TechCrunch+

TikTok goes a little overboard when it comes to categorizing every last aesthetic into its own microtrend. You notice it when Spotify Wrapped calls your music taste goblincore, or when you strangely end up at a charity gala in San Francisco and a tech exec asks you if he should be concerned that his teen daughter is obsessed with cottagecore (yes, this happened to me). Take any noun, add the suffix “core,” and you’re good to go.

There is no more natural terminus to this phenomenon than “corecore,” a meta aesthetic from “nichetok” that uses nihilistic video clips to create something so absurd and meaningless that somehow, it comes back around and makes you feel something. It leans into our impulse to mask all of our emotions in twelve layers of irony, but in the process, gets so earnest that it might not be ironic after all.

Take a look at arguably the most popular corecore video, which tallied up 2.2 million likes. It begins with a clip from a salary transparency account, in which people ask strangers what they do and how much money they make. A child says that when he grows up, he wants to be a doctor, and when the host asks him how much he wants to make, he says, “I’m gonna make… people feel okay.” Then, you’re immediately exposed to fast-cycling clips: a timelapse of a busy street; a guy screaming; elderly people playing slot machines in a casino; a TikToker talking about a chicken that lives in the metaverse; and people rushing out of a garage in crisis.

Some corecore videos look like they could come out of an overwrought documentary that tells us really obvious truths about how social media makes us lonely; others make little sense at all. But most of these videos are tied together by a general malaise — a concern that life has no meaning and technology is alienating us from one another. Within corecore, we see clips of robots at CES talking about how people are afraid of them, demos of new VR headsets, and clips from Elon Musk’s appearance on Joe Rogan’s podcast. This lack of faith in corporate tech innovation is the exact opposite of the ubiquitous “day a lifeas a tech employee” trend, which shockingly isn’t a top-down corporate propaganda psyop (… or is it).

Corecore has been popular on TikTok since late 2020, but the techno-futurism-doom vibes feel especially appropriate now, as we watch Microsoft, Google, Meta, Amazon and Salesforce all wage massive layoffs within weeks. These nichetok posters are probably not reacting to the state of tech employment, but something bigger that encompasses it: how we are all subject to the whims of a few billionaire tech guys who can just decide to buy Twitter or make “metaverse” a word that normal people think about. And of course, there’s the added layer of irony that corecore is, too, part of that ecosystem — that people are making TikTok accounts dedicated to creating their own corecore compilations, promising things like “face reveals” once they reach 10,000 followers, using an anti-capitalist, lonely aesthetic to attain social capital.

Corecore is not the first meme of its kind. In any given moment in internet culture, there’s usually some sort of absurdist meme in circulation, whether it’s corecore, deep-fried memes, weird Facebook, bad animated videos, or the iterations on loss.jpg. That’s because it’s very normal, almost cliché at this point, to make nonsensical art in response to a world that doesn’t seem to make any sense. As anyone who’s taken an introductory art history class knows, this is how Dadaist artists reacted to the tragedies of World War I — and now, it’s how contemporary meme-makers respond to the horrifying realization that we are all addicted to scrolling through short form videos. And it’s how the greatest minds of the weird internet will react again, the next time the world feels a bit too dystopian.

In the end, the only thing that really makes sense about corecore is the fact that it exists.

TikTok’s ‘corecore’ is the latest iteration of absurdist meme art by Amanda Silberling originally published on TechCrunch

The Indian government has ordered YouTube and Twitter to take down videos and tweets about a BBC documentary that is critical of the Prime Minister Narendra Modi.

India’s Ministry of Information and Broadcasting issued the directions “for blocking multiple YouTube videos” and “over 50 tweets” linked to the videos of the first episode of the BBC documentary, Kanchan Gupta, an adviser to the ministry, said Saturday.

The ministry issued the directions under the IT Rules, 2021 that gives the ministry the authority to take down posts that it deems undermines the sovereignty and integrity of India, and has “potential to adversely impact India’s friendly relations with foreign countries as also public order within the country,” Gupta said. Both YouTube and Twitter complied with the directions, he said.

Gupta called the BBC documentary a “hateful propaganda.” Multiple ministries, including MEA, MHA and MIB, examined BBC’s “malicious documentary” and found it “casting aspersions on the authority and credibility of Supreme Court of India, sowing divisions among various Indian communities, and making unsubstantiated allegations,” he wrote in a Twitter thread.

The BBC has not broadcasted the documentary in India.

BBC aired the first episode of the two-part documentary, “India: The Modi Question” on January 17. The series addresses the 2002 communal riots in the western Indian state of Gujarat, where Modi was the Chief Minister at the time. Nearly 800 Muslims and over 250 Hindus died in the riots, according to official figures.

The violence erupted after a train carrying Hindu pilgrims caught fire.

A Special Investigation Team appointed by India’s apex court a decade later said Modi had taken the steps to control the riots. Another petition questioning Modi’s exoneration was dismissed last year.

The BBC series says Modi’s governance has been “dogged by persistent allegations about the attitude of his government towards India’s Muslim population,” according to the description on its website.

“This series investigates the truth behind these allegations and examines Modi’s backstory to explore other questions about his politics when it comes to India’s largest religious minority.”

Arindam Bagchi, the spokesperson for the Indian foreign ministry, said this week that the documentary is a “propaganda piece designed to push a particular discredited narrative. The bias, the lack of objectivity, and frankly a continuing colonial mindset, is blatantly visible.”

“If anything, this film or documentary is a reflection on the agency and individuals that are peddling this narrative again. It makes us wonder about the purpose of this exercise and the agenda behind it and frankly we do not wish to dignify such efforts.”

BBC said in a statement that the documentary examines the tensions between India’s Hindi majority and Muslim minority and explores the politics of India’s PM Modi in relation to those tensions.

“The documentary was rigorously researched according to highest editorial standards. A wide range of voices, witnesses and experts were approached, and we have featured a range of opinions – this includes responses from people in the BJP [India’s ruling party]. We offered the Indian Government a right to reply to the matters raised in the series – it declined to respond,” a BBC spokesperson said.

This isn’t the first time a documentary on Modi has stirred debate. Disney-owned Hotstar, India’s largest on-demand video streaming service with more than 300 million users, blocked an episode of HBO’s “Last Week Tonight with John Oliver” that was critical of Modi. An uncensored version of that episode aired on YouTube in India.

India blocks YouTube videos and Twitter posts on BBC Modi documentary by Manish Singh originally published on TechCrunch

Area 120, the Google in-house incubator responsible for products such as Checks, Tables, Stack and ThreadBite, has been significantly affected by broader layoffs at Google parent company Alphabet. A spokesperson tells TechCrunch via email that the majority of the Area 120 team has been “winded down,” and that only three projects from the division will graduate later this year into core Google product areas.

The spokesperson wouldn’t say which specific projects were being shuttered or graduating. Previously, Area 120 was incubating pilots like the workplace video platform ThreadIt, spectrum marketplaceOrion,document scanner Stack, and more. At any given time, it usually had around 20 projects underway, though not all of them were made public.

“Employees in the U.S. who were affected have been notified [of layoffs at Area 120], but in other countries this process will take longer, and is subject to local laws and practices,” the spokesperson added. “Our managing partner of Area 120 remains at the company.”

Area 120 was created by Alphabet and Google CEO Sundar Pichai in March 2016 with the goal of creating experimental apps and services that could be later folded into established profit drivers.Over the years, the division has launched a number of successful products including the HTML5 gaming platform GameSnacks (now integrated with Google Chrome), AI-powered conversational ads platformAdLingo (which exited to Google Cloud), and video platforms TangiandShoploop (which exited to Google Search and Shopping).

Area 120 underwent a reorg in 2021 that saw the group moved into a new Google Labs division led by Clay Bavor, where it lived alongside other forward-looking efforts at Google having to do with augmented reality, virtual reality and videoconferencing. Then came cuts. Last September, Google canceled half the projects at Area 120 and majorly reduced the program’s staffing.

A source previously told TechCrunch that Area 120 had under 100 employees after the previous round of cuts. Google declined to confirm the number.

Area 120, Google’s in-house incubator, severely impacted by Alphabet mass layoffs by Kyle Wiggers originally published on TechCrunch

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PST, subscribe here.

Happy Friday! Join us in wishing Lorenzo a very warm welcome to the team! He’s joining our crack team of cybersecurity reporters, working alongside Zack and Carly. He just published his first article on TC, about T-Mobile reporting a hacker accessed personal data of 37 million customers. Welcome aboard!!

Enjoy your weekend! — Christine and Haje

The TechCrunch Top 3

Alphabet spells out layoffs: With all that talk about tech layoffs in the past couple months, it was only a matter of time before we saw something from Google’s parent, Alphabet. The search engine giant announced it was cutting 6% of its workforce, which impacts 12,000 people. And like the others, CEO Sundar Pichai took his turn explaining how the company “hired for a different economic reality,” Paul writes.
Game off: With gaming being as popular as it is, this next layoff story is a bit of a surprise, though not totally unexpected since media companies are being hit hard. Entertainment company Fandom, which publishes content under Giant Bomb, GameSpot and Metacritic, laid off roughly 10% of its staff across those publications, Ivan reports.
It’s all about the money, money, money: Social media influencers in India have to disclose promotional content, aka paid promotions, to the government, and now the Department of Consumer Affairs has released some guidelines on how to do that. Jagmeet has more.

Startups and VC

A $32 million seed round for Chris DeWolfe’s newest gaming company may seem like a throwback to frothier times, like … 2021. But that’s how much PLAI Labs just raised in a deal led by Andreessen Horowitz (a16z), reports Connie. She points out that that’s a lot of moolah in a volatile market, even coming as it does from two separate a16z funds: the firm’s $600 million debut games vehicle and its $4.5 billion crypto fund, both of which were announced last May.

Here’s another handful for ya:

Brush yourself off and try again: Jacquelyn reports that Coinbase and others back Brett Harrison’s (FTX U.S.’s ex-president’s) crypto trading infra startup Architect.
Stacking startups until they are unicorns: Mike explores a new kind of PE fund, which plans to roll up German startups into potential unicorns and bigger exits.
These photos are garbage: Haje reports that GoodOnes raises $3.5 million to help make sense of your mess of a camera roll.
Yeah, that tips into the absurd: Grazzy wants to stop letting people use “no cash” as an excuse to avoid tipping, reports Christine.
Slower food: Manish reports that Indian food delivery giant Swiggy is about to cut 380 jobs.

4 investors discuss the next big wave for alternative seafood startups

There’s a lot of hype around plant-based burgers and nuggets, but alternative seafood products are attracting more attention — and funding — from investors these days.

“More than $178 million was pumped into alternative seafood in the first half of 2022, and the market’s value is poised to reach $1.6 billion over the next 10 years,” she reports.

To learn more about this maturing space, Christine Hall surveyed four investors to get their thoughts on regulation, the “unique challenges” companies face as they try to reach scale, and how they’re approaching growth and risk:

Kate Danaher, managing director of ocean and seafood, S2G Ventures
Friederike Grosse-Holz, director, Blue Horizon
Christian Lim, managing director, SWEN Capital Partners’ Blue Ocean
Amy Novogratz, co-founder and managing partner, Aqua Spark

Three more from the TC+ team:

Developing startups: Why international DFIs are looking to African startups to scale impact investing efforts, by Annie.
A summary of what we’ve done: TechCrunch+ roundup: 2023 unicorn slump, global VC slowdown, email marketing 101, by Walter.
What’s your bias, A’s: 4 questions to ask when evaluating AI prototypes for bias, by Veronica Torres.

TechCrunch+ is our membership program that helps founders and startup teams get ahead of the pack. You can sign up here. Use code “DC” for a 15% discount on an annual subscription!

Big Tech Inc.

Okay, no more layoff talk. We are going to have some fun, because it’s Friday, damn it!

Are you still playing Wordle? Or perhaps you switched to its clone Quordle. Well, Quordle was acquired by Merriam-Webster, Paul reports. If you’ve never tried it, Quordle is similar to the basic Wordle concept, guessing a word in a certain amount of tries, except there are four five-letter words to guess at once, with just nine tries. It might be just the thing to warm you up on a cold winter’s night.

Here’s four more for your Friday enjoyment:

Your turn: Amanda writes that after weeks of backlash and protest from content creators and fans, Dungeons & Dragons’ publisher made a decision to put the game under a Creative Commons license.
An abrupt goodbye: After recently cutting off third-party clients, including Tweetbot and Twitterific, Twitter went ahead and officially banned them, Kyle writes.
ICYMI: Netflix founder Reed Hastings stepped down as co-CEO but will remain on the board, Taylor writes. Meanwhile, Netflix is eyeing free streaming “FAST” channels as a possibility to grow its ads business, Lauren reports.
Up, up, and away: As Darrell writes, Canada is getting up off the sidelines and joining the space race, saying it wants to support commercial space launches.

Daily Crunch: Alphabet CEO lays off 12,000 people, says company ‘hired for a different economic reality’ by Christine Hall originally published on TechCrunch

Welcome back to the TechCrunch Podcast. This week Amanda Silberling is here to talk about how Dungeons and Dragons creators are fighting to keep their livelihoods and Rebecca Bellan comes on to talk about how a tweet has gotten Elon Musk into legal trouble…again. And as always, we break down the biggest stories in tech.

Articles from the episode:

Dungeons & Dragons content creators are fighting to protect their livelihoods
Musk stands to lose billions in trial over ‘funding secured’ tweet

More from TechCrunch

Discord acquires Gas, a compliments-based social media app for teens
Norton LifeLock says thousands of customer accounts breached
Amazon fined by regulators for unsafe warehouse work conditions
Boston Dynamics’ latest Atlas video demos a robot that can run, jump and now grab and throw

Court to decide if Elon Musk is careless or criminal and other TC news by Darrell Etherington originally published on TechCrunch

Many of us would feel better if we ate better. But for patients with chronic diseases, the issue is more pressing: Fixing their diet is often key to keeping their condition under control.

According to the CDC, six in 10 adults in the U.S. have a chronic disease such as diabetes or heart conditions. Millions of these could benefit from professional nutrition guidance but don’t always have the time or means to seek care.

Enter Nourish, a U.S. startup that connects users with a registered dietitian (RD) via telehealth and helps them get their consultations covered by health insurance.

Telehealth is part of the appeal, both for patients and for nutritionists, but the RD qualification is an important point too.

“All registered dietitians are nutritionists — but not all nutritionists are registered dietitians,” the Academy of Nutrition and Dietetics warns. Unless you seek an RD or RDN (registered dietitian nutritionist), you won’t be sure that your nutritionist is properly qualified for the job — and your insurance will not cover it.

Insurance coverage is a big part of Nourish’s value add. The startup’s CEO, Aidan Dewar, told TechCrunch that “94% of our patients are fully covered by insurance and pay nothing out of pocket. Most of the rest just have a small co-pay.”

That’s because since 2002, medical nutrition therapy has fallen under the scope of Medicare under certain criteria, a move that led major private insurers to follow suit.

On paper, qualified patients who are aware of this could get reimbursed after seeing an outpatient RD, whether online or off. But as often with healthcare in the U.S., the process is cumbersome for practitioners, and many end up not accepting insurance.

In contrast, Nourish’s RDs are employed by the company, which took care of closing partnerships with Medicare and major U.S. healthcare companies Aetna, BCBS, Cigna, Humana and United Healthcare in exchange for a fee.

Nourish currently employs 50 RDs but has a waitlist of over 400 RDs interested in joining its team, Dewar said. Having launched in November 2021, the startup is pacing itself but already reports “millions in revenue” from “thousands of patients seeing dietitians each month.” And by the end of the year, it plans to employ 200 RDs and grow its non-RD team from 18 to around 30.

Nourish’s growth plans will be funded by a recent $8 million seed round that brought its total funding to $9.3 million. Led by Thrive Capital, it had participation from Susa Ventures, Operator Partners, Box Group and Y Combinator, whose accelerator the startup graduated from in 2021.

Dewar also highlighted that several of Nourish’s angel investors built exciting healthcare companies, such as Alto Pharmacy (Jamie Karraker), Headway (Andrew Adams), Rightway Healthcare (Jordan Feldman) and Spring Health (April Koh).

“Nutrition has largely been excluded from the healthcare system, despite its importance and connection to people’s health. We love that Nourish is changing that by bringing consumers, registered dietitians, and insurance companies together to build a more affordable and complete nutrition program,” Thrive Capital general partner Kareem Zaki said.

Expanding nutrition therapy

Nourish has big goals: By helping people to eat well, the startup is hoping to contribute to solving the American healthcare crisis. “More than half of Americans have a chronic condition related to what they eat, which has contributed to healthcare costs going up and quality-adjusted life expectancy going down,” its founders said.

Dewar and Nourish COO Sam Perkins are childhood friends and landed on Nourish’s mission after struggling with chronic conditions themselves (migraines and irritable bowel syndrome). After experiencing the positive impact of nutritional care, they co-founded their startup together with CTO Stephanie Liu, who had become close friends with Perkins at Princeton.

The founders knew firsthand that working with a dietitian was a long-term process, but this vision is also reinforced by the startup’s chief clinical officer, Adrien Paczosa. “We focus on a long-term, sustainable approach — truly a lifestyle change,” she said. “We will never put you on a fad diet that is impossible to maintain, tell you to only eat salad for every meal, make you track everything you eat, or give you some generic, one-size-fits-all meal plan.”

Because of this approach, the startup doesn’t see itself as directly competing with weight loss apps. However, it plans to use its seed round to launch an app of its own by the end of the quarter, but with different goals in mind.

“The mobile app will augment the core experience of seeing your dietitian, with features including high-quality nutrition content and resources, clinical outcome tracking, and features that help you acquire the food such as integrated grocery delivery (so your RD can prescribe you food in the same way an MD can prescribe medicine),” Nourish explained.

The app’s goal is to make sure that patients are achieving the desired outcomes. Indeed, Nourish has two priorities in 2023: growth and outcomes. This road map has to do with how Dewar and his team define success. “It’s [both] about how many people we help and how much we help them.”

There’s still plenty of room for Nourish to grow on both fronts: The vast majority of chronic illness patients who could benefit from seeing an RD currently don’t, and even when they do, eating well remains a struggle. Will an app help make their journey easier? Only time will tell.

With a focus on patients with chronic illness, Nourish hopes to help Americans eat better by Anna Heim originally published on TechCrunch

Thoma Bravo, the private equity and growth capital firm, today announced that it would spend $1.8 billion CAD (~$1.34 billion) to acquire Magnet Forensics, a Waterloo-based company making software used by defense forces and businesses to investigate cybersecurity threats.

Magnet Forensics will be purchased by a newly created corporation controlled by Thoma Bravo, Morpheus Purchaser Inc., which will pay Magnet Forensics shareholders a 15% premium over Thursday’s closing price on the Toronto Stock Exchange. Post-buy, Morpheus will be merged with mobile device forensics outfit Grayshift, which Thoma Bravo acquired majority control of last July.

The transaction is expected to close by Q2 2023, subject to shareholder and other customary approvals.

“We look forward to bringing together the complementary capabilities of Magnet and Grayshift to create a leader in the digital forensics and cyber security space,,” Thoma Bravo partner Hudson Smith said in a press release. “Digital evidence is an increasingly critical aspect of investigations and the combined company will be well-positioned to further market expansion, accelerate innovation and provide even greater solutions to its customers.”

Launched in 2010, Magnet Forensics develops digital investigation software that acquires, analyzes, reports on and manages evidence from computers, mobile devices, internet of things devices and cloud services. The company was founded by Jad Saliba, a Waterloo regional police constable who worked in the police force’s high-tech crimes unit. After incubating Magnet Forensics’ software at the unit, Saliba decided to strike out on his own and sell the tech for a licensing fee, partnering with Jim Balsillie and Adam Belsher, then BlackBerry executives.

Before going public, Magnet Forensics attracted an investment from In-Q-Tel, the nonprofit venture arm of the U.S. intelligence community. The company claims that its software is used by more than 4,000 public and private sector customers — e.g. police forces, intelligence agencies, tax officials, border guards, and militaries — in over 100 countries, helping investigators protect assets and guard national security.

Business was booming prior to the acquisition (granted, Thoma Bravo first submitted a proposal early last October). During its Q3 2022 earnings call, Magnet Forensics reported that annual recurring revenue increased 50% year-over-year to reach $80.9 million while EBITDA — earnings before interest, taxes, depreciation and amortization — climbed 25% to $5.9 million.

Magnet benefitted from the expanding market for digital forensics, which is expected to grow from $5.8 billion in 2022 to $10.9 billion in 2028, according to a recent Imarc report.

Adam Belsher, who serves as Grayshift’s CEO, says that the combination of Grayshift’s mobile access and extraction capabilities and Magnet’s digital investigation suite will position the merged firms strongly — allowing customers to better extract, process, examine, collaborate on and manage digital forensic evidence.

“We believe the combination of Magnet and Grayshift will unlock tremendous value for our customers by further integrating and expanding our product suite which will result in more seamless workflows in the recovery and analysis of critical digital evidence to investigations and ultimately contribute to our shared mission of the pursuit of justice,” Belsher said in a statement. “We look forward to partnering with Thoma Bravo and Grayshift to build upon our digital investigation suite to further innovate and continue to serve a growing number of organizations and use cases.”

For Thoma Bravo, which now has an estimated over $114 billion in assets under management, Magnet Forensics is the latest in a series of high-profile software venture purchases. In 2022, the firm spent billions of dollars buying cybersecurity startups Ping Identity, Sailpoint, ForgeRock, Bottomline Technologies and Coupa Software.

Thoma Bravo agrees to acquire digital forensics firm Magnet Forensics for over $1B by Kyle Wiggers originally published on TechCrunch

People can never land on a word to explain what is happening to women and minorities within venture. Are such founders overlooked or undersought? Underestimated and underrepresented? Marginalized? Discriminated against? Or just ignored?

The excuses used to justify these sobriquets are equally scattered. Women received just 1.9% of all venture capital funds last year because they are only building beauty and wellness companies; there is a lack of a proven track record; it’s too early, they are too risky, and there is a pipeline problem. Maybe she’ll get married, have a family, and leave the business behind.

And Black founders raised 1% of venture funds because there aren’t enough of them pitching; they are a minority of the population and thus deserve a minority of the funds; their products and markets tap into something only their community can relate toward; there isn’t enough traction, they aren’t qualified; or, as one Twitter user wrote, they aren’t “male, pale and from Yale.”

Ah, yes, this explains it all. Women are too emotional to run companies. One female founder told TechCrunch she heard an investor say he wouldn’t invest in a women-founded company because “she was annoying.”

Men, on the other hand, are not annoying. They are competent and qualified, and, as we all well know, sexism and racial discrimination went poof after the civil rights and third-wave feminism movements. Since then, decisions toward people of color and women have been based purely on quantitative and provable facts. Obviously.

Indeed, investors’ fact-based due diligence often leaves out that women-founded companies have higher returns than male-founded ones. The rest of the data regarding bias in the venture industry is so nebulous that it’s hard to call much of it out. Without transparency, it’s difficult to determine exactly how many people of color and women are pitching, thus making it hard to assess how disproportionate funding to these groups truly is. There is a way, though, to pick apart some common misconceptions.

For one, women (especially Black women) are more likely to start a business than men (and continue to open companies in increasing amounts), meaning the idea that there aren’t enough women to invest in is simply untrue.

Debunking the myths of why venture investors don’t fund diverse startups by Dominic-Madori Davis originally published on TechCrunch

Though investment in food technology has slowed in line with the rest of the venture capital world, the industry recently achieved some milestones that suggest the sector and the government are moving into alignment.

In fact, some investors feel that 2023 will be the year when alternative seafood companies and products make notable strides.

More than $178 million was pumped into alternative seafood in the first half of 2022, and the market’s value is poised to reach $1.6 billion over the next 10 years. One of the sector’s biggest investments was Wildtype, which raised $100 million in a Series B round for its “sushi-grade” cultured salmon.

If this momentum held in the past six months, funding into the sector would meet or exceed the $306 million invested in all of 2021, despite the slowdown last year.

“Investment has been growing steadily, and we expect this to continue,” said Christian Lim, managing partner at SWEN Capital Partners’ Blue Ocean. “We see the alternative seafood industry achieving key technical and economic milestones faster than the alternative meat space, which indicates a potential for continued acceleration,” he said.

Many companies say they are in this for the sustainability factor, and even with the initial blessing from the FDA to Upside Foods for its cultivated chicken making process, the focus is on getting these alternative foods close to the scalability and cost of traditional meat.

“The cultivated seafood industry is beyond needing to solve for the technology — the technology is there and it continues to improve with every iteration,” said Kate Danaher, managing director, S2G Ventures. “Now we need to think about brand-building, labeling, consumer education, scaling production, and developing and improving the supply chain and inputs that will support a scalable industry.”

And like other plant-based, cultured and fermented food companies, alternative seafood companies also must figure out the best way to get people to not only give their products a try, but to ask for seconds.

As we kick off 2023, investors say regulation will help alternative seafood make additional strides, and they are optimistic that traction will be found. Read on to find out how active investors are thinking about alternative seafood, where they see growth, what they are keeping their eye on, and more.

We spoke with:

Kate Danaher, managing director of ocean and seafood, S2G Ventures
Friederike Grosse-Holz, director, Blue Horizon
Christian Lim, managing director, SWEN Capital Partners’ Blue Ocean
Amy Novogratz, co-founder and managing partner, Aqua-Spark

Kate Danaher, managing director of ocean and seafood, S2G Ventures

What will it take for the alternative seafood industry to have its first unicorn? Do you think 2023 is the year for it? Which companies do you think are close to achieving this milestone?

I do not expect the first alternative seafood unicorn to happen in 2023. The first goal we should all be focused on is demonstration of repeated production runs at viable price points.

Cultivated protein companies have made tremendous progress in the development of their products, but the big hurdle is getting a product of consistent quality and cost to the market.

To date, we have seen big dollars flowing to support the first wave of cultivated protein products, including in seafood. To achieve the step up in valuations that will eventually lead to a unicorn, companies will have to demonstrate a quality product with margins that fit within a viable business model at scale.

There have been some strides in the U.S. towards approving the process for producing alternative protein. How can founders work with regulators and investors to bring more proof-of-concept projects to fruition?

Many constituencies need to be “won over” to mitigate the headwinds that cultivated protein is likely to meet as it goes to market, such as industry groups, consumer groups and regulators.

Startup founders can support industry growth, commercialization and acceptance by building bridges with industry groups to show that cultivated seafood can be complementary to wild and farmed seafood.

Additionally, they should provide transparency into the production process to win over consumer groups and join an association, such as AMPS or Good Food Institute, who are doing important regulatory work on behalf of the industry.

Depending on who you ask, mainstream production of alternative proteins, like beef, chicken, and pork, is still years away. How can the alternative seafood industry achieve this faster?

I feel confident that alternative protein products will be available for purchase in the U.S. in the next 12 months, both cultivated seafood and other animal proteins. But for the foreseeable future, that product will be niche, premium and in limited production. Once production capacity constraints are resolved and costs come down, I expect these products to be as widely available as their animal protein counterparts.

One area where seafood may have an advantage in speed to market is related to regulation, given the FDA has sole jurisdiction over alternative proteins whereas the USDA and FDA share jurisdiction over animal protein.

In addition, seafood has a higher price point and its muscle structure is simpler in comparison to other animal proteins, making it more straightforward to grow a product that more easily replicates wild/farmed species.

Many alternative seafood startups aim to solve for the climate crisis as well, but this industry has unique challenges such as cost and appealing to consumers. What will be key in helping companies produce sustainable products at scale?

For cultivated seafood, the technology is there and it continues to improve with every iteration. Now we need to think about brand-building, labeling, consumer education, scaling production, and developing and improving the supply chain and inputs that will support a scalable industry.

If these products can be more affordable and meet consumer expectations, they can achieve impact at scale — for the animal through less wild fishing, for humans by delivering a seafood product with no toxins or microplastics, and for the environment through less waste.

Additionally, consumer education will be key. This, in part, includes driving awareness around the true cost of our food beyond what we pay in the grocery store. Consumers are becoming more aware of the externalities and factoring that into their purchasing decisions, but there is much more work to be done in that respect.

What does the future look like for investment in this space? Which areas are you highlighting as future growth indicators?

The good news is that cellular seafood products have reached a stage where they are approaching readiness to go to market from a regulatory, taste and performance perspective.

Cellular seafood companies are making amazing advancements in reducing the price and nearing the stage where they are ready for growth capital to scale the business. I expect to see more innovation and investment into the advancement of consumer experience and 3D structures.

What is needed to attract more institutional investment for later-stage funding to help scale the market?

I fully expect cellular seafood companies to be in a sold-out position in the future, because there is demand from a large early adopter consumer segment. The next wave of investments will be into infrastructure and companies that build adjacent inputs to outsource parts of the supply chain.

We have strong indications that FDA clearance is coming, and that will tick a big box for institutional and later-stage investors. Once this is behind us, it will be about who is in the market showing traction and producing a product at a price point that makes a compelling business case.

Friederike Grosse-Holz, director, Blue Horizon

What will it take for the alternative seafood industry to have its first unicorn? Do you think 2023 is the year for it? Which companies do you think are close to achieving this milestone?

It will take a clean label and healthy nutritional composition equivalent to seafood, including protein and omega-3 fatty acids.

4 investors discuss the next big wave for alternative seafood startups by Christine Hall originally published on TechCrunch

On Wednesday, Microsoft announced it was laying off 10,000 people. Alphabet added to the misery with another 12,000 this morning. We’ve previously seen 18,000 job cuts at Amazon and another 11,000 at Meta. You could also throw in Salesforce, which slashed 7,000 jobs at the beginning of the month.

You’ll notice one company is conspicuously missing from this wretched list, and that’s Apple, which at least until now, has remained on the sidelines when it comes to layoffs.

It’s worth noting that the company hasn’t had a history of big layoffs, and the last big one was back in 1997 when Steve Jobs returned to run things and laid off 4,100 employees. That was a time when Apple was in dire straits before Jobs led a massive turnaround that began a steady march to the company we see today.

One of the biggest reasons we’ve heard for these layoffs has been over hiring, as the chart below illustrates:

Company

Employee numbers at time of layoffs

Employee growth 2020-2021
Employees laid off

Amazon
1.5 million
800,000
18,000

Alphabet
187,000
52,000
12,000

Meta
87,000
27,000
11,000

Microsoft
221,000
58,000
10,000

Apple
164,000
17,000
–

Source: Macrotrends. Click employee growth numbers to access source data.

These companies grew like gangbusters during the height of the pandemic for various reasons depending on the company, but each boosted their employee base significantly over the period between 2020 and 2022. As the economy slowed throughout 2022, these companies decided it was time to make a correction, and we’ve seen these massive layoffs as a result.

While the other organizations were adding gobs of employees, Apple has hired at a much more modest rate than its large tech company counterparts, adding only 17,000 employees during 2020-2022 (per Statista), and perhaps because it didn’t bring in so many employees as the others, that could account for the fact that it has yet to make big layoffs.

The only layoff news so far from Apple was a pretty modest one. In August Forbes reported that the company quietly laid off 100 contract tech recruiters. In a company of over 160,000 employees that feels insignificant, but it could have been a sign that at least the company was slowing hiring.

And that’s exactly what happened when the company announced a hiring freeze in November. While Apple indicated that it intended to keep hiring in certain roles, it was a general freeze as a reaction to the overall economic uncertainty that all these companies are reacting to.

The shifting economic climate, and overall uncertainty heading into the new year has also been a big driver of the job cuts, but Apple has avoided using layoffs as a tool to this point.

All that said, with Apple scheduled to report earnings on February 1, we’ll probably get a clearer picture of the company’s overall financial performance. Nobody can predict what will happen here, and certainly given the overall pattern of layoffs we’ve seen recently at the other companies, it wouldn’t be unreasonable to expect something similar, but perhaps their hiring prudence will help prevent a comparable fate and Apple will spare its employees from this trauma.

While layoffs keep coming, so far Apple has steered clear by Ron Miller originally published on TechCrunch