WP Pro Online

Welcome to Startups Weekly, a nuanced take on this week’s startup news and trends by Senior Reporter and Equity co-host Natasha Mascarenhas. To get this in your inbox, subscribe here.

It kind of feels like tech forgot its umbrella. Like, it remembered to pack its water bottle, wear the right shoes and layer up, but when it came time to officially go outside — and say, face the year ahead — it realized that a waterproof hoodie wasn’t enough. It needs an industrial umbrella.

You know what I mean?

Here’s what I’m dancing, or, erm, writing, around. It feels like the macroeconomic environment has been reasonably volatile for the past year; and we’re still seeing entrepreneurs react to the market as if it just happened to knock on their door, trip them over and proceed to steal all their belongings. I’m not saying that founders and investors should have perfectly predicted what Q1 of this year should look like; I’m just wondering how long we’re going to get “the economy” as a catalyst for hard decisions.

What finally gets a CEO to step down? What finally gets a company to conduct its third round of layoffs? Is it the economy, or is it a uniquely human decision that comes just months after you were told to grow at all costs? When we’re talking about pivots and layoffs, I think it’s important to talk about the realities of shifting to deal with the new normal. Abstractions such as the economy just fall flat now that it’s been more than a few months since the markets have been grey.

I guess what I’m trying to say is, you can probably leave your house during a drizzle and end up at the grocery store just a little damp. If you forget your umbrella during a downpour, well, now you’re soaking wet and no one feels that bad for you. Don’t forget them, and better yet, sport them proudly.

Can you tell it’s been raining on the East Coast? Follow me on Twitter or Instagram for other subpar metaphors and thoughts. In the rest of this newsletter, we’ll talk about a fresh new venture fund that isn’t afraid to talk about privilege or honesty,

G on G

I spoke to Sophia Amoruso, the founder of Nasty Gal and Girlboss, about her new venture fund for founders, Trust Fund.

It is launching with a $5 million target, targeting a check size between $50,000 to $150,000. She’s already landed checks from the who’s who in tech. Prominent investors include a slew of a16z partners such as Marc Andreessen, Andrew Chen and Chris Dixon, as well as entrepreneur Ev Williams, icon Paris Hilton and support from investors Ryan Hoover and Cleo Capital’s Sarah Kunst.

Here’s why this is important: It’s her high-profile and rocky experience in Silicon Valley’s spotlight that has finally given Amoruso the operating experience needed to launch her own venture firm. While she is opening up a $5 million allocation to accredited investors outside her network, she said from a portfolio construction standpoint: she’s not necessarily looking for “diamonds in the rough” or a specific diversity quota.

“I plan to invest in men and women and everything in between. And if anything, like why not invest in the privilege and ride the coattails of a dude?” Amoruso said. “As a woman, why wouldn’t I want to invest in the advantage that a man has, like, feel free to publish that — it’s true.”

Sequoia injects $195 million into an ever-eager seed environment
Women-founded startups raised 1.9% of all VC funds in 2022, a drop from 2021

Gas

Discord has acquired Gas, a compliments-based social media app for teens. Reports Amanda Silberling:

On Gas, users sign up with their school, add friends and answer polls about their classmates. But the questions in the polls are intended to boost users’ confidence rather than damage it. Teens might be asked to choose which of four friends is the best DJ or has the best smile. Then the person who was chosen will get an anonymous message with their compliment, sent from a vague “boy in 10th grade” or “girl in 11th grade.”

Here’s why it’s important: When Clubhouse first rose to fame, investors and founders alike were abuzz with energy around the opportunity for innovation in the consumer social space. Since, Clubhouse has been through its share of struggles — listen to my Equity episode with the CEO here — but so has Twitter. I think Gas’ early exit and the slew of similar apps already on site, may bring some needed optimism to the conversation.

Losing the horn: VCs think majority of unicorns aren’t worth $1 billion anymore
A peek into the future as Sam Altman sees it

The follow-up

I’ve covered Clearco, formerly known as Clearbanc, for years. Like many, the Toronto-based fintech had a particularly volatile past 12 months. But this week truly marked the end of an era, with co-founder Michele Romanow stepping down from her position as chief executive of the tech unicorn.

Here’s why it’s important: Clearco has undergone numerous rounds of layoffs over the pandemic, including a cut that impacted 25% of staff. Additionally, in 2022, the Toronto-based fintech saw its other co-founder, Andrew D’Souza, step down from his CEO role to be replaced by Romanow. Now, both the co-founders will assume executive chairman positions.

“We don’t ever lie, we are under the same pressures as every other company to become a profitable business. And so we’ve just continued to make the hard decisions … and continue to be ahead of the curve,” Romanow said in an interview with TechCrunch, explaining the shift.

A lot of fintechs ‘have to fix their business models,’ say VCs who invest in fintech
Netflix founder Reed Hastings steps down as co-CEO
Shein valuation reportedly plummets by a third as it seeks $3B

Etc., etc.

Moritz Baier-Lentz joined Lightspeed Ventures as head of gaming, and Nihar Bobba joined Better Tomorrow Ventures as a new principal.
Amazing advice for anyone who is a student or just … new.
The latest from Helena Price Hambrecht, founder of Haus, in her new newsletter, Founder Things.
Eduardo Saverin’s B Capital raised $2.1 Billion, reports Bloomberg.
Funding for web3 startups plummeted 74% in Q4 2022, reports Crunchbase News.
If you missed my most recent Startups Weekly, read it here: “The slow-burn standardization of venture capital.”
TechCrunch is coming to Boston on April 20. I’ll be there with my favorite colleagues to interview top experts at a one-day founder summit. Book your pass ASAP!

Seen on TechCrunch

Musk stands to lose billions in trial over ‘funding secured’ tweet

Boston Dynamics’ latest Atlas video demos a robot that can run, jump and now grab and throw

Microsoft announces 10,000 job cuts, nearly 5% of its global workforce 

What’s next for the entrepreneur behind Layoffs.FYI

Seen on TechCrunch+

Pitch Deck Teardown: Scrintal’s $1M seed deck

Dear Sophie: What are some fast options for hiring someone on an expiring grace period?

Build a company, not a feature

7 space tech predictions for 2023

With that, I’m off to enjoy a weekend in Philadelphia with some new and old friends. Is anyone else tired of my East Coast tour? No? Just me? I’ll be back in San Francisco, and your inboxes, soon.

Take care,

N

Tech forgot its umbrella by Natasha Mascarenhas originally published on TechCrunch

W

elcome to the TechCrunch Exchange, a weekly startups-and-markets newsletter. It’s inspired by the daily TechCrunch+ column where it gets its name. Want it in your inbox every Saturday? Sign up here.

Buy now, pay later is an alluring option for consumers, perhaps even more so in a recession. But with rising debt and inflation, perhaps the focus should be on companies that help protect borrowers from digging themselves into a hole. — Anna

The enduring appeal of buy now, pay later

I thought that tougher economic times would create immediate headwinds for the buy now, pay later trend. I was wrong.

“BNPL is a form of credit that allows a consumer to split a retail transaction into smaller, interest-free installments and repay over time,” and it is “in the midst of rapid growth,” a September Consumer Financial Protection Bureau report stated.

More recently, the Financial Times reported that “demand for BNPL boomed during the pandemic and has continued to grow, according to data from U.K. open banking fintech Snoop.”

This isn’t just a Gen Z trend, the FT added: Demand “has surged among all age groups in the U.K., including older people, who find themselves squeezed by the cost of living crisis and in need of short-term credit.”

Protect me from what I want by Anna Heim originally published on 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 life as 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 marketplace Orion, 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 platform AdLingo (which exited to Google Cloud), and video platforms Tangi and Shoploop (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