Africa Roundup: Terragon’s Asia acquisition, Twiga Foods’ $10M raise, SimbaPay’s China payment service

Jake Bright Contributor Jake Bright is a writer and author in New York City. He is co-author of The Next Africa. More posts by this contributor Africa Roundup: Terragon’s Asia acquisition, Twiga Foods’ $10M raise, SimbaPay’s China payment service SimbaPay launches Kenya to China payment service over WeChat Nigerian consumer data analytics firm Terragon Group  acquired Asian […]

Nigerian consumer data analytics firm Terragon Group  acquired Asian mobile marketing company Bizense in a cash and stock deal. The price of the acquisition was not disclosed.

Based in Singapore, with operations in India and Indonesia, Bizense specializes in “mobile ad platform[s] for Telco’s, large publishers, and [e-commerce] ad networks.”

Headquartered in Lagos, Terragon’s software services give its clients — primarily telecommunications and financial services companies — data on Africa’s growing consumer markets.

“Most of the problems we seek to solve for our clients in Africa also exist in places like South East Asia and Latin America,” Umeh told TechCrunch of the logic for the acquisition.

Umeh indicated the company is contemplating further expansion in Asia and the Latin America, where Terragon already has consumer data research and development teams.

Tarragon has a team of 100 employees across Nigeria, Kenya, Ghana  and South Africa. Clients include local firms, such as Honeywell, and global names including Unilever,  DHL  and international agribusiness firm Olam.

Terragon’s acquisition in Singapore, and moves by several other Nigerian ventures this year, signal greater global possibilities for Sub-Saharan African startups.

African financial technology companies like Mines and Paga announced their intent to expand in and outside Africa. They would join e-commerce site MallforAfrica, which went global in July in a partnership with DHL.

Kenya’s Twiga Foods has raised $10 million and announced it will add processed food and fast-moving consumer goods to its product line-up.

The $10 million IFC and TLcom Capital co-led investment comes in the form of convertible notes, available later as equity, according to Wale Ayeni, regional head of IFC’s Africa VC practice.

Twiga Foods has built a B2B platform to improve the supply chain from farmers to markets. The startup now aims to scale additional merchandise on its digital network that coordinates pricing, payment, quality control and logistics across sellers and vendors.

CEO and co-founder Grant Brooke sees “a growth horizon…to build a B2B Amazon,”  with produce as the base.

“If we can build a business around fresh fruit and vegetables, everything else after that is much simpler to add on,” he told TechCrunch in this feature.

Forging another link between Africa and China’s digital economies, the African-focused money transfer startup SimbaPay and Kenya’s Family Bank have launched an instant payment service from East Africa to China.

The new product — which piggy-backs on WeChat’s  messaging service — is aimed at Kenyan  merchants who purchase goods from China, Kenya’s largest import source.

To be clear, SimbaPay isn’t partnering with WeChat on this service, neither to provide the payments nor to build the service.

Using QR codes, SimbaPay developed a third-party payment aggregator that enables funds delivery when the buyer and seller both use WeChat’s network, which today has more than 1 billion registered accounts.

Individuals and businesses can now send funds to China through Family Bank’s PesaPap app, Safaricom’s M-Pesa or by texting USSD using the code *325#.

The service opens a faster and less expensive money transfer option between Kenya and China through the Tencent-owned WeChat social media platform.

SimbaPay transfers funds to 11 countries — nine in Africa then to China and India. “Early next year we’ll increase this to 29 countries,” SimbaPay co-founder Sagini Onyancha told TechCrunch in this feature.

In case you missed it, TLcom Capital senior partner Omobola Johnson and Terragon CEO Elo Umeh joined TechCrunch editor Jon Shieber for a breakdown of African tech at Disrupt Berlin. They covered everything from digital skills, the pros and cons of Andela in African IT markets, and Africa’s IPO prospects.

Umeh described how “copying and pasting” Silicon Valley models didn’t work for his Nigerian startup’s mission “to help…enterprise companies achieve value at scale.”

Johnson envisioned Africa’s next unicorn as “as a B2B—business to very small business and SMEs—company” that can solve small businesses challenges, across advertising, access to markets, and finance.

TechCrunch’s discussion of African tech with top founders, IT leaders, and VCs continues December 11 in Lagos for the second Startup Battlefield Africa. In addition to the pitch competition of 15 top early-stage startups, discussions are teed up on blockchain in Africa, unique VC models for the continent, and solving Africa’s connectivity equation. Hopefully tickets aren’t sold out by the time you read this.

More Africa Related Stories @TechCrunch

African Tech Around the Net

Nigerian logistics startup Kobo360 raises $6M, expands in Africa

Jake Bright Contributor Jake Bright is a writer and author in New York City. He is co-author of The Next Africa. More posts by this contributor SimbaPay launches Kenya to China payment service over WeChat Africa’s agtech wave gets $10 million richer as Twiga Foods raises more capital Nigerian trucking logistics startup Kobo360 has raised $6 million […]

Nigerian trucking logistics startup Kobo360 has raised $6 million to upgrade its platform and expand operations to Ghana, Togo, and Cote D’Ivoire.

The company — with an Uber -like app that connects truckers and companies with freight needs — gained the equity financing in an IFC led investment. The funding saw participation from others, including TLcom Capital and Y Combinator.

With the investment Kobo360 aims to become more than a trucking transit app.

“We started off as an app, but our goal is to build a global logistics operating system. We’re no longer an app, we’re a platform,” founder Obi Ozor told TechCrunch.

In addition to connecting truckers, producers and distributors, the company is building that platform to offer supply chain management tools for enterprise customers.

“Large enterprises are asking us for very specific features related to movement, tracking, and sales of their goods. We either integrate other services, like SAP, into Kobo or we build those solutions into our platform directly,” said Ozor.

Kobo360 will start by developing its API and opening it up to large enterprise customers.

“We want clients to be able to use our Kobo dashboard for everything; moving goods, tracking, sales, and accounting…and tackling their challenges,” said Ozor.

Kobo360 will also build more physical presence throughout Nigeria to service its business. “We’ll open 100 hubs before the end of 2019…to be able to help operations collect proof of delivery, to monitor trucks on the roads, and have closer access to truck owners for vehicle inspection and training,” said Ozor.

Kobo360 will add more warehousing capabilities, “to support our reverse logistics business”—one of the ways the company brings prices down by matching trucks with return freight after they drop their loads, rather than returning empty, according to Ozor.

Kobo360 will also use its $6 million investment to expand programs and services for its drivers, something Ozor sees as a strategic priority.

“The day you neglect your drivers you are not going to have a company, only issues. If Uber were more driver focused it would be a trillion dollar company today,” he said.

The startup offers drivers training and group programs on insurance, discounted petrol, and vehicle financing (KoboWin). Drivers on the Kobo360 app earn on average approximately $5000 per month, according to Ozor.

Under KoboCare, Kobo360 has also created an HMO for drivers and an incentive based program to pay for education. “We give school fee support, a 5000 Naira bonus per trip for drivers toward educational expenses for their kids,” said Ozor.

Kobo360 will complete limited expansion into new markets Ghana, Togo, and Cote D’Ivoire in 2019. “The expansion will be with existing customers, one in the port operations business, one in FMCG, and another in agriculture,” said Ozor

Ozor thinks the startup’s asset-free, digital platform and business model can outpace traditional long-haul 3PL providers in Nigeria by handling more volume at cheaper prices.

“Owning trucks is just too difficult to manage. The best scalable model is to aggregate trucks,” he told TechCrunch in a previous interview.

With the latest investment, IFC’s regional head for Africa Wale Ayeni and TLcom senior partner Omobola Johnson will join Kobo360’s board. “There’s a lot of inefficiencies in long-haul freight in Africa…and they’re building a platform that can help a lot of these issues,” said Ayeni of Kobo360’s appeal as an investment.

The company has served 900 businesses, aggregated a fleet of 8000 drivers and moved 155 million kilograms, per company stats. Top clients include Honeywell, Olam, Unilever, Dangote, and DHL.

MarketLine estimated the value of Nigeria’s transportation sector in 2016 at $6 billion, with 99.4 percent comprising road freight.

Logistics has become an active space in Africa’s tech sector with startup entrepreneurs connecting digital to delivery models. In Nigeria, Jumia founder Tunde Kehinde departed and founded Africa Courier Express. Startup Max.ng is wrapping an app around motorcycles as an e-delivery platform. Nairobi-based Lori Systems has moved into digital coordination of trucking in East Africa. And U.S.-based Zipline—who launched drone delivery of commercial medical supplies in partnership with the government of Rwanda and support of UPS—and is in “process of expanding to several other countries,” according to a spokesperson.

Kobo360 has plans for broader Africa expansion but would not name additional countries yet.

Ozor said the company is profitable, though the startup does not release financial results. Wale Ayeni also wouldn’t divulge revenue figures, but confirmed IFC’s did full “legal and financial due diligence on Kobo’s stats,” as part of the investment.

Ozor named Lori Systems as Kobo360’s closest African startup competitor.

On the biggest challenge to revenue generation, it’s all about service delivery and execution, according to Ozor.

“We already have volume and demand in the market. The biggest threat to revenues is if Kobo360’s platform doesn’t succeed in solving our client’s problems and bringing reliability to their needs,” he said.

Putting the band back together, ExactTarget execs reunite to launch MetaCX

Scott McCorkle has spent most of his professional career thinking about business to business software and how to improve it for a company’s customers. The former President of ExactTarget and later chief executive of Salesforce Marketing Cloud has made billions of dollars building products to help support customer service and now he’s back at it […]

Scott McCorkle has spent most of his professional career thinking about business to business software and how to improve it for a company’s customers.

The former President of ExactTarget and later chief executive of Salesforce Marketing Cloud has made billions of dollars building products to help support customer service and now he’s back at it again with his latest venture MetaCX.

Alongside Jake Miller, the former chief engineering lead at Salesforce Marketing Cloud and chief technology officer at ExactTarget, and David Duke, the chief customer officer and another ExactTarget alumnus, McCorkle has raised $14 million to build a white-labeled service that offers a toolkit for monitoring, managing and supporting customers as they use new software tools.

If customers are doing the things i want them to be doing through my product. What is it that they want to achieve and why did they buy my product.

“MetaCX sits above any digital product,” McCorkle says. And its software monitors and manages the full spectrum of the customer relationship with that product. “It is API embeddable and we have a full user experience layer.”

For the company’s customers, MetaCX provides a dashboard that includes outcomes, the collaboration, metrics tracked as part of the relationship and all the metrics around that are part of that engagement layer,” says McCorkle.

The first offerings will be launching in the beginning of 2019, but the company has dozens of customers already using its pilot, McCorkle said.

The Indianapolis -based company is one of the latest spinouts from High Alpha Studio, an accelerator and venture capital studio formed by Scott Dorsey, the former chief executive officer of ExactTarget. As one of a crop of venture investment firms and studios cropping up in the Midwest, High Alpha is something of a bellwether for the viability of the venture model in emerging ecosystems. And, from that respect, the success of the MetaCX round speaks volumes. Especially since the round was led by the Los Angeles-based venture firm Upfront Ventures.

“Our founding team includes world-class engineers, designers and architects who have been building billion-dollar SaaS products for two decades,” said McCorkle, in a statement. “We understand that enterprises often struggle to achieve the business outcomes they expect from SaaS, and the renewal process for SaaS suppliers is often an ambiguous guessing game. Our industry is shifting from a subscription economy to a performance economy, where suppliers and buyers of digital products need to transparently collaborate to achieve outcomes.”

As a result of the investment, Upfront partner Kobie Fuller will be taking a seat on the MetaCX board of directors alongside McCorkle and Dorsey.

“The MetaCX team is building a truly disruptive platform that will inject data-driven transparency, commitment and accountability against promised outcomes between SaaS buyers and vendors,” said Fuller, in a statement. “Having been on the journey with much of this team while shaping the martech industry with ExactTarget, I’m incredibly excited to partner again in building another category-defining business with Scott and his team in Indianapolis.”

 

Still a year away from launch, Meg Whitman and Jeffrey Katzenberg’s Quibi keeps adding talent

Video won’t start rolling on Meg Whitman and Jeffrey Katzenberg’s new bite-sized streaming service with the billion dollar backing until the end of 2019, but talent keeps signing up to come along for their ride into the future of serialization. The latest marquee director to sign on the dotted line with Quibi is Catherine Hardwicke, […]

Video won’t start rolling on Meg Whitman and Jeffrey Katzenberg’s new bite-sized streaming service with the billion dollar backing until the end of 2019, but talent keeps signing up to come along for their ride into the future of serialization.

The latest marquee director to sign on the dotted line with Quibi is Catherine Hardwicke, who will be helming a story around the creation of an artificial intelligence with the working title “How They Made Her” according to an announcement from Katzenberg onstage at the Variety Innovate summit.

Hardwicke, who directed ThirteenLords of Dogtown, and, most famously, Twilight, is joining Antoine Fuqua, Guillermo del Toro, Sam Raimi and Lena Waithe, in an attempt to answer the question of whether Whitman and Katzenberg’s gamble on premium (up to $6 million per episode) short-form storytelling is a quixotic quest or a quintessential viewing experience for a new generation of media consumers.

Katzenberg also revealed in a LinkedIn post that Quibi would be working on a basketball related series with Steph Curry’s production company. He wrote:

I announced a new docu-series by Whistle called “Benedict Men” coming exclusively to Quibi. “Benedict Men” will be executive produced by Stephen Curry’s Unanimous Media and will give viewers an inside look at one of the most unique high school basketball teams in America at St. Benedict’s Prep in Newark, New Jersey.

St. Benedict’s Prep is an all-boys secondary school founded on the core belief ‘What Hurts My Brother Hurts Me,’ and aims to foster a legacy of strong character, community, leadership, and faith. As one of the top athletic high schools with a storied basketball program and the highest graduation rate in New Jersey, the series will follow the brotherhood of young men who seek to balance life in complicated surroundings.

In some ways, the big adventure backed by Katzenberg, the former chairman of Walt Disney Studios and founder of WndrCo, and every major Hollywood studio including Disney, 21st Century Fox, Entertainment One, NBCUniversal, Sony Pictures Entertainment, Alibaba Goldman Sachs, is the latest in an everything old is new again refrain.

If blogs reinvented printed media, and podcasts and music streaming reinvented radio, why can’t Quibi reinvent serialized storytelling.

Again and again, Whitman and Katzenberg returned to an analogy from the early days of the cable revolution. “We’re not short form, we’re Quibi,” said Whitman, echoing the tagline that HBO made famous in its early advertising blitzes. That Whitman and Katzenberg’s project to take what HBO did for premium television and apply that to mobile media is ambitious. Now industry-watchers will have to wait until 2019 at the earliest to see if it’s also successful.

In the interview onstage at a Variety event on artificial intelligence in media, Katzenberg cited Dan Brown’s DaVinci Code as something of an inspiration — noting that the book had over one hundred chapters for its five hundred pages of text. But Katzenberg could have gone back even further to the days of Dickens and his serialized entertainments.

And right now for the entertainment business it really is the best of times and the worst of times. Traditional Hollywood studios are seeing new players like Netflix, Amazon, Apple, and others all trying to drink their milkshake. And, for the most part, these studios and their new telecom owners are woefully ill-equipped to fight these big technology platforms at their own game. 

Taking the long view of entertainment history, Katzenberg is hoping to win networks with not just a new skin for the old ceremony of watching entertainment but with a throwback to old style deal-making. The term serialization here takes on greater meaning. 

Quibi is offering its production partners a sweetheart deal. After seven years the production company behind the Quibi shows will own their intellectual property, and after two years those producers will be able to repackage the Quibi content back into long form series and pitch them for distribution to other platforms. Not only that but Quibi is fronting the money for over 100% of the production.

Katzenberg said that it “will create the most powerful syndicated marketplace” Hollywood has seen in decades. It’s a sort of anti-Netflix model where Katzenberg and Whitman view Quibi as a platform where creators and talent will want to come. “We are betting on the success of the platform — and by the way it worked brilliantly in the 60s, and 70s and 80s.” Katzenberg said. “Hundreds of TV shows were tremendous successes and [like the networks then] we don’t want to compete with our suppliers.”

In addition to the business model innovations (or throwbacks, depending on how one looks at it), Quibi is being built from the ground up with a technology stack that will leverage new technologies like 5G broadband, and big data and analytics, according to Whitman.

Indeed, launching the first platform built without an existing stable of content means that Quibi is preparing 5,000 unique pieces of content to go up when it pulls the curtains back on its service in late 2019 or early 2020, Whitman said.

And the company is looking to big telecommunications companies like Verizon (my corporate overlord’s corporate overlord) and AT&T as partners to help it get to market. Since those networks need something to do with all the 5G capacity they’re building out, high quality streaming content that’s replete with meta-tags to monitor and manage how an audience is spending their time is a compelling proposition.

“We want to work to have video that good on mobile [and] ramp up content in terms of quantity and quality,” Whitman said. That quality extends to things like the user interface, search features and analytics.

“We have to have a different search and find metaphor,” Whitman said. “It takes 8 minutes to find what you’re looking for on Netflix… We will be able to instrument this with data on what people are watching and using that in our recommendation engine.”

Questions remain about the service’s viability. Like what role will the telcos actually play in distribution and development? Can Quibi avoid the Hulu problem where the various investors are able to overcome their own entrenched interests to work for the viability of the platform? And do consumers even want a premium experience on mobile given the new kinds of stars that are made through the immediacy and accessibility that technology platforms like YouTube, Instagram, and Snap offer?

“Where the fish are today is a phenomenal environment,” Katzenberg said of the current short-form content market. “But it is an ocean. We need to find a place where there are these premium services.”

Malfunction mars the landing for SpaceX’s latest Falcon 9 resupply mission to the ISS

The latest Falcon 9 mission launched successfully, but its reusable booster just missed sticking the landing thanks to a stalled hydraulic pump on the grid fin, according to a tweet by Elon Musk. Grid fin hydraulic pump stalled, so Falcon landed just out to sea. Appears to be undamaged & is transmitting data. Recovery ship […]

The latest Falcon 9 mission launched successfully, but its reusable booster just missed sticking the landing thanks to a stalled hydraulic pump on the grid fin, according to a tweet by Elon Musk.

Footage captured by the Twitch streamer DazValdez, who was on the ground for the launch, managed to record the whole missed landing.

The Tuesday flight from Cape Canaveral Air Force Station in Florida is delivering 5,600 pounds of equipment and supplies to the International Space Station. And marks the 16th supply run SpaceX has made out to the Space Station.

SpaceX has had a busy week already. Yesterday the company launched a commercial flight with a payload of 64 small satellites.

Malfunction mars the landing for SpaceX’s latest Falcon 9 resupply mission to the ISS

The latest Falcon 9 mission launched successfully, but its reusable booster just missed sticking the landing thanks to a stalled hydraulic pump on the grid fin, according to a tweet by Elon Musk. Grid fin hydraulic pump stalled, so Falcon landed just out to sea. Appears to be undamaged & is transmitting data. Recovery ship […]

The latest Falcon 9 mission launched successfully, but its reusable booster just missed sticking the landing thanks to a stalled hydraulic pump on the grid fin, according to a tweet by Elon Musk.

Footage captured by the Twitch streamer DazValdez, who was on the ground for the launch, managed to record the whole missed landing.

The Tuesday flight from Cape Canaveral Air Force Station in Florida is delivering 5,600 pounds of equipment and supplies to the International Space Station. And marks the 16th supply run SpaceX has made out to the Space Station.

SpaceX has had a busy week already. Yesterday the company launched a commercial flight with a payload of 64 small satellites.

WhiteFox Defense lands $12 million as the demand for drone defense technologies intensifies

Four months ago, when two commercial DJI-made drones loaded with 1 kilogram each of plastic explosive detonated during a speech from Venezuelan dictator Nicolás Maduro at a military event in Caracas, the world at large was introduced to the newest threat from our automated, dystopian present — cheap weaponized drone technology. For Luke Fox, the […]

Four months ago, when two commercial DJI-made drones loaded with 1 kilogram each of plastic explosive href="https://techcrunch.com/2018/08/05/venezuela-claims-drones-loaded-with-explosives-used-in-failed-attack-on-president/">detonated during a speech from Venezuelan dictator Nicolás Maduro at a military event in Caracas, the world at large was introduced to the newest threat from our automated, dystopian present — cheap weaponized drone technology.

For Luke Fox, the founder and chief executive of WhiteFox Defense Technologies, it was simply the latest in a string of events proving the need for the kinds of services his company is developing. Something he calls “a highway patrol for the sky.”

From drug smuggling to reconnaissance and information gathering to terror attacks, unmanned aerial drones are no longer the provenance of state military and police actors, and are increasingly being used by criminal organizations to open new, aerial fronts in their operations.

“Drones are by far the biggest asymmetric threat that the U.S. faces,” says Fox. “Countries that don’t have a state-sponsored drone program are using them [and] it’s where you see people like ISIS are going.”

In the battle for Mosul in Iraq, ISIS flew more than 300 drone missions in one month, according to a talk given last year at CyCon by Peter Singer, a senior fellow and strategist at the New America Foundation. One-third of those were strike missions, representing the first time U.S. military faced an aerial attack since the Korean War.

The 24-year-old Fox began thinking seriously about the weaponization of commercial and consumer drone technology six years ago, when he founded WhiteFox Defense.

Creating the company was an extension of the way that Fox had been taught to think about the world as a child, he’s said. Fox grew up in an abusive foster home, raised by a mentally ill foster mother (who was, herself, a child protective service employee) who had adopted him and a number of mentally and physically challenged children.

“The reality I grew up in had my mind constantly looking for vulnerabilities. And instead of seeing these vulnerabilities as opportunities for crime I now had a whole color palette to choose from,” said Fox. “For example, when the world started going crazy over drones as recreational toys I saw that they could be used as weapons or for crime, and this insight into the criminal mind inspired a company that defends the country from drones.”

Fox was adopted from foster care by the librarian of his local Sacramento-area high school, tested out of college and went on to a community college before enrolling in California Polytechnic University in San Luis Obispo.

He began working with drones while in school and credits that introduction to the technology as the inspiration for starting WhiteFox.

“We previously started out in drone manufacturing, starting out in high-performance drones for specialty clients and research organizations. We needed affordable drones that were highly capable,” said Fox. “Making a highly capable drone that was very affordable attracted some very shady people. And, realizing that there was only so much we could control, it brought us to ask what is out there? At the time, the only thing to counter drone-related attacks was large missiles shooting down large Iranian drones.”

WhiteFox currently has three products either in development or on the market. Two have already been released to a select group of customers in different industries and the entire suite will be launched at the beginning of next year, according to Fox.

Without going into specific details of how the technology works, Fox said that WhiteFox Defense systems can detect, identify and mitigate unauthorized drones flying in a particular airspace.

“It’s not jamming or blocking drones or catching them out of the sky,” says Fox. Rather the idea is to provide situational awareness and identify the type of threat that an errant drone represents — whether the operator is, in Fox’s words, “clueless, careless or criminal.”

What Fox would say is that his company has developed a technology that’s based on identifying and differentiating between drones based on their unique radio frequency signatures. That product for identifying drones operating in a space is complemented by a second technology offering that allows WhiteFox to take control of the unauthorized drones in an airspace.

“One of the technologies that was started at Drones For Change [the company that would become WhiteFox] was a universal controller,” said Fox. “That technology really formed the basis. We asked what if this universal controller could become a master controller to take over any drone that was in your airspace? That solved the problem that got us out of drone manufacturing.”

WhiteFox isn’t alone in its attempts to create anti-drone technology. According to some industry statistics there are at least 70 companies working on drone defense technologies, with solutions ranging from deploying other drones to capture unauthorized UAVs to jamming technologies that will block a drone’s signal.

Earlier this year, Airspace Systems raised $20 million for its kinetic (drone versus drone) approach to drone defense, while Citadel Defense raised $12 million and Dedrone pulled in $15 million for their drone-jamming technologies.  And last year, SkySafe raised $11.5 million for a radio-jamming approach similar to WhiteFox, which forces unauthorized drones out of restricted airspace while permitting authorized drones to still fly.

“As​ ​the​ ​adoption​ ​of​ ​consumer​ ​drones increases,​ ​we​ ​believe​ ​it​ ​is​ ​vital​ ​for​ ​an​ ​ambitious​ ​and​ ​effective​ ​defense​ ​platform​ ​to​ ​emerge,” said Alex Rubacalva, a partner at Stage Venture Partners and an early investor in WhiteFox Defense. 

In all, drone-related startups have raised nearly $2 billion in the last eight years, according to data from Crunchbase, pulled at the beginning of 2018. Roughly $600 million of that investment total has come in 2017 and the early part of 2018 alone, the Crunchbase data indicated.

Technologies like SkySafe and WhiteFox are about more than just defending airspace from malicious actors.

“Counter-drone technology is not just about securing spaces from drones and preventing bad things from happening,” says Fox. “It’s about enabling drones to be used in the right way.”

The applications extend far beyond military uses. In fact, Fox’s technology is already being adopted by prisons around the U.S. and, indeed, anywhere airspace usage can be considered sensitive.

“Someone described as the largest delivery operations in the world is happening at prisons,” said Fox. “You have a lot of money behind buying a DJI at Best Buy and loading it up with heroin, with drugs, with weapons, with even Chinese food that was smuggled in. We found that there were drones smuggling in contraband every single day.”

WhiteFox recently conducted a survey with an undisclosed large public prison system in the United States to study just how pervasive a problem drone-smuggling was among its prison population. What the prison saw as one drone a week flying into restricted airspace became a realization that multiple drone flights per day were occurring in attempts to smuggle contraband onto prison grounds.

Operations extend far beyond police and military applications though, according to Fox.

During the California wildfires, rescue operations were halted thanks to unauthorized usage of drones by civilian operators who wanted to capture footage of the disaster. Their actions potentially risked the lives of not only rescue workers but of the citizens they were trying to save and the fire crews attempting to control the worst wildfire in the state’s history.

“This is one of the fascinating things about this industry as a whole,” says Fox. “It’s not that drones are bad and scary and we need to do something about them. If we’re going to embrace this technology as a society we need to be able to safely integrate it into society.”

From its initial deployments, WhiteFox was able to convince investors to funnel $12 million into the company to finance its expansion plans.

The extension of the company’s seed round included investors like JAM Capital, Stage Venture Partners, Okapi Venture Capital, Serra Ventures and OCA Ventures. 

“WhiteFox’s customers are armed with a highly robust and scalable-for-deployment technology​ ​platform​ ​that​ ​addresses​ ​the​ ​increased​ ​threat​ ​of​ ​hostile​ ​drones​ ​and enables​ ​greater​ ​control​ ​of​ ​their​ ​airspace,” said Jeff Bocan, a partner at OKapi Venture Capital, in a statement.​ “Crucially, WhiteFox’s technology also offers customers the ability to protect against reckless drone use, while enabling “friendly” drones to fly freely — all without any human intervention.”

Is ethical tech a farce?

Shannon Farley Contributor Shannon Farley is co-founder and executive director at Fast Forward. More posts by this contributor Legal tech is opening the system to those who need legal representation the most Why we need diverse founder and funding teams and how to find them In the past year, we’ve seen tech platforms called out […]

In the past year, we’ve seen tech platforms called out for stoking hate and not doing enough to instill ethics from the top down. There is a bigger problem at hand, and to borrow Silicon Valley parlance, it’s a feature, not a bug. When profits trump impact, ethics lose out.

Tech companies become profitable or lose their shirts on engagement rates. Cute cats gets clicks. So do incendiary comments from world leaders. Engagement rates drive top line growth. Social media platforms are designed to advance voices that drive engagement, regardless of the impact of that engagement. The problem is not just fueling hate; it’s a singular focus on a specific kind of value creation – profits. We have yet to see a tech sector leader optimize for profit and ethics with the same fervor. One always wins.

If profits beat ethics, is ethical tech possible? Simply put, yes. There is a different genre of tech startup that values impact over profits. They are tech nonprofits. Rather than building products that satisfy animalistic behavior, from screen addiction to fear mongering, tech nonprofits are building technology to fill gaps in basic human needs – education, human rights, health care. Or as an early tech nonprofit Mozilla stated in its manifesto, technology that, “must enrich the lives of human beings.” Tech nonprofits are building tech products that serve customers where markets have failed.

Their primary goal is not a profit-proxy like engagement rates. Contrarily, they are designed to make the lives of human beings better – not just the ones whose clicks have market value. As the profit-focused tech community grapples with how to reverse its impact, and how to take a step back and consider building products with ethics in mind, tech nonprofits are the one clear example of ethical tech.

Take Khan Academy. Khan’s mission is to provide a free, world class education to anyone, anywhere. Khan has many for-profit competitors with new competitors launching everyday. Those tech companies are laser focused on educating those with perceived market value whereas Khan is designed with the rest of the population in mind, and not just those who can afford it.

Crisis Text Line, born out of a recognized need for text-based crisis support for youth, is so impatient to solve the problems their users face that the organization open sources its data to inform journalists, school systems, and citizens, encouraging collaborative support in reducing and preventing these crises.

There are hundreds more tech nonprofits that value impact over profit and improve the lives of human beings. Platforms created to teach anyone to write well like Quill, or prevent teen pregnancy like RealTalk, or end veteran suicide like Objective Zero. These tech nonprofits will never measure success based on revenue or engagement. They exist to serve humanity. Tech nonprofits function as a social safety net. Engagement and profits couldn’t be further from the goal.

All of these companies started with the problem and leveraged the tech we use everyday to solve it. In this moment, the tech community is reckoning with what it’s built. It may take a generation or two to fix what we broke. It will certainly take an emerging breed of technologists, those who measure value in more than money, to model ethical tech.

So is ethical tech a farce? It doesn’t have to be. Tech nonprofits prove that.

Former eBay product chief RJ Pittman takes the reins at 3D capture company Matterport

Matterport, a provider of 3D image capture technology, has named former eBay chief product officer RJ Pittman as its new chief executive. Pittman will take the reins from former chief executive Bill Brown, who will continue to advise Matterport as the company looks to capitalize on its library of three dimensional scans. The company currently […]

Matterport, a provider of 3D image capture technology, has named former eBay chief product officer RJ Pittman as its new chief executive.

Pittman will take the reins from former chief executive Bill Brown, who will continue to advise Matterport as the company looks to capitalize on its library of three dimensional scans.

The company currently has a library of 1.4 million three dimensional models that have been viewed at least 600 million times since the company launched.

According to Silicon Valley Business Journal, the company had revenue in 2017 of $33 million from selling its camera equipment and software services to businesses.

The company was launched when founders Matt Bell and David Gausebeck realized the commercial potential of the motion capture and sensor technology that Microsoft had unveiled with their Kinect camera back in 2010.

At the time, the company’s several thousand dollar pieces of hardware were the cutting edge for capturing images — now it can be done with software and a cell phone camera. The march of technology has put Matterport in a somewhat precarious position, but the company continues to lock in deals with companies like Donan, an investigation service for insurers and others that looks at fire damage.

The company has inked deals with a number of different enterprise customers — and even brought on State Auto Labs as a strategic investor earlier this year.

“Matterport has the opportunity to revolutionize how property risks are underwritten and claims are handled in the insurance industry,” said Kim Garland, Senior Vice President, Commercial Lines & Managing Director of State Auto Labs said in a statement at the time.

In all, Matterport has raised around $77 million from investors including State Auto Labs, Lux Capital, DCM Ventures, Qualcomm Ventures, Ericsson Ventures, AMD Ventures, AME Cloud Ventures, CBRE, Felicis Ventures, GIC, Crate and Barrel founder Gordon Segal, iGlobe Partners, Navitas Ventures, News Corp, and Sound Ventures.

Matterport’s hardware can digtially capture, document, visualize and collaborate around properties in 3D on web, mobile and in VR. And its hosted Matterport Cloud service automates the creation of state-of-the-art 3D models, high-quality 4K 2D photography, floorplans and other assets and stores them in easily accessible formats.

There’s still a lot of contested space in the collection and capture of the real world for use in augmented and virtual reality and the addition of Pittman should help Matterport as it looks at a much more crowded competitive landscape.

“RJ’s operating experience at scale, paired with his entrepreneurial DNA and deep product vision will be instrumental to unlocking the full potential of our breakthrough technology and unparalleled 3D media and data,” said company co-founder and chief technology officer David Gausebeck, in a statement.

Indeed, Pittman discussed the importance of Matterport’s library when he spoke of the opportunity he saw for the company. “Matterport Cloud is an unrivaled dataset of precision 3D environments that represents an enormous opportunity to scale the company’s data services business exponentially. This will open up new strategic partnerships and investments as we realize the full value of this data,” Pittman said in a statement.

As an entrepreneur, product developer and real estate investor, Pittman is uniquely qualified to take charte at Matterport.

He previously worked on product, design, engineering and mobile payments at eBay and held roles at Apple and Google. In addition, he had also co-founded and served as the chief executive for the search engine that created the industry’s first graphical information interface, Groxis.

Finally, Pittman worked on a number of real estate projects in the U.S. and UK, giving him insight on the role that technology can play in the new architectural landscape.

 

Bright spots in the VR market

Virtual Reality is in a public relations slump. Two years ago the public’s expectations for virtual reality’s potential was at its peak. Many believed (and still continue to believe) that VR would transform the way we connect, interact, and communicate in our personal and professional lives. It’s easy to understand why this excitement exists once […]

Virtual Reality is in a public relations slump. Two years ago the public’s expectations for virtual reality’s potential was at its peak. Many believed (and still continue to believe) that VR would transform the way we connect, interact, and communicate in our personal and professional lives.

Google Trends highlighting search trends related to Virtual Reality over time; the “note” refers to an improvement in Google’s data collection system that occurred in early 2016

It’s easy to understand why this excitement exists once you put on a head mounted display. While there are still a limited number of compelling experiences, after you test some of the early successes in the field, it’s hard not to extrapolate beyond the current state of affairs to a magnificent future where the utility of virtual reality technology is pervasive.

However, many problems still exist. The all-in cost for state of the art headsets is still out of reach for the mass market. Most ‘high-quality’ virtual reality experiences still require users to be tethered to their desktops. The setup experience for mass market users is lathered in friction. When it comes down to it, the holistic VR experience is a non-starter for most people. We are effectively in what Gartner refers to as the “trough of disillusionment.”

Gartner’s hype cycle for “Human-Machine Interface” in 2018 places many related VR related fields (e.g., Mixed Reality, AR, HMDs, etc.) in the “Trough of Disillusionment”

Yet, the virtual reality market has continued its slow march to mass adoption, and there are tangible indicators that suggest we could be nearing an inflection point.

A shift towards sustainable hardware growth

What you do and do not consider a virtual reality display can dramatically impact your view on the state of the VR hardware industry. Head-mounted displays (HMDs) can be categorized in three different ways:

  • Screenless viewers — affordable devices that turn smartphones into a VR experience (e.g., Google Glass, Samsung Gear VR, etc.)
  • Standalone HMDs — devices that are not connected to a computer and can independently run content (e.g., Oculus Go, Lenovo Mirage Solo, etc.)
  • Tethered HMDs — devices that are connected to a desktop computer in order to run content (e.g., HTC Vive, Oculus Pro, etc.)

2018 has seen disappointing progress in aggregate headset growth. The overall market is forecasted to ship 8.9M headsets in 2018, up from an approximate aggregate shipment of ~8.3M in 2017, according to IDC. On the surface, those numbers hardly describe a market at its inflection point.

However, most of the decline in growth rate can be attributed to two factors. First, screenless viewers have seen a significant decline in shipments as device manufacturers have stopped shipping them alongside smartphones. In the second quarter of 2018, 409K screenless viewers were shipped compared to approximately 1M in the second quarter of 2017. Second, tethered VR headsets have also declined as manufacturers have slowed down the pricing discounts that acted as a steroid to sales growth in 2017.

Looking at the market for standalone HMDs, however, reveals a more promising figure. Standalone VR headsets grew 417% due to the global availability of the Oculus Go and Xiaomi Mi VR. Over time, these headsets are going to be the driver of the VR market as they offer significant advantages compared to tethered headsets.

The shift from tethered to standalone VR headsets is significant. It represents a paradigm shift within the immersive ecosystem, where developers have a truly mobile platform that is powerful enough to enable compelling user experiences.

IDC forecasts for AR/VR headset market share by form factor, 2018–2022

A premium market segment

There are a few names that come to mind when thinking about products that are available for purchase in the VR market: Samsung, Facebook (Oculus), HTC, and Playstation. A plethora of new products from these marquee names —  and products from new companies entering the market —  are opening the category for a new customer segment.

For the past few years, the market effectively had two segments. The first was a “mass market” segment with notorious devices such as the Google Cardboard and the Samsung Gear, which typically sold for under $100 and offered severely constrained experiences to consumers. The second segment was a “pro market” with a few notable devices, such as the HTC Vive, that required absurdly powerful computing rigs to operate, but offered consumers more compelling, immersive experiences.

It’s possible that this new emerging segment will dramatically open up the total addressable VR market. This “premium” market segment offers product alternatives that are somewhat more expensive than the mass market, but are significantly differentiated in the potential experiences that can be offered (and with much less friction than the “pro market”).

The Oculus Go, the Xiaomi Mi VR, and the Lenovo Solo are the most notable products in this segment. They are the fastest growing devices in this segment, and represent a new wave of products that will continue to roll out. This segment could be the tipping point for when we move from the early adopters to the early majority in the VR product adoption curve.

A number of other products have also been released throughout 2018 that fall into this category, such as Lenovo’s Mirage Solo and Xiaomi’s Mi VR. Even more so, Oculus recently announced that  they’ll be shipping a new headset called Quest this spring, which will sell for $399 and will be the most powerful example of a premium device to date. The all-in price range of ~$200–400 places these devices in a segment consumers are already conditioned to pay (think iPad’s, gaming consoles, etc.), and they offer differentiated experiences primarily attributed to the fact that they are standalone devices.