TechCrunch+

Being driven around the gridlocked-streets of Las Vegas during CES can be nauseating — at the best of times. But doing so with a virtual reality headset blocking your view? Certainly, it’s a recipe for disaster.

I don’t have the strongest of stomachs; and I pack Dramamine wherever I go. So it was with more than a little trepidation that during CES 2023I agreed to experience morning traffic on The Strip in the back of a car while wearing a VR headset.

This wasn’t just any car, though, and it wasn’t just any VR system. The car was a 1967 Cadillac DeVille, remarkable in so many ways but, in this context, notable for its abject lack of technology. (Worryingly, it also lacked seatbelts, thankfully not needed on this day.) The headset was an HTC VIVE Flow, paired with a Holoride’s new retrofit kit, a $199 add-on that allows you to get in-car VR experiences in literally any car.

Holoride’s initial launch was in partnership with Audi, which started integrating the company’s tech into its cars last year.

Holoride CEO Nils Wollny told me, while they have more OEM partnerships coming (“we can’t announce this yet”) this retrofit kit makes for an instant, massive expansion for the product’s market reach. Wollny calls it “an easy way for people that want to go on a Holoride to equip their car that they have, so they don’t need to have the latest Audi.”

All you do need is a place to mount the Holoride device, a puck-shaped thing that contains an accelerometer, a high-quality GPS, and a wireless module to connect to the HTC Vive Flow. Stick it on the windshield, turn it on and you’re good to go. Data from that module drives the various app experiences provided by Holoride, experiences that all include some sort of visual cues to prevent motion sickness.

I sampled what the retrofit pack had to offer while sitting in the generous back seat of the Cadillac, a broad stretch of vinyl that’s probably seen some experiences of a very different sort.

I started with Pixel Ripped 1995: On the Road. This is a Holoride-specific spin-off of the indie VR darling. Here, you’re playing a 2-D platformer on a virtual handheld gaming system (a “Gear Kid Color”), sitting in the virtual back seat of a virtual car while your virtual parents exchange idle banter up front.

As you really drive through traffic, the game simulates a world around you, an endless, idyllic neighborhood. It looks nothing like the hulking excess of Sin City. It does match the general street layout, so that when the real car stops at an intersection the virtual car does the same. The game is basic but fun, miles better than looking out at the gridlock.

In Cloudbreakers: Leaving Haven, a roguelike shooter that’s exclusive to Holoride, you pilot a giant robot through digital clouds, blasting wave after wave of geometric opponents. Around and beneath you, vertical and horizontal sweeping lines give a visual representation for streets. As the car makes a turn, the action in the game swings left or right to match.

The good news is that, while playing those experiences and more, I never felt even a little nauseous. In fact, I got more car sick after 10 minutes in the back of a cab on the way to my next appointment than I did in the 30 minutes I spent in that Cadillac wearing a VR headset.

The bad news is that none of the titles right now seem compelling enough to justify the $19.99 monthly or $180 per year to get access to Holoride’s service. Wollny says that they’re working with developers to add more titles to its library with an expected rate of new content every two weeks.

More of these simple experiences may not be the answer. To my eye, the killer app here is media consumption. Exit the games and you can mirror your smartphone into VR, jumping into any streaming app that you like. The Holoride software again renders a virtual landscape, like a giant theater screen floating across a moving background, meaning you can enjoy your content free from both distractions and motion sickness.

The next step? Wollny says they’re working to get the smartphone out of that equation: “We’re currently planning to have a native movie app or streaming app where you can also download the latest movies or the TV shows and then just relax, sit back on a virtual 180 inch screen.”

The retrofit kit is a great way to bring this tech to more people, and for Holoride to access far more customers.

However, Wollny told me that adding OEM partnerships are still very much the focus with Holoride working to make integration as seamless as possible.

With more cars packing accelerometers and high-quality GPS, adding support often just requires some software.

“We lowered the barrier as much as we could for car manufacturers to integrate our solution, because for them it’s an attractive solution for their passengers,” Wollny told TechCrunch. “And, it’s an additional revenue stream for mobility data they have. They provide us with the data we do a rev-share with them.”

More recurring revenue plus happier back-seat stomachs sounds like a proper win-win.

Finding Vegas VR nirvana in the backseat of a ’67 DeVille at CES 2023 by Tim Stevens originally published on TechCrunch

Verizon last month introduced a new subscription service aggregator, +Play, into open beta, allowing its customers to purchase and manage subscriptions to over 20 services, including Netflix, Disney+, Hulu, HBO Max, ESPN+, discovery+, AMC+, NFL+, NBA League Pass and NBA TV. But while the initial version of the service is expected to launch in the late Q1/March timeframe, exclusively to Verizon customers, the company today confirmed the eventual plan is to make +Play broadly available to all — even those who aren’t with Verizon.

Speaking at the Variety Summit at the Consumer Electronics Show in Las Vegas, Erin McPherson, Verizon’s Chief Content Officer and head of partnerships, said the service would, “at first” be for Verizon Wireless customers, then “eventually opened up to everyone down the road. But we’re starting out with our customer base,” she said,

“We’ve got roughly 20 premium subscription services,” McPherson noted, adding that it expects to grow that number to “about 50” by the end of 2023. That growth, however, won’t continue to expand to include the long tail of smaller streamers, she clarified.

“It’s not an attempt to aggregate the world’s apps, though — that’s not what we’re about doing. It’s going to always remain a curated selection. And our hope is also to push the industry forward by creating consumer-centric bundles and offers with these services,” said McPherson.

Verizon ended Q3 with 122 million total retail connections and 25% of its consumer wireless phone customers now have 5G-capable devices, it said. Its consumer division counted 234,000 fixed wireless net additions in the third quarter and 58,000 Fios Internet net additions. The company’s main mission is to keep growing that so this is also the endgame when it comes to the company’s media and content strategy these days.

McPherson hinted that longer-term plans may include bundles of services on its platform, as well.

“Again none of this is announced yet — but think about a bundle where a customer could get a video subscription service, something to do with health and wellness — since we offer Peloton and Calm. We might start to work with delivery services — anything that’s a monthly subscription,” she said.

One of the perks of +Play is a free year of Netflix Premium for customers who sign up for a subscription — something Verizon is helping to underwrite as a marketing initiative.

“As we go on forward with Netflix, we’re going to be doing other exciting things in this space as far as thinking about where we go with next-gen — perhaps next-gen bundling and other types of offers with all of our partners. We’ve got great trials. Think of it as our way of providing our customers with more value,” she said.

These types of offerings won’t be available in the near term. Instead, when the service exits beta testing later this year, McPherson said Verizon’s focus will be on enhancing the “features and functionality, making things prettier, and taking friction points away in the buy flow.”

We have contacted Verizon for comment.

Verizon’s +Play subscription store to later open to non-Verizon customers by Sarah Perez originally published on TechCrunch

The global economic and political turmoil of the past year has had a meaningful impact on corporate innovation in the technology industry and beyond.

The worldwide battle with COVID, the Ukraine-Russia conflict and the economic fallout of the COVID lockdowns and supply chain disruptions have together created a painful combination of a global recession, global inflation and unpredictable instability in the worldwide economy.

All of these factors have led to belt-tightening in the corporate world, layoffs and hiring freezes and a more conservative investment posture from the investment community. Inevitably, these changes will have a chilling effect on innovation in the years to come.

However, there is perhaps a silver lining when it comes to the prospects for innovation. In some ways, these market forces might actually serve as an accelerant for creativity and advancement in technology.

Short-term impacts

In the short term, the impact of these negative economic trends and the political instability will be felt by the centers of innovation in both the corporate and startup worlds.

Corporations are likely to slash spending on internal and external innovation. That is, they will reduce their research and development budgets and likely focus R&D on projects that can have immediate impacts on profitability at the expense of long-term visionary projects.

Corporations will also spend less on collaborations with other innovators and expensive acquisitions of advanced technology. We expect to see more acquisitions of early-stage companies as they become weaker and corporations look to develop new technologies more cheaply by buying at a discount rather than building from scratch.

How global unrest will impact innovation in 2023 by Ram Iyer originally published on TechCrunch

TikTok users regularly complain of hours lost on the platform, especially at night. In an effort to address these concerns, the company is testing new sleep reminders that include the option to set up alerts when it’s your bedtime and to mute notifications during the recommended seven hours of sleep. TikTok confirmed to TechCrunch on Friday that the new sleep reminders are being tested with select users globally.

Screenshots shared by product intelligence firm Watchful.ai show that the new feature appears under the “screen time” settings in the app. Users who are part of the test will see a new “sleep reminders” option. The app says sleep reminders will help you “know if you reach your sleep time on TikTok to help you get to bed when you want to.” After you select a sleep time, you will be reminded to close the app when the clock reaches that time. TikTok will also mute push notifications for seven hours after your sleep time to help you avoid distractions.

A spokesperson for the company said TikTok is continuously working on new ways to support users’ well-being and that this new tool builds on its current digital well-being features. The app first launched screen time management tools in February 2020, and has since introduced additional features aimed at giving users more control over their app usage.

Last June, the company launched an in-app tool to help users control how much time they spend on TikTok in a single sitting by allowing them to schedule regular screen time breaks. By default, it suggests break reminders of either 10, 20 or 30 minutes, though users can set reminders for a custom time if they wanted to engage in either longer or shorter sessions before being shown the notification. The app also has restricted nighttime notifications for teen accounts. Users aged 13-15 don’t receive push notifications from 9pm, and users aged 16-17 have push notifications disabled starting at 10pm.

Thanks to TikTok’s unmatched ability to distract and engage users via its advanced recommendation technology, its addictive nature has been the subject ofnumerouspsychological studies. As a result, it’s not surprising that TikTok is testing additional tools designed to put users in better control of their TikTok usage. As with any other test feature, it’s unknown when or if TikTok plans to officially roll out the sleep reminders feature more widely.

TikTok is testing a ‘sleep reminders’ feature that nudges you when it’s bedtime by Aisha Malik originally published on TechCrunch

It’s impossible to plan for everything that can go wrong while building a startup.

A definitive guide would have to include chapters like, “So you’ve hired the wrong person,” or, “Five ways to tell if an investor is lying to you.”

Mentors and advisors come in handy, but startups move at breakneck speed. Investors say they want to add value, but for founders under pressure, it’s hard to know exactly when to ask for help.

Before Tracy Young was co-founder and CEO of TigerEye, she held the same roles at construction productivity software startup PlanGrid.

Full TechCrunch+ articles are only available to members
Use discount code TCPLUSROUNDUP to save 20% off a one- or two-year subscription

Even though she led the company to $100 million in ARR before its acquisition by Autodesk, she has had “years to dissect the mistakes I made with my first startup,” she writes in TC+.

Young looks back at “five key failure points” that are common potholes on every founder’s path, and shares tactical advice for addressing internal conflict, losing product-market fit, and other stumbles.

“If these reflections help even one founder make one less mistake, I would consider this effort worthwhile.”

On Thursday, January 19 at 10 a.m. PT/1 p.m. ET, Tracy Young will join me in a Twitter Space to talk about how she dealt with these and other common founder challenges. Bring your questions and join the chat!

One last note: TC+ roundup is TechCrunch’s fastest-growing newsletter! Thanks very much for reading and subscribing!

Walter Thompson
Editorial Manager, TechCrunch+
@yourprotagonist

3 questions founders should be asking investors in Q1 2023

Money is power, and VCs know it.

It’s one of the reasons why so many founders perform inadequate due diligence on their investors, says Talia Rafaeli, a partner with early-stage European VC fund Kompas.

Instead of going into a pitch meeting hoping to eke out favorable terms, Rafaeli advises entrepreneurs to interrogate investors with direct questions about liquidity, exit expectations and how they intend to add value over time.

“A tough economic climate doesn’t mean the power dynamic automatically tips in favor of those with the cash,” she says.

“The best working relationships are those built on an equitable footing with honesty and clarity.”

Will record levels of dry powder trigger a delayed explosion of startup investment?

There’s a subtext to the waves of layoffs and Craigslist ads for discounted office furniture: tech investors have amassed approximately $290 billion in dry powder.

“Despite the downturn, strong cash supply and tailwinds for spending on digitization are leading some market participants to believe we’re in a strong investment cycle,” according to Raphael Mukomilow and Pierre Bourdon at Picus Capital.

After they tracked uninvested capital by year going back to 2006, the pair found that “a crisis within the investment landscape has often been followed by years of systematic outperformance of returns, and history has a way of repeating itself.”

Whoops! Is generative AI already becoming a bubble?

Generative AI is making a splash with apps like Lensa AI, DALL-E and ChatGPT, but does that make it a strong investment?

Several VCs who responded to a recent TechCrunch+ survey “said the tech’s growth has reminded them too much of crypto,” writes Rebecca Szkutak.

“Everyone is piling on faster than they should be.”

When will IPOs return? The past may hold some clues

Natalia Holgado Sanchez, head of capital markets at Secfi, studied the impact of five downturns since 2002 to see how well privately-held startups held up, “and, most importantly, how long it took the IPO market to reopen.”

For each period, Sanchez looked at the inciting events, the similarities and differences between this downturn and past crises, and how startups were impacted.

“Based on historical data, the IPO market has opened up after 18 to 24 months, on average,” she found. “Given that we’re now about 9 months since our window closed, we could see movement by June 2023.”

Dear Sophie: How can I transfer my H-1B to my new startup in 2023?

Dear Sophie,

I am RESOLVED: This is the year I finally live my dream and create my startup! I currently have an H-1B for my full-time engineering role at another company.

How can I transfer my visa to my startup? How do we structure the startup for immigration success?

— Restless & Resolved

Teach yourself growth marketing: How to set up a landing page

In the first article of a five-part series on growth marketing fundamentals, Jonathan Martinez explains how to create an essential part of every company’s sales funnel: a landing page.

This overview includes basic steps for writing a clear headline, offering visitors social proof that builds credibility, and crafting calls to action that drive results.

Next week, Martinez, who helped scale startups like Uber, Postmates and Chime, will share his tips for launching a paid acquisition channel.

TechCrunch+ roundup: Dry powder’s slow fuse, landing page basics, generative AI hype by Walter Thompson originally published on TechCrunch

After the challenging year that was 2022, one might think that the coming months are not looking great for VCs or founders.

But, “dry powder” — money raised by VCs that hasn’t yet been deployed — has risen to record levels. Venture capital investors in the United States, for instance, are sitting on a $290 billion powder keg that’s ready to ignite a new wave of tech startups.1 Investors are understandably cautious. But if handled wisely, the payoff could be big, especially because valuations have normalized drastically.

But why has this happened and what does it mean for the tech industry? And why does the current market environment offer an unprecedented opportunity for investors?

Tech stocks are seeing significant valuation corrections

Tech stocks have been through a storm this past year.

The Nasdaq composite index has seen losses of 32% since last January. For instance, Meta, Amazon, Netflix and Google have seen their shares plummet by 63%, 45%, 48% and 34% since the start of 2022, respectively. For only these four stocks, such a decline has meant a decline of $2.3 trillion in market value — that is 1.4 times the cumulative market capitalization of all 40 companies in the TecDAX, Germany’s largest stock market index.2

Such declines were driven by a correction in valuation metrics. In 2021, the average enterprise value for listed cloud software companies was, at times, as high as 20x NTM revenues. Since the valuation correction in early 2022, multiples have normalized and are now at around 5x to 10x NTM revenues.3

But last year’s downturn also affected private-market startups. The average valuation of Series C rounds fell by about a third to $336 million in Q2 2022 from $500 million in Q4 2021.4

The lack of funding, skyrocketing layoffs, inflation and a recession have led some pundits to label the tough climate as the “startup apocalypse.” But despite these challenging circumstances, tech trends show signs of hope.

The tech sector has remained resilient

Strong growth in cloud and AI have kept key tech trends steady, largely in part due to huge shifts in the way we work. Spurred by the need to ensure they’re prepared for the future, organizations have poured money into upgrading their digital infrastructure and processes.

Will record levels of dry powder trigger a delayed explosion of startup investment? by Richard Dal Porto originally published on TechCrunch

Cloud computing giant Rackspace has confirmed hackers accessed customer data during last month’s ransomware attack.

The attack, which Rackspace first confirmed on December 6, impacted the company’s hosted Exchange email environment, forcing the web giant to shut down the hosted email service following the incident. At the time, Rackspace said it was unaware “what, if any, data was affected.”

In its latest incident response update published on Friday, Rackspace admitted that the hackers gained access to the personal data of 27 customers. Rackspace said the hackers accessed PST files, typically used to store backup and archived copies of emails, calendar events and contacts from Exchange accounts and email inboxes.

Rackspace said about 30,000 customers used its hosted Exchange service — which it will now discontinue — at the time of the ransomware attack.

“We have already communicated our findings to these customers proactively, and importantly, according to Crowdstrike, there is no evidence that the threat actor actually viewed, obtained, misused, or disseminated any of the 27 Hosted Exchange customers’ emails or data in the PSTs in any way,” said Rackspace. The company added that customers that haven’t been contacted directly can “be assured” that their data was not accessed by attackers.

Rackspace attributed the breach to the Play ransomware group, a relatively new gang that recently claimed attacks on the Belgian port city of Antwerp and the H-Hotels hospitality chain. Rackspace’s stolen data is not currently listed on the ransomware group’s leak site, and it’s unclear if Rackspace has paid a ransom demand.

According to the incident report update, Play threat actors gained access to Rackspace’s networks by exploiting CVE-2022-41080, a zero-day flaw patched by Microsoft in November that has been linked to previous ransomware incidents.

Rackspace says hackers accessed customer data during ransomware attack by Carly Page originally published on TechCrunch

AR tech sounds pretty cool, but nobody wants to be a glasshole. Today at CES, we checked out Lumus‘ bid to make AR glasses a little bit less cringe. The company creates a series of glasses that look, well, more or less like glasses, and are compatible with prescription lenses, too.

The new glasses are the second generation of its ‘Z-Lens 2D waveguide’ tech, halving the size and weight of the tech needed to make AR bloom to life.

“In order for AR glasses to penetrate the consumer market in a meaningful way, they need to be impressive both functionally and aesthetically. With Z-Lens, we’re aligning form and function, eliminating barriers-of-entry for the industry and paving the way for widespread consumer adoption,” said Ari Grobman, Lumus CEO, in an interview with TechCrunch. “Our introduction of Maximus 2D reflective waveguide technology two years ago was just the beginning. Z-Lens, with all of its improvements unlocks the future of augmented reality that consumers are eagerly waiting for.”

The lenses include a 2Kx2K resolution, surprisingly vibrant colors, and a heads-up display that can be seen even in broad daylight. Extra good news for this particular glasses wearer – the company’s tech can be bonded directly to Rx prescription glasses. The tech works by using so-called ‘reflective waveguides’ that help the tiny projectors held in the eyeglass frames to project on the inside of the semitranslucent lenses. This means that the glasses can be used as regular glasses, while also being usable as projection surfaces. The other advantage is that there’s minimal light leakage – so it’s virtually impossible to see from the front that the wearer is getting info beamed into their eyeholes.

The company tells me it has gone on a patenting binge, claiming it already has more than 430 patents granted, with an additional 540 patents pending. That both places it among the world’s top patent holders for augmented reality optics and positions it beautifully as an acquisition target for a larger company that may be scared of getting sued, bored of paying licensing fees, or both.

Lumus shows off AR glasses that don’t look too dorky by Haje Jan Kamps originally published on TechCrunch

Some. Good. News.

The latest Crunchbase data shows that Black startup founders in the United States raised around $264 million out of the total $33.6 billion in venture capital allocated in Q4 2022. That’s an uptick from the $178 million — or 0.43% — the group raised in Q3.

In total, U.S. Black founders raised an estimated $2.254 billion out of the $215.9 billionin U.S. venture capital allocated last year. That’s about 1%, a slight drop from the 1.3% raised in 2021. Let’s break this down.

So Black in the U.S. founders picked up around 0.79% of VC funds raised in Q4 2022. There was a fear that, during a bear market, investors would retreat to their old-school networks, and the total amount of funding Black founders received last year is practically half the amount they raised in 2021 — a record $4.340 billion (out of around $330 billion in the U.S. and $681 billion globally).

Despite the record-breaking 2021, that amount of money equates to just 1.3% of all capital raised in the U.S. alone. No matter what, it seems the actual percentage of the money raised for this cohort barely moves, even as more and more capital floods the markets.

Tye Calloway, the founder of the fintech Cooler, told TechCrunch that it’s embarrassing as a Black founder to always be associated with negative statistics, especially as one trying to fundraise.

Black founders still raised just 1% of all VC funds in 2022 by Dominic-Madori Davis originally published on TechCrunch

Victims of the MegaCortex ransomware can now recover their encrypted files for free, thanks to the release of a new file decryptor.

The free decryptor was built by cybersecurity firm Bitdefender and the EU’s No More Ransom initiative in cooperation with the Zürich Cantonal Police, the Zürich Public Prosecutor’s Office and Europol, which in September announced that 12 individuals had been arrested in connection with the Dharma, LockerGoga and MegaCortex ransomware families.

At the time, a statement from Zürich’s prosecutor revealed that the arrests allowed investigators to recover multiple private keys used by the ransomware gang that could allow victims to recover data that was previously encrypted with the LockerGaga or MegaCortex malware. BitDefender released a decryptor for LockerGoga last year.

Now, the cybersecurity company announced this week that a free MegaCortex decryptor is now available.

The tool, which should work to unlock files encrypted by all variants of MegaCortex ransomware, is available to download from Bitdefender and via No More Ransom’s decryption tools portal, which is home to 136 free tools for 165 ransomware variants, including Babuk, DarkSide, Gandcrab and REvil.

Bitdefender told TechCrunch that MegaCortex is estimated to have infected in excess of 1,800 companies around the world, including a number of “high-profile” targets, though the figure is likely to be far higher. The cybersecurity company said its Sodinokibi decryptor, which it released in September 2021, helped victims save over $800 million in unpaid ransoms, and it expects similar from the MegaCortex tool.

MegaCortex was first seen in May 2019 when it began targeting networks that have already been infected with malware, such as Emotet and Qakbot, which is often used to steal data but also deliver ransomware payloads.

Later that year, MegaCortex operators became among the first to engage in double extortion tactics, where they exfiltrate a victim’s sensitive data and encrypt it. The ransomware actors then threaten to release the stolen data unless a ransom demand was paid, which are said to have ranged from approximately $20,000 to as much as $5.8 million.

MegaCortex ransomware victims can now recover stolen files for free by Carly Page originally published on TechCrunch