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Hello and welcome to Daily Crunch for Wednesday, March 23, 2022! Lots to talk about today, including bushels of news from both startups and Big Tech alike. But as we are entering Event Season, a reminder that you can showcase your startup at our upcoming climate event, and that Early Stage should feature some pretty solid small group chats. – Alex
The TechCrunch Top 3
- Build-A-Bing: Microsoft was hacked by the Lapsus$ hacking group, leading to the leaking of company source code for Bing, Bing Maps and Cortana, TechCrunch reports. Does this mean that founders can parse the Bing code, learn from it and build a competing search engine? Let’s hope so?
- Yuga’s yuge funding round: The team behind the Bored Ape NFT phenom are busy, raising $450 million and sketching out a vision for tokens, games, and more. A good question at this juncture is why it is so expensive to build crypto companies. It seems that every major raise in the space is larger than the last. How far can the trend go? Well, pretty far, it seems.
- And speaking of crypto: A reminder to keep learning, as the web3 space — such as it is — is fast-moving and constantly inventing stuff for us to parse. Tea, for example, wants to bring a model for compensating open source developers to the crypto world, while our newest reporter has notes up on DeFi (decentralized finance) TVL (total value locked), providing a window into just how busy the investing game is on the blockchain.
Startups and VC
The pros and cons of pro rata: Before we get into discrete funding events and startup product launches, a word about pro rata. Pro rata rights are privileges investors often work into deals so that they can defend their ownership percentage in a startup over time. With pro rata, investors that buy 5% of a company early on can pay up in later rounds to ensure that they are not overly diluted. However, VSC Ventures’ Vijay Chattha thinks that the practice of pro rata is effectively outdated and should go. Food for thought.
Today in mega-rounds: Back in the day, a $100 million Series A fund was news. Today, nine-figure startup rounds can slip through the cracks. To avoid that, TechCrunch wrote up RapidAPI (third-party API integration) raising $150 million, Island (enterprise browser tech) raising $115 million and Astronomer (data orchestration tooling) raising $213 million and buying Datakin.
And the first Nothing phone is coming this summer. So if you are not enthused by current handset OEMs, well, you have a new option coming.
- Drones are big business: Japan’s TerraDrone just raised a huge $70 million Series B. What for? Founded back in 2016, TechCrunch reports, the company “develops drone software, hardware and uncrewed aircraft system traffic management solutions.” That means that the company could help its market avoid a drone traffic jam.
- Datagen raises for synthetic data sets: Datagen also raised a huge Series B, though at $50 million it’s a little bit smaller than what TerraDrone put together. Regardless, the company’s tech can create custom, synthetic datasets that customers can use to train their own computer vision tools. That there is enough of a market for its services that Datagen was able to attract so much capital underscores the work being done in computer vision more generally.
- Skyscraper strawberries: That’s what vertical farming company OnePointOne is going to sell to California Giant Berry Farms. TechCrunch notes that the company is following Bowery into the market. Oversaturation? Not a bit of it. I can eat a whole tub of strawberries with breakfast. Bring ‘em on.
- Rugged Robotics is building construction-focused Roombas: Well, not precisely, but close enough. Rugged’s robots paints building layouts onto floors. So Rugged is both a robotics company, and an automation company at the same time. We do note that the company’s “tech isn’t designed to replace humans on the job site, but rather to increase accuracy,” but it’s still the replacing of humans with robots, which is never a bad thing.
- And, finally, from Ron Miller, “Scratchpad adds deal alerts to help identify most promising prospects.” This story is neat as it shows that you can start a company building atop someone else’s platform, but pivot into making the service something more. In this case, Scratchpad is now “a central workspace for sales people by using intelligence to surface the most likely prospects to close deals,” Miller writes.
The product-led growth playbook
In a previous era, companies threw elbows and money around as they entered new markets and acquired customers. Today, a decade or more into the End User Era, consumers are the tail that wags the dog.
Product-led growth models have been widely embraced: Instead of devoting resources to customer acquisition, PLG companies scale faster and more efficiently.
Vidya Raman, a partner at Sorenson Ventures and former product manager, shared her prerequisites with TechCrunch+ for making PLG efforts more successful and sustainable.
“Think in bite-sized experiences, each of which would be a meaningful outcome for the customer,” she says.
(TechCrunch+ is our membership program, which helps founders and startup teams get ahead. You can sign up here.)
Big Tech Inc.
- YouTube announces ad-supported TV shows: During the pandemic, Roku had a crushing good time making money off of folks stuck at home, watching shows and its advertisements. YouTube wants in on that action, so it’s also rolling out ad-supported TV shows. Per our reporting, some 4,000 episodes are included at launch.
- Google Cloud now lets customers suspend VMs: The last code I really wrote was back in high school, so I never really had the need to suspend VMs on a public cloud. But Google’s public cloud infra now does offer that ability, if that’s your jam.
- Microsoft wants game dev to move to the cloud: And speaking of public clouds, Microsoft announced a new product called Azure Game Development Virtual Machine at a gaming conference today. It’s a game development workstation, but in the cloud.
- Are car solar roofs a good idea? The new hybrid Hyundai Sonata has solar panels in its roof, which some folks are saying are too low-powered to be of use. However, TechCrunch notes that their impact over a longer time period really could add up to something material.
- Instagram gets down with chronological feeds: If you are an Instagram user, you can now use a chronological feed. From testing earlier in the year, the new feature is now available to all, along with “another new feed-filtering option that will allow you to scroll through posts from your favorite accounts,” TechCrunch writes.
- Snap buys a mind-control headband company: Fresh from turning in some quarterly profits, Snap is not slowing its roll. Nope, the social giant has bought NextMind, which builds hardware that reads brain waves to interact with PCs. Snap, what do you have in mind?