How an immigration crackdown is hurting UK startups
Our European correspondent Natasha Lomas spent the past few weeks investigating what’s been happening to immigrant founders and tech talent in the UK, who have been receiving more scrutiny from the Home Office in recent months. Natasha zooms in on Metail, a virtual fitting room startup, and its tribulations with the immigration authorities and the damage those action are having on the broader ecosystem:
The January 31 decision letter, which TechCrunch has reviewed, shows how the Home Office is fast-tracking anti-immigrant outcomes. In a short paragraph, the Home Office says it considered and dismissed an alternative outcome — of downgrading, not revoking, the license and issuing an “action plan” to rectify issues identified during the audit. Instead, it said an immediate end to the license was appropriate due to the “seriousness” of the non-compliance with “sponsor duties”.
The decision focused on one of the two employees Metail had working on a Tier 2 visa, who we’ll call Alex (not their real name). In essence, Alex was a legal immigrant had worked their way into a mid-level promotion by learning on the job, as should happen regularly at any good early-stage startup. The Home Office, however, perceived the promotion to have been given to someone without proper qualifications, over potential native-born candidates.
In addition to reporting the story, Natasha also wrote a guide specifically for Extra Crunch members on how founders can manage their immigration matters, both for themselves and for their employees.
The state of the smartphone
TechCrunch hardware editor Brian Heater analyzed the slowdown in smartphone sales, finding few reasons to be optimistic about how smaller handset manufacturers can compete with giants like Apple and Samsung. There are slivers of good news from the developing world and also from 5G and foldable tech, but don’t expect profits to reach their zenith again any time soon.
Market share has remained relatively stable among top manufacturers, even as many of the also-rans have begun to fall away. Things have consolidated on the high end — as Canalys notes above, market share among the top five smartphone vendors rose from 66.8 to 72% of the total global market — a trend that’s likely to continue as smaller manufacturers struggle to grapple with larger market trends.
[Speaking about Huawei in particular:] “They haven’t grown the pie,” Gartner analyst Tuong Nguyen tells TechCrunch.” They’ve taken pieces of other vendors’ pies by pushing their marketing strategy (to drive their brand perception). “They were also smart about doing this as a dual-brand strategy — to both the high end as well as the mid/low tier. This gives them access to a broader segment of the market than if they were to just focus on the high end and it gives them the aspirational products that mid/low tier users can aspire to own and associate with.”
How startups can use Amazon’s SEO best practices to dominate new shopping verticals
Growth advisor Eli Schwartz analyzes SEO best practices by evaluating how Amazon positions its product pages to garner maximum visibility from search engines like Google. He buckets the tactics into four categories: content positioning, SEO site architecture, cross-linking, and page layout design.
One interesting point Schwartz makes is that backlinks are not as valuable as they might otherwise appear to be:
As one of the largest brands in the world, Amazon certainly has a unique ability to garner backlinks that any smaller competitor would not have, but this is not the magical elixir some would think it is. Backlinks are only a component of the algorithm and better performance on areas like relevancy and intent matching will always beat out a better-linked page.
For example, the query “Michael Jackson”, Amazon is nowhere in the top 10 results and some of the ranking results have significantly fewer links than Amazon.com with nearly 4 billion backlinks according to Ahrefs.com.
This is because, for this query, a shopping site like Amazon is not considered to be relevant. As soon as a shopping intent keyword is appended to the query like “Michael Jackson costume” suddenly Amazon does rank.
Interestingly, Amazon is the second-ranking result behind a site that specifically sells costumes likely because Google has determined that a costume site is more relevant for a searcher looking for costumes. This underscores the point of this guide that with good SEO Amazon can be beaten and Amazon does not have an innate SEO advantage because of their brand.
Under the hood on Zoom’s IPO, with founder and CEO Eric Yuan
This week, we hosted newly-christened public company CEO and Zoom founder Eric Yuan for a live conference call for Extra Crunch members hosted by our SF-based correspondent Kate Clark. If you missed the call or want to read it, we have now posted the transcript, which covered Zoom’s journey from idea to multi-billion IPO as well as the company’s sales approach to customers.
Caller Question: Congratulations on the IPO. I wanted to ask, as you were growing, how did you know to cater more to the enterprise customers versus focusing on small and medium businesses instead?
Eric: I think that’s a great question. It seems more like it’s based on the customer feedback from several years ago, like six years ago, when we first introduced our service and we were more of a startup company with no brand, when nobody knew about Zoom. I think ideally you start with SMB customers, and that’s why our first three customers were all from the high end, because they were looking for solutions, and they do not really care about your company as a brand as long as you have a much better solution.
But along the way, and of course we’ve had so many SMB customers for sure. They also use Zoom with other big enterprise customers every time. Those big enterprise customers, after they had done a Zoom meeting, their experience sort of forced them to try Zoom as well, because the experience was much better than their existing solutions. And that’s why we had many incoming leads, or phone calls or emails from big enterprise customers. They wanted to test Zoom, they wanted to try Zoom. That’s how we started.
And then we got some big Fortune 100 companies we knew already from the product side. That’s why we established our enterprise team, almost three years ago. And every day, you have so many large enterprise customers coming to Zoom platform, and that’s why we say, “Hey, we are very ready now. And how do we further help our enterprise strategy?” And that’s the reason why we wanted to become a public company.
At this point, SoftBank Group is really just its Vision Fund
SoftBank Group’s annual financial report came out last week, and so I decided to read all of it and compile the most interesting themes that emerged from the figures.
In other words, in just about two years, the Vision Fund’s realized and unrealized returns equals the income generated by all the rest of SoftBank Group’s businesses combined. Masayoshi Son’s lifetime of building a business empire is being matched — again, at least for now — by a two-year-old investment vehicle funding late-stage startups.
…
Across its various companies, SoftBank Group employs literally hundreds of thousands of people, but it is the 400 (going on 800) professionals at the Vision Fund that are driving the dollars. If that doesn’t explain the rise and power of finance, I don’t know what else will.
Reality Check: The marvel of computer vision technology in today’s camera-based AR systems
Shape Immersive managing partner Alex Chuang analyzes the technology stack that makes camera-based augmented reality function, covering localization/mapping, geometry, and semantics.
What is SLAM (Simultaneous Localization and Mapping)?
To bring everything together, SLAM refers to the broader system that allows your phone to construct and update a map of an unknown environment while simultaneously keep track of its location within the map. SLAM systems include subsystems that we already mentioned like the phone’s optical systems, inertial systems, and mapping systems. Through tight integration between hardware and software, your phone now has this incredible ability to understand where it is in the world and track itself within its environment.
How to see our world in a new light
Speculative fiction is one of the best lenses we have available in the startup / innovation world to understand, empathize, and view our world in a new light. I interviewed Eliot Peper about his new novel Breach, which concludes his Analog trilogy on algorithms, social media, and geopolitics (and a bunch of other topics, really). Eliot previously wrote a guide on Extra Crunch to the best fiction for startup founders if you haven’t caught that one before.
Danny: When you consider your own thinking about these themes, what changed from from Bandwidth [Eliot’s first book in the trilogy] to Breach?
Eliot: It made me realize that when we look at big problems, like climate change or like how people are worried about how the internet might be sort of subverting their thinking, when we think about the big picture issues, we often want big solutions. We have too many emissions going into the world, so let’s have the UN pass a resolution.
If you read the news headlines today, it seems like the world is just going down in flames, right? We have nationalist reactionary politics on every side, we have all of these things that just feel horrible. And when I see those things that just makes me want a big fix, I’m like, ‘oh, my god, somebody just make us better.’
We always want the permanent fix, but the world isn’t static.
I think that working through these three books really made me realize that the only place you can start is in your own life, actually in your own life and your own world. That is where those kinds of changes come from.
Verified Expert Brand Designer: Milkinside
Yvonne Leow has written another Verified Expert Brand Designer profile, this time on Gleb Kuznetsov, who founded Milkinside,a boutique branding agency that focuses on product development as much as a company’s brand itself. He and his studio have worked with Mapbox, Airbus, and a host of others on their brands.
Yvonne Leow: What are some of the mistakes you see founders make when it comes to branding?
Gleb Kuznetsov: There are a lot of founders who believe they created useful technology and are absolutely certain people will use it. But everything is moot if users aren’t able to understand your product narrative and how it fits into their lives. Establishing a product narrative at an early stage is key. A lot of founders will try to create a minimum viable product as soon as possible, but they aren’t thinking about the narrative, branding, the product design, and how everything comes together.
ICYMI: Earlier this week:
- MailChimp’s Ben Chestnut on bootstrapping a startup to $700M in revenue
- Equity Shot transcribed: Judging Uber’s less-than-grand opening day
- Market map: the 200+ innovative startups transforming affordable housing
- The misunderstandings of 18-month-old Luckin’s $500m IPO
- Beyond costs, what else can we do to make housing affordable?
- Verified Expert Brand Designer: Phil Weiner
- CEO Howard Lerman on building a public company and the future of Yext
- What Uber and Lyft’s investment bankers got right
Thanks
To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people, and companies. If I can ever be of assistance, hit reply, or send an email to danny@prod22.techcrunch.com.
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