Month: April 2020

As a small business owner, I was excited to learn about the $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act that offers low-interest loans to firms impacted by the COVID-19 pandemic. However, as I read through the details and began to apply, it became clear that this legislation — while well-intentioned — may not be enough to help many SMBs and startups.

Here’s a quick recap of my experience.

Emergency Economic Injury Grants and Economic Injury Disaster Loans

First and foremost: You need to act swiftly. Emergency Economic Injury Grant and Economic Injury Disaster Loan programs included in the CARES Act function on a first-come, first-served basis, and are funded from a limited pool of resources.

I began my company’s application process by submitting our EIDL and EEIG applications through the SBA website. This was easy, if tedious. It took about two hours to complete the necessary online forms and about two seconds to click the EEIG checkbox. Submission was seamless, but I haven’t received any further communication from the SBA since completing my application, which is a bit confusing — EEIG funds are supposed to be dispersed within 3-5 days of the submission date.

However, I know there’s been a huge volume of submissions recently and this must be exceptionally difficult to handle. I look forward to any email correspondence or updates from the SBA that might give me — and other applicants — an updated estimate of the expected dispersal timeline.

Source: Tech Crunch

Kara Carmichael has been an Instacart shopper for years in Orlando, Fla. It’s how she’s been able to support her family, she told TechCrunch. But she says she has noticed an increase in third-party bot activity that has made shopping “nearly impossible.”

Despite the high demand for Instacart amid the COVID-19 pandemic, shoppers like Carmichael are facing difficulties claiming orders within the shopper app. This is the result of what appears to be some sophisticated work by third-party apps like Ninja Hours, Sushopper and others.

“They grab the batches within a blink of an eye,” Carmichael said. “I can barely see the amounts offered. Sometimes I may even just receive a notification because the batch has been taken before it was even registered in my app.”

Ninja Hours appeared on the scene about a year ago in the Little Havana community in Miami, according to Logan B., an Instacart shopper with experience using Ninja Hours. Shoppers could pay Ninja Hours about $25 to $35 a week to get access to hours for the following week and in exchange, Ninja Hours would take over the shopper’s app to claim hours on their behalf. This was during a time when Instacart required shoppers to claim hours rather than on-demand orders.

Ninja Hours also provided account activations for immigrant workers without proper documentation. For $200, according to Logan, undocumented immigrants could pay Ninja Hours to create an account for them so they could shop.

Logan says Instacart eventually caught on to Ninja Hours, which forced the service to shut down. Ninja Hours then became Hours For You, which emerged in the fall, Logan says. Hours For You then folded into Sushopper earlier this year.

“The site would go offline for a week and then they would send you a text message,” he said. “It was always written in Spanish — really targeting the Latino community.”

Other shoppers didn’t seem to notice this was going on, Logan says, because Sushopper would claim the orders before they would even appear on the apps. But now that Sushopper has shut down, there’s a new service — one that is not quite as fast.

“There is definitely still a service out here because I’m not getting anything at all,” Logan, who has since stopped paying for early access to orders, said. “There’s no way anyone would be able to grab it that fast.”

What’s happening is that shoppers can see the orders come in, but then they pretty much immediately disappear. Below, you can see a gif of how the moment batches become available, one order immediately disappears.

With this new service, which he doesn’t know the name of, the messages are coming in Portuguese. That leads him to believe it’s run by a different group of people.

“It’s so mainstream now and it seems just about everywhere is having a problem,” Logan said.

Instacart has acknowledged this is a practice that goes on but says that this is not a breach of its platform.

“The safety and security of the entire Instacart community is our top priority,” an Instacart spokesperson told TechCrunch. “We have several robust security measures in place to ensure the security of the Instacart platform. Selling or purchasing batches is not an authorized use of the Instacart platform and is a violation of our Terms of Service. Anyone found to be engaged in any type of inappropriate or fraudulent use of the Instacart platform, including selling or purchasing batches or utilizing any of these types of services, will have their accounts immediately deactivated. We advise shoppers not to engage with any individual or company that claims to provide priority access to batches on the platform, particularly those that request sensitive information such as Instacart usernames, passwords, and/or credit card information.”

Despite Instacart’s efforts, it’s gotten so bad that Carmichael ends up sitting in her car for hours waiting for a batch she can try to snag before the bots.

“My thumbs are sore and eyes are strained,” she said. “I’ve only managed to grab four orders. My livelihood is literally being snatched out from beneath me.”

She and others have reached out to Instacart to report the issue, Carmichael said. But in her experience and the experience of those she knows, Instacart has not responded. Some shoppers, however, are able to get through to Instacart support about this issue. As you can see below, Instacart acknowledges an issue and told one shopper it will “be fixed as soon as possible.”

Before the bot activity ramped up in Orlando, Carmichael was receiving about 20 orders a week. During the week of March 16-22, for example, Carmichael completed 26 batches, according to documents reviewed by TechCrunch. Last week she was only able to claim 11. This week, she has only been able to get four batches.

This increase in bot activity comes at a time when Instacart is ramping up its hiring of full-service shoppers. Just yesterday, Instacart announced it’s adding 250,000 more shoppers to meet demand. That came after Instacart announced last month its plans to hire another 300,000 shoppers.

The increased number of full-service shoppers coupled with third-party bots quickly claiming orders, it’s no wonder why some shoppers are feeling frustrated. Behind the scenes, Instacart is working to ban unauthorized third parties from accepting batches. In the meantime, the company is recommending shoppers not engage with those services.

Source: Tech Crunch

The FCC has finally gotten around to updating its 15-year-old orbital debris rules, adding new requirements and streamlining the approval process. With hundreds of satellites going up every year into increasingly crowded orbits, these rules are more important than ever.

In stating the necessity for mitigating the accumulation of orbital debris, the FCC noted that while some like to downplay the problem, there is already significant danger:

Studies indicate that already in some regions of LEO, the number of new objects and fragments generated from collisions exceeds those removed by natural atmospheric drag. Other regions have sufficient densities of orbital debris to lead some analysts to conclude that they are close to or have already reached a “runaway” status, where the debris population will grow indefinitely due to collisions between debris objects.

To be clear, the rules are not anything along the lines of “your spacecraft can’t break up into more than 20 pieces” or anything like that. They’re more along the lines of requiring satellite operators to show that they’re operating in a safe and sustainable way, making guarantees like the ability to track or deorbit the craft if there’s a problem.

The new rules are not wildly different from those that came before, but rather reflect the new reality of satellite constellations thousands strong and changes resulting from improvements to technology and launch methods. (The 2004 rules have been tweaked here and there, but this is the first “comprehensive” update since then.)

For instance, with launches of multiple spacecraft like SpaceX’s StarLink satellites, it’s important that each craft is uniquely identifiable, trackable either via ground radar or some other telemetry method, and so on. The new rules require satellite operators to disclose exactly how and to what extent this is done, and also whether and how they plan to share things like orbit adjustments and other maneuvers with spacecraft tracking authorities.

They also have to estimate the likelihood of collision with large and small objects, the possibility that the satellite will fail, and what risk that creates for anyone on the surface.

The biggest change in rules is probably the requirement that any spacecraft going above the International Space Station be capable of some kind of maneuvering in order to avoid collisions.

Considering what goes on in those orbits — imaging and communications, mainly — maneuvering is something most craft need to do already. But if there’s no requirement, and the price of satellites and launches continues to drop, it would only be a matter of time before someone decides to spray a thousand tiny, dumb satellites into orbit with empty assurances that they definitely won’t hit anything.

And the thing is, if the FCC doesn’t make rules, no one will. It’s strange that the same agency is responsible for broadband speeds, obscenity on TV, and orbital debris, but that’s just how it is.

As Commissioner Jessica Rosenworcel noted in her statement accompanying the new rules: “We need to recognize the FCC has unique authority. We are the only ones with jurisdiction over commercial space activities. That makes our work to update the agency’s 2004 orbital debris policies really important.”

Although they work in concert with NASA, NOAA, and international authorities trying to develop global best practices, the FCC is the one making the rules when it comes to the vast majority of satellites going up today.

One proposal not adopted today but which the FCC is publicizing in order to generate discussion is a potential requirement for companies to put up a bond that’s redeemable when their satellite is successfully retired as planned.

Essentially a company that wants to launch a satellite would be asked to put down, just for example, $10,000 in a government bond before it goes to orbit. A few years later, when the satellite has finished its job and is ready to be scuttled, that $10,000 could be redeemed if all goes according to plan. But if the craft fails, or goes out of control, or otherwise departs from the plan, the $10,000 is forfeited.

The idea makes sense intuitively — a sort of security deposit for spacecraft — but the specifics are very difficult to work out. So the FCC is soliciting comments to see how best to approach the requirement, or whether to at all.

You can read the full set of new rules and justification thereof at the FCC’s website.

Source: Tech Crunch

U.S. companies rely on Mexican manufacturers for goods ranging from automotive and aerospace parts, to avocados and other produce, to electronics and furniture. But the trucking system that transports these things across the border relies on an inefficient mix of paper, phone calls, faxes and too many stakeholders who drive up costs.

These snarls congesting border traffic are precisely why Nuvocargo founder and CEO Deepak Chhugani has raised a $5.3 million seed round for a managed marketplace for door to door freight transportation, serving trade routes between the United States and Mexico. 

Investment came from both sides of the border. The round was co-led by Silicon Valley-based NFX and Mexico City-based ALLVP. And Nuvocargo marks the first deal for Antonia Rojas-Eing, the youngest female VC in Latin America, under ALLVP which she joined earlier this year as a partner. 

The seed round also saw participation from One Way Ventures, Maya Capital, Magma Partners, the co-founders of Rappi, the former CMO of Cabify, and other angels. The total includes earlier backing from Y Combinator, when Nuvocargo existed under a different name.

Chhugani joined Y Combinator’s W18 class with a startup called The Lobby, which sought to connect job seekers to personalized coaches. He raised $1.2 million for the startup, but decided to pivot into logistics and work on Nuvocargo. The change in direction was fairly natural for the Ecuador-raised entrepreneur, who cited his family’s previous work in the Latin American logistics industry.

When the time came to pivot, Chhugani offered investors their money back. Some chose to leave, but Y Combinator elected to stay under the new promise of digitizing trucking between Mexico and the U.S. Nuvocargo says that the $5.3 million seed is its first round, and what they’ve raised to date. Investors who stayed in from The Lobby are part of this round for Nuvocargo.

Nuvocargo, which calls itself a modern managed marketplace for door to door freight transportation, has set up shop with fully bilingual teams in both New York and Mexico.

Mexico is already one of the United States’ largest trade partners, and Chhugani predicts that relationship will only strengthen in the next decade. The U.S.-China trade war shows no signs of easing and tariffs have increased buying friction. With the 2018 United States-Mexico-Canada Agreement that aims to renegotiate NAFTA and uncertainty around coronavirus, Chhugani believes Mexico will become an even more attractive trade opportunity to capitalize on with Nuvocargo. 

To the company’s knowledge, U.S.-Mexico trucking is within the top five biggest trade lanes in the world, with 6.5 million trucking shipments going between Mexico and the U.S. every year. Notably, 80% of all the goods transported between the US and Mexico move by truck.

VCs have jumped on the freight and logistics opportunity as startups like NEXT Trucking, Convoy and Flexport secure hundreds of millions dollars from investors like Sequoia and SoftBank. 

Now, smaller startups like Nuvocargo that specialize on specific routes and countries, are focusing in regionally to bring these systems that rely on paper, phone calls, faxes and spreadsheets to do business, online. 

Nuvocargo’s free software digitizes the different steps with timestamps, geo tracking and document housing in a centralized cloud based dashboard providing a snapshot understanding of every step of a cross border shipment. Customers can request new shipments using Nuvocargo using a WhatsApp integration, email or SMS. 

The 15-person startup wants to house the entire shipping process within its tracking software, simplifying the customer experience. The customer, Chhugani says, is any company that needs to move goods between Mexico and the U.S., and he notes that Nuvocargo is working with dozens of customers ranging from beverage companies to multi billion dollar corporations – though he declined to specify who. 

Chhugani says that in a typical U.S.-Mexico cross border trucking transaction, up to 12 stakeholders are involved in a single shipment, and that is too many. Multiple people on the U.S. side are procuring the trucks and managing customs, FDA inspection and warehouse storage. On the Mexico side there are even more entities handling scheduling and pick up for the trucking companies and drivers. 

With the new seed funding, Nuvocargo will prioritize early hires in product, operations, finance and engineering in its New York and Mexico offices on its fully bilingual team. 

Chhugani says he’s especially appreciative of the truck drivers that put themselves in harms way to ensure critical items are getting to the right destination ensuring shelves are stocked. He says that in this uncertain time, Nuvocargo is working to give drivers predictable business near their homes, and pay them faster.  “All of us as a society should be more appreciative of truck drivers and the trucking industry, because this is something that really fuels the economy in both the United States and in Mexico.” 

In the current age of the coronavirus pandemic, Nuvocargo says it is focusing significant efforts on working with companies that are transporting essential goods to aid in the supply crisis.

Source: Tech Crunch

Fresh off of a successful earnings report, Snap announced today that it was looking to raise $750 million in a new debt offering.

This upcoming offering will consist of $750 million in convertible senior notes that will mature May 1, 2025. It will be a private placement to qualified institutional buyers and Snap is looking to give buyers the option to secure $112.5 million worth of notes down the road as well.

Snap’s Q1 earnings impressed investors but the company is still losing plenty of cash and it’s clear that the full impact of the digital ad market’s downturn won’t be seen until the company’s Q2 earnings. On Tuesday, the company shared it had logged $462.5 million in revenue for the quarter and a $306 million net loss.

The COVID-19 crisis has pushed private and public companies to take a long and hard look at their balance sheets. For well-positioned companies, raising debt is an attractive option for combatting looming market uncertainty.

This isn’t the first time Snap has looked to a debt offering either. In August, the company announced they were pursuing a $1.1 billion debt offering.

Source: Tech Crunch

Digits, a fintech startup hailing from the same team that built and sold Crashlytics to Twitter, is officially launching today after two years of development. It’s also announcing a $22 million Series B round of funding led by GV, as it makes its public debut.

While the company had been fairly quiet about product details while in stealth mode, it’s today unveiling its first product: a visual, machine learning-powered expense monitoring dashboard aimed at startups and small businesses.

The dashboard, called Digits for Expenses, helps business owners track how their company is spending money, by showing things like spend by category, by identifying vendors and recurring expenses and by offering real-time alerts, among other features.

Instead of requiring business owners to make a switch from their existing financial solutions, Digits connects with the accounting software, banks, payroll providers, financial packages, sources of revenue and credit cards the business already uses — like Xero, QuickBooks, NetSuite, Citi, Bank of America or Chase, for example.

At launch, the list includes more than 9,000 banks, with support for Xero and NetSuite coming soon.

After setup, Digits will then automatically analyze the company’s spend and visualize it, in real time.

While visualizations of data may be reminiscent of personal finance startup Mint, Digits’ web-based solution is more technical in nature and offers an expanded analysis of the data on hand. Plus, as a business solution, it has to offer features like security, permissioning and collaborative workflows, which results in a more sophisticated product.

Digits also uses machine learning technology to predictively categorize transactions as they happen and the software can alert users to anomalies — like suspicious activity or unexpectedly large transactions — in real time. Business owners can use the dashboard to find out things like how quickly expenses are growing, what the cash flow looks like, where costs can be trimmed, what services are being paid for on a recurring basis and more, and can search for transactions.

The software also supports the ability to comment on transactions, loop in a colleague to ask for clarification about a charge and upload missing receipts. Everything uses HTTPS along with TLS and certificates so data is encrypted between Digit’s services and at rest.

The original idea for Digits came from a problem that co-founders Wayne Chang and Jeff Seibert faced themselves when building Crashlytics. As they explained previously, their focus as entrepreneurs was on solving technical challenges, not on the operational side of running a business.

Many entrepreneurs also find themselves in this same space. They’re trying to solve a problem or crack a tough engineering puzzle, but instead have to redirect their time and resources to spreadsheets, financial reports, transaction records and other paperwork required to actually run the business.

“Startups and small businesses today simply don’t have the resources to manage their finances internally. Most of them still settle for spreadsheets, and the lucky ones work on an hourly basis with external accountants,” explains Seibert. “As a result, their accounting itself is seen as a cost-center, and they pay for little beyond the basic monthly financial statements — Profit & Loss, Balance Sheet, etc. By the time those statements are delivered — weeks after the end of each month — they’re already out of date,” he said.

That means things businesses need — like updates, one-off reports and new budgets — can require additional costs and longer wait times, so they get skipped.

The COVID-19 pandemic has put even more pressure on small businesses, many of which are now struggling to even survive. As a result, Digits has decided to launch the product for free to those who sign up — not a free trial, but actually free. It plans to later charge for additional products and paid upgrades to support its own business.

Digits is able to make this offer because of its now-expanded venture funding.

Already, the company had raised $10.5 million in Series A funding in a round led by Benchmark. That round had included a sizable 72 angel investors as well, including founders and CEOs from companies like Box, GitHub, Tinder, Twitch, StitchFix, SoFi and several others — entrepreneurs with an understanding of the problems Digits is aiming to solve.

Today, Digits is announcing an additional $22 million led by Jessica Verrilli at GV,  who also now joins Digits’ board alongside Benchmark’s Peter Fenton. (Benchmark also participated in the new round).

“Jeff and Wayne are masterful at creating intuitive, high-utility products from complicated data,” said Verrilli about the GV investment. “I saw this up close with Crashlytics and Twitter, and I’m thrilled to partner with them on Digits as they reimagine financial software for startups,” she added.

The startup, now a team of 18 and hiring, was already offering its software solution to a group of customers ahead of today’s public launch, who effectively operated as beta testers allowing Digits to refine its product. Digits isn’t able to share its customer names, for the most part. However, it noted that Coda was one of early adopters and provided valuable feedback.

It also has over 10,000 companies who joined its waitlist over the past two years who are now being let in.

At the time of its Series A, Digits saw more than $1.5 billion in transaction value flowing across its production systems. That number has since grown to $8 billion.

The software is free starting today for U.S.-based small businesses. The company plans to add support for international markets later this year.

Source: Tech Crunch