Ever had branzino? Either way, you’ll love it grilled! Buy the whole fish, grill it, and serve it topped with a rosemary vinaigrette. (Best substitutes are walleye, Pacific rock cod, or a large Atlantic black sea bass.)
Ever had branzino? Either way, you’ll love it grilled! Buy the whole fish, grill it, and serve it topped with a rosemary vinaigrette. (Best substitutes are walleye, Pacific rock cod, or a large Atlantic black sea bass.)
Monzo, the fast-growing U.K.-based challenger bank with more than two million account holders, has raised £113 million (~$144m) in additional funding.
Confirming TechCrunch’s scoop in April, the Series F round is led by Y Combinator’s “Continuity” growth fund, and gives the company a new £2 billion (~$2.5b) post-money valuation. That’s double the £1 billion valuation it garnered in October last year.
A number of other new and existing investors have also participated in the Series F. They include Latitude, General Catalyst, Stripe, Passion Capital, Thrive, Goodwater, Accel, and Orange Digital Ventures.
The investment by London-based Latitude, the growth fund from prolific seed investor LocalGlobe, is particularly noteworthy given that LocalGlobe itself didn’t previously back Monzo. The same might be said of YC’s Continuity, considering that Monzo isn’t a YC alumni (although GoCardless, Monzo co-founder Tom Blomfield’s previous startup, did take part in the Silicon Valley accelerator).
The take-away: a growth fund attached to an early-stage fund can be a great antidote to the anti-portfolio (the list of successful companies a VC firm either missed, were unable or chose not to invest in).
Meanwhile, Monzo’s new funding round and YC’s backing should be viewed within the context of not only fast growth and increasingly convincing product-market fit in the U.K. — the challenger bank is currently adding 200,000 new sign-ups for its current account each month — but also recently unveiled plans to tentatively launch across the pond.
We first reported that Monzo was busy assembling a U.S.-based team over five months ago, and the U.K. company made its U.S. plans official last week. This will see a U.S. Monzo app and connected Mastercard debit card available via in-person signups at events to be held soon. The rollout will initially consist of a few thousand cards, supported by a waitlist in preparation for a wider launch.
The U.S. launch is being done in partnership with a local bank, but in the longer term Monzo plans to apply for its own U.S. bank license, similar to the strategy it employed in the U.K. so as to own and operate as much of its technical, product and regulatory infrastructure as possible.
In the U.K., this has helped Monzo achieve an NPS score of 80, which Blomfield previously told me is unusually high for a bank. This is seeing 60% of U.K. signups remain long-term active, transacting at once per week. As a counterpoint, however, the percentage of Monzo users that pay a salary into their Monzo account sits at between about 27% and 30% of active users, suggesting that a significant number of Monzo customers aren’t yet using it as their main account (Monzo’s definition of salaried is anyone who deposits at least £1,000 per month by bank transfer).
Success in the U.S., therefore, isn’t a given, conceded Blomfield when I had a call with him earlier this month. Instead, he argued that the key to cracking North America will be creating a fully localised version of Monzo based on carefully listening to U.S. users and once again finding product-market fit. He says there are obvious and less obvious cultural and technical differences in the way Brits and Americans save, spend and manage their finances, and this will require significant product divergence from the U.K. version of Monzo. Today’s new £113 million injection of capital is clearly designed to provide some of the breathing space required to achieve that.
As a side note, there are encouraging signs from other London-based fintechs that have ventured across the pond. One recent example is the financial “digital assistant” chatbot Cleo, which entered the U.S. around a year ago and has been more successful than the company anticipated, seeing Cleo add 650,000 active U.S. users to date. In fact, the U.S. currently makes up more than 90% of new Cleo users, prompting one source to describe the U.K. startup as effectively a U.S. company now.
YouTube’s loudest couple is engaged, and honestly nobody surprised.
Jake Paul proposed to fellow vlogger Tana Mongeau during a weekend trip to Las Vegas to celebrate her 21st birthday. At around 1:30 a.m. at a club on Monday, he brought out a three-tier cake decorated with an enormous ring and the words, “Will you marry me, Tana?”
She immediately tweeted about it.
JAKE JUST PROPOSED
— Tana Mongeau (@tanamongeau) June 24, 2019
The last few decades have produced many successful marketplaces. We went from goods marketplace pioneers such as eBay and Amazon to simple service marketplaces such as Uber, Lyft, Doordash, Upwork, Thumbtack, TaskRabbit, and Fiverr. But why haven’t we seen many successful B2B service marketplaces?
Some would argue that companies such as Upwork, Thumbtack, Fiverr, or TaskRabbit are horizontal B2B marketplaces in the sense that they provide access to suppliers of different services. But while businesses do indeed transact with freelancers on such “horizontal” marketplaces, for most service verticals these are limited-value, one-off transactions. They fail to enable long-term business collaborations.
Horizontal services marketplaces don’t provide much value beyond matching clients with quality service providers. In other words, they don’t facilitate collaboration between buyers and suppliers, never mind provide ways for the two parties to collaborate more efficiently over time as they engage in follow-on projects.
In essence, the model these marketplaces were built around is not much different from the likes of Craigslist, which put a convenient UX on traditional classified advertisements.
In their article “What’s Next for Marketplace Startups?,” Andrew Chen and Li Jin found that there aren’t many successful service marketplaces because those offerings are complex, diverse, and difficult to evaluate. It’s challenging to define a successful transaction in a service marketplace because it’s harder to quantify success.
One reason is that several service providers must often work together to complete a single job for a buyer, requiring a complex workflow from end to end. As a result, it’s difficult for marketplaces to not only mediate service delivery but also make it significantly more efficient for buyers and suppliers. If both the buyer and suppliers don’t see a significant efficiency gain other than being initially matched, why would they continue using the marketplace?
(Image via Getty Images / Lidiia Moor)
The $50 billion translation industry is a prime example of complex B2B services marketplaces. On the supply side are roughly 50,000 small agencies around the globe responsible for more than 85% of this $50 billion industry. (Note we are referring to agencies here as suppliers, though they play on both sides.)
On the demand side are businesses that need to translate text from one language into another. Plus about 1,500,000 freelance linguists work in this industry, many of whom are more specialized than professionals in other industries.
Anyone can find and hire a translator on Fiverr or Upwork. Both provide a vast selection of language translators. However, the quality and cost of the translation depends on the translation tools available to the translator as well as their subject expertise.
Neither Fiverr nor Upwork provide computer-aided translation (CAT) and collaborative workflow solutions for users of their platforms. Additionally, neither provides an effective way for all parties to collaborate and continuously improve the efficiency and quality.
But the problem with traditional marketplaces goes even further: Multiple translators and reviewers are usually needed to complete a single job for a customer. Multi-language translation projects are even more complicated. Such projects require multiple service providers and cost estimates, in addition to project management tools.
This is why building a B2B service marketplace is difficult. Service marketplaces must not only connect buyers and suppliers, but also provide tools to enable an efficient and collaborative workflow that reduces wasted time and effort.
In addition to the problems already outlined, traditional marketplaces experience another issue that prevents them from growing and retaining market participants: Buyer and supplier attrition.
Many business services are based on regularly recurring engagements. In some cases, a buyer and a service provider interact daily, requiring a different workflow than gig-marketplaces are built around.
Buyers and suppliers have little motivation to continue interacting on a platform with no workflow automation solutions. They lack a way to improve service efficiency and quality, automate collaboration, payment, paperwork, and other basic processes required for a business.
This is why many traditional marketplaces suffer from slow network effects and high attrition. (A network effect is what happens when a platform, product, or service delivers more value the more it is used.
Think Facebook, eBay, WhatsApp.) Why wouldn’t companies work directly with service providers outside of a marketplace after they were introduced? What incentives keep the service transaction on the marketplace? These are critical questions to answer when building a marketplace.
Traditional marketplaces target broad services, making it nearly impossible to provide workflow solutions for buyers and suppliers. Going forward, successful service marketplaces will be developed relying on an industry-specific SaaS workflow. This will focus buyers and suppliers on longer-term projects and interactions that serve the unique needs of collaborations and transactions in a specific vertical.
Image via Getty Images / OstapenkoOlena
In “The next 10 Years Will Be About Market Networks,” James Currier, Managing Partner at NFX Ventures, defines a new era of service marketplaces, which he calls market networks.
A market network is a platform that combines elements of an n-sided marketplace, a network, and workflow solutions. An n-sided marketplace is one that requires coordination of multiple supply-side parties to provide a complex service for a single buyer.
Market networks enable multiple buyers and suppliers to interact, collaborate, and transact on the same platform. They provide users with industry-specific workflow solutions that enable efficient, ongoing collaboration on long-term projects. This reduces costs and leads to a higher quality of services and increased overall value for all users.
But how do you actually build a successful market-network platform? While the answer to that varies from company to company, here is our approach. We were able to build a market network for the translation industry that combines the components: network, marketplace, and workflow solution.
The first step to building an effective complex market network is to develop a workflow that is easy for users to embrace. It might not seem like much, but this increases productivity by enabling teams to perform tasks that were previously impossible.
The UK government has delayed the introduction of mandatory age verification for accessing online pornography — blaming an administrative cock-up.
The controversial scheme had been due to launch on July 15, after an earlier implementation date also came and went. Although in this instance it does not appear the policy has been derailed by the technical challenges around online age verification.
Giving a statement in the House of Commons this morning, digital minister Jeremy Wright said the government failed to notify the European Commission of age verification standards it expects companies to meet — in line with EU law.
Not having done so means it can’t legally introduce the policy at this stage.
“It has come to my attention in recent days that an implementation process was not undertaken for an element of this policy and I regret to say this will delay the commencement date,” he told parliament — adding that the error is expected to result in a delay “in region of six months”.
Apologising for the delay, Wright emphasized that government remains committed to the policy.
“This is not a change of policy or a lessening of this government’s determination for these changes to come about,” he said.
“Many [people] have campaigned passionately for age verification to come into force as soon as possible to ensure children are protected from seeing pornography they shouldn’t — I apologise to them all that these measures will not be brought in as soon as they and I will like.”
“In the mean time there is nothing to stop responsible providers of online pornography from implementing age verification mechanisms on a voluntary basis,” he added. “I hope and expect that many will do so.”
In the statement on age verification, Wright also referenced other policy measures the government has in train which he said will help protect children from seeing inappropriate content online — such as the Online Harms white paper, published in April.
He said a draft code of practice on child online safety will be published ahead of the new regulatory framework coming in — “to set clear standards” for online child safety.
He also noted that the technical challenge of accurate online age verification had been raised during the consultation on the white paper — and said he has commissioned new guidance that will be published in the fall “about the use of technology to ensure children are protected from inappropriate content online”.
As we reported in March, tech companies including Snap have been participating under NDA in a government working group on age verification.
Wright said the government would publish a response to the consultation by the end of the year. And that legislation would be introduced as soon as parliament time allowed after that.
“The new regulatory framework for online harms announced in the white paper will be introduced as soon as possible because it will make a significant difference to action taken by companies to keep children safe online,” he said.
“Age verification for online pornography needs to happen, and I believe it is the clear will of the house and those we represent that it should, and in the clear interests of our children that it must.”
IBM announced its latest blockchain initiative today. This one is in partnership with KPMG, Merk and Walmart to build a drug supply chain blockchain pilot.
These four companies are coming to together to help come up with a solution to track certain drugs as they move through a supply chain. IBM is acting as the technology partner, KPMG brings a deep understanding of the compliance issues, Merk is of course a drug company and Walmart would be a drug distributor through its pharmacies and care clinics.
The idea is to give each drug package a unique identifier that you can track through the supply chain from manufacturer to pharmacy to consumer. Seems simple enough, but the fact is that companies are loathe to share any data with one another. The blockchain would provide an irrefutable record of each transaction as the drug moved along the supply chain, giving authorities and participants an easy audit trail.
The pilot is part of set of programs being conducted by various stakeholders at the request of the FDA. The end goal is to find solutions to help comply with the U.S. Drug Supply Chain Security Act. According to the FDA Pilot Program website, “FDA’s DSCSA Pilot Project Program is intended to assist drug supply chain stakeholders, including FDA, in developing the electronic, interoperable system that will identify and trace certain prescription drugs as they are distributed within the United States.”
IBM hopes that this blockchain pilot will show it can build a blockchain platform or network on top of which other companies can build applications. “The network in this case, would have the ability to exchange information about these pharmaceutical shipments in a way that ensures privacy, but that is validated,” Mark Treshock, global blockchain solutions leader for healthcare and life sciences at IBM told TechCrunch.
He believes that this would help bring companies on board that might be concerned about the privacy of their information in a public system like this, something that drug companies in particular worry about. Trying to build an interoperable system is a challenge, but Treshock sees the blockchain as a tidy solution for this issue.
Some people have said that blockchain is a solution looking for a problem, but IBM has been looking at it more practically with several real-world projects in production including one to track leafy greens from field to store with Walmart and a shipping supply chain with Maersk to track shipping containers as they move through the world
Treshock believes the Walmart food blockchain is particularly applicable here and could be used as a template of sorts to build the drug supply blockchain. “It’s very similar, tracking food to tracking drugs, and we are leveraging or adopting the assets that we built for food trust to this problem. We’re taking that platform and adapting it to track pharmaceuticals,” he explained.
Delicious crab dip with lump crab meat, sour cream, mayonnaise, shallots, dill, lemon zest, white wine vinegar, and Worcestershire sauce.
The two people who sat down in reception without an appointment would not leave the startup’s office until the end of the day.
Two months later, a letter followed informing the company it had been suspended from the United Kingdom’s register of licensed sponsors, the database of companies the government has approved to employee foreign workers. The business had 20 working days from the typed date to make “representations” and submit “evidence” and “supporting documents” to counter the “believed” infractions spread across 12 pages, threaded through with copious references to paragraphs, annexes and bullet points culled from the Home Office‘s official guidance for sponsors.
Early in the new year another letter arrived, and an assessment process that had begun with an unannounced visit one autumn morning delivered its final verdict: The revocation of Metail‘s sponsor license with immediate effect.
“There is no right of appeal against this decision,” warns paragraph 64 of the 22-page decision letter — in text which the sponsor compliance unit has seen fit to highlight in bold. “Whilst your client can no longer recruit sponsored workers under Tier 2 and 5 of the Points Based system, they can continue to recruit UK and EEA workers as well as non-EEA nationals that have the right to work in the UK. The revocation of the license does not stop a business from trading,” the letter concludes. Tier 2 is the general work visa for regular employees, while Tier 5 is for temporary workers.
The government department that oversees the UK’s immigration system gets to have — and frame — the last word.
London-based Metail is a decade-plus veteran of the virtual fitting room space, its founders having spied early potential to commercialize computer vision technology to enable individualized sales assistance for online clothes and fashion shopping. It now sells services to retailers including photorealistic 3D body models to power virtual try-ons; algorithmic size recommendations; and garment visualization to speed up and simplify the process of showcasing fashion products online.
In the story below, we’ll look at how Metail’s situation sits within wider issues facing startups in the United Kingdom today. We also dig into the details of the company’s encounters with immigration rules, and what startups in the UK can do to hire the people they need without similar problems, in this article for Extra Crunch subscribers.
Metail has approached research-heavy innovation in the field of 3D visualization with determined conviction in transformative commercial potential, tucking $32 million in VC funding under its belt over the years, and growing its team to 40 people (including 11 PhDs) at a head office in London and a research hub located close to Cambridge University where its British founder studied economics in the late ’90s. It’s also racked up an IP portfolio that spans computer vision, photography, mechanics, image processing and machine learning — with 20 patents granted in the UK, Europe and the US, and a similar number pending. Years of 3D modeling expertise and a substantial war-chest of patents might, reasonably, make Metail an acquisition target for an ecommerce giant like Amazon that’s looking to shave further friction off of online transactions.
Nothing in its company or business history leaps out to suggest it fits the bill as a “threat to UK immigration control.” But that’s what the language of the Home Office’s correspondence asserts — and then indelibly inks in its final decision.
“I took them into a meeting room. And at that point, they hand me a bunch of documents and say: ‘We’re here to see and understand about your sponsored migrants.’ So at the beginning, the language is all very dehumanizing,” says Metail founder and CEO Tom Adeyoola, recounting the morning of the unannounced visit. “They hand me a bit of material which includes the sentence ‘you’ll be allowed a toilet break every two hours’. And I’m like, ‘am I being arrested?! What’s going on?’
“Then they ask ‘are your sponsored migrants here?’ I said I don’t know, I don’t manage them directly. I only had two.
“‘Can we see your lease? Can we see your accounts?’ Genuinely everything. ‘Can we see proof that this is your office?’ I was like, well you’re in the office… So [it was] very much a box-ticking exercise.
“And then the interview process going through with [the HR manager] was effectively ‘why have you hired sponsored migrants over the settled workers? Talk me through your process about how you track everybody in the organization?’
“‘What happens when they are not in one day? What happens when they’re not in at work the second day?’
“A bit of this thing was like an assumption that they’re not human beings but they’re like prisoners on the run.”
Image via Getty Images / franckreporter
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. We detail the full saga over on Extra Crunch, along with the takeaways that other startups can learn from.
For Metail, the situation suddenly became about its own existence and not just the fate of one hardworking younger employee.
Metail’s other Tier 2 sponsor visa was for Dr. Yu Chen, who is originally from China, and leads the startup’s research efforts based at its Cambridge office. Chen has been with the business for around seven years — starting his relationship with Metail projects while still working on his computer vision PhD at Cambridge University.
Adeyoola describes him as “critical” to the business, a sentiment Chen confirms when we chat — albeit more modestly summing up his contribution as “quite theoretically involved in all these critical algorithms and key technologies developed by this organization since the very beginning”.
A major first concern for Adeyoola was what the loss of Metail’s sponsor license meant for Chen — and by extension Metail’s ability to continue business-critical research work.
The Home Office letter provided no guidance on specific knock-on impacts. And the lawyers Metail contacted for advice weren’t sure. “Our lawyers told us that that was the implication. In their revocation notice, they do not tell you what it means explicitly. You have to figure that out for yourself,” says Adeyoola. “Hence it is confusing and unclear.”
The lawyers advised Chen’s employment be suspended to keep the rest of the company safe — which instantly threw up further questions.
“Can I suspend his employment with pay or not with pay? Because the Home Office had his passport and they’ve had his passport since he’d applied for indefinite leave to remain in October and in January he still hadn’t had his passport back. He can’t go anywhere or do anything, so backward and forth it worked out that, yeah, we could suspend him with pay. But he couldn’t be seen at that time to be doing any work — and he’s critical for us.
“We had government R&D grants, he runs all our research — so I was like well we’re going to have to talk to the government and add an extension to that project.”
They had to tell everybody in the office that while Chen’s employment was suspended they weren’t allowed to talk to him. “He wasn’t allowed to use Slack,” Adeyoola recounts. “So if you were going to talk to him you had to meet him off-premise.”
“Nobody knows whether you can normally work,” says Chen of the uncertainty around his status at that point. “Are you just allowed to stay at home legally but not allowed to work? Lot of question marks. It’s a very, very rare scenario I think.”
Image via Getty Images / Dina Mariani
Adeyoola says he was also concerned whether Metail having its sponsor license suspended might negatively impact Chen’s in-train application for ‘indefinite leave to remain’ in the UK — which he had applied for in October, before the sponsor license suspension letter landed, having been in the UK the requisite ten years by then. And because, ironically enough, he had been “panicking” a bit about his future status as a result of Brexit.
Metail used an online email checking service, available via a Home Office portal, which suggested Chen could, in fact, work while the company license was suspended. At the same time Adeyoola had reached out to Chen’s local MP for help confirming his status — and with the aid of a political side-channel did manage to get it firmly confirmed in writing from the Home Office that Chen could still work while the license was suspended.
“We had to operate on lowest common denominator basis until we had written notice. Because systems operate on a ‘with prejudice’ basis,” says Adeyoola of the week Chen had been suspended from work.
“It was not in the letter. There was nothing in the letter about what it means for your people. Again, the human aspect of it seems to be the last thing on their mind. I think that’s part of the indoctrination of the people there — so they’re highly process-ified and trained so that they do their job.”
Chen’s period of suspension turned out to be mercifully brief, although that was purely due to lucky timing. Had he waited a month or so longer to lodge the original paperwork for his indefinite leave to remain, then his situation — and Metail’s — could have panned out very differently.
“In my case, I was just lucky because I started to apply for indefinite leave to remain before this stuff blew up,” he says, saying he filed the application around nine months before his Tier 2 visa was due to apply.
Nearly six months after filing for it in October, Chen’s indefinite leave to remain came through.
But by that time Metail’s sponsor license had gone. Now they wouldn’t be able to hire more people like Chen without overcoming major hurdles.
Image via Toby Melville / WPA Pool / Getty Images
A photograph of the UK prime minister, Theresa May, smiles down at the reader of the Wikipedia page for the Home Office hostile environment policy.
As smiles go, it’s more rictus grin than welcoming sparkle. Which is appropriate because, as the page explains, the then-home secretary presided over the introduction of the current hostile environment, as the coalition government sought to deliver on a Conservative Party manifesto promise in 2010 to reduce net immigration to 1990 levels — aka “tens of thousands a year, not hundreds of thousands”.
The policy boils down to: deport first, hear appeals later. One infamous application of it during May’s tenure as home secretary saw vans driven around multicultural areas of London, bearing adverts with the slogan ‘Go Home’. The idea, criticized at the time as a racist dog-whistle, was to convince illegal workers to deport themselves by making them feel unwelcome.
Summarizing the broader policy intent in an interview with the Telegraph newspaper in early 2012, May told the right-leaning broadsheet: “The aim is to create here in Britain a really hostile environment for illegal migration.”
Associated measures introduced to further the hostile environment have included a requirement that landlords, employers, banks and the UK’s National Health Service carry out ID checks to determine whether a tenant, worker, customer or patient has a legal right to be in the UK, co-opting businesses and non-government entities into policing immigration via the medium of extra bureaucracy.
But in seeking to make life horribly difficult for workers who are in the UK without authorization, the government has also created a compliance nightmare for legal migration.
A Channel 4 TV report last year highlighted two cases of highly skilled Pakistani migrants who, after more than a decade in the UK had applied for indefinite leave to remain — only to be told they must leave instead. The Home Office cited small adjustments to their tax returns as grounds to order them out, apparently relying on a clause that allows it to remove people it decides to be of ‘bad character’.
That’s just the tip of the iceberg where the human impact of the Home Office’s hostile environment is concerned. There have been a number of major scandals related to the policy’s application. The most high profile touches Windrush generation migrants, who came to the UK between 1948 and the early 1970s — after the British Nationality Act gave citizens of UK colonies the right to settle in the country but without providing them with documentary evidence of their permanent right to remain.
The combination of thousands of legal but undocumented migrants — many originally from the Caribbean — and a Home Office instructed to take a hostile stance that pushes for deportations in order to shrink net migration has led to scores of settled UK citizens with a legal right to be in the country being pushed out or deported illegally by the government.
PHILIPPE HUGUEN/AFP/Getty Images
The Windrush scandal eventually claimed the scalp of May’s successor at the Home Office, Amber Rudd, who resigned as home secretary in April 2018 after being forced to admit to “inadvertently” misleading a parliamentary committee about targets for removing illegal immigrants.
Rudd had claimed the Home Office did not have such targets. That statement was contradicted by a letter she wrote to the prime minister that was obtained and published by The Guardian newspaper — in which she promised to oversee the forced or voluntary departure of 10% more people than May had during her time at the Home Office by switching resource away from crime-fighting to immigration enforcement programs.
May chose Sajid Javid to be Rudd’s replacement as home secretary. And while he has sought to distance himself from the hostile environment rhetoric — saying he prefers to talk about a “compliant environment” for immigration — the reality is the architect of the policy remains (for now) head of the government in which he serves.
Her government has not directly repeated the 2010 Conservative Party manifesto pledge to reduce net migration to the “tens of thousands”. But an immigration white paper published at the end of last year retraced the same rhetoric — talking about reducing “annual net migration to sustainable levels as set out in the Conservative party manifesto, rather than the hundreds of thousands we have consistently seen over the last two decades”.
It’s clear that controlling immigration remains right at the top of the government’s policy agenda, and is bearing out in how policies are enforced today.
Image via Amer Ghazzal / Getty Images
As UK prime minister, May is also in charge of delivering Brexit. And here she has made ending freedom of movement for European Union citizens another immutable red-line of her approach — repeatedly claiming it’s necessary to ‘take back control’ of the UK’s borders to deliver on the Brexit vote.
Brexit — the UK’s 2016 referendum to exit the European Union — saw around 52% of those who cast a ballot voting to leave, or around 17.4 million people out of a total population of approximately 65.6M.
May’s interpretation of that result has been to claim citizens voted to end free movement of EU people and workers, despite there being no such specific detail on the ballot paper. (The referendum question simply asked whether the UK should remain a member of the European Union or leave.)
So her vision of a post-Brexit future will require UK businesses which want to recruit EU workers needing a sponsor license and relevant visas for all such hires. This will mean UK businesses hiring from outside the settled worker pool will have to expose more of their inner workings to the rules and regulations of the immigration system — with all the compliance cost and risk that entails.
From the outside looking in it might seem odd that the Conservative Party — a formidable political force that likes to claim it can be trusted to manage the economy, and which is traditionally associated with being more closely aligned with the interests of the private sector— is presiding over policies that drive up compliance bureaucracy for companies while simultaneously increasing their recruitment costs and squeezing their ability to access a broader talent pool.
But the traditional politics of right and left do seem to be in flux in the UK, as indeed they are elsewhere.
This is perhaps in part linked to the aging demographic of the Conservative Party’s base. (One disputed guesstimate, put out by a right-leaning think tank in 2017, suggested that the average age of a member of the party is 72; whatever the exact figure, no one disputes it skews old.)
The UK’s position in Europe — as a major economy, with a low unemployment rate and English as its first language — has also historically served to make the country an attractive destination for EU workers to settle. Hundreds of thousands of EU migrants arrived in the UK annually between mid 2014 to mid 2016, prior to the Brexit vote. Post-referendum, EU immigration dropped to 74,000 last year (even as net migration to the UK has not reduced).
That locus has long been a major benefit to UK businesses and startups, and so to the wider economy. But once it got geared into years of austerity politics — also introduced by the Conservative-led government in the wake of the 2008 financial crash — the country’s success as a worker and talent magnet started to butt up against and even drive rising resentment among sections of the population that have not felt any economic benefit from the concentrated wealth of high tech hubs like London.
Against a backdrop of growing inequality in UK society and sparser access to publicly funded resources, it has been all too easy for right-wing populists to re-channel resentment linked to government austerity cuts — framing immigration as a drain on services and pointing the finger of blame at migrants by encouraging the idea that they have a lesser claim than natural UK-born citizens to essential but now inadequately resourced public services.
This cynical scapegoating glosses over the fact that public services have been systematically and deliberately underfunded by austerity politics. But, at the same time, research that suggests EU migrants are in fact a net benefit to the UK economy has little comfort to offer those who feel economically excluded by default.
Image via Getty Images / Daniel Limpi / EyeEm
One interesting component of the UK’s Brexit vote split is that it appears to cut — not so much along traditional left/right political lines — but across educational divides, with research suggesting that pro-Brexit voters were more likely to live in areas with lower overall educational attainment.
High tech hubs and startup businesses are therefore in the awkward position of risking exacerbating the same sort of societal divide. They can be seen as driving the automation of traditional jobs, creating work that’s more specialized which in turn makes employable skills harder to attain from a low skills base, and concentrating opportunity and wealth in the hands of fewer people. Hence the needs of startups are becoming more difficult for politicians to prioritize.
There’s no doubt the politics of austerity has supercharged UK inequality as service cuts have hit hardest at the regional margins where wider economic gains were always the least profound and first to evaporate under pressure. While rising competition for scarcer state-funded resources has created perfect conditions for scapegoating migration.
A report by the Institute for Fiscal Studies think tank earlier this month, at the launch of a five-year review into factors driving UK societal inequality, also warned that widening inequalities in pay, health and opportunities are undermining trust in democracy.
All of which makes responding to Brexit a political minefield for the UK government. The Brexit crisis seems to require a bold, society-wide re-engineering that attacks inequality of opportunity, radically invests in education, reskilling and upskilling to grow participation in the digital economy, and a tax policy that works to dilute concentrated wealth to ensure economic benefits are more fairly redistributed. None of which, it’s fair to say, is terrain traditionally associated with Conservative politics. (Though, in recent years, there have been attempts to claw in more tax from profit-shifting tech giants.)
Instead, the government’s top-line answer to the Brexit conundrum has, first and foremost, been to attack immigration. Playing to the lie that inequality is a simple numbers game based on population figures.
It’s not a strategy that properly addresses the question of how to manage wealth, resources and opportunity in an increasingly digital (and divided) world — to ensure it’s more equally and fairly distributed so that society as a whole benefits, rather than just a fabulously wealthy techno-elite getting richer.
Yet the government is badging its planned post-Brexit immigration reforms as a ‘Britain first’ overhaul that will create a system that’s “fair to working people here at home”, as the prime minister puts it. “It will mean we can reduce the number of people coming to this country, as we promised, and it will give British business an incentive to train our own young people,” runs her introduction to the immigration white paper published at the back end of last year, when Brexit was still marching towards a March 29 deadline.
The government making reducing net migration both flagship policy and political success metric has the knock-on effect of heaping cost, administrative burden and operational risk on UK startups — which rely, like all high tech businesses, on access to skills and talent to develop and scale commercial ideas.
Image via Getty Images / TwilightEye
But in the new austerity-fuelled Brexit political reality, the UK government not being overly supportive of the needs of talent-thirsty businesses seems to be the order of the day. Even as, on the other hand, other bits of opportune government rhetoric talk about Britain being “open for business” — or wanting the country to be the best place in the world to build a tech business.
Another government claim — that the planned “skills-based” future approach to immigration will allow businesses to cherry pick the very best talent from all over the globe — does not credibly stack up against the Conservative Party’s overarching push to shrink net migration.
The political reality, certainly for now, is that the ‘compliant’ environment approach to immigration is a euphemist label atop the same openly hostile policy that has slammed doors on people and businesses.
“I want to be able to hire great talented people with drive, enthusiasm and dynamism. I don’t want my choices to be restricted and if they are going to continue to be restricted we’ll have to look at other ways of maintaining the talent pool” says Adeyoola, discussing how he feels after Metail’s brush with the ‘compliant environment’.
“I’d love to just be able to hire the best person for the job… often a lot of that comes from people who want to come and make a life here. They have greater drive. So you get higher quality so you want to be able to hire those people if they come up.
“I think, unfortunately for us, we’re going to see fewer and fewer of them. Because if stuff continues the way it’s continuing, well we’ve already seen net migration from Europe fall dramatically over the last three years. In part that’s Brexit, in part that’s also because eastern European nations are flourishing… so the prospects are the other way. That’s just generally how things work. Great people move to great places.
”Just through going through this process it’s cost me money,” he adds of the audit and everything it triggered. “Real money in legal fees… lost time through weeks of work and effort from people inside the organization… We’re having to restrict the talent pool we can hire from… We’re going to have to spend more money on recruiters to find the right people… It is all just negative… The Brexit argument has always been Brexit will mean fewer EU which means we can have more people from outside… Well, that’s not how the immigration rules work now.
“You’re trying desperately to keep people from outside out. So I can’t believe that, post-Brexit you’re going to loosen the rules… So this whole thing about ‘fewer EU, more commonwealth and more everywhere else’ is not believable.”
Image via Nicolas Economou/NurPhoto via Getty Images
Change is coming for the UK’s immigration system. But if the government executes on May’s version of Brexit — which intends to end freedom of movement for EU citizens — it will require UK businesses to interface with the Home Office if they wish to recruit almost any skilled individual from overseas.
Simply put, the same set of rules will apply to EU and non-EU migrants in the future. With the caveat that it remains possible for any post-Brexit trade deals that the UK might ink to include agreements with certain countries to carve out distinct offers related to work visas.
Per its white paper, the government has said it will simplify immigration requirements, as part of the shift to a single, “skills-based future immigration system” post-Brexit, slated from 2021 onwards.
Planned changes include removing the cap on skilled workers, which has — in years past — put another hard limit on startups hiring skilled migrants as, up until doctors and nurses were excluded from the quota last summer, it kept getting hit each month — limiting how many visas were available to businesses.
The government has also said it will do away with the requirement that employers advertise jobs to settled workers. So no more resident labour market test — aka the process which helped skewer Metail’s sponsor license.
Instead, for skilled workers, the plan is to apply a minimum salary threshold of £30,000 (including those with lower, intermediate level skills than now) — using pay as a lever to discourage migrant workers from being used to undercut wages. So no more forcing businesses to undertake an arduous, lengthy and risky (from a compliance point of view) process of advertising to settled workers in case one can be found for a vacancy.
Although the 2021 timeline for introducing the skills-based system that’s written into the immigration policy paper was contingent on the UK leaving the EU on March 29 this year. Whereas Brexit still has yet to happen. So the implementation date for any post-Brexit immigration reforms remains as equally uncertain and moveable a ‘feast’ as Brexit itself.
“Cost certainly won’t go away,” says Charlie Pring, a senior counsel who specializes in immigration work for law firm Taylor Wessing, of the planned reforms. “The red tape will go away a little bit from 2021 when they rework this new one-size fits all system that will cover Europeans and non-Europeans — because they’re going to scrap the cap and they’re going to scrap advertising. And they’re also going to lower the skill level as well — so almost like A-level qualified jobs rather than graduate one jobs. So it’ll be mid-level jobs as well as graduate ones. But that’s still best part of two years away — so until then employers have got to lump it.”
The immigration system that remains in force has been designed to make the process of sponsoring migrant workers akin to a tax on businesses — with associated cost, complexity and uncertainty designed to discourage recruitment of non-UK workers.
PAUL FAITH/AFP/Getty Images
For startups, Pring (who to be clear did not advise Metail) sees costs as the biggest challenge — “because the visa fees are so high”. He also points out the fees scale with the company. Once a startup is “no longer deemed to be a small” by the Home Office there’s “a higher skills tax to the government as well. So that’s a real issue”.
Startups don’t get any kind of compliance break based on the fact they’re trying to be innovative, develop new skills, tap novel technologies and create new business models. The same skeptical compliance can also be seen operating across the board — whether a business entails low tech seasonal fruit picking or is a high growth potential AI startup with a wealth of PhD expertise and patented technologies.
Nor does the Home Office have any remit to actively support sponsors to help them understand how to fulfil all the various knotted requirements of an immigration system that can be charitably described as opaque and confusing.
On the contrary, the government’s goal of shrinking annual migration creates a political counter-incentive for immigration rules to be complex and unclear. Encouraging enforcement to be aggressive and confrontational — and for compliance officers to hunt for reasons to find and penalize failure.
UK startups that sponsor migrants should understand they remain at risk of falling foul of the charged politics swirling around immigration — and having all their sponsored visas liquidated and business penalized by a system that, parts of which the government’s own policy plan concedes are not working as intended.
Even with reform looming, the future for entrepreneurs in the UK looks no less uncertain — if, as the government intends, free access to the EU talent pool goes away after Brexit. That will give the Home Office far greater control over migration, and therefore a much bigger say over who businesses can and cannot hire — putting its hands on cost and skill levers which can be used to control migrant flow.
Here’s Pring again: “The government is deliberately funneling people through into Tier 2 [visas]. If they push everybody through Tier 2, which is what they want, that’s the way they control skill level and salary level because you can only get a Tier 2 visa if the job is skilled enough and you’re paying enough for it. So it enables the government to put an element of control onto the visa numbers. And even though they’re not [generally] capping the numbers… they are through the backdoor deterring people from applying by making it difficult to qualify and ramping up the visa fees.”
The UK’s future immigration system is also being fashioned by a Conservative government that sees itself under siege from populist, anti-immigration forces, and is led — at least for now — by a prime minister famed for her frosty welcome for migrants.
Without a radical change of government and/or political direction it’s hard to imagine those levers being flipped in a more startup-friendly direction.
Entrepreneurs in the UK should therefore be forgiven for feeling they have little reason to smile and plenty to worry about. Rising costs for accessing talent and growing political risk is certainly not the kind of scale they love to dream of.
Here’s a classic recipe for Camarones al Ajillo, a.k.a. spicy garlic shrimp! The shrimp gets quickly sautéed with garlic and jalapeno, then mixed with some coconut rice. Serve with coconut rice for a full meal.
Luckin Coffee, the ambitious Chinese upstart that’s going after Starbucks, could raise nearly $600 million from its upcoming IPO. That’s according to a price range released by the Chinese startup.
In a new filing, Luckin said it plans to sell 30 million shares at an initial range of $15-$17. That gives an estimated raise of $450 million to $510 million, but it could be bumped up if underwriters take up the additional allocation of 4.5 million shares. So, as a grand total, the listing could raise $586.5 million if the full offering is bought at the top of the range.
The company will list on the Nasdaq as ‘LK.’
Luckin filed to go public last month, just weeks after it closed a $150 million Series B+ funding round led by New York private equity firm Blackrock, which interestingly holds a 6.58 percent stake in Starbucks. The deal valued Luckin at $2.9 billion and it took the three-year-old company to $550 million raised from investors to date.
The company has burned through incredible amounts of cash as it tries to quickly build a brand that can rival Starbucks, and the presence that the U.S. firm has built over the last 20 years in China. Through aggressive promotions and coupons, the company posted a $475 million loss in 2018, its only full year of business to date, with $125 million in revenue. For the first quarter of 2019, it carded an $85 million loss with total sales of $71 million.
Starbucks CEO Kevin Johnson has been vocally dismissive of the viability of that strategy of “heavy, heavy discounts.”
“We’re deploying capital and building 600 new stores per year. [We’re] generating the return on invested capital that we believe is sustainable to continue to build new stores at this rate for many years to come,” he told CNBC in a recent interview.
Starbucks claims 30,000 stores worldwide. It has been in China for 20 years and it is aiming to reach 6,000 stores in the country by 2022. Luckin, fuelled by that VC money, has quickly scaled to reach 2,370 locations in under two years with plans to add a further 2,500 this year. That would see it overtake Starbucks — which has 3,600 stores across 150 Chinese cities — although that a metric gives a distorted view since Luckin specializes in digital orders and on-demand delivery. That’s in contrast to the retail model operated by Starbucks.
Cross-border fintech continues to be an area of interest for venture capitalists. The latest deal sees GGV Capital — the U.S-China firm that’s backed Xiaomi, Airbnb, Square and others — lead a $10 million investment in Singapore-based startup Thunes.
Other investors in the Series A round are not being disclosed at this point.
Thunes — which is slang for money in French and is pronounced ‘tunes’ — is not your typical startup. Its service is a b2b play that provides payment solutions for companies and services that deal with consumers and need new features, increased interoperability and flexibility for users. It makes money on a fee basis per transaction and, in the case of cross border, a small markup on exchange rates using mid-market rates for reference.
The company was founded in February of this year when TransferTo, a company that provided services like mobile top-up cross-border split itself in two. Thunes is the b2b play that uses TransferTo’s underlying technology, while DT One was spun out to cover the consumer business of top-up and mobile rewards.
The investment, then, is a first outside raise for Thunes, which had previously been financed by TransferTo, which is a profitable business, according to Thunes executive chairman Peter De Caluwe, who led payments startup Ogone to a €360 million acquisition in 2013.
De Caluwe, who is also CEO of DT One, told TechCrunch that Thunes reached $3 billion in payment volumes over the last 12 months. His goal for this year is double that to $6 billion and already, he said, it is “on track to get there.” (Steve Vickers, who previously managed Xiaomi in Southeast Asia and has worked with Grab, is Thunes CEO.)
Thunes works with customers across the world in North America, Central America, Latin America, Africa, Europe and Asia, but it is looking particularly at Southeast Asia and the wider Asia continent for growth with this new capital. It is not a consumer-facing brand, but its biggest customers include Western Union, PayPal and Mpesa — where it has worked to connect the two payment interfaces in Africa — and India’s Paytm and ride-hailing company Grab, which it helps to pay drivers.
In the case of Grab — the $14 billion company backed by SoftBank’s Vision Fund — De Caluwe said Thunes helps it to pay “millions” of drivers per day. Grab uses Thunes’ real-time payment system to help drivers, many of whom need a daily paycheck, to convert their earnings to money in Grab’s wallet, their bank account or cash pick-up locations.
It’s hard to define exactly what Thunes’ role is, but De Caluwe roughly calls it “the swift of the emerging markets.” That’s to mean that it enables interoperability between different wallets, banks in different countries and newer payment systems, too. It also provides feature — like the instant payout option used by Grab — to enable this mesh of financial endpoints to work efficiently — because right now the proliferation of mobile wallets can feel siloed to the ‘regular’ banking infrastructure.
De Caluwe said that Thunes will work to add more destinations, support for more countries, more partners and more features. So growth across the board with this money. It is also looking to increase its team from the current headcount of 60 to around 110 by the end of this year.
Singapore is HQ but Thunes also has staff located in London and Nairobi offices, with some employees in the U.S. — they share a Miami office with DT One — and others remote in India and Indonesia. A Dubai office, covering the important and lucrative Middle East region, is in the process of being opened.
The company is also looking to raise additional capital to support continued growth. De Caluwe, who has spent time working at Telenor and Naspers-owned PayU, said a Series A+ and Series B is tentatively timed for the end of this year or early next year. The Thunes executive chairman sees massive potential since he believes the company “doesn’t have much competition.”
That’s echoed by GGV managing partner Jenny Lee .
“In China and the U.S, currency is homogenous and payment systems are established,” Lee told TechCrunch in an interview. “But in Southeast Asia right now, a huge number of the population is just getting on the internet and there are not a lot of established players.”
GGV has just opened its first office in Singapore — Lee herself is Singaporean — and the company intends to make fintech a major focus of its deals in the region. To date, Thunes is just its second investment in Southeast Asia, so there is certainly more to come.
The latest proof is LG’s Q1 financials, released this week, which show that its mobile division grossed just KRW 1.51 trillion ($1.34 billion) in sales for the quarter. That’s down 30 percent year-on-year and the lowest income for LG Mobile for at least the last eight years. We searched back eight years to Q1 2011 — before that LG was hit and miss with releasing specific financial figures for its divisions.
To give an indication of its decline, LG shipped over 15 million phones in Q4 2015 when its revenue was 3.78 trillion RKW, or $3.26 billion. That 2.5 times higher than this recent Q1 2019 period.
Regular readers will be aware that LG mobile is a loss-making division. That’s the reason its activities — and consequently sales — have scaled down in recent years. But the losses are still coming.
LG put Brian Kwon, who leads its lucrative Home Entertainment business, in charge of its mobile division last November and his task remains ongoing, it appears.
LG Mobile recorded a loss of 203.5 billion KRW ($181.05 million) for Q1 which it described as “narrowed.”
It is true that LG Mobile’s Q1 loss is lower than the 322.3 billion KRW ($289.8 million) loss it carded in the previous quarter, but it is wider than one year previous. Indeed, the mobile division lost 136.1 billion KRW ($126.85 million) in Q1 2018.
LG said Mr Kwon is presiding over “a revised smartphone launch strategy” which is why the numbers are changing so drastically. Going forward, it said that the launch of its G7 ThinQ flagship phone and a new upgrade center — first announced last year — are in the immediate pipeline, but it is hard to see how any of this will reverse the downward trend.
LG Mobile is increasingly problematic because the parent company is seeing success in other areas, but that’s being countered by a poor performing smartphone business. Last quarter, mobile dragged LG to its first quarterly loss in two years, for example.
Just looking at the Q1 numbers, LG’s overall profit was 900.6 billion KRW ($801.25 million) thanks to its home appliance business ($647.3 million profit) and that home entertainment business, which had a profit of $308.27 million. Its automotive business — which is, among other things, focused on EVs — did bite into the profits, but that is at least a business that is going places.
While discounting is an intrinsic aspiration of all the customers, it is arguably the most important pricing strategy for all businesses, especially retailers. It, however, requires a great amount of prudence in execution.
You can consider it as a double-edged sword.
It can allure customers and drive sales. And with wrong implementations, it may lead to a reduced bottom line as well.
I know that after reading the previous paragraph, all ambitious entrepreneurs would be eager to know the most effective discount strategies and tactics they could use. If you are one of those people, then read on.
Instead of announcing blanket discount offers like 15% off or $15 off on all purchases, a conditional discounting strategy keeps your margins protected. It enhances your conversion rate at the same time. You can always set conditions or fix certain limits for customers to avail discount.
The following examples will explain this strategy:
• Get an X % discount if you buy Y or number of items: This is also called volume discount aiming to entice customers to purchase products in large quantities. Large discounts for large volumes attract first-time customers. In highly competitive markets, companies lock in customers through this strategy.
• Buy one get one free or buy one and get another on discount: This strategy is commonly used by many retailers. They make a good profit on account of a large turnover.
• Spend a certain amount and save X %. This strategy motivates customers to purchase an item in bulk for future requirements or buy multiple items in order to avail the announced saving.
Loyal customers deserve special favor.
For businesses, it costs 10 times higher to sell something to a new customer than to an existing one. These discounts prove to be an excellent retention tool.
Offering rewarding discounts to regular and repeat customers make them feel privileged. The point scoring mechanism for members of the loyalty club is an excellent tool that motivates customers to spend more on shopping for scoring higher points. Each point carries a dollar amount which you can redeem any time.
The loyal customers often get reward through special arrangements as well. For instance, a sports clothing store offers discounted membership to a local gym to its customers who spend a certain amount. Reciprocally, the gym also offers discount vouchers to its loyal customers for purchasing from that sports clothing shop.
This strategy bundles a group of products and sells this set at a discounted price. The customers perceive a discount on the package as a better deal than a discount on individual items.
The fast-food chains, like McDonald’s and KFC, understand this bundling discount concept quite well. With that, they offer various deals which combine many items for a reduced cumulative price than buying each item individually.
Similarly, a cable service provider may sell you internet, cable TV, and home phone service separately or in a bundle. In the latter case, the price you will pay will be a much-discounted one against individual services.
The bundles work well for profit margins, which are high enough to cover the cost of offering. The higher sales thus increase profitability.
The sellers can make the best use of special discounts for selected groups of consumers. For example, students, senior citizens, and women generally shop for discounts. They hunt promotional deals and search keenly for sale.
According to a Payment sense report, 71% of women say they would more likely purchase an item that is on sale. A research study by Stock and Bailey reveals that both male and female students hunt items on sale and search for promotional deals.
The strategy to offer discounts for exclusive consumer groups allows sellers to leverage these discounts without straining their profitability. There are plenty of businesses that offer discounts to select consumer groups.
FedEx, for instance, gives 30% discounts on documents and 20% on shipping to students. Bealls, the retail clothing store, offers a discount of 50% to senior citizens (50+) every Tuesday. These are just two examples.
In fact, the strategy to discount consumers on segmentation basis is very common. Most customers highly value those companies that offer discounts for students, military persons, and seniors.
The businesses offer a good discount on advance payments of services and physical products. There are software companies that either bill monthly or annually, offering discounts in case customers choose the annual option. The advance payments can be used to acquire additional inventory or to improve cash flows.
The early-bird discount is also a special kind of prepayment discounting strategy. Many online stores use it for to-be-launched products. The customers are motivated to book their orders prior to launch and are rewarded with substantial discounts.
Hotels, training academies, and publishers are some examples that use this strategy successfully.
These are rewards for certain favorable action from your customers that can open doors for greater business opportunities. For instance, you may announce an automatic 10% discounts to customers when they share your products on Twitter. Another of such incentives may be a 20% discount on referring three friends.
These action-oriented discounts may initially seem costlier but they promote and benefit the company in many ways. In fact, prudent use of this strategy brings multiple marketing benefits for the company.
Every online business confronts these shoppers who add items to their shopping cart and then leave the site without making a purchase. The reasons for abandonment often include higher shipping cost, lengthy/complicated checkout process, and poor navigation of the site.
Being a huge issue for E-commerce, the businesses are paying serious attention to this. Enters the abandoned cart email strategy, which includes sending a suitable personalized message soon after abandonment. The message is sweetened by incentivized purchasing deal, offering some discount.
Most companies report increased conversion by using the discount for abandoned carts. A word of caution, however, is to make this discount a one-time offer only. This is important in preventing the customer from getting used to abandoning the card for getting a discount.
Events and discounts now seem inseparable. Be it Black Friday, Christmas, Valentine’s Day or Mother’s Day, businesses offer substantial discounts.
Most people tend to be in a shopping mindset these days. Retailers can boost their sales volumes backed by intelligent and well-thought-out discounting strategies.
Many companies relate discounting schemes to company-specific events. A leading TV shopping channel in Germany cleverly discounts their not-selling-well products on self-designed events, like the anniversary of the internet site or an annual-themed Exercise week.
Seasonal discounts often target out-of-season inventory to help reduce the inventory carrying costs. The seasonal discounts usually exclude high-end brands and confine to those products, which are sought by bargain hunters.
See Also: How to Survive Black Friday
The savvy marketers are using the ubiquitous coupon codes very commonly to track their campaign’s ROI. The retail shoppers delightedly search sites like RetailMeNot or SlickDeals to find the best shopping deals.
The coupon codes are alphanumeric strings. They are offered by online shopping stores as a vital part of their overarching marketing strategy. The coupon, according to a research conducted by Center of Neuroeconomic studies, Claremont graduate university, is physically shown to be more enjoyable than getting a gift.
These sophisticated marketing tools drive sales and help build the brand image. The coupon code strategy for a discount is producing excellent results in revenue generation for retailers around the globe.
The correct discounting strategy definitely boosts the sales and enhances your income streams. However, there are three prerequisites that are critical for getting a guaranteed positive outcome of discounting. These are:
While a correct and well-timed strategy offered to relevant customers may turn around your sales volumes, a wrong strategy may likely impact your business negatively. It’s all about matching your goals with an appropriate strategy.
The post Amazing Discount Strategies That Keep Your Sales Moving Upward appeared first on Dumb Little Man.
These Greek meatballs are great for a party appetizer! They’re made with lamb and a handful of seasonings (orange zest! mint! garlic!), and rolled into perfect little bites. Eat with toothpicks and serve some yogurt dipping sauce on the side.
China’s biggest ecommerce company Alibaba was again on the U.S. Trade Representative’s blacklist over suspected counterfeits sold on its popular Taobao marketplace that connects small merchants to consumers.
Nestling with Alibaba on the U.S.’s annual “notorious” list that reviews trading partners’ intellectual property practice is its fast-rising competitor Pinduoduo . Just this week, Pinduoduo founder Colin Huang, a former Google engineer, wrote in his first shareholder letter since listing the company that his startup is now China’s second-biggest ecommerce player by the number of “e-way bills”, or electronic records tracking the movement of goods. That officially unseats JD.com as the runner-up to Alibaba.
This is the third year in a row that Taobao has been called out by the U.S. government over IP theft, despite measures the company claims it has taken to root out fakes, including the arrest of 1,752 suspects and closure of 1,282 manufacturing and distribution centers.
“Although Alibaba has taken some steps to curb the offer and sale of infringing products, right holders, particularly SMEs, continue to report high volumes of infringing products and problems with using takedown procedures,” noted the USTR in its report.
In a statement provided to TechCrunch, Alibaba said it does “not agree with” the USTR’s decision. “Our results and practices have been acknowledged as best-in-class by leading industry associations, brands and SMEs in the United States and around the world. In fact, zero industry associations called for our inclusion in the report this year.”
Pinduoduo is a new addition to the annual blacklist. The Shanghai-based startup has over the course of three years rose to fame among China’s emerging online shoppers in smaller cities and rural regions, thanks to the flurry of super-cheap goods on its platform. While affluent consumers may disdain Pinduodou products’ low quality, price-sensitive users are hooked to bargains even when items are subpar.
“Many of these price-conscious shoppers are reportedly aware of the proliferation of counterfeit products on pinduoduo.com but are nevertheless attracted to the low-priced goods on the platform,” the USTR pointed out, adding that Pinduoduo’s measures to up the ante in anti-piracy technologies failed to fully address the issue.
Pinduoduo, too, rebutted the USTR’s decision. “We do not fully understand why we are listed on the USTR report, and we disagree with the report,” a Pinduoduo spokesperson told TechCrunch. “We will focus our energy to upgrade the e-shopping experience for our users. We have introduced strict penalties for counterfeit merchants, collaborated closely with law enforcement and employed technologies to proactively take down suspicious products.”
The attacks on two of China’s most promising ecommerce businesses came as China and the U.S. are embroiled in on-going trade negotiations, which have seen the Trump administration repeatedly accused China of IP theft. Tmall, which is Alibaba’s online retailer that brings branded goods to shoppers, was immune from the blacklist, and so was Tmall’s direct rival JD.com.
Taobao has spent over a decade trying to revive its old image of an online bazaar teeming with fakes and “shanzhai” items, which are not outright pirated goods but whose names or designs intimate those of legitimate brands. Pinduoduo is now asked to do the same after a few years of growth frenzy. On the one hand, listing publicly in the U.S. subjects the Chinese startup to more scrutiny. On the other, small-town users may soon demand higher quality as their purchasing power improves. And when the countryside market becomes saturated, Pinduoduo will need to more aggressively upgrade its product selection to court the more sophisticated consumers from Chinese megacities.
If you find ramps at your local farmer’s market, make this ramp pesto! Ramps have a bright, garlicky flavor that is perfect for pesto. Toss it with pasta, spread on sandwiches, or swirl it into a spring soup.
Perfect, easily-peeled hard boiled eggs can be surprisingly tricky to pull off, especially when you need to make a big batch for Easter or a summer potluck. Here are three different ways that we’ve found give us consistent results, every time. Pick one to try the next time you need hard boiled eggs!
Aptiv, the U.S. auto supplier and self-driving software company, is opening an autonomous mobility center in Shanghai to focus on the development and eventual deployment of its technology on public roads.
The expansion marks the fifth market where Aptiv has set up R&D, testing or operational facilities. Aptiv has autonomous driving operations in Boston, Las Vegas, Pittsburgh and Singapore. But China is perhaps its most ambitious endeavor yet.
Aptiv has never had any AV operations in China, but it does have a long history in the country including manufacturing and engineering facilities. The company, in its earlier forms as Delphi and Delco has been in China since 1993 — experience that will be invaluable as it tries to bring its autonomous vehicle efforts into a new market, Aptiv Autonomous Mobility President Karl Iagnemma told TechCrunch in a recent interview.
“The long-term opportunity in China is off the charts,” Iagnemma said, noting a recent McKinsey study that claims the country will host two-thirds of the world’s autonomous driven miles by 2040 and be trillion-dollar mobility service opportunity.
“For Aptiv, it’s always been a question of not ‘if’, but when we’re going to enter the Chinese market,” he added.
Aptiv will have self-driving cars testing on public roads by the second half of 2019.
“Our experience in other markets has shown that in this industry, you learn by doing,” Iagnemma explained.
And it’s remark that Iagnemma can stand by. Iagnemma is the co-founder of self-driving car startup nuTonomy, one of the first to launch a robotaxi service in 2016 in Singapore that the public—along with human safety drivers — could use.
NuTonomy was acquired by Delphi in 2017 for $450 million. NuTonomy became part of Aptiv after its spinoff from Delphi was complete.
Aptiv is also in discussions with potential partners for mapping and commercial deployment of Aptiv’s vehicles in China.
Some of those partnerships will likely mimic the types of relationships Aptiv has created here in the U.S., notably with Lyft . Aptiv’s self-driving vehicles operate on Lyft’s ride-hailing platform in Las Vegas and have provided more than 40,000 paid autonomous rides in Las Vegas via the Lyft app.
Aptiv will also have to create new kinds of partnerships unlike those it has in the U.S. due to restrictions and rules in China around data collection, intellectual property and creating high resolution map data.
In a few weeks, Tesla buyers will have to pay more for an option that isn’t yet completely functional, but that CEO Elon Musk promises will one day deliver full autonomous driving capabilities.
Musk tweeted Saturday that the price of its full self-driving option will “increase substantially over time” beginning May 1.
Tesla vehicles are not self-driving. Musk has promised that the advanced driver assistance capabilities on Tesla vehicles will continue to improve until eventually reaching that full automation high-water mark.
Please note that the price of the Tesla Full Self-Driving option will increase substantially over time
— Elon Musk (@elonmusk) April 13, 2019
Musk didn’t provide a specific figure, but in response to a question on Twitter, he said the increase would be “something like” around the $3,000+ figure. Full self-driving currently costs $5,000.
Something like that
— Elon Musk (@elonmusk) April 13, 2019
The price hike comes amid several notable changes and events, including an upcoming Investor Autonomy Day on April 22 meant to explain and showcase Tesla’s autonomous driving technology. On Thursday, Tesla announced that Autopilot, its advanced driver assistance system that offers a combination of adaptive cruise control and lane steering, is now a standard feature.
The price of vehicles with the standard Autopilot is higher (although it should be noted that this standard feature is less than the prior cost of the option). Buyers previously had to pay $3,000 for the option and examples given by Tesla suggest a $500 savings.
Tesla also announced it would begin leasing the Model 3 vehicles.
The more robust version of Autopilot is called Full Self-Driving, or FSD, and currently costs an additional $5,000. FSD includes Summon as well as Navigate on Autopilot, an active guidance system that navigates a car from a highway on-ramp to off-ramp, including interchanges and making lane changes. Once drivers enter a destination into the navigation system, they can enable “Navigate on Autopilot” for that trip.
Tesla continues to improve Navigate on Autopilot and the broader FSD system through over-the-air software updates. The company says on its website that FSD will soon be able to recognize and respond to traffic lights and stop signs and automatically driving on city streets.
The next major step change is a new custom chip called Hardware 3 that Tesla recently began producing. The Tesla-built piece of hardware is designed to have greater processing power than the Nvidia computer currently in Model S, X, and 3 vehicles.
Musk tweeted Saturday that Tesla will begin swapping the new custom chip into existing vehicles in a few months.
Tesla will start FSD computer upgrade in a few months
— Elon Musk (@elonmusk) April 13, 2019
Musk has been promising full self-driving for years now. In late 2016, when Tesla started producing electric vehicles with a more robust suite of sensors, radar and cameras that would allow higher levels of automated driving, it also started taking money from customers for FSD. Musk said at the time, it would become available if and when the technical challenges were conquered and regulatory approvals were met.
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Uber’s exits from China, Russia and Southeast Asia were billed as failures from the company, but the ride-sharing giant has already made billions on paper from those moves, according to its IPO filing.
Uber released its much-anticipated S1 on Thursday U.S. time and reporters and analysts are frantically digging into a treasure trove of previously-unreleased details. A number of sections on Uber’s global divestitures begin to paint a clear picture of the strategy that Uber employed when leaving China, Russia and Southeast Asia in recent years.
In each case, Uber decided to leave the market but, upon doing so, take a stake in its rival business in exchange for the assets it had remaining. That not only keeps them involved, but it removes the often substantial cost of competing with a single-market player and gives Uber options to re-enter the market or profit from its partner’s success there.
Already that strategy is bearing fruit. Today, those holdings are collectively worth a cool $12.5 billion on paper, with a least $3 billion in gains so far.
China was Uber’s first tactical exit and it saw the company sell to local giant Didi Chuxing in August 2016.
The Uber filing shows the U.S. firm took an 18.8 percent take in Didi. That, Uber estimates, has since been reduced to around 15.4 percent due to subsequent fundraising from Didi, which last publicly announced a $5.5 billion raise one year ago — previously, it raised $4 billion at the end of 2017.
Didi’s $56 billion valuation means it is the third highest valued startup in the world behind only ByteDance, parent of TikTok, and Uber, which it counts as an investor
The really interesting part of the filing its Uber’s estimate for the value of its Didi stake: that was $5.97 billion as of the end of 2017, and $7.95 billion at the end of last year. That’s a $2 billion paper increase in just one year, although the Uber filing doesn’t provide a value for the initial merger deal. Didi is also in the money having invested $1 billion into Uber in exchange for shares.
One notable piece is that an investigation into whether the deal constitutes a monopoly is still ongoing, some two and a half years after the transaction was first announced.
“It is not clear how or when that proceeding will be resolved,” Uber notes in its document.
Finally, the original deal included a clause forbidding Didi from making “certain investments outside of Asia” for a six-year period. The company breached that — it acquired Uber rival 99 in Brazil and expanded its business into Mexico, among other moves — which saw Uber take back some shares, although its net gain was only $152 million.
Didi has struggled over the last 18 months so safety concerns bubbled to the fore following the murder of two female passengers last year. Operationally, too, there have been challenges. Didi reportedly lost $1.6 billion last year — that’s more than Uber — and it reshuffled the organization by laying off 15 percent of its staff recently. Despite buying out Uber, it is up against increased competition after a consortium of automakers inked a $1.45 billion ride-hailing joint-venture while new government rules have made the business of ride-hailing, and in particular recruiting drivers, more challenging in China.
Still, as China’s dominant firm and with an increasingly global presence, you’d imagine that Uber’s stake is likely to become more lucrative in the future.
Uber’s exit from Southeast Asia in March 2018 never seemed a copy of its China play, where it was burning a reported $1 billion a year. Instead, I argued that the deal was actually a win for the U.S. firm because it took a decent slice of Grab as part of the agreement and Uber’s filings show that is already proving to be the case.
Uber noted that the exit deal saw it take an initial 30 percent stake for $2.28 billion, which has since diluted to around 23 percent following Grab fundraising, which remains ongoing with a goal of $6.5 billion for its Series H. (That may be why the Uber stake was initially announced as 23 percent rather than 30 percent.)
Grab’s most recent valuation was $14 billion, according to sources, which means Uber’s stake is already worth $3.22 billion, a nearly $1 billion jump on paper in just a year.
Uber’s investment in Grab has already made it a $1 billion profit in just over one year
With the company in a dogfight with Go-Jek, its Indonesia rival that’s backed by the likes of Google and Tencent, it seems unlikely that Grab and key shareholder SoftBank will do anything other than keep on raising. That’ll likely dilute Uber — which, as a shareholder rather than an investor, isn’t likely to invest again — but it’ll increase Grab’s valuation and thus the value of Uber’s stake.
That leads us to the next detail of Uber’s Grab investment: its stake is classified as “available-for-sale debt security.” That’s to say that Uber could potentially dispose of its stake in the future.
Indeed, the Uber filing notes a clause in the deal that would allow the U.S. firm to sell “all or a portion of its investment back to Grab for cash” if the company hasn’t gone public by March 25 2023, five years after the deal.
That’s the first real line in the sand that we’ve seen for a Grab IPO and, with a buyback already expensive as Uber’s stake is worth more than $3 billion, the clock is ticking.
Finally, Uber’s third tactical retreat is Russia, where it formed a joint venture with local rival Yandex.taxi in July 2017. The combined business covers ride-hailing and food delivery in over 127 cities in Russia.
That gives it a different kind of relationship to its deals with Didi and Grab, where it one of many minority shareholders, and Uber’s S1 gives fewer details of the Russia JV.
Yandex, like Uber, is testing self-driving vehicles that could used in its taxi service in the future
What we do know is that Uber estimates its share of the business is 38 percent, a slice that it says is worth $1.4 billion. That’s a valuation of around $3.68 billion which is on par with the $3.7 billion that the companies announced at the time of the deal. Like the other deals, the business is the dominant one in a huge market — Russia has a population of more than 140 million people — so it stands to reason that the business will grow and thus Uber’s value within it will increase.
Yandex, the parent of Yandex.taxi, also stands to gain and not just from the joint venture. Uber allocated the company two million shares (then worth $54 million) which, at a proposed $55 per share, would more than double to $110 million at IPO and that’s not counting its potential value in the future.
Uber CEO Dara Khosrowshahi said that Southeast Asia would be the company’s last global retreat, and he seems to have been good to his word so far. Indeed, Uber announced its largest acquisition last month with a planned $3 billion purchase of Middle East-based rival Careem, which is present in 15 markets.
The Uber filing explains that the deal, which has not been completed, is $3.1 billion with around $1.4 billion in cash.
“We have structured the acquisition and proposed integration of Careem with the goal of preserving the strengths of both companies, including opportunities to create operating efficiencies across both platforms. We expect to share consumer demand and driver supply across both platforms, thereby increasing network density and reducing wait times for consumers and drivers in the region, while simultaneously achieving synergies from combining back-end support functions and shared technology infrastructure,” Uber wrote in a statement.
That’s certainly a new approach for Uber worldwide and, post IPO, it’ll be interesting to watch it actively play a role in consolidating other businesses into its own rather than going the other way. Still, those three global retreats are likely to pay off handsomely despite being billed as the result of failure.
A graphic from Uber’s filing shows its global presence, and the importance of its investments in China, Russia and Southeast Asia
Women-focused co-working space The Wing has hired Rachel Racusen as vice president of communications. Racusen has been the director of communications at Snap, the developer of Snapchat, since late 2016.
Racusen’s exit represents the latest in a series of departures at the “camera company.”
Earlier this year, the company’s chief financial officer Tim Stone stepped down. Shortly after, The Wall Street Journal reported that Snap had fired its global security head Francis Racioppi after an investigation uncovered that he had engaged in an inappropriate relationship with an outside contractor. Snap CEO Evan Spiegel reportedly asked the company’s HR chief Jason Halbert to step down as a result of the investigation’s findings.
Racusen worked under Snap’s chief communications officer Julie Henderson, who had joined late last year from 21st Century Fox.
Racusen has a history in politics similar to several other executives at The Wing. Ahead of her Snap tenure, she served as the associate communications director under President Barack Obama . Before that, she was a vice president at MSNBC and the public affairs firm SKDKnickerbocker, where The Wing co-founder and chief executive officer Audrey Gelman worked prior to launching her business.
Four months after closing a $75 million Series C, The Wing is making two other key additions to its management team. The company has brought on Nickey Skarstad as vice president of product and Saumya Manohar as general counsel. Skarstad joins from Airbnb, where she was a product lead on the Airbnb Experiences team. Saumya Manohar spent the last three years as Casper’s vice president of legal.
“We’re thrilled to be bringing this group of seasoned and talented women to build out our executive team,” Gelman said in a statement. “The Wing is the perfect home for leaders who thrive on fast growth and want to combine their social values with their work practice.”
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It’s that time again folks, Samsung has reported guidance for its upcoming Q1 quarter — and things don’t look good.
Samsung is forecasting that revenue for the quarter will reach 51-53 trillion KRW ($44.87-$46.63 billion), which would represent a drop of around 15 percent on one year previous. The Korean tech giant reported a record operating profit in Q1 2018 — $13.76 billion — but this time around that is forecast to fall by a whopping 60 percent for the current quarter of business. According to Bloomberg, that would be the company’s worst slump for four years.
Following a record year is never going to be easy, but the forecast Q1 2019 operating profit of 6.1-6.3 billion KRW — around $5.5 billion — represents a pretty steep 43 percent drop on the previous quarter. That’ll give Samsung shareholders plenty to worry about.
The company’s pre-earnings guidance doesn’t go into details on the predictions, but last year’s record profits were largely down to the success of its consumer handset business and also a strong market for memory chips. There have been plenty of warning signs that those good times might not last.
Samsung itself played down those impressive Q1 2018 results multiple warnings on the future — my colleague Brian Heater pointed out that the words “slowing growth” appeared seven times in Samsung’s announcement at the time — due to concerns around the company’s display panel business and a slowing growth within the general smartphone industry.
As we well know, analyst reports show that people are buying fewer phones for a range of reasons. That’s one explanation for Apple’s multi-device approach which pushes its top-of-the-range model to well beyond the $1,000-mark. Slowing growth means a need to extract more revenue from the most loyal users, to thus increase the overall average selling price (ASP).
Samsung has long played in the mid-tiers — where it is up against tough competition from the likes of Xiaomi, Oppo, Huawei and others from China — but it’ll be interesting to see if it shifts its top-end approach.
We’ll know more when the company releases its full Q1 earnings report later this month so stayed tuned.
Last month, it became widely known that MySpace has lost much of the user data uploaded to it before 2016, including potentially million of music tracks from between 2003 to 2015. This is a significant loss for people who may not have used the site anymore, but took for granted that it would remain an online scrapbook of the years when Myspace was the go-to social network, including for musicians promoting their work. A new collection of MP3s hosted by the Internet Archive, however, may help some users recover lost music (and memories).
ANNOUNCING THE MYSPACE MUSIC DRAGON HOARD, a 450,000 song collection of mp3s from 2008-2010 on MySpace, gathered before they were all “deleted” by mistake. https://t.co/oIunuHF7wc includes a link to a special custom search and play mechanism that lets you search and play songs. pic.twitter.com/aGkFPDBN7r
— Jason Scott (@textfiles) April 4, 2019
Called the MySpace Music Dragon Hoard, the collection contains 450,000 songs. While this is just a small percentage of the tracks reportedly lost (according to estimates, up to 53 million songs from 14 million artists were deleted), it contains early work from now-famous artists including Donald Glover and Katy Perry, as Twitter user @pinkpushpop discovered.
This is so cool! I’ve already found early clips from Donald Glover, 2 Chainz, Katy Perry, Nicki Minaj, Jeffree Star, Rza, Pitbull and others.
There’s even some that you can’t find anywhere else, that would have been lost to the interwebs. This is amazing!
— Katrina (@pinkpushpop) April 4, 2019
Jason Scott of the Internet Archive said on Twitter that the set was compiled by “an anonymous academic group who were studying music networks and grabbed 1.3 terabytes of mp3s to study from MySpace in roughly 2008-2010 to do so.” After learning about the data loss, they offered the collection to Scott.
While it appears that the tracks were lost during a data migration, MySpace has remained tight-lipped about the situation, leading to speculation that the loss may not have been accidental.