Ideaforge

Market timing  —  how relevant an idea is to the current state and direction of a market  —  is the most important factor in determining the durability of that idea.

Several inputs inform market timing: The skew of consumer preferences in response to a pandemic. The price of goods for a resource that is finite and becoming scarce. The creation of a novel algorithmic or genetic technique that enlarges the potential of what can be streamlined, repaired and built.

But market timing is also defined by a less discussed area that is born not in capital markets but in the public sector  —  the regulatory landscape  —  namely, the decisions of government, the broader legal system and its combined level of scrutiny toward a particular subject.

We can understand the successes and challenges of several valuable companies today based on their combustion with the regulatory landscape, and perhaps also use it as an optic to see what areas represent unique opportunities for new companies to start and scale.

Looking back: The value in regulatory gray areas

“The tech comes in and moves faster than regulatory regimes do, or can control it,” Uber co-founder and former CEO Travis Kalanick said at The Aspen Institute in 2013.

The brash statement downplayed that the regulatory landscape had, in fact, driven a number of pivotal outcomes for the company up to that event. It changed its name from UberCab to Uber after receiving a cease-and-desist order in its first market, California. Several early employees left because of the startup’s regulatory challenges and iconoclastic ethos. It shut down its taxi service in New York after just a month of operations, and then in early 2013 received its lifeline in the city after being approved through a pilot program.

Fast forward to the present, and Uber has a market cap of about $82 billion, with the ousted Kalanick having a personal net worth in the neighborhood of $2.8 billion.

Still, even at its scale, many of its most important questions on growth centered around how favorably the regulatory landscape would treat its category. Most recently, this came with the U.K. Supreme Court ruling that Uber drivers could not be classified as independent contractors.

The regulatory fabric has had similar leverage over other sharing-economy companies. In October 2014, for example, Airbnb’s business model became viable in San Francisco when Mayor Ed Lee legalized short-term rentals. In November 2015, Proposition F in the city aimed to restrict short-term rentals like Airbnb, and the startup spent millions in advertisements to mobilize voters in opposition.

Airbnb’s current market cap stands at $92 billion, and its CEO, Brian Chesky, has an estimated net worth over $11 billion. Like Uber, its regulatory tribulations continue, most recently being fined and judged to owe $9.6 million to the city of Paris.

The stories of these two companies and others in the sharing economy space demonstrate the value that the regulatory fabric can add or subtract from a company’s wealth, but also underscore the value  —  for founding teams, early employees, investors and customers  —  of navigating the gray areas.

Looking around: The data economy

The present regulatory fabric has precipitated market timing for ideas in a number of categories. Solutions that enable data privacy, like BigID, and ones that embed data privacy into larger customer value propositions, like Blotout, are on streamlined growth tailwinds from the GDPR in Europe and their inspired analogs in the U.S.

Source: Tech Crunch

Amid a year of editorial pivots and employee exits, Medium announced today that it will make significant changes to its Medium Partner Program, which allows writers on the platform to monetize their content.

Founded in 2011, Medium launched its Partner Program in 2017. Since then, the platform has paid out $28 million to over 200,000 contributors. Initially, it offered payouts based on how much time Medium members spent reading a writer’s content. For $5 per month or $50 per year, Medium members could read all posts on the platform without hitting a paywall. Plus, part of each member’s subscription was split among the writers they read; so, if a Medium member spent 10% of their time reading one writer’s work, for example, that writer would get 10% of the subscriber’s revenue share.

Medium said that earnings based on read time will remain the same. But now, Medium will offer a new way to make money with the launch of a referral program.

Previously, if a reader converted to a paying member within 30 days of reading a writer’s story, that writer would get credit for the amount of time the reader spent reading their work. Under the new model, Partner Program writers will now have a personalized referral landing page — for any reader who purchases a Medium subscription via their page, the writer will get half of that member’s subscription fee for as long as they remain a paying member, minus the standard 2.9% + $0.30 in payment processing fees. So, if a writer got 100 readers to sign up for a monthly Medium membership through their referral, that would net the writer $227 per month.

Image Credits: Medium (opens in a new window)

However, now it’s more difficult for a writer to join the Partner Program — writers must have 100 followers, at least one published Medium story, and they must live within specific geographic regions. Even if a Partner meets the new eligibility requirements, they might lose their status if they don’t publish anything new in a six-month period. Still, under the previous structure, just becoming a Partner didn’t guarantee financial rewards — some Partners with smaller followings would make pennies each month. Existing Partners will retain their status through the end of 2021, and if they haven’t reached 100 followers by then, they will be removed.

Also, Medium will soon institute a minimum payout threshold of $10, meaning that if a writer makes less than $10 in a month, that pay will roll over to the next month until they amass at least $10.

Medium has been reticent about its member numbers in the past, but CEO Ev Williams told TechCrunch in November that its member numbers were in the “high hundreds of thousands.” In March 2021, Medium had 725,000 members per Axios, but Digiday previously reported that Medium had hoped to reach 1 million members by 2020. As of September, its competitor Substack, founded in 2017, had 250,000 paid subscribers and raised a $65 million series B round two months later. Medium last raised venture funding in 2016 with a $50 million series C round.

Platforms like Substack and the newer Ghost pay writers based on how many paying subscribers they have. Medium’s new revenue sharing model similarly incentivizes writers to corral readers to the platform, but Medium takes about 50%. For direct subscriptions to a writer’s individual newsletter, Substack takes 10%, and Ghost takes $9 per month. While Substack or Ghost readers might subscribe to multiple individual newsletters, Medium subscribers pay just one $5 monthly or $50 yearly fee to access all of the website’s content.

The newsletter business is competitive — in June, Facebook launched a newsletter platform called Bulletin with hand-picked contributors, and Twitter acquired Revue earlier this year. Then, last week, Quora unveiled a monetization platform called Quora+, which costs the same as a Medium membership. Similar to Medium, Quora+ subscribers get access to all content any writer chooses to put behind a paywall, and writers are paid based on engagement with their content. But writers can also write paywalled posts on Spaces, which are like user-created publications on Quora — Quora takes a 5% cut of those payments.

Source: Tech Crunch

Unity, the company behind the super popular 2D/3D engine of the same name, is today announcing plans to make its biggest acquisition to date. Unity says it will acquire Parsec, a remote desktop tool for developers and creatives, for $320 million in cash.

Parsec’s pitch has long been remote desktop access without compromise. Tuned for creatives, it works fine even if your rig has multiple high resolution displays. It’ll stream your work-in-progress artwork without screwing up the colors, and it’ll play friendly with fancier input devices like pressure sensitive drawing tablets.

Parsec began its life back in 2016, initially focused on helping gamers stream games from their powerful PCs to other (generally less powerful) devices. It turns out the same things that made it good for game players — low latency, high-resolution display support, and compatibility with all kinds of different input devices — made it good for game makers as well. After noticing a number of users across the creative industry tapping Parsec to beam into their workstations, the company started rolling out plans and features just for creative teams. When the pandemic sent more teams home and away from their office setups, usage of Parsec took off.

“We believe that, more and more, creators will need to be able to work anywhere” Unity Senior Vice President Marc Whitten told me in a call earlier this week. “They’re going to work in groups that are dispersed by distance, or they’re going to be in a hybrid environment where they might be working in the office sometimes and at home sometimes.”

“I think that’s going to mean that those creators are going to need to have access to the power they need on the glass that they have, wherever they are.” he adds. “And Parsec is a great example of a company that has just deeply innovated in that space.”

Whitten also alluded to this being the beginning of a deeper cloud push for Unity: “I think you’re gonna see that Parsec is a great foundational block for a broad sort of cloud ambition that we have as a company,” he said. “You’re going to see a lot more from us in that particular regards.”

Parsec’s total funding before the acquisition was $33 million, according to Crunchbase. Its most recent funding was a $25 million Series B led by Andreessen Horowitz last December.

Whitten tells me that he doesn’t foresee any changes for existing Parsec users, but couldn’t comment yet on any potential changes to subscriptions/pricing.

Source: Tech Crunch

Most businesses by now are well versed with the consequences of the COVID-19 pandemic: Faltering offline sales, flexible work-from-anywhere options, fluctuating foot traffic with lockdown mandates and e-commerce becoming a channel many brands wished they had built infrastructure for earlier.

As a record number of consumers in Southeast Asia move from shopping malls to online platforms like Shopee, Lazada, Tiki and Tokopedia, the advertising dollars are naturally flowing in. Emerging markets are witnessing the advent of retail media right now.

Amazon paved the way in North America in 2018 by launching Amazon Advertising to become the first bid-and-buy marketplace. BCG now estimates retailers have a $100 billion business opportunity to capture, if they can keep up.

The money is where the consumer is

To understand why retailers will capture more ad spend, it’s important to evaluate what modern day marketing has become.

Is it bus stop advertisements? Bidding on Google keywords or a Clubhouse session? Or is it a viral TikTok video? As the world becomes more connected and the lines between offline and online blur even more, modern day marketing is a mix of all the channels tied to key performance metrics.

The main goal of marketing, no matter the medium, is to highlight a business or product to the right consumers to score a potential sale. And like most things, there is a bad, a good and a much better way of doing things.

Traditional marketing channels were primarily linear TV, radio and print, because the mediums were highly popular at the time. However, with the birth of the internet newer platforms emerged such as email, websites and streaming. Then came the rise of social media and apps that shook up the advertising landscape. But regardless of these shifts, there has always been one constant: The business went where the consumer was.

So when sources of traffic and revenue once again change, let’s say due to a pandemic, the marketing mix follows. In the next 12 months alone, many marketers are planning to decrease spending in cinema, print and out of home (OOH), while the majority will increase budgets in social and search, according to Nielsen.

The search for superior advertising channels

So which channels will benefit as money flows out of outdated buckets? A good indicator is ad revenue trends in mature markets like the U.S. While Google and Facebook remain the dominant advertising players, Amazon has eaten into the duopoly’s ad revenue pie in the U.S., growing its share from 7.8% to 10.3% in 2020 alone, according to eMarketer.

How? Because the most valuable advertising channel is the one that has the most measurable touch points with the consumer.

Source: Tech Crunch

Traditional MBA programs can be costly, lengthy, and often lack the application of real world skills. Meanwhile, big global brands and companies who need Product Managers to grow their businesses can’t sit around waiting for people to graduate. And the EdTech space hasn’t traditionally catered for this sector.

This is perhaps why Product School, says it has secured $25 million in growth equity investment from growth fund Leeds Illuminate (subject to regulatory approval) to accelerate its product and partnerships with client companies.

The growth funding for the company comes after bootstrapping since 2014, in large part because product managers (PMs) no longer just inside tech companies but have become sought after across almost virtually all industries.

Product School provides certificates for individuals as well as team training, and says it has experienced and upwelling of business since Covid switched so many companies into Digital ones. It also now counts Google, Facebook, Netflix, Airbnb, PayPal, Uber, and Amazon amongst its customers.

“Product managers have an outsized role in driving digital transformation and innovation across all sectors,” said Susan Cates, Managing Partner of Leeds Illuminate. “Having built the largest community of PM’s in the world validates Product School’s certification as the industry standard for the market and positions the company at the forefront of upskilling top-notch talent for global organizations.”

Carlos Gonzalez de Villaumbrosia, CEO and Founder of Product School, who started the company after moving from Spain, said: “There has never been a better time in history to build digital products and Product School is excited to unlock value for product teams across the globe to help define the future. Our company was founded on the basis that traditional degrees and MBA programs simply don’t equip PMs with the real-world skills they require on the job.”

Product school has also produced the The Product Book, The Proddy Awards and ProductCon.

It’s main competitor is MindTheProduct community and training platform, which has also boostrapped.

Source: Tech Crunch

Zomato’s losses more than tripled in its first quarterly earnings report since its listing last month as the company’s expenses grew and the pandemic hit the firm’s dining-out business.

The Gurgaon-headquartered firm reported (PDF) a net loss of $48 million in the quarter that ended in June, up from about $13.5 million during the same period last year.

The 12-year-old firm also reported strong revenue growth, moving from $35.7 million to $113.4 million during the aforementioned period as more people in the country began to order food online.

The firm said it delivered more than 100 million food orders last quarter and has surpassed a billion orders in the past six years.

“This is largely on account of non-cash ESOP expenses which have increased meaningfully in Q1 FY22 due to significant ESOP grants made in the quarter pursuant to creation of a new ESOP 2021 scheme. This divergence in reported profit/loss and Adjusted EBITDA will continue going forward,” a blog post signed by top Zomato executives read.

The executive said in the post that the second wave of the coronavirus, which hit the country beginning in April, “significantly impacted the dining-out business in Q1 FY22 reversing most of the gains the industry made in Q4 FY21.”

Zomato’s shares on BSE.

Shares of Zomato, which had a stellar debut on the Indian stock exchanges last month, fell 4% on Tuesday ahead of the results and ended at slightly below the original issue price of $1.68 a share on July 23, which valued Zomato then at $13 billion.

The company said it will hold one call with analysts a year — instead of the typical four — and address questions through blogs and quarterly shareholder letters.

In India, Zomato competes with Swiggy, which is backed by SoftBank and Prosus. Last month, the Indian food delivery startup said it had raised $1.25 billion in a new financing round. SoftBank Vision Fund 2 evaluated Zomato before making its bet on Swiggy, people familiar with the dealflow said.

Both the firms in recent quarters have expanded to new categories including grocery delivery.

Zomato is the first Indian consumer internet startup in the current wave to go public. India’s financial services Paytm and MobiKwik as well as online insurer PolicyBazaar and online beauty products firm Nykaa have filed the paperworks to go public later this year.

Source: Tech Crunch

I worked at Google for six years. Internally, you have no choice — you must use Kubernetes if you are deploying microservices and containers (it’s actually not called Kubernetes inside of Google; it’s called Borg). But what was once solely an internal project at Google has since been open-sourced and has become one of the most talked about technologies in software development and operations.

For good reason. One person with a laptop can now accomplish what used to take a large team of engineers. At times, Kubernetes can feel like a superpower, but with all of the benefits of scalability and agility comes immense complexity. The truth is, very few software developers truly understand how Kubernetes works under the hood.

I like to use the analogy of a watch. From the user’s perspective, it’s very straightforward until it breaks. To actually fix a broken watch requires expertise most people simply do not have — and I promise you, Kubernetes is much more complex than your watch.

How are most teams solving this problem? The truth is, many of them aren’t. They often adopt Kubernetes as part of their digital transformation only to find out it’s much more complex than they expected. Then they have to hire more engineers and experts to manage it, which in a way defeats its purpose.

All of this means there is a great opportunity for DevOps startups to come in and address the different pain points within the Kubernetes ecosystem. This technology isn’t going anywhere, so any platform or tooling that helps make it more secure, simple to use and easy to troubleshoot will be well appreciated by the software development community.

In that sense, there’s never been a better time for VCs to invest in this ecosystem. It’s my belief that Kubernetes is becoming the new Linux: 96.4% of the top million web servers’ operating systems are Linux. Similarly, Kubernetes is trending to become the de facto operating system for modern, cloud-native applications. It is already the most popular open-source project within the Cloud Native Computing Foundation (CNCF), with 91% of respondents using it — a steady increase from 78% in 2019 and 58% in 2018.

While the technology is proven and adoption is skyrocketing, there are still some fundamental challenges that will undoubtedly be solved by third-party solutions. Let’s go deeper and look at five reasons why we’ll see a surge of startups in this space.

Containers are the go-to method for building modern apps

Docker revolutionized how developers build and ship applications. Container technology has made it easier to move applications and workloads between clouds. It also provides as much resource isolation as a traditional hypervisor, but with considerable opportunities to improve agility, efficiency and speed.

Source: Tech Crunch

Match today is introducing new features that aim to address some of users’ complaints with modern-day dating apps — like how much time it takes to find a relevant match and how frustrating it is when users ghost one another after the initial conversation fades. As part of a new strategy to better position Match for more “emotionally mature” singles (read: adults), the company says it will begin beta testing a recommendation system called “Matched by Us,” which may pave the way for a broader matchmaking service in the future. It’s also testing an anti-ghosting feature which pushes users to either continue a conversation or unmatch the recipient, instead of leaving them hanging.

The features are designed to address the challenges that face Match’s older demographic. Match users tend to be in their 30’s and up, and have full lives. They’re generally ready to find relationships and settle down with a partner. That’s a different life phase than those using other Match dating apps, like Tinder, where younger users are still in a more exploratory phase and enjoy on going on many dates, including casual dates.

“When we talk to our members, we hear a lot of frustration around [there being] a lot of swiping, a lot of messaging back and forth — that’s happening in the dating world more broadly,” explains Dushyant Saraph, Match’s Chief Product Officer. “When we think about folks on our product, who don’t have a ton of time, that’s where ‘Matched by Us’ came from. Our singles don’t want to swipe through hundreds of profiles,” he says.

Image Credits: Match

The new feature, which is made available to free and paid users alike, will present one, free customized match every week, where both users can see each other and no longer have to wait for a “like” back in order to engage in a conversation.

The system works to find compatible matches by algorithmically examining a new set of preferences around users’ personalities, based on responses to questions posed in users’ Match bios.

For example, questions may ask about users’ five-year plans, their favorite weekend activities, or whether they’re open to moving somewhere new if they find the right person. The latter has become especially relevant in the new age of remote work, driven by the pandemic, which no longer requires people to live in the bigger cities where their company may be headquartered, Saraph notes.

Image Credits: Match

Currently, the system will recommend a match based on a holistic view of users’ preferences, as determined by an algorithm, but the company has been internally testing adding a layer of human curation to its suggestions, as well.

In other words, Match is testing an actual match-making service.

For the time being, however, the human curation team inside Match is working in more of an R&D capacity, Saraph says.

“We’ve been flexing how many experts we need as we’re testing kind of different concepts — everything from coaching to expert picks, where we’re doing human curation,” he says. The team also works on other features, like suggesting conversation starters to keep conversations going.

“Long-term we expect to be flexible, depending on which of these [products] is most interesting to our members, and scaling up our expert team accordingly. Right now, human curation is one area that we’re really excited about and want to crack, and I think you’ll hear more about that in the coming months,” Saraph adds.

Another new feature aimed at helping adults to stop waste their time on dating apps involves how Match will handle matches’ conversations. Typically, conversations either take off leading to real-world dates, or slowly fade away, until communication stops altogether. Sometimes, the other party simply “ghosts,” and never responds at all.

Image Credits: Match

Users told Match that their main issue with ghosting is the uncertainty around what it means.

Did the user just get busy, or did they decide they weren’t interested?, users wonder.

A new feature aims to keep conversations’ momentum going by nudging users when a conversation is about to “expire” — that is, when it will be archived into a new section of the inbox for inactive conversations.

And if you are in the app, you can visit the conversation to get suggestions of conversation starters to help you pick things back up, or you can tap a button to unmatch the other user. The latter would send a more explicit signal to the recipient that there was a lack of interest, though it won’t actually push a notification that tells the user they’ve been unmatched. (That can sometimes lead to safety issues, particularly for women who have received threats from men they’ve rejected.)

Image Credits: Match

Match says it’s currently testing the right number of days to elapse before it nudges users to either re-engage or end their conversations with an unmatch. But the right amount of time seems to be in the three to five-day range, Saraph says.

The new features are rolling out to some portion of Match’s U.S. user base in beta, as the company kicks off a new brand campaign targeting adult daters. The campaign’s message is that Match understands what modern adult singles are looking for in order to date better, and these features are an example of that understanding being put into practice.

The beta tests are rolling out across all Match platforms, including iOS, Android, mobile web and desktop over the next few months, starting in the U.S.

The news follows a mixed earnings report from the dating app giant, Match Group, which owns top brands including Match, Tinder, OKCupid, Plenty of Fish, Hinge, and others. The company saw the impact of a pandemic recovery in the second quarter, with 15 million paying customers across its brands, up from 13 million in the year-ago quarter. Revenue was $707.8 million, topping analyst projections of $694 million. But Match Group missed on earnings, with net income of $140.9 million, or 46 cents a share, when analysts expected 49 cents per share.

The company also spoke in detail about its plans for social networking app maker Hyperconnect, a company Match bought for $1.73 billion earlier this year. Match Group said it plans to add audio and video chat, including live video, to its dating brand portfolio.

Match’s dating app is among those that will benefit from Hyperconnect integrations, Saraph told TechCrunch, as Match plans to explore “building out live experiences.” The company expects these to be added around year end towards the beginning of 2022, we’re told.

Source: Tech Crunch