co-founders Maurits van de Ven and Tony Martens (from left to right).

Through the new capital, Plantible claims it will be cost-competitive with egg whites. Currently, two pounds of liquid egg whites cost $8 to $10 dollars to make and sell for $15 to $20 dollars.

“In the end it is about developing a scalable and cost-competitive supply chain that produces a desired ingredient. Since it is very hard to compete with nature, we have decided to embrace it as much as possible by identifying a highly functional and nutritional enzyme,” he said.

“The more you can leverage nature, the more scalable you become,” he said.

As with any seed-stage alternative-protein company, the proof that Plantible has legs to succeed will be in sales and capacity to produce. And it’s not quite there yet.

Figma raises $50 million Series D led by Andreessen Horowitz

Figma, the design platform that lets folks work collaboratively and in the cloud, has today announced the close of a $50 million Series D financing. The round was led by Andreessen Horowitz, with partner Peter Levine and cofounding partner Marc Andreessen managing the deal for the firm. New angel investors, including Henry Ellenbogen from Durable Capital, also participated in the round alongside existing investors Index, Greylock, KPCB, Sequoia and Founders Fund.

Forbes reports that the latest funding round values Figma at $2 billion.

Figma launched in 2015 after nearly six years of development in stealth. The premise was to create a collaborative, cloud-based design tool that would be the Google Docs of design.

Since, Figma has built out the platform to expand access and usability for individual designers, small firms and giant enterprise companies alike. For example, the company launched plug-ins in 2019, allowing developers to build in their own tools to the app, such as a plug-in for designers to automatically rename and organize their layers as they work (Rename.it) and one that gives users the ability to add placeholder text that they can automatically find and replace later (Content Buddy).

The company also launched an educational platform called Community, which gives designers the ability to share their work and let other users ‘remix’ that design, or simply check out how it was built, layer by layer.

A spokesperson told TechCrunch that this deal was “opportunistic,” and that the company was in a strong cash position pre-financing. The new funding expands Figma’s runway during these uncertain times, with coronavirus halting a lot of enterprise purchasing and ultimately slowing growth of some rising enterprise players.

Figma says that one interesting change they’ve seen in the COVID era is a significant jump in user engagement from teams to collaborate more in Figma. The firm has also seen an uptick in whiteboarding, note taking, slide deck creation and diagramming, as companies start using Figma as a collaborative tool across an entire organization rather than just within a team of designers.

5 tips for starting a business with a stranger

Sam Pillar Contributor

Sam Pillar is the co-founder and CEO of Jobber, a business management platform for small home service businesses started in 2010 with his co-founder and CTO Forrest Zeisler.

When I first thought of the idea for what would become Jobber, I never could have imagined that I would one day be the CEO of a tech company with nearly 100,000 active customers in more than 45 countries. And that I would do this alongside a complete stranger who I met during a chance encounter at a coffee shop.

When you’re first thinking about starting a company, most people would either go at it alone or partner with someone they know, like a friend, family member, or former colleague. Few would consider pursuing their entrepreneurial dream with a stranger. Without proper due diligence, co-founding a company with a stranger can feel like putting a down payment on a new house without opening the front door. While this might not be the right path for everyone, it was absolutely the best move for me.

Jobber is proof that starting a company with a stranger isn’t just doable, it can even be an advantage.

Pursuing a business partnership without a prior relationship has allowed my co-founder Forrest Zeisler and I to be more honest and forthcoming with each other as we worked toward a clear, common objective from the start. The ability to arrive at big decisions and have productive debate without the baggage and bias of a preexisting relationship helped to establish Jobber’s feedback-oriented culture, which is ingrained in the DNA of the company. I attribute our company’s early success to our focus on building a strong and honest business partnership first.

For aspiring entrepreneurs looking to launch a company, I’ve identified five tips that really helped me build trust, camaraderie and mutual understanding with my co-founding partner — a partnership that can withstand intense competition and the test of time.

Start small and aim big

I didn’t know that Forrest would become my co-founder when we first met. As a self-taught developer, I was looking for more sophisticated development help on the project I was working on. During the early stages of our relationship, I would present a problem, such as technical aspects with code, and he would help me with it. Through these initial interactions, it became clear how Forrest’s mind works, and we learned that we worked really well together. At the time, I wasn’t thinking of these tasks as “tests” on compatibility, but in retrospect, they were. If you can’t overcome the small hurdles amicably and efficiently, then how do you expect to take on the big stuff? It’s not a good sign for a long-term business relationship.

Dribbble, a bootstrapped ‘LinkedIn’ for designers, acquires Creative Market, grows to 12M users

Traditionally dominated by big players like Adobe and Autodesk, the world of design has been flush with a newer wave of startups that are creating collaboration spaces and new cloud-based tools designed to address the needs of creatives today. Today, two of those players are combining. Dribbble, an online community for designers that lets them post their work and look for work, is acquiring Creative Market, a marketplace for ready-to-use fonts, icons, illustrations, photos and other design assets.

Financial terms of the deal are not being disclosed, Dribbble’s CEO Zack Onisko said in an interview. Prior to this, bootstrapped Dribbble was profitable — revenues come from its job boards, advertising and member subscriptions, kind of like a LinkedIn aimed at the design community — and it had 6 million monthly active users, with 3.5 million registered users. Adding in Creative Market will bring the total number of monthly active users across the two sites to 12 million.

The acquisition is happening at a time when we’re seeing some big growth among startups that speaks to how the balance of power is shifting in the world of software aimed at designers.

Just today, Figma announced a $50 million raise at a $2 billion valuation, money that it plans to use for its own spate of acquisitions and investments in more design tools. Canva last year raised funding at a $3.2 billion valuation. Smaller, younger startups like Frontify (which helps companies manage their design assets) have also been raising and Dyndrite have also been raising. Meanwhile, Adobe continues to work on ways to keep its legacy products, like the 30-year old Photoshop (look, it’s a millennial!) relevant.

Indeed, even the concept of who the target audience even is has shifted.

“We talk about designers but really it’s creatives,” Onisko said. “A lot of creatives are multi-skilled and they work in all sorts of different mediums. The historic focus is product and web design but we’ve seen it slide into motion graphics or 3D or photography.”

This is actually the second time Creative Market has been acquired. The startup was first purchased by Autodesk in 2014, at a time when the latter was looking to widen its range of products both to take on Adobe more squarely, and to target more casual and prosumer users as well as to address the wider needs of its core designer community.

That ultimately didn’t work out, and Creative Market was spun out as a startup again in 2017, with $7 million in funding led by Accomplice.

More than two years on from that, it seems that Creative Market saw the logic in coming together with another company for better economies of scale.

And perhaps this time, the acquirer is a better cultural fit. Both companies are pretty distributed and decentralised (making for a very easy transition to working under stay-at-home orders in recent weeks). And it might have helped, too, that Onisko had once previously been Creative Market’s chief growth officer before taking on the role as Dribbble’s CEO.

The plan will be to keep both companies’ brands and teams separate, with Chris Winn continuing to lead Creative Market as its CEO. Creative Market will continue to build out its marketplace of design assets, and Dribbble will continue to position itself as a place for those designers to set out their profiles and connect with those looking to hire them, as well as each other.

“We’re able to do our own thing and beat our own drums,” said Onisko, with the plan being to keep “marching on our own roadmaps.”

Over time, when the time is right, Onisko said there might be an opportunity to integrate the businesses, but that will be in the future.

One area where the two will be coming together right away is in cross-pollinating membership. Up to now, people joined Dribbble by invitation from previous members, which Onisko said was a good way of keeping growth in check and applying a kind of peer-reviewed quality control layer. Now, the idea will be that Dribbble will open up to all new users, and those who are already registered on Creative Market can automatically become members on the sister site.

“The big opportunity is that we can do in 2-3 years what we would have done in 3-5 years as separate companies,” Onisko added.

“We’re so excited to bring together two fully-distributed teams who work everyday to serve the design community,” said Winn, in a statement. “The opportunity for both companies is that much larger thanks to this partnership and I’m so excited to join forces.”

For its part, Onisko said that Dribbble has no intention of changing from its growth course when it comes to finances. The company has always been bootstrapped — that is, surviving with no outside investors — and is profitable. And there are no plans to use this moment to seek outside funding, he added. The company has been approached by interested parties — “all the usual suspects,” he said — for acquisition, Onisko said, but for now that’s also not been something the company has wanted to explore.

“We feel that we’re very much in our infancy,” Onisko said. “We have pretty big ambitions and want to march forward. We’ve talked to all the usual suspects, and we are on friendly terms and keep all the conversations going, but we will continue to stay independent and operate in our contrarian way.”

Early stage investor The Fund expands beyond NYC with new partners in LA and London

The Fund, an early-stage investment firm with a memorably straightforward name, is looking beyond New York City as it starts investing its second fund.

Founders Jenny Fielding (who’s also managing director at Techstars New York) and Scott Hartley (also co-founder and partner at Two Culture Capital) told me that in the past two years, they’ve already backed 52 New York City startups.

“The seed funds in New York have all gone upstream,” Fielding argued, making it harder for founders to get the smaller checks they need when they’re getting started. So The Fund is aiming to participate in those “first check” rounds of between $500,000 and $1.2 million.

To find those investments, Fielding and Hartley said rely on a “crowdsourced” approach, taking recommendations from the startup founders that they’ve recruited as limited partners in The Fund — a group that includes names like General Assembly founder Matthew Brimer, One Medical founder Tom Lee, Handy co-founder Oisin Hanrahan, SoundCloud founder Alex Ljung and ClassPass co-founder Sanjiv Sanghavi.

At the same time, rather than relying on a “voting and consensus” process, the decisions are ultimately made by the investment committee, a smaller group that initially included Brimer, Fielding, Hartley and Katie Hunt.

The firm is targeting $9 million for the second fund, with one-third deployed in New York, another third in Los Angeles and the final third in London.

Hartley said The Fund is taking a “modular approach” to this expansion, with an independent investment committee in each city: In New York, it will be Josh Hix, Katie Shea and Becky Yang, along with Fielding and Hartley; in Los Angeles, the committee includes Raina Kumra, Josh Jones, Anna Barber and Austin Murray; and in London, it’s Carmen Alfonso Rico, Eamonn Carey and Marina Gorey.

“The big vision is, we’ve literally written the playbook,” Fielding said. “Fund one was an experiment, and now fund two is an experiment: Does this scale? After we have about a year’s worth of data about deals under our belt, we want to take it to the next level. Why shouldn’t The Funds be popping up in every city?”

And even though COVID-19 has brought a halt to large sectors of the global and domestic economy, Hartley said the firm has continued to write checks at the same pace.

“We had such conviction in the [founding] teams that it hasn’t really slowed down the cadence of our investing,” he said. “We take a long-term approach with pre-seed investing. We see this as a multi-year journey.”

Fielding added that it’s been “inspiring” and “phenomenal” to see how their existing portfolio companies have adapted to this new reality. As an example, she pointed to how rowing class startup CityRow has shifted to virtual classes.

And if you’re wondering about that name, Fielding said they were perfectly aware that calling themselves The Fund could prompt some  “Who’s on first?”-style confusion.

“We wanted to make fun of ourselves a little bit,” she said. And besides, most of the good tree names were taken.

Digging for dollar signs amid edtech’s current momentum

Freada Kapor Klein warns of ‘vulture capitalists’ during pandemic

The tech industry experienced turmoil before during the dot-com bust and again during the 2008 economic downturn. But this time it’s a bit different, according to Kapor Capital founding partners Freada Kapor Klein and Mitch Kapor.

“What’s different this time is that it is society-wide,” Kapor Klein said during an Extra Crunch Live appearance this week. “It’s not just the dot-com bust or its not just financial services. It is much more widespread. But again, as you point out, tech is in a much better position because tech is related to the things that are thriving.”

For Kapor, formerly a partner at a Sand Hill Road VC firm during the dot-com bust, said it’s similar in that it’s an “enormous disruption with great uncertainty about what will be on the other side of it.”

The details, however, are very different. Assuming there will eventually be a vaccine, Kapor said he believes things will be able to get back to some sort of normal, “notwithstanding the irrecoverable disruptions of permanently-closed small businesses.”

In the two previous downturns, there was something inherently wrong with the economy, but that’s not the case right now, he added.

“The good news is that, to the extent to which the pandemic gets under control, the economy should restart,” said Kapor. “The question, though, is on what basis and do we use this as an opportunity to rethink some fundamentals. Are we actually serious about treating essential workers better, really having a safety net and paid sick leave and universal health benefits and childcare — where we can see and feel now the absence of that is hurting the people we depend on four our lives. But it is not a certainty. This is the other thing about these great disruptions. We have some agency about what happens next. And so it’s almost a cliché now, but it’s terrible to waste, you know, a crisis. Our hope is that coming out of this, as a society, we make some different decisions about how we allocate resources and what we think the baseline is that everybody is entitled to.”

But while we’re all still knee-deep in the pandemic, there are ways to ensure employers treat workers fairly and VC firms treat founders with respect and don’t take advantage of them during these vulnerable times.

Below you’ll find some more stellar insights from the duo that touch on making tough decisions to layoff or furlough employees and how to do it in an equitable way, as well as the rise of what Kapor Klein refers to as “vulture capitalists.”

Equitable layoffs

Material Bank, a logistics platform for sourcing architectural and design samples, raises $28M

Material Bank, a logistics platform for the architectural and design industry, has announced the close of a $28 million Series B financing today, led by Bain Capital Ventures. Bain’s Merritt Hummer led the round on behalf of the firm and will join the board of directors at Material Bank, along with Jeff Sine, cofounder and partner at The Raine Group.

Existing investors Raine Ventures and Starwood Capital Group cofounder, Chairman and CEO Barry Sternlicht also participated in the round.

Material Bank launched in January 2019, founded by Adam I. Sandow. Its platform is meant to serve designers, architects and others who source and purchase the very building blocks of our physical world: materials.

Most architectural firms and designers have their own physical library of materials in their office, like carpet swatches, wall covering samples, tiles, and hardwoods for flooring. These libraries are nearly impossible to keep up to date — not only do styles change over time (just like clothes or anything else) but architects pull this or that binder of wall coverings or carpets and there’s no telling if or when that binder returns to the library, or if the binder will still be complete when it does return.

The other big obstacle for designers and architects is that there’s no real aggregation across the many, many manufacturers of these materials.

Sandow likens it to searching for a flight in the old days.

“We all used to book airline travel through an agent, and then the airlines offered websites,” said Sandow. “We thought ‘this is great! I can just go to AA.com or Delta.com to book my flights.’ Until we wanted to price shop. Then you had to search four or five different websites and write down all the prices and by the time you found the price you wanted, it may be gone.”

Then came Expedia and Hotwire.

That’s how Sandow thinks of Material Bank for the architectural industry.

Material Bank aggregates materials across hundreds of vendors, giving users the ability to filter around multiple parameters to find a selection of materials in minutes instead of hours.

But aggregation and powerful search are only half the battle. Designers and architects are also burdened by the time it takes to get their samples. One package may arrive tomorrow, with two others in the next three days, and still more coming in one week.

This leads to a confusing experience of getting all these samples together to show a client, and is a huge environmental waste with dozens of boxes arriving at the same exact location over several days.

To combat this waste, Material Bank built a facility in Memphis directly next door to FedEx’s sorting center. This facility is the very last stop that FedEx makes each night before sorting and sending off its overnight packages by plane.

That means that Material Bank users can place an order by midnight EST and get their samples, from any vendor on Material Bank, by 10am ET the next morning. These samples come in a single box with a tray that can be repurposed into a return package to send back unneeded samples.

Obviously, Material Bank’s facility would require hundreds of workers to turn around orders that come in late to be picked up by FedEx if it weren’t for advancements in robotics. Material Bank partners with Locus Robotics in its facility, and is thus able to pay $17.50 an hour to its human workers in the building.

Sandow says that coronavirus has not hampered the business at all, with the company seeing record revenues in March and with expectations to beat that record in April. That is partially due to the fact that those physical sample libraries in architectural and design firms are no longer accessible to employees who have had to shift to working from home.

Material Bank doesn’t charge architects or designers for the service, but does have a hybrid SaaS model in place for manufacturers and vendors on the platform. Manufacturers pay a monthly fee to access and use the platform, listing their SKUs, as well as a transactional fee to get access to the architects and designers placing orders for samples of their materials. Essentially, the manufacturers pay for the lead generation and hand-off to potential customers.

Sandow spent the last two decades growing a media network of architectural and design-focused magazines and knew early on that a reliance on advertising wouldn’t cut it as media moved online, with plans to build tools and services instead.

Material Bank was born out of that effort, and spun out of Sandow group relatively early on in its life.

The company has raised a total of $55 million since inception.

7 VCs talk about today’s esports opportunities

Even before the COVID-19 shutdown, venture funding rounds and total deal volume of VC funding for esports were down noticeably from the year prior. The space received a lot of attention in 2017 and 2018 as leagues formed, teams raised money and surging popularity fostered a whole ecosystem of new companies. Last year featured some big fundraises, but esports wasn’t the hot new thing in the tech world anymore.

This unexpected, compulsory work-from-home era may drive renewed interest in the space, however, as a larger market of consumers discover esports and more potential entrepreneurs identify pain points in their experience.

To track where new startups could arise this year, I asked seven VCs who pay close attention to the esports market where they see opportunities at the moment:

• Peter Levin, Griffin Gaming Partners
• Beth Ferriera, Firstmark
• Ethan Kurzweil, Bessemer Venture Partners
• Jens Hilgers, BitKraft Ventures
• Doug Higgins, Sapphire Sport
• Rick Yang, NEA
• Kevin Baxpehler, Remagine Ventures

Their responses are below.

This is the second investor survey I’ve conducted to better understand VCs’ views on gaming startups amid the pandemic; they complement my broader gaming survey from October 2019 and an eight-article series on virtual worlds I wrote last month. If you missed it, read the previous survey, which is based on my theory that games are the new social networks.

Peter Levin, Griffin Gaming Partners

Which specific areas within esports are most interesting to you right now as a VC looking for deals? Which areas are the least interesting territory for new deals?

Everything around competitive gaming is of interest to us. With Twitch streaming north of two BILLION hours of game play thus far during the pandemic, this continues to be an area of great interest to us. Fantasy, real-time wagering, match-making, backend infrastructure and other areas of ‘picks and shovels’-like plays remain front burner for us relative to competitive gaming.

What challenges does the esports ecosystem now need solutions to that didn’t exist (or weren’t a focus) 2 years ago?

As competitive gaming is still so very new with respect to the greater competitive landscape of content, teams and events, the Industry should be nimble enough to better respond to dramatic market shifts relative to its analog, linear brethren. A native digital industry, getting back “online’”will be orders of magnitude more straightforward than in so many other areas.

VC appetite for AI startups holds up in Q1 despite lackluster exit volume

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Today we’re taking our final look back at Q1 venture capital through the lens of AI-focused startups. New data out this week paints a mixed picture of the AI startup landscape. Venture dollar volume in Q1 was pretty good, though there was weakness in certain startup stages. Exit data was weak, however, and some Q1 numbers were juiced by a single deal.

AI-focused startups have grown past their history as the hot new thing (remember when every new tech company was doing AI for 45 minutes?) into a more mature niche; TechCrunch has spent a reasonable amount of time digging into their economics, and just this week a new, $180 million AI-focused fund caught our attention.

In the post-hype days, then, let’s check in on what global AI startups got done with investors in Q1. We’re leaning on this report from CB Insights, which breaks down the quarter’s numbers for us. Let’s pick them apart and see what we can divine concerning the future.

AI Q1 2020

To set the stage, venture capital investment into AI-focused startups has generally risen on a global basis for years. Indeed, deal and dollar totals have risen year-over-year from 2015 through 2019. Indeed, 2019’s Q2 and Q3 saw record AI startup venture dollar volume ($8.45 and $8.47 billion, respectively), per CB Insights.

These Cities Have the Most At-Risk Businesses During Coronavirus Pandemic Response

The coronavirus pandemic has affected virtually every industry, business and city and town in the United States. Nowhere is immune to the consequences of the deadly virus.

Most At Risk Businesses

However, cities that rely heavily on entertainment, retail, accommodation and food, are most vulnerable.

Cities Most at Risk from Pandemic

A study by LendingTree, America’s largest online lending marketplace, analyzed the cities to be worse hit by the pandemic. The study ranks the 100 metropolitans with the most retail establishments to determine which cities have been hit the hardest.

Myrtle Beach, South Carolina at Greatest Risk

The researchers found that mid-sized cities are at greatest risk from the affects of the pandemic. Myrtle Beach, South California, has the highest concentration of local businesses in retail, entertainment and food and accommodation sectors. Consequently, Myrtle Beach is the highest-ranking city in terms of being the worse affected by the pandemic.

This is followed by Salisbury, Maryland, where almost a third of businesses are in one of the most heavily impacted sectors. The third worse hit city is Scranton, Pennsylvania, where 28.8% of businesses operate in the most vulnerable industries.

Finding the Right Business Support

The research provides insight into how the ongoing pandemic is affecting small businesses and which industries are at greatest risk. It is important that small businesses stay informed about the economic and business impact of this unprecedented crisis. Knowing which industries and locations are worse affected will give businesses insight into the support that might be available to them.

Businesses operating in entertainment, retail, accommodation and food are proving most vulnerable to the consequences of the pandemic-induced lockdown. Myrtle Beach has the highest proportion of these types of businesses. This coastal city is therefore the most exposed to the economic slowdown. As the report’s authors write:

“Visitors to Myrtle Beach are crucial to the region’s economy, as they support jobs, businesses and residents’ quality of life. The area’s 20.4 million annual visitors make a $7 billion impact. On April 6, South Carolina joined the growing list of states to close non-essential businesses to the public…. As the summer months approach, Myrtle Beach and other US tourist towns may miss out on crucial revenue while these businesses stay closed.”

Salisbury is Second Most Affected City

With more than 32% of businesses in the most vulnerable industries, Salisbury is the second most heavily impact city by the pandemic. All non-essential businesses closed in Maryland on March 23.

The report directs businesses in Salisbury to the Salisbury Area Coronavirus Recovery Task Force. This resource provides a wealth of information to help support local businesses during these testing times.

Larger Cities are Less Vulnerable

The report shows that larger cities, such as Denver and Minneapolis are less reliant on retail, entertainment and food and accommodation. Subsequently, these cities are not being as adversely affected by the pandemic as other US cities.

LendingTree’s report highlights the importance for businesses to stay informed about the support resources available to them. Particularly those operating in the most vulnerable sectors.

Image: Depositphotos.com

This article, "These Cities Have the Most At-Risk Businesses During Coronavirus Pandemic Response" was first published on Small Business Trends

6 Simple Rules and Tips for Visual Storytelling in Marketing

The human brain absorbs visual information 600 times faster than sounds and smells. People also remember pictures with logical connections between them 65% better than text. But how do you make the visual information generated by your brand even more effective? Some visual storytelling tips will help you with this.

Visual Storytelling Tips

Let’s take a dive into these 6 simple visual storytelling tips:

1. Choose your Goal and Metrics

Aimless marketing leads only to budget losses. So don’t let your storytelling-based content be commercially aimless.

Storytelling can be integrated into any level of your marketing strategy, including a single ad, a marketing campaign, the tone of voice for social networks, and general brand narration.

If visual storytelling is a new tool for you, start on a small scale. For example, use visual storytelling for advertising a new product on social networks. In this case, the goal of your message will be to increase the sales of goods. Metrics that will help you evaluate the success of a storytelling approach are sales, clients’ requests, and social resonance (reposts, brand or product mentions, and comments).

2. Set a Budget to Find your Tools

You can apply visual storytelling at a single product advertising level or through the brand narrative on social networks. Each of the options means that you need a specific budget. The smaller your communication scale, the cheaper the tools are.

Master visual storytelling by working with small messages. This approach will help you figure out which stories are the most popular among your target audience and invest more in communication that really works in the future.

Visual storytelling can be embodied in the form of a static picture with brand captions, custom animations, videos, face filters, online games, and more. The most affordable way to start with visual storytelling is to use stock images, which I use often, and then edit them based on your needs. There are many editing tools out there, so you can design like a pro with no design experience needed.

3. Emotions are Everything

The emotional context of your brand can be very broad. Curiosity can encourage your customers to surf your online catalog. The desire to be part of a cool crowd encourages users to turn certain products into bestsellers. The euphoria from ordering a long-awaited product can make an online store user order something else as part of one order.

You can work with either positive or negative emotions as the latter can also be a purchasing trigger. If your potential customer experiences irritation while reading the assembly instructions by your competitor, they are more likely to buy goods from you next time if you provide them with a solution such as free installation.

Analyze what emotions are at the heart of a potential customer. Anger? Despair? Joy? This emotional trigger will influence the plot of your story and its visual style. This way you’ll increase your chances of capturing their attention to your product and prompt them to take a specific action.

4. Create a Hero that Saves the Day

The main rule for creating a realistic hero of your narrative is its relevance to your audience. In order for your story to be involved, a hero (and an antihero) must be familiar with your audience. It is wonderful if the hero’s prototype is representative of your target audience. At the same time, the hero may be the product you are advertising or your brand.

And who is an antihero? A good antihero embodies the fears of the hero and poses a serious threat to him or her. An antihero should also be easy-recognizable by the target audience. Use your target audience research to learn their fears and create an antihero based on that information.

5. Build a Storyboard Based on Conflict

A story is impossible without conflict. Conflict starts with your hero facing their challenges. Engaging stories are built on the clash of a hero and an antihero (a hero’s deepest fear). Your hero may win or die, or, perhaps you may leave an open ending that provides you with a room for a sequel. Build your first story using the following structure:

• Introduction
• Rising action
• Climax
• Falling action
• Resolution

A storyboard usually consists of simple images that reflect the essence of each structural element of your story. You may even use them as content for Instagram or Facebook Stories. However, to turn your storyboard frames into a video, a banner ad, or other material, you’ll need to go on one more step.

6. Visualize your Story

Creating the layout of your story, consider the technical features of the platform you are going to post content on. For example, storytelling for Instagram should be based solely on graphics and short videos without text injections.

Visual storytelling for YouTube or TikTok can take the form of a series or a long movie. At the same time, visual storytelling on the landing page should provide users with constant motivation to scroll down the page or follow CTA. So think about how the user will interact with your story and determine its shape, style, and scale.

Use some proven visual storytelling rules too. First, use color and shade contrasts to highlight the subject of the story. Second, strive for minimalism. Your images or videos should not have a single detail that does not matter to the story. Third, control users’ eyes by arranging elements on the image so they could guide users along a specific visual hierarchy.

Bonus ending: Here are some books that helped me develop my visual storytelling skills: Visual Storytelling: How to Speak to the Audience Without Saying a Word by Morgan Sandler, Graphic Storytelling and Visual Narrative by Will Eisner, and The Power of Visual Storytelling by Ekaterina Walter.

Image: Depositphotos.com

This article, "6 Simple Rules and Tips for Visual Storytelling in Marketing" was first published on Small Business Trends

Biloba lets you chat with a doctor if you have questions about your children

Meet Biloba, a French startup that wants to leverage tech to make it easier to keep your children healthy. The company recently launched a new mobile app that lets you chat with a doctor whenever you want between 8 AM and 8 PM. This way, if you have questions about your kids, you can get a quick answer.

Of course, a text conversation will never replace a visit to the pediatrician. But chances are you have a ton of questions, especially if you’re a first-time parent. Instead of browsing obscure discussion forums, you can go straight to a doctor.

Biloba isn’t working with pediatricians specifically. The company is also partnering with nurses and general practitioners. Eventually, the service is going to cost €10 per month but the company is waving fees during the lockdown.

After just three weeks, the startup managed to attract 4,000 users with around 200 conversations per day. Compared to other telemedicine services in France, such as Doctolib, Biloba doesn’t rely on video consultation. This way, it’ll be easier to deal with a large influx of new patients even with a small group of partner doctors.

The subscription business model is interesting for multiple reasons. First, Biloba isn’t covered by the French national healthcare system. In France, patients only get reimbursed if the doctor knows you already. That restriction has been lifted during the lockdown but it’s probably just a temporary lift.

Many parents probably don’t want to pay €120 per year to chat with a doctor when they could pay €0 through the national healthcare system. But if you can afford it, the barrier to medical advice becomes much lower.

Biloba previously released a vaccine reminder app that lets you enter information about your child’s vaccines and get reminders when the next scheduled vaccine is due.

Index and Credo lead a $2.75M seed in anti-fraud tech, Resistant AI

Prague based Resistant AI has nabbed a $2.75M seed round. The security startup’s machine learning technology is designed to be deployed on top of AI systems used for financial decision making to protect customers in markets such as financial services and ecommerce from attacks such as targeted manipulation, adversarial machine learning and advanced fraud.

The seed round was co-led by Index Ventures (Jan Hammer) and Credo Ventures (Ondrej Bartos and Vladislav Jez). Seedcamp also participating, along with Daniel Dines, CEO of UiPath; Michal Pechoucek, CTO of Avast and other unnamed angel investors. Bartos joins the board of directors on behalf of the investors.

The startup sells an additional layer of protection that’s specifically designed for tightening security around automated functions such as credit risk scoring and anti-money laundering by using tech to detect fake documents that feed such systems. Its tech is also aimed at uncovering suspicious patterns of transactions which might indicate a strategic attack on the model itself or an attempt to copy sensitive data.

“Historically, all systems that make high-value financial decisions become targeted. This is already happening with the automated systems deployed by our fintech and financial customers and we are here to protect them,” said Martin Rehak, founder and CEO, in a statement.

The seed round is Resistant AI’s first tranche of external funding, with the founders bootstrapping the company since starting up in February 2019.

“We have onboarded the first customers in 2019 and the funding will help us scale our sales organisation to meet the rising demand from banks and fintechs,” Rehak told us. “We are protecting the AI&ML systems used in financial automation from manipulation or misuse by smart attackers.”

Resistant AI has two products it offers its customers at this stage: First, document inspection. It offers a machine learning system that’s designed to flag and reject “malicious documents” submitted for automated processing. “Bank statements, payslips, invoices, purchase orders and KYC documents submitted to fintechs and banks are frequently manipulated or completely falsified,” explained Rehak. “Resistant Documents, our first service, identifies and rejects the suspicious or malicious inputs.”

A second offering — Resistant Transactions — applies AI to spot problematic transaction patterns.

“We work with the fact that most attacks on AI systems require extensive interaction to discover the vulnerability,” he said. “Our system is unique by inspecting all the customer queries (which can take form or payments, money transfers or credit applications assessed by the system we protect) in context of similar queries. By looking at the stream of queries statistically, we can recognise and block the attacks that seek to steal the information embodied in the model (information stealing) or, worse, aim to nudge the system into making the wrong decision by exploiting an existing bias in the system.”

Resistant AI isn’t breaking out customer numbers yet but Rehak said it onboarded its first customers last year. “The funding will help us scale our sales organisation to meet the rising demand from banks and fintechs,” he added, saying also that it will be spending on building out product features and extending functionality, as well as on beefing up the sales and go-to-market team.

“Right now, our target customers are financial and fintech startups, as well as other companies deploying the automated process (both software and RPA) in their financial processes,” he added. “The financial systems are our current focus, but the attacks on machine learning are relevant in many other areas: process automation, e-commerce, manipulation of ‘trend detection’ algorithms in social media and other opportunities.”

It’s using a SaaS model — preferring a value approach to pricing, per Rehak. “Our problem and approach is new, and we feel that the value pricing model aligns the incentives between us and the customer in the optimal way,” he said on that.

Asked who he sees as the main competitors for the business, he cited Google Brain plus the tech giant’s activities in adversarial machine learning.

The majority of work in this area is currently done in-house by the large tech companies building their own proprietary systems — such as Google and Microsoft, he added.

Other competitors he mentioned were Inpher, which is enabling machine learning on encrypted data; Sentilink, which is doing detection of synthetic identities in the US; and Bullwall (Denmark) and YC-backed Inscribe (US/Ireland) which are focused on document forgery.

Resistant AI’s founders have a background in machine learning applied to cyber security problems having founded Cognitive Security, an earlier startup which they subsequently sold to Cisco in 2013. Over some 12 years working in the security industry Rehak said they saw how attackers targeting AI systems were getting increasingly sophisticated in avoiding detection — which gave them the idea for their latest business.

Commenting on the seed funding in a statement, Jan Hammer, general partner at Index Ventures, added: “Automation, efficiency and reliability are cornerstones of financial innovation. As machine learning takes more and more nuanced financial decisions, it needs to be protected. And this is not true only in finance, but the attacks will rapidly spread to other domains as well. More of our activity today takes place online, a trend accelerated by COVID-19, and one we believe will last. With criminals ready to take advantage of every vulnerability, the need for solutions such as those from Resistant AI has never been greater.”

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Wise locks down $5.7 million to scale its challenger bank designed for small businesses

Stripe and Shopify have transformed the face of commerce for small business users, yet when it comes to putting that cash somewhere, SMBs have found that the banking options aren’t quite as transformative.

Wise is a new challenger bank built specifically for small businesses. The startup is aiming to insert itself as an essential service in the small business repertoire by bundling banking with payment services powered by Stripe. Customers can receive payments, manage their cash and pay employees all via Wise’s app.

CEO Arjun Thyagarajan tells TechCrunch that his company has closed a $5.7 million seed round led by Base10 Partners. Abstract Ventures, Backend Capital, The Fund and Two Culture Capital also participated in the round.

While the advent of challenger banks has helped drive plenty of innovation on the consumer banking side, says Rexhi Dollaku, a principal at Base10 who led the Wise deal, “very little of that innovation has happened in the business banking context.”

Thyagarajan and his investors hope that the startup can keep churn low by embedding a wider scope of financial services products inside its core product, expanding beyond the traditional scope of banking features by offering functionality to power things like payroll and accounting.

Rather than plunging into direct customer sales, Wise is partnering with behemoth platforms like Shopify to onboard small businesses where they already are. “If you look at other [banking] options out there, they’re going direct to the customer; what we’ve learned is that it is better to partner,” Thyagarajan says. “They’re signing up inside these ecosystems so we want to partner with these ecosystems.”

The small team has already built up a customer base of 1,000 businesses. The average Wise customer has between 2-10 employees and is pulling in somewhere between $500,000 and $5 million in ARR, the company tells us. Bank accounts on Wise’s platform are FDIC-insured up to $250,000 through the startup’s partnership with banking partner BBVA USA.

While Thyagarajan says they’ve seen online spend increasing, the COVID-19 pandemic has impacted plenty of Wise’s potential customers, and has pushed the company to stay flexible in the businesses they cater to. “I think a lot of industries are going to get accelerated and fast-forwarded,” he says. “The customers we want to cater to are rapidly modernizing.”

Alongside the funding announcement, the startup shared that Raghav Lal, a former general manager of Small Business at Visa, will be joining the startup as its president.