Daily Crunch: Coinbase will reduce its workforce by 18% to ‘stay healthy during this downturn’ 

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It’s June 14, 2022, and while we’re casually putting together the Daily Crunch newsletter, Bill Gates is chilling at the next table over at the TC Sessions: Climate event in Berkeley, California. Oh, and we just released some new tickets for our annual summer party! See you there? — Haje and Christine

The TechCrunch Top 3

  • More layoffs: We tried to think of something more clever than that, but let’s just get on with the bad news. Coinbase, Redfin and Compass are the latest companies to announce that big chunks of their employees will not be soon. Ivan writes that Coinbase laid off 18% of its workforce, or about 1,100 people, which had everyone doing the math on how many employees it actually had. And though Coinbase was well within its right to cut access to its systems before telling affected employees, we can’t help but wonder if there were some early birds wondering what the heck was going on. Meanwhile, Mary Ann reports a one-two punch of higher mortgage rates and fewer home sales led both Redfin and Compass to lay off a combined 920 employees today.
  • Gonna take some time to do the things we never had”: Launch Africa, a venture capital firm that has already backed over 100 startups, closed its first fund with $36.3 million in commitments, Tage reports. The fund boasts an impressive list of over 230 retail and institutional investors spanning 40 countries, and a large portion of it has already been put to work in startups.
  • SPACs lie here: We may now be reporting tech layoffs every day, but it wasn’t that long ago that we were doing the same for special purpose acquisition companies, fondly known as SPACs. Alex and Anna look into the fruits of that labor, but we warn you some of it is rotten.

Startups and VC

On the one hand, we write a lot of words about recessions. On the other, it seems like there’s a flurry of new funds popping up left, right and center.

Kate reports that  World Innovation Lab raised $1 billion to bridge the innovation gap between corporates and startups in the U.S. and Asia.

From our Asia-focused VC desk: Sequoia India and Southeast Asia raise $2.8 billion funds, Manish reports.

Continuing the theme of connecting startups to other entities, Dcode Capital closed a $50 million fund focusing on startups wanting to work with the federal government, Rebecca writes.

Some more highlights…

A decade after the bubble burst, 5 climate tech investors explain why they’re all in

Two Electric engineer wearing Personal protective equipment working on top of wind turbine farm; climate tech investor survey

Image Credits: Tunvarat Pruksachat (opens in a new window) / Getty Images

Twenty years ago, there were high hopes for companies aiming to mitigate environmental impacts, but an extended recession, China’s dominance over solar power manufacturing and low natural gas prices weren’t the only factors hobbling the industry.

A 2016 MIT Energy Initiative working paper found that VC is “the wrong model for clean energy innovation.” It takes years to create economies of scale, and not every investor is willing to foot the bill for a decade of R&D.

“If a new and more diverse set of actors avoids the mistakes of the cleantech VC boom and bust, then they may be able to support a new generation of cleantech companies,” the paper concluded.

That hypothetical cohort is now a reality: a McKinsey report found that climate tech “could attract $1.5 trillion to $2 trillion of annual capital investment” by 2025.

Senior climate writer Tim De Chant spoke to five investors to get their take on the state of the industry in Q3 2022. Their answers shed light on how VCs are reacting to the downturn, which tech may have the greatest potential for impact and what they’re looking for at the moment:

Pae Wu, general partner, SOSV; CTO, IndieBio

Christian Garcia, partner, Breakthrough Energy Ventures

Rajesh Swaminathan, venture partner, Khosla Ventures

Andrew Beebe, managing director, Obvious Ventures

Amy Burr, president, JetBlue Technology Ventures

(TechCrunch+ is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

India officials made it clear that if VPN firms want to conceal who uses their services, they will have to leave the country ahead of some stricter guidelines. Now firms are obliging. The latest to announce it is removing its services is NordVPN, Manish reports. “As digital privacy and security advocates, we are concerned about the possible effect this regulation may have on people’s data,” Laura Tyrylyte, head of public relations at NordVPN, told TechCrunch.

Two years after stepping away from Amazon Robotics, Brad Porter unveiled his new passion, Collaborative Robotics, which will study human-robot interaction, Brian writes. It was too early for Porter to spill the beans on what he’s working on, but he definitely said it will not be like Tesla’s Optimus robot. Perhaps it might be more like a Megatron robot?

Meanwhile, Natasha digs into why yet another European country is investigating Apple’s app privacy framework. This time, Germany’s antitrust watchdog wants to see if the tech giant is unfairly tipping the scales in its direction.

There are also a couple of cybersecurity breaches to talk about. Someone gained access to a Kaiser Permanente employee’s emails in April, which led to a breach of approximately 70,000 patient records. Carly notes that this may have been the result of phishing, and action has been taken to educate employees; however, it is not yet known why it took the company months to report to patients what happened. Going back over to India again, Zack reports on millions of farmers in the country being exposed to the new Aadhaar data leak, which means their confidential 12-digit identity numbers — essentially how they get paid — were not so confidential anymore.

Here are some more highlights from the day: