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Madrona Venture Labs raises $11M to build companies from the ground up

Posted by on May 15, 2019 in alpha, Amazon, Artificial Intelligence, blake irving, eBay, economy, entrepreneurship, erik blachford, Facebook, Finance, GoDaddy, madrona venture group, Microsoft, money, Private Equity, Seattle, spencer rascoff, Startup company, TC, Trinity Ventures, Venture Capital, venture capital Firms, venture capital funds, Zillow | 0 comments

In regions where would-be entrepreneurs need a little more support and encouragement before they’ll quit their day job, the startup studio model is taking off.

In Seattle, Madrona Venture Labs (MVL), a studio founded within one the city’s oldest and most-celebrated venture capital firms, Madrona Venture Group, has raised $11.3 million. The investment brings the studio’s total funding to $20 million.

Traditional venture capital funds invite founders to pitch their business idea to a line-up of partners. Sometimes that’s a founder with an idea looking for seed capital, other times it’s a more mature company looking to scale. When it comes to startup studios, the partners themselves craft startup ideas internally, recruiting entrepreneurs to lead the projects, then building them from the ground up within their own safe, protective walls. After a project passes the studio’s litmus test, i.e. shows proof of traction, product-market fit and more, it’s spun out with funding from Madrona and other VCs within its large and growing investor network.

For aspiring entrepreneurs deterred by the risk factors inherent to building venture-backed startups, it’s a highly desirable route. In the Pacific Northwest, where MVL focuses its efforts, it’s a chance to lure Microsoft and Amazon employees into the world of entrepreneurship.

“We want to be an onboard for founders in our market,” MVL managing director Mike Fridgen, who previously led the eBay-acquired business Decide.com, tells TechCrunch. “In Seattle, everyone isn’t a co-founder or an angel investor. Not everyone has been at a startup. A lot of people coming here are coming to work at Amazon, Microsoft or one of the larger satellite offices like Facebook. We want to help them fast-track learning, fundraising and everything else that comes with launching a successful company.”

Fridgen, MVL managing director Ben Elowitz, who co-founded the online jewelry marketplace Blue Nile and chief technology officer Jay Bartot, the co-founder of Hulu-acquired Vhoto, lead Madrona’s studio effort.

The investment in MVL comes in part from its parent company, Madrona, and for the first time, outside investors have acquired stakes in the practice. Alpha Edison, West River Group, Founder’s Co-op partner Rudy Gadre, Zillow co-founder Spencer Rascoff, former GoDaddy CEO Blake Irving, Trinity Ventures venture partner Gus Tai, TCV venture partner Erik Blachford and others participated.

With $1.6 billion in assets under management, Madrona is known for investments in Seattle bigwigs like Smartsheet, Rover and Redfin. The firm, which recently closed on another $100 million for an acceleration fund that will expand its geographic reach beyond the Pacific Northwest, launched its startup studio in 2014. Since then, it’s spun-out seven companies with an aggregate valuation of $140 million.

“There are some 85 VCs that have $300 million-plus funds,” Fridgen said. “In Seattle, we have two of the most valuable companies in the world and we have just one [big fund], Madrona; it’s the center of gravity for Seattle technology innovation.”

Companies created within MVL include Spruce Up, an AI-powered personal shopping platform, and Domicile, a luxury apartment rental service geared toward business travelers. Domicile was co-founded by Ross Saario, who spent the three years ahead of launching the startup as a general manager at Amazon. The company recently raised a $5 million round, while Spruce Up, co-founded by serial founder Mia Lewin, closed a $3 million round in May.

Other spin-outs include MightyAI, which was valued at $71 million in 2017; Nordstrom-acquired MessageYes, Chatitive and Rep the Squad. The latter, a jersey rental business, was a failure, shutting down in 2018 after failing to land necessary investment, according to GeekWire.

MVL’s latest fundraise will be used to invest in operations. Though MVL does provide its spin-outs with some capital, between $100,000 to $200,000 Fridgen said, it takes a back seat when it comes time to raise outside capital and doesn’t serve as the lead investor in deals.


Source: The Tech Crunch

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Flight-hailing startup BlackBird raises $10 million to replace driving with flying

Posted by on Mar 12, 2019 in air travel, Airbnb, Andrew Swain, Blackbird, California, eBay, Francoise Brougher, Google, Lyft, new enterprise associates, pilot, Pinterest, tahoe, TC, Transportation | 0 comments

The origin story of BlackBird, a startup that links travelers to planes and commercial pilots through an app, didn’t begin with air travel. It was prompted by car sickness.

BlackBird CEO and founder Rudd Davis, who was getting his pilot’s license at the time, asked his flight instructor if he would fly his family to Tahoe because his son gets terribly sick every time they traveled by car. What Rudd discovered was an incredible experience that was far more affordable than he realized. 

Davis launched the company in 2016 and has spent the past two years honing in on the business model as well as adding commercial pilots and members. Now, with fresh capital from New Enterprise Associates, BlackBird is ready to spread its wings. 

The company announced Tuesday it has raised $10 million in a Series A round led by NEA. NEA partner Jonathan Golden, who previously worked at Airbnb, has joined the BlackBird board of directors alongside Francoise Brougher of Pinterest, Square and Google, and Andrew Swain, who also is from Airbnb.

BlackBird has also hired Brian Hsu, who spent a decade at eBay and most recently was vice president of supply at Lyft, as chief operating officer. Davis is counting on Hsu, who has experience scaling marketplaces, to help BlackBird expand its membership and reach.

 

The company will use its new injection of capital to scale up, in terms of users, pilots and employees.

BlackBird currently has more than 700 commercial pilots who fly passengers between 50 and 500 miles from and within California. For now, Davis said this is a self-imposed geographic restriction.

“We’re trying to build up density and build up the network and optimize it before we start replicating it to other geographies,” Davis said.

It does face challenges. BlackBird has to find that price-per-seat sweet spot, which is largely driven by how many users and pilots are on the platform. Seats can be around $80 or upwards of $900, depending on the route, pilot availability and demand. And BlackBird must fight misconceptions of what and who the platform is designed for.

“A lot of people have looked at this space before, and really have kind of come up empty handed,” said Golden, who was a seed investor in BlackBird before joining NEA.

What makes BlackBird so compelling, Golden added, is that it’s not about luxury travel, but instead about how to actually replace driving through flights, which is really compelling.

“When most people think about kind of flying non-commercially, they think about huge jets with couches and for billionaires,” Davis said.And that is not the entirety of general aviation; there’s a huge aspect of aviation that is flying in smaller planes. It just hasn’t really been as accessible.”


Source: The Tech Crunch

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EBay announces plans for new strategic initiatives under pressure from investors

Posted by on Mar 1, 2019 in eBay, eCommerce, Elliott Management, TC | 0 comments

In January, eBay received a strongly worded letter from activist investors Elliott Management, outlining a way forward for the company that Elliott saw as floundering. Two weeks ago, the company announced it was restructuring operations and laying off some of its workers. Today, the company announced further steps toward reorganizing, much of which sounds straight out of Elliott’s letter earlier this year.

In the January letter, among other things, Elliott suggested the company lacked operational discipline and it believed that with some tweaking, it could get much better stock performance. “Today eBay suffers from an inefficient organizational structure, wasteful spend and a misallocation of resources,” Elliott wrote at the time. At the same time, Elliott encouraged the company to concentrate on what it saw as its primary value proposition as an e-commerce marketplace. That meant getting rid of any pieces that didn’t serve that mission, including StubHub, the online ticket selling marketplace.

Perhaps it’s not surprising then that today’s announcement indicates the company is going through a review of operations and taking stock of its assets, including StubHub. “These initiatives include an operating review and the commencement of a strategic review of the Company’s portfolio of assets, including StubHub and eBay Classifieds Group. eBay has worked collaboratively with Elliott Management, Starboard Value, and other significant shareholders on these initiatives, which include the addition of two new independent directors to the Board,” eBay indicated in the announcement.

These new board members include Jesse Cohn from Elliott Management and Matt Murphy from Marvell Technology, as the company begins to shift its focus.

The company announced earlier it was also moving the online marketplace, the key strategic asset of the company, according to Elliott, under a single global management team instead of the regional approach it had been taking. The company also announced plans to increase the advertising budget for the marketplace, according to the release.

These moves come as eBay tries to find a way to increase shareholder value to please activist investors like Elliott Management and Starboard Value. In a statement, Devin Wenig, company president and CEO, tried to put the best face on these changes. “The bottom line is that we all share common ground: we see tremendous opportunity ahead and want to see eBay’s full potential realized over the long-term. The initiatives we are announcing today are the result of this constructive dialogue,” he said.


Source: The Tech Crunch

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eBay beats in Q4 on sales of $2.9B and EPS of $0.71, but GMV of $24.6B is up only 1%

Posted by on Jan 29, 2019 in Earnings, eBay, eCommerce, TC | 0 comments

As eBay gets increasing pressure from activist shareholders like Elliott Management and Starboard to reform its business and turn it into a high-growth tech stock by overhauling its main Marketplace, refreshing management and rethinking its other businesses like StubHub and classifieds, the e-commerce platform delivered a set of Q4 results that were solid if a little lacklustre.

The company today said that for the quarter that ended December 31, it posted revenues of $2.9 billion with non-GAAP net income of $670 million or $0.71 per share. On both counts, it just beat analyst expectations, which were respectively $2.87 billion on EPS of $0.68. But as a sign of the flagging business that activist shareholders have been highlighting, gross merchandise volumes were $24.6 billion, up just one percent on a year ago, even as revenues rose six percent.

In what might be a small concession to those requests for reform, eBay said it repurchased approximately $1.5 billion of its common stock in the quarter, and that it plans to “return approximately $7 billion to shareholders through dividends and repurchases over the next two years, with approximately $5.5 billion to be returned in 2019.”

It also provided some guidance for the full year: net revenues will be between $10.7 billion and $10.9 billion, growing between just 1 percent and 3 percent, with GAAP earnings per diluted share from continuing operations in the range of $1.83$1.93 and non-GAAP earnings per diluted share from continuing operations in the range of $2.62$2.68.

“We delivered record earnings for the fourth quarter and full year 2018,” said Devin Wenig, President and CEO of eBay Inc., in a statement. “In 2019, our focus will be on further improvements to the eBay user experience, while pursuing significant long-term growth opportunities in advertising and payments. We are confident in the strength of our business and future growth prospects, as demonstrated by our decision to institute eBay’s first-ever dividend and increase our share repurchase program.”

Active buyers are up four percent to 179 million, with the Marketplace, its core platform, accountung for $2.3 billion of its revenues, and $23.2 billion of GMV. StubHub, its ticketing business, accounted for $314 million of sales, while classifieds brought in $263 million of revenues.

The company is often compared against Amazon, which started out of the gate around the same time as eBay, but has gone on to diversify into a vast array of business areas and has truly changed the face of commerce as we know it. eBay hasn’t quite had that impact, and arguably its greatest acquisition, of PayPal, was spun off several years ago into its own business, which is thriving (it will report results later this week).

eBay has been trying to diversify its own business in the meantime, in areas such as promoted listings and other services to expand how merchants and buyers can spend on its platform. It said that revenues from promoted listings are up 150 percent across 200 million listings from 600,000 active sellers.

It’s also trying to move into more services around its sales, for example around installation and authentication services for higher-end items such as jewellery.

It also provided some guidance on Q1, where it expects revenues of between $2.55 billion and $2.60 billion, which will be representative of flat to two percent growth on a year ago — one more sign of the kind of sluggish growth that Elliott is pinpointing in its reform plan. Non-GAAP earnings per diluted share from continuing operations in the range of $0.62$0.64.

I’m listening to the earnings call and will update this post with any additional points that are notable.


Source: The Tech Crunch

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In emerging markets there are no copycats, just budding entrepreneurs

Posted by on Dec 17, 2018 in Amazon, Business, business incubators, chef, Column, eBay, economy, entrepreneurship, Flipkart, founder, Innovation, Kickstarter, oliver samwer, Postmates, Private Equity, Rocket Internet, stanford, Startup company, Startups, Uber, United States | 0 comments

Every year I teach an MBA course at Stanford about the exciting opportunities for tech investors and entrepreneurs in developing economies. When we designed the syllabus back in 2013, Rocket Internet was still firing on all cylinders on four continents. The unapologetic machine built to copy big American internet companies created billions of dollars for the Samwer brothers and its backers. During Rocket’s golden years, the best startups in the developing economies seemed to inevitably have an original reference in Silicon Valley.

Accordingly, we added a class about the opportunity of replicating business models to seize this information arbitrage. Call it the second-mover advantage.

Despite my conviction about the model, the copycat word  —  short for replicating startups and attached to these ventures  —  annoyed me from the start. More than a term to describe a straightforward recipe to launch, I see it as an unconscious way to belittle an entire group of hard-charging founders and investors.

Indeed, while in foreign eyes, we have been building a Mexican Kickstarter, a Middle Eastern Uber, an Indian Amazon or a Colombian Postmates, I argue visionary founders are taking a simple idea that already exists and creating new worlds.

On the internet, there are Einsteins and there are Bob the Builders. I’m Bob the Builder. Oliver Samwer, founder of Rocket Internet

Gateway to entrepreneurship

While impact is the final goal, founders can approach the journey in different ways. The most common approach in the startup world is to use the business method, or more pompously, the design thinking methodology. “Fall in love with the problem, not the solution,” mentors keep telling a succession of startup clusters in acceleration programs. The best and “leanest” way to product market fit is by starting small then keep iterating the solution until you nail it.

A second way to start is favored by engineers and scientists: Take a new promising technology or a forgotten molecule, then find a big problem. Keep iterating until you find a problem worth solving, like a hammer looking for a nail.

A third way is starting like painters create, building skills by copying classics, or like a new chef cooks by starting with iconic recipes: replicate a proven idea and iterate until you find traction.

Until a few years ago it was ostensibly the only way to scale in developing economies. The model helped raise local capital from risk-averse investors who needed reassurance. The playbook to scale was unfolding a couple of years ahead and served as a guide to founders without previous startup experience and no local role models. The potential acquirer was identified and sometimes contacted in advance. Founders weren’t crazy and investors weren’t dumb.

Replicating a business model has served in emerging ecosystems as the gateway to entrepreneurship and venture investing.

Photo courtesy of Flickr/A_Marga

Riding the next wave

According to conventional wisdom, new ecosystems around the world grow through the following three stages, be them in developing economies or more developed countries. First, local and foreign entrepreneurs replicate successful models focused on local markets. Then as the ecosystem evolves, founders start applying existing technologies to solve local problems. Finally, as the tech space matures, new technologies begin to flourish.

In my opinion, those stages never happen sequentially as stated by ecosystem observers. Successful startups that started with a foreign inspiration can outgrow the master. If they are not bought into submission by the first mover, some of the most famous copycats reinvented the original and made it better: Mercado Libre is much more relevant in the e-commerce space than eBay . Flipkart is hardly an Amazon, not to mention WeChat. These companies are in turn some of the most prolific tech innovators on the globe. Truly ecosystems evolve organically in unique ways reflecting their history, geopolitical environment, economic structure and cultural features.

Two ways to defend the status quo: “It’s been done before” and “It’s never been done before.” –Thibault @Kpaxs

In defense of talent

Recently, it’s hard to hear American observers use the word copycat to describe any American company. After all, Guilt replicated VentesPrivees and Lime, Chinese dockless bike sharing and many more examples. All American startups are treated as innovators while the rest as mere followers.

Recently, Chinese or Indian startups seem to be given the benefit of the doubt regarding their originality. Is it because these regions have become more innovative? Maybe. But it’s also because these ecosystems have gained the respect of Silicon Valley. Indeed, Chinese consumer tech surpassed decisively the U.S. as the most important country in terms of investments.

So here’s my humble suggestion to our wealthier and more accomplished colleagues: stop using the c-word with founders. It’s offensive. Most probably, these founders are facing more challenges to build their companies and lower odds for success that the first mover. If anything, they have more merit than the originals.

As for founders, when they call you a me-too, remember all teams started somewhere, somehow. In fact, most started like Bob the Builder before turning into Einsteins. The truth is, it doesn’t matter where you start. You can start by applying a new technology or protocol. You can start with a problem you feel passionate about. You can start by replicating a business model. It doesn’t really matter if you take a big swing at the future and trust you will figure out how to make it happen. It doesn’t matter what label they use while you change the world for the better.


Source: The Tech Crunch

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Amazon reverses tax-triggered block on US shop in Australia

Posted by on Nov 22, 2018 in Amazon, amazon tax, Amazon.com, Australia, eBay, eCommerce, online shopping, Retail | 0 comments

Amazon has reversed a decision it made six months ago to shut off its US ecommerce site to Australian shoppers. Reuters reports that the U-turn comes after a customer backlash.

Since July shoppers in Australia trying to browse stuff to buy on Amazon.com have been redirected to the local site, Amazon.com.au.

Shipping to Australia from Amazon.com was also shut off at the same time. So shoppers were limited to buying goods sold by local sellers.

But from today the block has gone.

The geoblock on Amazon.com followed a change in Australian tax regulation requiring businesses earning more than $75,000 AUD per year to charge its 10% Goods and Services Tax (GST) on low value items imported by consumers.

The so-called ‘Amazon Tax’ was drawn up in response to concerns about the impact of Amazon and other large overseas ecommerce businesses on local retailers which have to apply GST to all products they sell.

A loophole had meant GST was only applied to items purchased from overseas retailers worth $1,000 AUD or more — so local competitors argued it gave Amazon, eBay and other overseas competitors an unfair advantage.

Amazon’s response was to shutter its overseas shops. But by limiting shoppers to the inventory on its Australian site, which only launched in December 2017, the ecommerce giant seems to have shot its local business in the foot — encouraging locals to look elsewhere for their retail fix. Or just not buy as much stuff.

The Guardian notes there are only about 80 million products on the Australian store vs 500 million on the US site.

Six months later Amazon has backtracked. And seemingly decided to suck up the 10% tax after all.

We’ve reached out to the company for a comment.

An Amazon spokesman told Reuters it had changed its mind after listening to customer feedback, adding it had built the “complex infrastructure needed to enable exports of low-value goods to Australia and remain compliant with [local] laws”.

So far only products sold by Amazon itself on Amazon.com are being made available for purchase by Australians, with third-party sellers not yet covered.

Notably — on the U-turn timing front — Black Friday is tomorrow.

Aka the day when retailers attempt to kick start a holiday buying bonanza by slashing a bunch of prices and scattering digital tinsel all over their online channels. Clearly Amazon doesn’t want to miss out on more sales.


Source: The Tech Crunch

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Eventbrite adds two more women to its C-suite

Posted by on Nov 20, 2018 in Diversity, dogvacay, eBay, eventbrite, Julia Hartz, Kevin Hartz, Personnel, TC | 0 comments

Shortly after raising $230 million in a September NYSE initial public offering, ticketing company Eventbrite is expanding its C-suite with two new hires.

Deborah Sharkey and Crystal Valentine have joined as chief commercial officer and chief data strategy officer, respectively. The additions make Eventbrite’s executive team 50 percent women.

Located in San Francisco, Eventbrite was founded in 2006 by chief executive officer Julia Hartz . The company, one of a few startup unicorns to debut on the public markets with a female co-founder and CEO, provides a ticketing and event platform that helps people find and attend events.

“The makeup of our board and executive team is the outcome of carefully and thoughtfully cultivating the right group of people based on values, experience and expertise,” Hartz told TechCrunch via e-mail.

Sharkey previously led product, marketing, operations and engineering teams as chief operating officer at DogVacay, a Rover-owned pet services company. Before that, Sharkey spent more than a decade at eBay, leading efforts including the expansion of eBay Australia. At Eventbrite, she’ll be focused on the company’s expansion into new markets.

Valentine, for her part, most recently served as the vice president of technology strategy at enterprise company MapR Technologies.

Eventbrite’s shares sank north of 8 percent after hours when the company failed to meet analyst expectations in its third-quarter earnings report last week. It did, however, surpass revenue expectations with $73.6 million, a 45.1 percent increase year-over-year. Paid tickets grew by 32.2 percent to 23.9 million and net revenue per ticket increased 9.7 percent to $3.08 per ticket.

“We’re focused on the massive opportunity in front of us — empowering creators of all types of live experiences around the world to bring people together around shared passions, artistry and causes,” Hartz said. “People are craving ways to get out from behind their screens and connect in real life now more than ever, and as we look ahead to 2019, having the right team in place will position us to continue enabling this growing experience economy on a global scale.”


Source: The Tech Crunch

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Ebay’s HeadGaze lets motor-impaired users navigate the site with head movements

Posted by on Sep 11, 2018 in accessibility, Apps, Augmented Reality, eBay, Gadgets, Hardware, TC | 0 comments

The sophisticated head-tracking system like the one built into the iPhone X may have been intended for AR and security purposes, but it may also turn out to be very useful for people with disabilities. A proof of concept app from an eBay intern shows how someone with very little motor function can navigate the site with nothing but head movements.

Muratcan Çiçek is one such person, and relies on assistive technology every day to read, work and get around. This year he was interning at eBay and decided to create a tool that would help people with motor impairments like his to shop online. Turns out there are lots of general-purpose tools for accessibility, like letting a user control a cursor with their eyes or a joystick, but nothing made just for navigating a site like eBay or Amazon.

His creation, HeadGaze, relies on the iPhone X’s front-facing sensor array (via ARKit) to track the user’s head movements. Different movements correspond to different actions in a demonstration app that shows the online retailer’s daily deals: navigate through categories and products by tilting your head all the way in various directions, or tilt partway down to buy, save or share.

You can see it in action in the short video below:

It’s not that this is some huge revolution in interface — there are some apps and services that do this, though perhaps not in such a straightforward and extensible way as this.

But it’s easy to underestimate the cognitive load created when someone has to navigate a UI that’s designed around senses or limbs they don’t have. To create something like this isn’t necessarily simple, but it’s useful and relatively straightforward, and the benefits to a person like Çiçek are substantial.

That’s probably why he made the HeadGaze project open source — you can get all the code and documentation at GitHub; it’s all in Swift and currently only works on the iPhone X, but it’s a start.

Considering this was a summer project by an intern, there’s not much of an excuse for companies with thousands of developers to not have something like it available for their apps or storefronts. And it’s not like you couldn’t think of other ways to use it. As Çiçek writes:

HeadGaze enables you to scroll and interact on your phone with only subtle head movements. Think of all the ways that this could be brought to life. Tired of trying to scroll through a recipe on your phone screen with greasy fingers while cooking? Too messy to follow the how-to manual on your cell phone while you’re tinkering with the car engine under the hood? Too cold to remove your gloves to use your phone?

He and his colleagues are also looking into actual gaze-tracking to augment the head movements, but that’s still a ways off. Maybe you can help.


Source: The Tech Crunch

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Crater rebrands as Shyft to focus on helping global nomads move

Posted by on Aug 22, 2018 in eBay, Logistics, moving, Startups | 0 comments

After finally settling on a new apartment, packing your last box and rushing out to pick up your moving van for the measly three hours you could book it — have you ever taken a moment to think, “Wow, this is so easy?”

Nope, and neither has anybody else. But Shyft, a logistics platform company based in San Francisco, is hoping to change that.

Originally named Crater, the company announced today a re-brand of its name and mission to focus on helping improve the corporate relocation process for millions of movers per year. The company is bringing with it three years of experience developing software and technology to help moving companies provide better estimates and service to customers.

“We spend hours thinking about these global citizens who are moving everyday and literally shifting their lives,” Shyft CMO Rajiv Parikh told TechCrunch. “They’re moving to new communities, they’re finding new schools, they’re finding new opportunities. It’s a monumental and pivotal moment in someone’s life.”

The process works two-fold. First, Shyft is continuing its partnerships with moving companies and selling its software to them in order to help update their portals and make the process as seamless as possible for their existing customers. As part of these partnerships, Shyft is able to create a reliable network of moving companies and services that it can utilize in the second part of its service — connecting with corporate Fortune 500 companies to help their transferees easily and intuitively complete their moving process.

Through the platform, employees planning a move can fill out information like how many boxes they’re moving, what their housing needs will be and even what kind of food they like and dietary restrictions they have. With this data, Shyft will help direct them to the services they need and work to help them best integrate into their new communities.

Shyft works with corporate companies’ lump-sum funds to help employees find the best price possible for their move. And transferees can use the services for free (or be reimbursed the difference).

“A traditional moving company is focused on moving — dollars and cents — [and] they want the largest and the biggest moves out there,” Shyft CEO Alex Alpert told TechCrunch. “From our perspective, we’re agnostic to that. If it’s in someone’s best interest to sell their sofa and buy a new one, we want to help facilitate that.”

In a recent collaboration with eBay, the company says it has seen large increases in the number of employees using its portal instead of trying to figure out logistics on their own.

“We have monitored the use of Shyft in our lump sum program and have seen a marked increase in the willingness of employees to engage with Shyft to identify the best solution to their moving needs,” eBay Director of HR Global Mobility Eric Halverson said in a statement. “Shyft is helping our employees optimize their lump sum allowance with a variety of moving solutions geared to their personal needs and circumstances.”

Alpert says that Shyft is now focusing on growing and refining its service, and this summer was accepted to join Moderne Venture’s summer Passport Program. The seven-month industry immersion program is designed to help companies refine their go-to-market strategies and network with others working in the real estate, finance, insurance and home-services spaces.


Source: The Tech Crunch

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EBay paid $573M to buy Japanese e-commerce platform Qoo10, filing reveals

Posted by on Jul 20, 2018 in Amazon, Asia, China, E-Commerce, eBay, eCommerce, economy, Flipkart, Giosis, gmarket, India, Japan, korea, online marketplaces, online payments, Qoo10, Software, TC, United States, Walmart | 0 comments

EBay is a very distant second behind Amazon when it comes to e-commerce sales in the U.S., but abroad — and in particular in Asia — it is willing to invest to grow its footprint in a targeted way. In February, eBay paid a total of $573 million to acquire Qoo10, a Japanese sales platform, according to the company’s quarterly earnings filing.

In more detail, the deal consisted of $306 million in cash and the relinquishment of about $266 million in shares in Giosis, a pan-Asian e-commerce marketplace business originally founded as a joint venture with Korea’s Gmarket. Qoo10, which claims two million shoppers, was originally part of Giosis.

The acquisition is similar to a deal eBay did in Korea in 2001 when it purchased Internet Auction Co and linked the Korean service up to its global network of buyers and sellers. That integration has been successful, and today South Korea is eBay’s fourth largest market based on revenue behind only the U.S., Germany and UK, respectively.

Although the acquisition of Qoo10 was first announced in February, the actual price was not disclosed until the company’s earnings report dropped on Thursday. “We believe the acquisition will allow us to offer Japanese consumers more inventory and grow our international presence,” eBay explained in the filing.

The deal underscores how eBay is at the same time pulling back from general plays while doubling down on more targeted opportunities. Earlier this year, the company gave up its stake in Flipkart as part of its acquisition by Walmart, but at the same time committed to investing in a new, standalone eBay operation in India, using some of the $1.1 billion in proceeds it made from selling its Flipkart stake to Walmart.

EBay had an unsuccessful effort in China which ended in 2006 and it hasn’t returned to the country.

According to its latest financial results, the company’s U.S.-based business accounted for $1.1 billion out the company’s total quarterly sales of $2.6 billion. That North American revenue was up five percent year-on-year, but eBay’s revenue from other international locations grew by more over the same period to give the company’s total sales a nine percent annual increase.

That didn’t impress investors, however, and the company’s share price dropped by 10 percent to close Thursday at $34.11.

EBay doesn’t break out revenue for Japan — where Qoo10 operates — but revenue from Korean rose by 13 percent to $304 million in the most recent quarter. Sales for ‘rest of the world’ were up nine percent to $505 million.

While it used to be neck-and-neck with Amazon in terms of e-commerce sales and presence in the US, it has fallen behind over the years and now accounts for just 6.6 percent of online transactions in the country, versus 49.1 percent for its bigger rival.

More growth abroad could be one route to improving those fortunes, with India one of the world’s fastest-growing and most populous economies. But success in the country will be challenging with Flipkart joining forces with Walmart and Amazon’s India unit continuing to grow in strength.

But eBay isn’t going to go head-to-head with those two. Instead, its India operations will focus on cross-border sales, so essentially looking to connect buyers and sellers in the country with opportunities overseas within its network. That’s the same model it has used to effect in other parts of the world, so its acquisition of Qoo10 and its other international services will be a key part of that India strategy, and vice versa.


Source: The Tech Crunch

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