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Daily Crunch: July 26, 2021

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Regulatory Shifts in China

Good day, and welcome to Daily Crunch for July 26, 2021. The week began with significant developments in the tech world, triggered by new regulations issued by the Chinese government over the weekend.

These regulations specifically target the numerous educational technology (edtech) startups operating within China. The initial postponement of the Ant IPO proved to be a precursor to a broader wave of economic adjustments initiated by the Chinese government.

Impact Across Multiple Sectors

The effects of these changes extend beyond the edtech sector. Recent adjustments have also impacted the food delivery market and Tencent Music.

Consideration has been given to the potential implications of this evolving situation for startups throughout the country. Further analysis explores the broader context of these regulatory actions.

— Alex

TechCrunch Highlights: Recent Developments

Several noteworthy events have recently transpired in the tech and business world. These include developments concerning space exploration, digital signatures, alternative food production, and legal precedents regarding biometric data.

Bezos and Blue Origin's Pursuit of NASA Contracts

Following Jeff Bezos’ recent suborbital spaceflight, discussions have centered on the value of private investment in space exploration. Bezos is reportedly prepared to reduce the pricing of Blue Origin’s lunar lander project to secure a contract with NASA.

This move presents a dual interpretation: it could represent a beneficial cost reduction for taxpayers, or alternatively, be perceived as a form of corporate influence.

Box Sign and the E-Signature Landscape

Box, a well-known cloud storage provider, has entered the electronic signature market with the rollout of Box Sign to its customer base at no additional cost.

This development signals a shift in the e-signature market, where established players like DocuSign and PandaDoc face increasing competition. Offering e-signature capabilities as a standard feature suggests it’s becoming a core expectation rather than a separate product.

NotCo's Rise as an Alternative Food Unicorn

NotCo, a company specializing in plant-based food alternatives, has secured $235 million in Series D funding, achieving a valuation of $1.5 billion.

This funding round highlights the growing investment and consumer interest in alternative food products. The company’s success demonstrates the evolution of this sector from a niche concept to a viable business opportunity.

Biometric Authentication and Fifth Amendment Rights

A recent legal case in Washington D.C. has raised questions about the intersection of biometric data and Fifth Amendment protections against self-incrimination.

Guy Reffitt, facing charges related to the January 6th Capitol riot, had his password-protected laptop seized by the FBI. Prosecutors successfully argued for the use of facial recognition to unlock the device, citing a legal exception to the Fifth Amendment.

This case, as reported by TechCrunch’s Zack Whittaker, establishes a precedent for compelling the use of biometrics to access digital information, even when protected by a password.

Startups and Venture Capital Updates

Let's begin with startup news, highlighting the profile of Olumide Soyombo, a Nigerian investor who has recently launched a new fund. Soyombo’s newly established firm, named Voltron Capital, is focused on making investments throughout the African continent. Africa represents a substantial and growing market for both startups and venture capital, indicating further developments of this nature are likely.

The success Soyombo experienced with his early investment in PayStack, prior to its acquisition by Stripe, likely played a significant role in the formation of this new venture. This demonstrates the potential for returns in the African tech ecosystem.

Recent Funding Rounds

Turning to our regular overview of recent funding activity, the facial recognition sector is demonstrably thriving in attracting investment. Despite growing public concerns regarding privacy and the tracking of individuals, financial backing for companies operating in this market continues to increase.

Zack Whittaker provides detailed coverage of this trend. The demand for these technologies appears to outweigh ethical considerations for many investors.

Notable Funding Announcements

• Accelerated Protein Sequencing: Glyphic Biotechnologies has secured $6 million in new funding to advance its technology. This innovation promises to significantly reduce the time required for protein sequencing, potentially leading to breakthroughs in healthcare and related fields.
• Expansion for D2C Beauty Brand: MyGlamm, an Indian direct-to-consumer beauty company, has raised an additional $47.8 million. This follows a previous $23.5 million Series C round, bolstering the company’s financial resources. The beauty market’s size, coupled with the popularity of the direct-to-consumer model, are key factors driving investor interest.
• Growth in Embedded Fintech: The embedded fintech space – defined as the integration of financial services via APIs – is experiencing increased investment. Solarisbank, a Berlin-based company, is acquiring competitor Contis and has achieved a valuation of $1.65 billion.
• Sila Secures Series A Funding: Further demonstrating the momentum in fintech APIs, Sila, described as a “banking and payment platform,” has raised a $13 million Series A round. Founded in 2018 and based in Portland, Oregon, the company has now raised a total of $20 million.
• Queenly Continues to Attract Investment: Queenly, a recent participant in the Y Combinator program and a TechCrunch favorite, has secured a seed extension round led by Andreessen Horowitz. The company reported a 20% increase in dresses listed on its platform since February, positioning itself as a marketplace for formalwear similar to StockX.
• SoftBank Invests in Pet Health: SoftBank’s latest investment is in Embark Veterinary, a company utilizing DNA testing to improve pet longevity. Valued at approximately $700 million after a $75 million Series B raise, Embark represents a more grounded investment compared to some of SoftBank’s past ventures.

Genki Forest's Rapid Ascent: A $6 Billion Beverage Success Story in 5 Years

A significant number of readers of Extra Crunch may be unfamiliar with Genki Forest, China’s most rapidly expanding bottled beverage enterprise. This direct-to-consumer company initiated sales of its sodas, milk teas, and associated items a mere five years ago.

Currently, the company’s offerings are distributed across 40 nations, with projections indicating a revenue of $1.2 billion for the year 2021. Following the completion of its most recent funding cycle, Genki Forest has achieved a valuation of $6 billion.

Observers within the industry often draw parallels between this emerging brand and established leaders such as PepsiCo and Coca-Cola. However, the company’s founder, Binsen Tang, originates from the technology sector, previously providing funding for ELEX Technology, a social gaming firm that experienced international success.

In 2015, Tang articulated to his team that “China has sufficient platforms, but a demand exists for superior products.”

Genki Forest capitalizes on China’s well-developed distribution infrastructure, exceptionally swift manufacturing processes, and an extensive data reservoir that facilitates comprehensive digitization. Consequently, over 30% of its sales are conducted through online channels.

VC investor Anna Fang commented, “The company presents a compelling proposition across all facets.” She highlighted the favorable market position, the founder’s vision, the quality of the products, and the robust backend systems, characterizing them as representative of the evolving Chinese consumer brand landscape.

(Extra Crunch is a membership program designed to empower founders and startup teams. Registration is available here.)

Big Tech Inc.

Here are two noteworthy updates concerning prominent companies within the Big Tech sector.

Earnings Reports on the Horizon

The period of quarterly earnings reports is now underway. A significant number of leading technology corporations will be disclosing their financial results over the coming fortnight.

TechCrunch will be focusing on the most important takeaways from these reports, despite not being primarily a financial news source. Expect a substantial volume of data to be released.

Investment in the Electric Vehicle Sector

Continued substantial investment is being observed in the electric vehicle (EV) market.

Rivian, a manufacturer of electric trucks, has recently secured an additional $2.5 billion in funding.

Lordstown has also received a capital injection, which can be characterized as a financial rescue, to maintain its operations.

These developments indicate ongoing confidence and activity within the EV industry, despite market fluctuations.

TechCrunch Insights: Growth Marketing Professionals

Did you have a chance to review last week’s reporting on growth marketing strategies? The previous coverage can be found here if you missed it.

TechCrunch is currently seeking recommendations for accomplished growth marketers. Expertise in areas like SEO, social media, and content creation is highly valued!

Growth marketers are encouraged to share this survey with their clientele. We are interested in gathering feedback regarding positive client experiences and the value provided.

Seeking Expert Recommendations

We aim to identify top-tier professionals who demonstrate success in driving growth. Client testimonials are a crucial component of this process.

The survey will help us understand the specific contributions made by growth marketers. This includes the impact on key performance indicators and overall business objectives.

• SEO specialists who improve organic search rankings.
• Social media experts who build brand awareness.
• Content writers who create engaging and informative material.

Your participation will contribute to a valuable resource for businesses seeking growth marketing support. We appreciate your time and insights.

Engage with the Tech Community

TechCrunch’s Managing Editor, Danny Crichton, will host a Twitter Spaces discussion tomorrow, July 27th, beginning at 3:30 p.m. PDT / 6:30 p.m. EDT.

The event will feature Seth Levine, co-author of “The New Builders: Face to Face with the True Future of Business.” A question and answer session will follow a conversation centered around the book’s core themes.

Event Details

• Host: Danny Crichton
• Guest: Seth Levine
• Book: “The New Builders: Face to Face with the True Future of Business”
• Date: July 27th
• Time: 3:30 p.m. PDT / 6:30 p.m. EDT
• Platform: Twitter Spaces

Attendees will have the opportunity to engage directly with both Danny Crichton and Seth Levine following their initial discussion. This provides a valuable forum for exploring the insights presented in “The New Builders.”

Early Bird Pricing for TechCrunch Disrupt Concludes This Friday

A notice for prospective attendees: discounted passes priced at $99 or less for the TechCrunch Disrupt conference will no longer be available after Friday, July 30.

Secure your attendance now to benefit from these reduced rates and participate in the premier event for the startup ecosystem.

What TechCrunch Disrupt Offers

Disrupt is recognized as the foundational startup conference, providing unparalleled opportunities for growth and connection.

• Content: Access to insightful presentations and discussions led by industry experts.
• Learning: Workshops and sessions designed to enhance your knowledge of the startup landscape.
• Networking: Connect with founders, investors, and other key players in the tech world.

The conference is designed for anyone with an interest in startups and technology, offering valuable resources for all experience levels.

Don't miss the chance to join us at Disrupt – register today!