As the world stays home, edtech’s Q2 venture totals rose sharply – TechCrunch

But one major round skewed the numbers

My friend and colleague Natasha Mascarenhas has been reporting on the edtech beat quite a lot in 2020. So far reading her coverage, I’ve discovered that not only is edtech less dull than I anticipated, it’s actually somewhat interesting on a regular basis.

This week, for example, India’s Byju bought WhiteHat Jr., another Indian edtech company, for $300 million. So what, you’re thinking, that’s just another startup deal? Yes, but it was an all-cash transaction, and White Hat Jr. was only 18 months old.

That’s enough to tell you that edtech is hot at the moment. Which makes sense: much of the world is sheltering at home with school and offices shuttered.


The Exchange explores startups, markets and money. You can read it every morning on Extra Crunch, or get The Exchange newsletter every Saturday.

 

The COVID-19 era has provided an enormous boon to many software startups, though some more than others. Luckily for its boosters, edtech, after being neglected by VCs due to an expectation of small exits and long sales cycles thanks to red tape, is one of the sectors enjoying renewed interest from private investors and customers alike.

According to a Silicon Valley Bank (SVB) markets-focused report, edtech venture funding reached a local-maxima in Q2 2020, jumping more than 60% from the first quarter of this year to the second. On a year-over-year basis, Q2’s VC edtech results were even more impressive.

But, there’s some nuance to the data that should temper declamations that private edtech funding is forever changed.

This morning let’s peel apart the SVB data and parse through edtech funding rounds themselves from the second quarter to see what we can learn. COVID-19 is remaking the global economy as we speak, so it’s up to us to understand its evolving form.

An edtech boom?

From the top-line numbers, you’d be forgiven for thinking that edtech’s Q2 venture capital results were across-the-board impressive.

Before we dig into the results themselves, here’s the chart you need:



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Trump signs executive orders banning transactions with TikTok and WeChat – TechCrunch

President Donald Trump signed an executive order on Thursday banning transactions with ByteDance, the parent company of popular app TikTok . The White House also announced that he signed a similar order banning transactions with Tencent-owned WeChat, a messaging app that is ubiquitous in China, but has a much smaller presence than TikTok in the United States, where it is used mainly by members of the Chinese diaspora. Both orders will take effect in 45 days.

The orders cite the International Emergency Economic Powers Act and the National Emergencies Act.  It is important to note that naming the apps’ operations in the United States as a national emergency is an act that is highly unprecedented and the legality of the orders will likely be challenged. ByteDance is currently pushing back against the Indian government’s July decision to ban TikTok along with 59 other apps; like the U.S., India also cited national security concerns around user data collection.

Microsoft announced over the weekend that it is in negotiations to buy TikTok from ByteDance, naming September 15 as a deadline for negotiations. The order would take affect shortly after the deadline set by Microsoft for the deal. ByteDance reportedly agreed to give up its entire ownership in the app even though it had previously wanted to maintain a minority stake.

Trump announced at the end of last month that he planned to ban TikTok through the use of an executive order. The president and government officials, including Secretary of State Michael Pompeo, have made escalating comments over the past few weeks alleging that TikTok is a threat to national security. While TikTok is owned by ByteDance, the Beijing-based company (which also operates a Chinese version of the app called Douyin) has taken steps to distance TikTok from its Chinese operations, and claims that its data is stored outside of China.

The executive order on ByteDance said that “the spread in the United States of mobile applications developed and owned by companies in the People’s Republic of China…continues to threaten the national security, foreign policy, and economy of the United States. At this time, action must be taken to address the threat posed by one mobile application in particular, TikTok.”

In 45 days, transactions by any person or property subject to U.S. jurisdiction with ByteDance or any of its subsidiaries will be prohibited “to the extent that they are permitted under applicable law.” The order claims that TikTok’s access to user data including location, browsing and search histories “threatens to allow the Chinese Communist Party access to American’s personal and proprietary information–potentially allowing China to track the locations of Federal employees and contractors, build dossiers of personal information for blackmail, and conduct corporate espionage.”

Trump’s executive order on WeChat was less expected, but not a complete surprise because Pompeo named the messaging app earlier this week when he said Trump was planning to take action “shortly” on TikTok and other Chinese companies. Like ByteDance, Trump claims WeChat’s data collection is a national security threat and may give the Chinese Communist Party access to user information. The order also cites WeChat’s censorship of material deemed politically sensitive by the Chinese government.

TechCrunch has contacted ByteDance, TikTok, WeChat and Microsoft for comment.

This story is developing and will be updated.



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Google discontinues the Pixel 4, nine months after release – TechCrunch

Days after announcing the Pixel 4a, Google has quietly discontinued sales of the Pixel 4 and Pixel 4 XL. The move, noted early by the Verge, represents an extremely truncated lifecycle for a Google flagship — around half of the 18 months the company continued to sell its two predecessors.

Google already announced the imminent arrival of the Pixel 5, when it noted the forthcoming handset would be one of two Pixels devices to sport 5G, along with the Pixel 4a 5G.

The company confirmed the move in a statement, noting, “Google Store has sold through its inventory and completed sales of Pixel 4 [and] 4 XL. For people who are still interested in buying Pixel 4 [and] 4 XL, the product is available from some partners while supplies last. Just like all Pixel devices, Pixel 4 will continue to get software and security updates for at least three years from when the device first became available on the Google Store in the US.”

The Pixel 4 was a largely well-received device, owing mostly to impressive camera work. But the handset was hampered by bad battery life — something Google has since addressed in the 4a. The new budget handset also sports an excellent camera for its price point, making the Pixel 4’s  existence somewhat redundant. Though the end of the Pixel 4 XL does leave Google with a larger option.

The company has clearly been dealing with a kind of identity crisis with its smartphones. A recent management shakeup appears to point to a desire for a new direction for the line, which has long suffered from uneven sales. Among other things, Google entered an already saturated market and has had some trouble distinguishing its offerings from other Android handsets.

It remains to be seen whether the Pixel 5 will be the first device to benefit from the division’s new direction.

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Twitter locked the Trump campaign out of its account for sharing COVID-19 misinformation – TechCrunch

Twitter took action against the official Trump campaign Twitter account Wednesday, freezing @TeamTrump’s ability to tweet until it removed a video in which the president made misleading claims about the coronavirus. In the video clip, taken from a Wednesday morning Fox News interview, President Trump makes the unfounded assertion that children are “almost immune” from COVID-19.

“If you look at children, children are almost — and I would almost say definitely — but almost immune from this disease,” Trump said. “They don’t have a problem. They just don’t have a problem.”

While Trump’s main account @realDonaldTrump linked out to the @TeamTrump tweet in violation, it did not directly share it. In spite of some mistaken reports that Trump’s own account is locked, at this time his account had not been subject to the same enforcement action as the Trump campaign account, which appears to have regained its ability to tweet around 6PM PT.

“The @TeamTrump Tweet you referenced is in violation of the Twitter Rules on COVID-19 misinformation,” Twitter spokesperson Aly Pavela said in a statement provided to TechCrunch. “The account owner will be required to remove the Tweet before they can Tweet again.”

Facebook also took its own unprecedented action against President Trump’s account late Wednesday, removing the post for violating its rules against harmful false claims that any group is immune to the virus.

The president’s false claims were made in service of his belief that schools should reopen their classrooms in the fall. In June, Education Secretary Betsy DeVos made similar unscientific claims, arguing that children are “stoppers of the disease.”

In reality, the relationship between children and the virus is not yet well understood. While young children seem less prone to severe cases of COVID-19, the extent to which they contract and spread the virus isn’t yet known. In a new report examining transmission rates at a Georgia youth camp, the CDC observed that “children of all ages are susceptible to SARS-CoV-2 infection and, contrary to early reports, might play an important role in transmission.”



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Here’s the Samsung Galaxy Z Fold 2 – TechCrunch

Samsung promised five “power devices” for its virtually-only Unpacked event. We already know about the Note 20, Galaxy Watch 3, Tab S7 and Buds Live — so what’s left? We speculated based on an earlier news that the company would debuting a new foldable — the biggest question, however, is whether it would be a rehash of the recently announced Galaxy Z Flip 5G or something else entirely.

Turns out the company is releasing the sequel to its first foldable, the…troubled Galaxy Fold. After a false start or two, the company says it sold one million units of the innovative but overly fragile handset. Announced earlier this year, however, the clamshell-styled Flip was better received, and frankly the foldable Samsung ought to have released in the first place.

With all of that in mind, what lessons has the company applied to the new version of the Fold? For starters, the front displays seemed like something of an afterthought on the original Fold. For the Galaxy Z Fold 2, it expands significantly to 6.2 inches, in addition to the main (foldable) 7.6-inch screen.

Details are still forthcoming, including how reinforced this version is. The company notes in the press material, “After releasing two foldable devices and listening to user feedback on the most requested upgrades and new features, Samsung unveils the Galaxy Z Fold 2 with meaningful innovations that offer users enhanced refinements and unique foldable user experiences.”

The company appears to not quite be ready to talk about the new foldable beyond these first few details. Instead, it’s promising addition information next month — likely at the press event it has planned in lieu of an appearance at IFA in September.

 

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SpaceX successfully flies its Starship prototype to a height of around 500 feet – TechCrunch

SpaceX has been developing Starship, its next-generation spacecraft, at its site in Boca Chica, Texas. The company has built a number of different Starship prototypes to date, include one prior version called the Starhopper that was essentially just the bottom portion of the rocket. Today, the company flew its first full-scale prototype (minus the domed cap that will appear on the final version, and without the control fins that will appear lower down on its sides), achieving an initial flight of around 150 m (just under 500 feet).

This is the furthest along one of these prototypes has come in the testing process. It’s designated Starship SN5, which is the fifth serialized test article. SpaceX actually built a first full-scale demonstration craft called the Starship Mk1 prior to switching to this new naming scheme, so that makes this the sixth one this size they’ve built — with the prior versions suffering failures at various points during preparations, including pressure testing and following a static engine test fire.

SN5 is now the first of these larger test vehicles to actually take off and fly. This prototype underwent a successful static test fire earlier this week, paving the way for this short flight test today. It’s equipped with just one Raptor engine, whereas the final Starship will have six Raptors on board for much greater thrust. It managed to fly and land upright, which means that by all external indications everything went to plan.

Image Credits: NASA Spaceflight (opens in a new window)

Starhopper previously completed a similar hop in August of 2019. SpaceX has an aggressive prototype development program to attempt to get Starship in working order, with the ambitious goal of flying payloads using the functional orbital vehicle as early as next year. Ultimately, Starship is designed to pair with a future Falcon Heavy booster to carry large payloads to orbit around Earth, as well as to the moon and eventually to Mars.

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Messenger launches a new chat plugin for business websites to reach non-Facebook customers – TechCrunch

Facebook is making it easier for businesses to leverage its Messenger service on their own websites. The company in November 2017 first launched a new customer chat plugin which allowed customers to talk directly with a business on the business’s own website using the Messenger service. However, that plugin had required the website visitors to be logged into Facebook, limiting adoption. Today, that’s changing, Facebook says.

The prior version of the plugin may have worked for smaller businesses who couldn’t afford a more robust live chat service, but it also limited customers’ ability to interact. Customers who didn’t use Facebook, couldn’t remember their password, or who were visiting the website from a different device than their own, for example, wouldn’t have been able to chat with the business.

Other customers may have simply wanted to submit their queries more anonymously — perhaps worried that the business would continue to bother them later in their Messenger app, even if they weren’t ready for such a direct relationship.

The updated plugin will now allow customers to talk to businesses without being logged in, Facebook says. Instead, a “continue as guest” option will be available. However, on the business’s side, they’ll still be able to use all their same tools to manage their conversations with these online users, whether logged in or not.

Facebook hints that its requirement around being logged in may have limited adoption of the product. Developers who built websites for clients, for instance, claimed the plugin wasn’t always an easy sell, as it required the business to offer some sort of alternative for the non-logged in users.

“As a developer, it’s much easier to convince a business to use a live chat offering that is available to all their customers,” noted Soma Toth, founder of Recart. “Our business customers are seeing sales directly tied to engagement on Messenger, and the Chat Plugin helps them leverage the same investment across both their Facebook page and their website at no additional cost. It also reduces the complexity of having to work with or support a fallback for users who are not logged into Facebook.”

The update will also bring a redesigned look and feel for the plugin, which Facebook claims had resulted in a 45% increase in customer chats with businesses, during its tests.

To some extent, though, that increase could be partly attributed to the surge of customers shopping online due to the coronavirus pandemic, not just the better plugin.

Though Facebook’s plugin has the benefit of being tied to the larger social network, where many businesses today run their own Page to reach customers, it’s still facing a range of chat software competitors, large and small, including solutions from brands like HubSpot, Intercom, Live Chat, Zendesk, Zoho, and dozens of others. These competing solutions will often offer deeper integrations with other services the business may need to use, like CRM, analytics, help desk software, tools for lead gen and sales, and more.

Businesses can now choose to install the plugin themselves, or they can work with partners like WooCommerce, ManyChat, and Haravan to have it installed for them, Facebook says.

 

 

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FCC invites public comment on Trump’s attempt to nerf Section 230 – TechCrunch

FCC Chairman Ajit Pai has decided to ask the public for its thoughts on an attempt initiated in Trump in May to water down certain protections that arguably led to the creation of the modern internet economy. The nakedly retaliatory order seems to be, legally speaking, laughable, and could be resolved without public input — but the FCC wants your opinion, so you may as well give it to them.

You can submit your comment here at the FCC’s long-suffering electronic comment filing system, but before you do so, perhaps acquaint yourself with a few facts.

Section 230 essentially prevents companies like Facebook and Google from being liable for content they merely host, as long as they work to take down illegal content quickly. Some feel these protections has given the companies the opportunity to manipulate speech on their platforms — Trump felt targeted by a fact-check warning placed by Twitter on his unsupported claims of fraud in mail-in warning.

To understand the order itself and see commentary from the companies that would be affected, as well as Senator Ron Wyden (D-OR), who co-authored the law in the first place, read our story from the day Trump signed the order. (Wyden called it “plainly illegal.”)

For a bipartisan legislative approach that actually addresses shortcomings in Section 230, check out the PACT Act announced in June. (Sen. Brian Schatz (D-HI) says they’re approaching the law “with a scalpel rather than a jackhammer.”)

More relevant to the FCC’s proceedings, however, are the comments of sitting commissioner Brendan Starks, who questioned the order’s legality and ethics, likening it to a personal vendetta intended to intimidate certain companies. As he explained:

The broader debate about Section 230 long predates President Trump’s conflict with Twitter in particular, and there are so many smart people who believe the law here should be updated. But ultimately that debate belongs to Congress. That the president may find it more expedient to influence a five-member commission than a 538-member Congress is not a sufficient reason, much less a good one, to circumvent the constitutional function of our democratically elected representatives.

Incidentally, Starks may be who Pai is referring to in a memo announcing the commentary period. “I strongly disagree with those who demand that we ignore the law and deny the public and all stakeholders the opportunity to weigh in on this important issue. We should welcome vigorous debate—not foreclose it,” Pai wrote.

This may be a reference to Commissioner Starks’s suggestion that the FCC address the order quickly and authoritatively: “If, as I suspect it ultimately will, the petition fails at a legal question of authority, I think we should say it loud and clear, and close the book on this unfortunate detour,” he said. After all, public opinion doesn’t count for much if the order has no legal effect to begin with and the FCC doesn’t even have to consider how it might revisit Section 230.

Whatever the case, the proposal is ready for you to comment on it. To do so, visit this page and click, in the box on the left, “+New Filing” or “+Express” — the first is if you would like to submit a document or evidence in support of your opinion, and the second is if you just want to explain your position in plain text. Remember, this information will be filed publicly, so anything you put in those fields — name, address and everything — will be visible online.

To be clear, you’re commenting on the  NTIA proposal that the FCC draw up new rules regarding Section 230, which the executive order compelled that organization to send, not the executive order itself.

As with the net neutrality debacle, the FCC does not have to take your opinion into account, or reality for that matter. The comment period lasts 45 days, after which the item will likely go to internal deliberations at the Commission.

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OneKey wants to make it easier to work without a desktop by integrating apps into mobile keyboards – TechCrunch

“The app that you use the most on your phone and you don’t realize it is your keyboard,” says Christophe Barre the co-founder and chief executive of OneKey.

A member of Y Combinator’s most recent cohort, OneKey has a plan to make work easier on mobile devices by turning the keyboard into a new way to serve up applications like calendars, to-do lists, and, eventually, even Salesforce functionality.

People have keyboards for emojis, other languages, and gifs, but there have been few ways to integrate business apps into the keyboard functionality, says Barre. And he’s out to change that.

Right now, the company’s first trick will be getting a Calendly-like scheduling app onto the keyboard interface. Over time, the company will look to create modules that they can sell in an app-store style marketplace for the keyboard space on smartphones.

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For Barre, the inspiration behind OneKey was the time spent working in Latin America and primarily conducting business through WhatsApp. The tool was great for messaging, but enterprise functionality broke down across for scheduling or other enterprise app integrations.

“People are doing more and more stuff on mobile and it’s happening right now in business,” said Barre. “When you switch from a computer-based world to a mobile phone, a lot of the productivity features disappear.”

Barre, originally from the outskirts of Paris, traveled to Bogota with his partner. She was living there and he was working on a sales automation startup called DeepLook. Together with his DeepLook co-founder (and high school friend), Ulysses Pryjiel, Barre set out to see if he could bring some of the business tools he needed over to the mobile environment.

The big realization for Barre was the under-utilized space on the phone where the keyboard inputs reside. He thinks of OneKey as a sort of browser extension for mobile phones, centered in the keyboard real estate.

“The marketplace for apps is the longterm vision,” said Barre. “That’s how you bring more and more value to people. We started with those features like calendars and lists that brought more value quickly without being too specialized.”

The idea isn’t entirely novel. SwiftKey had a marketplace for wallpapers, Barre said, but nothing as robust as the kinds of apps and services that he envisions.

“If you can do it in a regular app, it’s very likely that you can do it through a keyboard,” Barre said.

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Microsoft pursuing TikTok purchase by September 15th, may invite U.S. investors to deal – TechCrunch

Microsoft has posted a statement today on its corporate blog that says it will continue discussions on a potential TikTok purchase in the U.S.. As a part of the statement, it says that it may invite other “American investors” to participate on a minority basis.

The company says that this is a result of conversations between CEO Satya Nadella and President Trump. That is, basically, the ‘news’ here. Previous reports and our own digging pointed to the situation being totally in the hands of the White House, with Microsoft willing to make the buy but having roadblocks in the form of Presidential sentiment. If Satya has engaged Trump directly then there could be light at the end of this possibility tunnel after all.

“Following a conversation between Microsoft CEO Satya Nadella and President Donald J. Trump, Microsoft is prepared to continue discussions to explore a purchase of TikTok in the United States,” the statement reads. “Microsoft fully appreciates the importance of addressing the President’s concerns. It is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury.”

Microsoft says that in any case their discussions about acquisition from ByteDance would complete no later than September 15th, 2020 and that it is keeping discussion ongoing with the President and the U.S. government.

The purchase would cover TikTok operations in the U.S., Canada, Australia and New Zealand and would result in Microsoft owning and operating it in those markets. One region not mentioned here is India, which could provide an interesting future opportunity for both companies if this deal goes down. If Microsoft can position itself as a steward of TikTok it removes the data issue (if not the over-arching national tensions between China and India).

Unsurprisingly, data and privacy protections ​make an appearance, with Microsoft assuring that “the operating model for the service would be built to ensure transparency to users as well as appropriate security oversight by governments in these countries.”

“Among other measures, Microsoft would ensure that all private data of TikTok’s American users is transferred to and remains in the United States. To the extent that any such data is currently stored or backed-up outside the United States, Microsoft would ensure that this data is deleted from servers outside the country after it is transferred.”

The historical here (if you can call it that because this whole thing has been the work of but a couple weeks tops) is that Microsoft is pursuing TikTok because ByteDance needs to divest it in order to keep it running in the U.S., one of its biggest markets. That need arose when the White House decided that it was important to make a stink about data sovereignty with relation to the China-owned network. Even though social services of many kinds including Facebook, Twitter, Google and others offer aggregate data through advertising brokerages that can make deals globally, the opportunity presented itself to run up the anti-China flag and take aim at an easy target — an app that undoubtedly has access to an enormous amount of behavioral data on U.S. citizens.

And then there’s the fun Twitter theory that Trump just got pissed at a comedian who got very popular making fun of him on the platform.

Anyway, now we have another tock in the TikTok ticking clock. We’ll reach out to all parties but this looks like it may be the final result of this weekend’s flurry of news on this. We’ll see you Monday morning.

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