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Today, baby registry and product discovery platform Babylist announced that it has acquired health and wellness tool Expectful for an undisclosed price. The deal, announced today, brings together two companies focused on parental support, now helping people navigate everything from eco-friendly diapers to mental wellness around fertility.

The overlap, however, is in more than the mission. Both of the company’s CEOs invested in each other’s last venture capital round; Babylist’s CEO and founder Natalie Gordon wrote a check into Expectful’s $3 million seed round back in 2021; and Expectful CEO Nathalie Walton invested in Babylist’s last round, a $40 million Series C closed in the same year.

And while the two founders didn’t publicly disclose purchase price, both certainly have venture capitalists to answer to. Babylist has raised $50 million in known funding from investors including Norwest Venture Partners, Halogen Ventures, 500 Global, Next Play Capital, and Marcy Venture Partners. Expectful has raised over $4.2 million in funding from investors including Harlem Capital. Indicator Ventures, Sequoia Scout Fund, Break Trail Ventures and Chinagona Ventures.

The long-term vision for the newly-combined company is for Babylist to change its relationship with its audience and become a larger, health and wellness media property, Gordon said. While Expectful will stay as a standalone website, Gordon hinted that much of its content will eventually be free to access – different from its currently advertised subscriber-oriented business model.

“Having a baby is so wonderful – it’s also overwhelming and isolating,” Gordon said. “When you talk to people going through this – the stuff is one thing, but actually their physical and their mental and emotional health are like much more significant.” With Expectful, she said, the company can talk to its audience in a way that doesn’t make sense for the tech-powered registry side of the business to do so.

Babylist’s eye for expansion may be partially attributed to its revenue growth; the company grossed over $240 million in revenue in 2021, although it did not share 2022 revenue on the record. Over eight million people made purchases from Babylist this past year, the company said.

Walton went from a user of Expectful to its chief executive in less than a year. She first joined as an advisor to Expectful, seeing it as an opportunity to be entrepreneurial despite delivering her son just weeks prior in a stressful pregnancy. Soon, Expectful’s then-CEO and founder Mark Krassner saw her as a key fit to lead the business, as it pivoted its product strategy to grow beyond recorded meditations. In a past interview, Walton described Expectful’s plan to mimic Peloton’s playbook of matching premium content with community.

Now, the entrepreneur is staying on at Babylist as a board advisor. She says she always saw the company’s exit looking like a merger with a partner in the digital health space.

“This acquisition allows us to have a much bigger impact than if we were to stay focused on revenue even,” Walton said. “Women need our products and they need our solution now, we don’t have time to wait to go that route of let’s just keep on growing revenue and have an IPO – it was more like, let’s prioritize impact, and I don’t think enough startups are thinking” that way.

Babylist makes an even bigger bet on baby products with Expectful acquisition by Natasha Mascarenhas originally published on TechCrunch

SpaceX is poised to conduct a wet dress rehearsal of the Starship launch system from its Starbase site in southeastern Texas, a major milestone in CEO Elon Musk’s quest to turn long-haul interplanetary transportation from science fiction to reality.

It’s the strongest signal yet that Starship’s first orbital flight test could well and truly be imminent. The wet dress is a critical series of prelaunch tests that includes propellant loading of both the upper stage and booster, and a run-through of countdown to around T-10 seconds, or just before engine ignition. If no major issues crop up during the testing, the next step would be “de-stacking,” or the separation of the Starship second stage and Super Heavy booster. That would be followed by a full static fire test, where engineers would light up all 33 of the booster’s Raptor 2 engines. The launch system would then be re-stacked before the first orbital flight test.

This could all take place in a matter of weeks — March is not off the table for the orbital flight test — but that’s assuming that everything goes well and no major mishaps take place (they’re not unheard of). It also assumes that the U.S. Federal Aviation Administration, the body that regulates commercial launches, issues SpaceX the all-important launch license fairly soon. The FAA has been basically mum about the status of its evaluation of SpaceX’s plans, though it’s been conducting extensive assessments of the Starship launch program for some time.

One can think about Starship as SpaceX’s raison d’être, the means by which the company will, as Musk puts it, preserve “the light of consciousness” in the cosmos. Given that Starship could have the potential to put as much as 100 tons into orbit — and given that there is not yet a robust market to support and exploit such a capability — it seems clear that Starship was designed with Mars in mind. The company will likely end up spending billions of dollars to work toward this goal.

It’s not just SpaceX that is betting big on Starship’s success. NASA is also counting on Starship to work, to the extent that the agency made it a central piece of its Artemis moon program. In April 2021, NASA awarded SpaceX a $2.9 billion contract to develop a version of Starship to land on the moon for the Artemis III mission, which will take place no earlier than 2024. The agency later expanded that contract by $1.15 billion to include a second crewed Starship mission for later in the decade.

But before any of that can happen, Starship needs to reach orbit. And it may happen sooner rather than later.

With Starship testing, SpaceX moves one step closer to making science fiction a reality by Aria Alamalhodaei originally published on TechCrunch

Temu, a shopping app from Chinese e-commerce giant Pinduoduo, is having quite the run as the No. 1 app on the U.S. app stores. The mobile shopping app hit the top spot on the U.S. App Store in September and has continued to hold a highly-ranked position in the months that followed, including as the No. 1 free app on Google Play since December 29, 2022. More recently, Temu again snagged the No. 1 position again on the iOS App Store on January 3 and hasn’t dropped since — even outpacing competitor Shein’s daily installs in the U.S.

Offering cheap factory-to-consumer goods, Temu provides access to a wide range of products, including fast fashion, and pushes users to share the app with friends in exchange for free products, which may account for some of its growth. However, the large majority of its new installs come from Temu’s marketing spend, it seems.

When TechCrunch covered Temu’s rise in November, the app had then seen a little more than 5 million installs in the U.S., according to data from app intelligence firm Sensor Tower, making the U.S. its largest market. Now, the firm says the app has seen 5 million U.S. installs this January alone, up 19% from 4.2 million in the prior 22 days from December 10 through December 31.

According to Sensor Tower estimates, Temu has managed to achieve a total of 19 million lifetime installs across the U.S. App Store and Google Play, more than 18 million of which came from the U.S.

The growth now sees Temu outpacing rival Shein in terms of daily installs. In October, Temu was averaging around 43,000 daily installs in the U.S., the firm said, while Shein averaged about 62,000. In November, Temu’s average daily installs grew to 185,000 while Shein’s climbed to 70,000 and last month, Temu averaged 187,000 installs while Shein saw about 62,000.

The shopping app’s fast rise recalls how the video entertainment platform TikTok grew to become the most downloaded app worldwide in 2021, after years of outsized growth. The video app topped 2 billion lifetime downloads by 2020, including sister app Douyin in China, Sensor Tower said. Combined, the TikTok apps have now reached 4.1 billion installs.

Like Temu, much of TikTok’s early growth was driven by marketing spend. The video app grew its footprint in the U.S. and abroad by heavily leveraging Facebook, Instagram, and Snapchat’s own ad platforms to acquire its customers. TikTok was famously said to have spent $1 billion on ads in 2018, even becoming Snap’s biggest advertiser that year, for instance.

By investing in user acquisition upfront, TikTok was able to gain a following which then improved its ability to personalize its For You feed with recommendations. Over time, this algorithm became very good at recognizing what videos would attract the most interest thanks to this investment, turning TikTok into one of the most addictive apps in terms of time spent. As of 2020, kids and teens began spending more time watching TikTok than they did on YouTube. And earlier this month, Insider Intelligence data indicated all TikTok users in the U.S. were now spending an average of nearly 1 hour per day on the app (55.8 minutes), compared with just 47.5 minutes on YouTube, including YouTube TV.

While Temu is nowhere near TikTok’s sky-high figures, it appears to be leveraging a similar growth strategy. The company is heavily investing in advertising to acquire users, which it uses to personalize the shopping experience. One of Temu’s key features, in fact, is its own sort of For You page that encourages users to browse trending items “Selected for You.” In addition to gamification elements, Temu also puts heavy emphasis on recommending shops and products on its home page, which is informed by its user data.

But the app’s growth doesn’t seem to be driven by social media. While the Temu hashtag (#temu) on TikTok is nearing 250 million views, that’s not really a remarkable number for an app as big as TikTok where something like #dogs has 120.5 billion views. (Or, for a more direct comparison, #shein has 48.3 billion views.) That suggests Temu’s rise isn’t necessarily powered by viral videos among Gen Z users or influencer marketing, but rather more traditional digital advertising.

According to Meta’s ad library, for instance, Temu has run some 8,800 ads across Meta’s various platforms just this month. The ads promote Temu’s sales and its extremely discounted items, like $5 necklaces, $4 shirts, and $13 shoes, among other deals. These ads appear to be working to boost Temu’s installs, allowing the app to maintain its No. 1 slot on the App Store’s “Top Free” charts, which are heavily influenced by the number of downloads and download velocity, among other things.

Of course, having a high number of downloads doesn’t necessarily mean Temu’s app will maintain a high number of monthly active users. Nor does it mean those users won’t churn out of the app after their initial curiosity has been abated. Still, Temu’s download growth saw it ranking as the No. 1 “Breakout” shopping app by downloads in the U.S. for 2022, according to data.ai’s year-end “State of Mobile” report. (Data.ai calculates “Breakout” apps in terms of year-over-year growth across iOS and Google Play.)

Because Temu’s growth is more recent, the app did not earn a position on the Top 10 apps in 2022 in either the U.S. or globally in terms of downloads, consumer spend, or monthly active users, on this report. Instead, most of those spots still went to social media apps, streamers, and dating apps like Bumble and Tinder. The only retailer to find a spot on these lists was Amazon, which was the No. 7 app worldwide by active users and the No. 8 most downloaded in the U.S.

Temu’s marketing investment may not pay off as well as TikTok’s did, though, as other discount shopping apps saw similar growth only to later fail as consumers found that, actually, $2 shirts and jeans were deals that were too good to be true. Wish famously fumbled as consumers grew frustrated with long delivery times, fake listings, missing orders, poor customer service, and other things consumers expect from online retail in the age of Amazon.

Temu today holds a 4.7-star rating on the U.S. App Store, but those ratings have become less trustworthy over the years due to the ease with which companies can get away with fake reviews. Dig into the reviews further and you’ll find similar complaints to Wish, including scammy listings, damaged and delayed deliveries, incorrect orders and lack of customer service. Without addressing these issues, Temu seems more likely to go the way of Wish, not TikTok, no matter what it spends.

Shopping app Temu is using TikTok’s strategy to keep its No. 1 spot on App Store by Sarah Perez originally published on TechCrunch

TechCrunch Live is entering its third season, and I’m thrilled to be leading the events again this year. The first event is on February 1, 2023, and will feature a timely discussion on what to do if your company can’t raise a Series A. We have Cambly’s Sameer Shariff and Benchmark’s Sarah Tavel speaking at the first event.

Of course, TechCrunch Live is free to attend. This weekly event/episode records live each Wednesday at 12:00/3:00 PST/EST. Register on Hopin to ask questions and network with guests and other attendees. The event also streams to Facebook Live and YouTube and will also be on Twitter Spaces.

TCL’s mission is still to help founders build better venture-backed businesses. But going into 2023, there’s new urgency behind this mission. TechCrunch Live started in the heady days of 2021, and now in early 2023, the startup world is experiencing radical changes. It’s harder to fundraise, sales cycles are much longer, and investors (and their LPs) have different expectations that are affecting all industries.

A few updates for 2023

TechCrunch Live is back on Hopin. Each event will have a dedicated Hopin room, allowing you, the viewer, to ask the guests questions. You have to register, and sign up for each event. But it’s worth the hassle. Trust me.
I’m also turning to Twitter to help source some questions for each week’s guest. It’s critical to me that you get to ask the questions you find most interesting, so if you can’t log in to Hopin, send me questions over Twitter at @mjburnsy.
The TCL Podcast! I got a producer, and the lackluster TCL Podcast is getting some serious love. Each Monday, we’ll upload an edited and condensed version of TCL. And the logo is changing thanks to @dicebourbon.
Pitch Practice is back! Apply to present your company using this form.

Upcoming guests

Sarah Tavel (Benchmark) and Sameer Shariff (Cambly) — 2/1/2023

Cambly looks like a sure bet right now, but as you’ll hear from Sameer, it was a struggle to get to this point. After failing to raise a Series A, the company had to change its model overnight. When VC after VC said no, Cambly had to find a way to make a profit to keep the doors open. Since then, the company went on to raise a $20 million Series A and a $60 million Series B, but only because the company took the hard steps to seek profitability earlier than expected.

Register Here

Christina Ross (Cube) and Rajeev Batra (Mayfield) — 2/8/2023

Christina Ross and her company, Cube, are on a mission to improve financial planning and analysis. Unlike competitors, Cube is not trying to replace internal spreadsheets, but rather live alongside these beloved sheets. Cube’s strategy is meeting its customers where they’re at. Hear how this novel approach was developed and how it attracted investments from major firms, including Rajeev Batra at Mayfield Fund.

Register Here

Christina Cacioppo (Vanta) and Andrew Reed (Sequoia) — 2/15/2023

Christina Cacioppo co-founded Vanta to help companies stay up-to-date with ever-changing compliances. And the industry responded enthusiastically. The company quickly raised over $200 million in venture capital, becoming a unicorn with its $150 million Series B in October 2022. Hear from Cacioppo and Sequoia Capital general partner Andrew Reed on Vanta’s growth trajectory and fundraising strategy.

Sagi Eliyahu (Tonkean) and Joanne Chen (Foundation Capital) — 2/22/2023

David Blumberg (Blumberg Capital) and Tanis Jorge (Trulioo) — 3/1/2023

Mark Goldberg (Index Ventures) and Rick Song (Persona) — 3/8/2023

Mamoon Hamid (Kleiner Perkins) and Arianna Huffington (Thrive Global) — 3/15/2023

Eric Tarczynski (Contrary) and Harshita Arora (AtoB) — 3/22/2023

TechCrunch Live is back with top founders and investors, and you get to ask the questions each week by Matt Burns originally published on TechCrunch

Meta is expanding its partnership with the NBA and WNBA to offer more than 50 live games in VR on Meta Quest, the company announced on Monday. The Meta Quest is the official headset of the NBA, as the company signed a deal with the league back in 2020.

The company will deliver a package of 52 live NBA games, including five immersive 180-degree monoscopic VR games in 2880 on its Xtadium offering and on Meta Horizon Worlds. Meta will also offer a selection of WNBA, NBA G League and NBA 2K League games over the course of the season. In Meta Horizon Worlds, you’ll also be able to access game highlights, recaps and archival content.

Users can visit the dedicated NBA Arena in Meta Horizon Worlds starting today to watch NBA content with friends, compete in interactive mini-games and support their favorite teams. Meta says that in the future, fans will be able to watch even more content in the app with an NBA League Pass subscription.

Meta also announced that it’s partnering with the league to launch NBA-licensed apparel in Meta’s Avatar Store in the coming weeks. Users will be able to purchase their favorite NBA or WNBA team apparel for their avatar and showcase it across Facebook, Instagram, Messenger and on Meta Quest.

“Meta’s immersive VR technology is opening up new opportunities for sports fans to engage and interact with their favorite NBA teams,” said Meta Director of Sports Media and League Partnerships Rob Shaw in a blog post. “Fans will be able to express their fandom by donning their favorite team’s gear on Avatars and enjoy more live NBA games and experience NBA League Pass in a much more social and immersive way.

The games available in VR on Meta Quest in January include Milwaukee Bucks vs. Detroit Pistons on January 23, Denver Nuggets vs. New Orleans Pelicans on January 24, Denver Nuggets vs. Milwaukee Bucks on January 24, Cleveland Cavaliers vs. Oklahoma City Thunder on January 27, Los Angeles Clippers vs. Cleveland Cavaliers on January 29 and Miami Heat vs. Cleveland Cavaliers on January 31.

Meta expands its partnership with the NBA to offer 52 games in VR by Aisha Malik originally published on TechCrunch

You have a great idea for a startup, and you’re working hard to build, launch and scale. But, and stay with us here, is your idea truly good? According to James Currier — founding partner of NFX, a VC firm by and for entrepreneurs — good ideas have patterns, and 90% of the ideas he sees at the pre-seed/seed stage will not lead to large exits.

Currier — a five-time founder with significant exits across multiple sectors — is arguably the most well-equipped investor-operator to help answer this vital question. It’s why we’re excited to have him join us onstage at TechCrunch Early Stage on April 20 in Boston, Massachusetts.

In a session called “How to Make Sure Your Startup Idea Is Actually Good,” Currier will share different tactics, like how to:

Recognize platform shifts that make something newly possible.
Identify fast-moving markets — where the TAM is not large, but increasing.
De-risk your idea.
Iterate on concepts that already work and why you shouldn’t be afraid of competitors.

The session reserves plenty of time for Q&A, so bring your questions. Currier is passionate about helping entrepreneurs and new founders assess their companies early on to make sure they’re tackling the right problem and providing the right solution.

Want to dig deeper into this topic? During the show, Currier will also host a roundtable — a focused, small-group discussion — that gives founders even more time to ask questions.

A serial entrepreneur and angel investor in DoorDash, Lyft and Patreon, James Currier has led four VC-backed companies (Tickle, acquired by Monster; WonderHill, acquired by Kabam; IronPearl, acquired by PayPal; and Jiff (acquired by Castlight).

Currier’s an early pioneer of some of the most-used tactics in the tech startup world, including user-generated models, viral marketing, A/B testing and crowdsourcing. In 2015, he co-founded NFX, a $475 million early-stage venture firm focused on network-effect businesses.

Currier speaks regularly at numerous industry conferences. He’s also been featured in Forbes, Fortune, Harvard Business Review, TechCrunch and Silicon Valley Business Journal. You can read his analysis of network effects and growth at NFX.

TechCrunch Early Stage sessions give attendees plenty of time to engage, ask questions and walk away with a deeper, working understanding of topics and skills that are essential to startup success. Buy an early-bird founder ticket now and save $200.

Founder and NFX VC James Currier vets startup ideas at TC Early Stage by Lauren Simonds originally published on TechCrunch

The U.S. Federal Trade Commission has fined home services marketplace HomeAdvisor up to $7.2 million for its use of deceptive and misleading tactics in selling home improvement project leads to service providers, including small businesses operating in the gig economy. The fine is the first gig work-related penalty following the FTC’s fall 2022 announcement that it was prepared to crack down on unfair, deceptive, and anticompetitive practices taking place in the gig economy.

Dever-based HomeAdvisor had merged with Angie’s List in 2017 to form a new public company called “Angi.” However, the FTC’s charge against HomeAdvisor wasn’t issued until March 2022. The Commission said that since at least the middle of 2014, HomeAdvisor had made unsubstantiated, false or misleading claims about the leads it sells to service providers, like general contractors and lawn care professionals. Specifically, it claimed that the Angil affiliate had misrepresented the quality and source of leads, and the likelihood that they would result in actual jobs.

The Commission found that HomeAdvisor told service providers its leads resulted in home improvement jobs at higher rates than its own data supported and misled service providers about the cost of its one-month subscription to its platform. The company told service providers the first month of the mHelpDesk subscription, which helps with scheduling appointments and processing payments, was free with an annual membership package. But this was not true, the FTC said. Service providers would end up paying $59.99 more than they expected, it noted. (The mHelpDesk program is an optional add-on to the $287.99 annual membership to the HomeAdvisor network).

In addition, the FTC found that while HomeAdvisor claims its leads concern consumers who intend to soon hire a service professional in soon, many of them do not. This is in part because HomeAdvisor would resell leads from affiliates who generate leads from online forms that asked consumers about potential home projects they were considering. However, the company would claim the leads came from its own website, which suggested consumers were seeking out HomeAdvisor’s assistance.

The FTC’s complaint also said many of the leads didn’t match the types of services the providers offered or were outside their preferred geographic area, despite HomeAdvisor’s claims to the contrary.

“Gig economy platforms should not use false claims and phony opportunities to prey on workers and small businesses,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, at the time of the original FTC order.

The new administrative order also bars HomeAdvisor from continuing its deceptive practices and sets up two redress funds to provide money to defrauded service providers. The first fund will make payments of up to $30 to service providers impacted by HomeAdvisor’s misrepresentations about its lead quality. Meanwhile, the second fund will make payments of up to $59.99 to service providers who had been told that the first month of their mHelpDesk subscription was free. In total, HomeAdvisor is required to pay up to $7.2 million for redress, the FTC said.

The Commission voted 4-0 to accept the proposed consent agreement.

This gig economy fine follows other warnings issued by the FTC, including one reminding MLMs (multi-level marketers) to not lie to consumers about potential earnings. This one was sent out to 1,100 MLMs, even if they were not under investigation. It also reminded these companies it had previously sued MLMs like Herbalife and Advocare for their promotions of high-earning potential even though most participants made little or no money. Herbalife settled with the FTC for $200 million and Advocare agreed to pay $150 million. The FTC settled with Amazon as well for using misleading earnings claims to attract drivers to its Flex platform, and sued DeVry University for false claims over the higher incomes graduates received.

The FTC fines HomeAdvisor up to $7.2M for lying about lead quality and other matters by Sarah Perez originally published on TechCrunch

Coverdash, providing small businesses, e-commerce merchants and gig-economy workers with insurance, launched its product in all 50 states after closing over $2.5 million in seed capital.

The round was led by Bling Capital, with participation from investors, including AXIS Digital Ventures, Tokio Marine Future Fund (in affiliation with World Innovation Lab), Expansion VC and Cameron Ventures. A group of strategic angel investors also participated, including Greg Hendrick, CEO of Vantage Risk; Garrett Koehn, president of CRC Insurance; and Steve Shenfeld, president of MidOcean Partners.

The New York City-based insurtech was started by Ralph Betesh, David Vainer and Avery Rubin in 2022 to help smaller businesses source coverage in seconds and to provide an embedded technology so that partners working with businesses, like online marketplaces and service providers, can plug in Coverdash’s end-to-end insurance experience with a single line of code. The company secured 35 of these partners pre-launch, Betesh told TechCrunch.

Betesh, who started his career in insurance investment banking, said that large insurance carriers want those equally large policies to show top line growth to investors, so they often focus on big companies, and have done so for years now.

However, he saw a dynamic shift in the last two or three years of big carriers looking at smaller businesses “as a way to pick up fragmented premiums without necessarily having to go head to head with each other,” Betesh said. This is where many startups were successful in developing some niche approaches to solving the insurtech problem, and also attracting venture capital dollars.

Betesh himself began to look at what the process was for small businesses to get insurance and found, in his words, “a lot of clunkiness” and “murky” processes with no transparency. In addition, customers weren’t able to purchase policies without speaking to a human being.

“It just wasn’t the purchase experience that I would have expected,” Betesh added. “We felt like this wasn’t in alignment with small business expectations in the U.S., specifically tech-enabled small businesses.”

So the team set out to build a product that would make insurance accessible to small businesses of all shapes and sizes and one that was seamless and simple. It works with over a dozen carriers to offer policies including liability, property, workers’ compensation and cyber.

Here’s how it works: Customers come to the Coverdash site, and they can get a quote, bind policies together, pay for them and manage them in a matter of seconds. Betesh said there’s no redirection of the customer to a payment portal, a carrier portal or to speak to an agent, everything can be done through Coverdash.

Though the company is offering policies in a direct-to-consumer format, Betesh said the Coverdash’s future scale and revenue will likely come from policies sold through those partners that will embed its technology into their websites.

Meanwhile, the new funding will be used for go-to-market initiatives, product and technology development and hiring.

“The development and adoption of commercial insurance APIs within the insurtech industry has reached a tipping point, enabling innovative companies with the opportunity to drive true growth and transformation,” said Ben Ling, founder and general partner at Bling Capital, in a written statement. “We view Coverdash as the future of business insurance and embedded distribution.”

Bling Capital-backed Coverdash unveils its embedded, digital insurance for small businesses by Christine Hall originally published on TechCrunch

Fintech-turned-HR outfit Deel reached $295 million in annual recurring revenue (ARR) by the end of 2022, the company’s co-founder and CEO Alex Bouaziz shared today.

That’s up 417.5% from $57 million in ARR achieved at the end of 2021.

The massive jump in ARR is impressive by normal standards but particularly so considering the challenging macroenvironment that startups everywhere faced last year. Deel says it calculates ARR as monthly recurring SaaS revenues x 12. Bouaziz told TechCrunch that a bulk of its ARR is from the company’s EOR (Employer of Record) business. 

Bouaziz also today confirmed the company’s valuation of $12 billion, which we reported on in May at the time of Deel’s $50 million raise. At the time, Deel did not confirm that valuation, apparently choosing to wait until it had full year ARR numbers to share.

Bouaziz also told TechCrunch that Deel is profitable, having been EBITDA positive since September. Further, Deel claims that it makes in profits a margin of 85%. In other words, for every dollar in revenue generated, it retains 85 cents.

Bouaziz and Shuo Wang started remote-first, San Francisco-based Deel in 2019 as an EOR – with the mission of allowing businesses to hire employees and contractors in other countries “in less than five minutes.” Deel also says that it gives companies the ability to pay teams in more than 150 currencies with “just a click.” It has since evolved its strictly fintech model to what it describes as a “full-stack” “truly global HR platform” designed “to compliantly manage your entire workforce in just one system—from direct employees to international workers and everything in between.”

On January 11, we reported on Deel’s acquisition of Capbase for an undisclosed amount in a cash and stock deal, marking its entry into the equity management space.

Deel says it has over 15,000 customers including Nike, Subway, Reebok, Forever21 and Klarna and that it has “paid out $5 billion in salaries to hundreds of thousands of workers.”

In a blog post today, the company also said is offering a new basic product, Deel HR, for free for any business with under 200 people. It also unveiled a Deel Engage, a set of HR Slack plugins designed “to help distributed teams build stronger culture, improve employee engagement, and measure adoption with powerful metrics.” The startup also announced the expansion of its global payroll offering by building what it described as its “first in-house payroll engine,” starting with the U.S. The expansion aims to help companies hire globally without opening legal entities and consolidating payroll, among other things, Deel said.

Over the past year, the global HR space has heated up. In October, for example, Rippling revealed its own global payroll offering, stating it was specifically competing with companies like Deel.

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Remote work revolution helps Deel reach $295M in ARR by Mary Ann Azevedo originally published on TechCrunch

Meta announced today that it has started gradually expanding testing default end-to-end encryption for Messenger. The messaging service is also bringing some of its standard features to end-to-end encrypted chats, including chat themes, custom chat emojis and reactions, group profile photos, link previews and active status.

Over the next few months, millions of users around the world will continue to see some of their chats gradually upgraded with end-to-end encryption. Messenger will notify people in these individual chat threads as they are upgraded. Meta says the process in which it selects and upgrades individual threads is random so that there isn’t a negative impact on the company’s infrastructure and users’ chat experience.

“We know people want a space to connect and they want to know that those conversations are private, safe and secure,” Meta said in a blog post. “That is why we’ve spent time building a team of talented engineers, cryptologists, designers and policy experts who are all committed to rolling out default end-to-end encryption on Messenger. Building a secure and resilient end-to-end encrypted service for the billions of messages that are sent on Messenger every day requires careful testing.”

Meta first tested end-to-end encryption features for Messenger back in 2016 for “secret conversations.” Last January, the company introduced opt-in end-to-end encryption for group chats and calls for Messenger. But unlike Meta’s other popular chat app WhatsApp, end-to-end encryption is not yet enabled by default for all conversations on Messenger, but this will soon change as the company begins rolling out default end-to-end encryption.

As for Instagram, the popular Meta app began testing end-to-end encrypted messages through an opt-in setting in 2021. Last February, the social media app introduced the feature for all users in Ukraine and Russia.

Meta has previously said that it expects to roll out default end-to-end encryption protection across all its apps sometime in 2023. The company has not provided a recent update on this timeline, but says it will give updates as it continue to bring end-to-end encryption to Messenger.

Messenger ramps up testing of default end-to-end encryption by Aisha Malik originally published on TechCrunch