Chinese electric scooter startup Niu files for $150M U.S. public offering

Chinese electric scooter startup Niu Technologies has filed for an initial public offering on Nasdaq to raise up to $150 million. In its form, Niu said it is “the largest lithium-ion battery-powered e-scooters company in China,” according to data from China Insights Consultancy, and also a market leader in Europe based on sales volume.

Founded in 2014 and based in Beijing, Niu says it currently holds a market share of 26% in China based on sales volume. Niu’s debut will the latest in a string of recent Chinese tech IPOs, the most prominent of which include the recent Hong Kong listings of Xiaomi and Meituan.

Niu’s scooters connect with an app that give drivers maintenance and performance data and also delivers firmware updates. As of the end of June, Niu claims it had sold more than 431,500 smart electric scooters in China, Europe and other markets.

According to the CIC’s data, China is the largest market for electric two-wheeled vehicles, with retail sales expected to increase to $13 million by 2022, up from $8 billion in 2017. Niu says its growth markets also include Southeast Asia and India, where scooters are a popular form of transportation.

In its filing, Niu said its net revenue in 2017 was RMB 769.4 million ($116.2 million), an increase of 116.8% from RMB 354.8 million in 2016. Its net losses during that time decreased to RMB 184.7 million ($27.9 million) in 2017 from RMB 232.7 million in 2016. More recently, net revenue for the first six months of 2018 was RMB 557.1 million ($84.2 million), an increase of 95.4% from RMB 285.1 million the same period a year earlier. Net loss was RMB 314.9 million ($47.6 million) during that period, compared to RMB 96.6 million the year before.

 

Google CEO Sundar Pichai will reportedly meet with Republican lawmakers this week

Google CEO Sundar Pichai will meet in private with Republican lawmakers on Friday to discuss issues including its work in China and alleged political bias, reports the Wall Street Journal. The meeting was organized by House Majority leader Kevin McCarthy, who has accused Google of “controlling the internet” by boosting negative news stories about conservatives in its search results, despite the company’s denials.

The WSJ reports that Pichai also plans to appear at a House Judiciary Committee hearing scheduled to take place in November after the mid-term elections.

Pichai told the newspaper that “I look forward to meeting with members on both sides of the aisle, answering a wide range of questions, and explaining our approach. These meetings will continue Google’s long history of engaging with Congress, including testifying seven times to Congress this year.”

A vocal opponent of net neutrality, McCarthy tweeted earlier this month that “an invite will be on its way” to Google, which he accused in the same tweet of making a “silent donation” to an unnamed left-wing group to stop Trump; working with Russia and China to censor the Internet even though it cancelled a U.S. military contract and ignoring a Senate hearing.

McCarthy told the WSJ that “Google has a lot of questions to answer about reports of bias in its search results, violations of user privacy, anticompetitive behavior and business dealings with repressive regimes like China.”

As an example of what he claims to be Google’s anti-conservative bias, McCarthy previously cited search results that listed “Nazism” under the California Republican Party’s ideologies. Google blamed vandalism on Wikipedia for the descriptor, which appeared in an information box, and quickly removed it.

Though McCarthy did not specify what contract he was referring to in his tweet, it may have been Project Maven, an aerial drone imaging program that provided artificial intelligence to the Department of Defense. Google reportedly decided not to renew the contract when it expires because of ethical concerns and employee backlash.

In August, however, sources told the Intercept that Google is working on a version of its search engine for China, code-named Project Dragonfly, that would adhere to the government’s censorship regulations. This prompted bipartisan outcry and more employee backlash, including the resignation of senior research scientist Jack Poulson. Poulson told the Intercept that about five of Google’s employees have resigned over Project Dragonfly, which he says represents “the forfeiture of our public human rights commitments.”

As part of the Republican Party’s onslaught against what it perceives to be political bias on social media, Attorney General Jeff Sessions will also meet with state attorneys general to discuss social media’s alleged suppression of conservative users.

TechCrunch has contacted Google for comment.

Meituan-Dianping’s IPO off to a good start as shares climb 7% on debut

Meituan-Dianping (3690.HK) enjoyed a strong debut today in Hong Kong, a sign that investors are confident in the Tencent-backed company’s prospects despite its cash-burning growth strategy, heavy competition and a sluggish Hong Kong stock market.

During morning trading, Meituan’s shares reached a high of HKD$73.85 (about $9.41), a 7% increase over its initial public offering price of HKD$69. When Meituan reportedly set a target valuation of $55 billion for its debut, it triggered concerns that the company, which bills itself a “one-stop super app” for everything from food delivery to ticket bookings, as overconfident.

While Meituan, the owner of Mobile, is the leading online marketplace for services in China, it faces formidable competition from Alibaba’s Ele.me and operating on tight margins and heavy losses as it spends money on marketing and user acquisition costs. As it prepared for its IPO, Meituan was also under the shadow of underwhelming Hong Kong debuts by Xiaomi and China Tower. Like Xiaomi, Meituan is listed under a new dual-class share structure designed to attract tech companies by allowing them to give weighted voting rights to founders.

The sponsors of Meituan’s IPO are Bank of America Merrill Lynch, Goldman Sachs and Morgan Stanley.

Google will match up to $1M in donations for Hurricane Florence relief

As cities in Hurricane Florence’s path deal with its aftermath, Google will match up to $1 million in donations to help with relief efforts.

The disaster’s death toll is currently 35 people and about 343,000 people in North Carolina are without electricity. The hurricane caused widespread flooding and property damage throughout North Carolina, South Carolina and Virginia.

 

Google drew attention to its Hurricane Florence donation campaign with a banner that appeared on top of Gmail for some users. Google has matched donations for other disasters before, including Hurricane Irma and Hurricane Harvey last year. It’s also raised money for humanitarian efforts crises, like a 2015 matching program for up to $5.5 million in donations to provide aid to refugees in Europe. For that campaign, it temporarily added a “Donate” button to its search homepage.

The company is partnering with non-profit Network for God to collect and distribute funds. All donations will be directed to the American Red Cross, which Google said it chose to work with “because of their strong track record and existing response in the region.”

Other tech companies helping with Hurricane Florence relief include Amazon, which enabled Alexa users to make donations by saying “Alexa, donate to Hurricane Florence disaster relief” and sent trucks with food and donated items to affected areas, and Apple, which donated $1 million to the American Red Cross. Airbnb also offered free rooms to people fleeing the hurricane.

 

Ola raises $50M at a $4.3B valuation from two Chinese funds

Ola, the arch-rival of Uber in India, has raised $50 million at a valuation of about $4.3 billion from Sailing Capital, a Hong Kong-based private equity firm, and the China-Eurasian Economic Cooperation Fund (CEECF), a state-backed Chinese fund. The funding was disclosed in regulatory documents sourced by Paper.vc and reviewed by Indian financial publication Mint.

According to Mint, Sailing Capital and CEECF will hold a combined stake of more than 1% in Ola . An Ola spokesperson said the company has no comment.

Ola’s last funding announcement was in October, when it raised $1.1 billion (its largest funding round to date) from Tencent and returning investor SoftBank Group. Ola also said it planned to raise an additional $1 billion from other investors that would take the round’s final amount to about $2.1 billion.

At the time, a source with knowledge of the deal told TechCrunch that Ola was headed toward a post-money valuation of $7 billion once the $2.1 bllion raise was finalized. So while the funding from Sailing Capital and CEECF brings it closer to its funding goal, the latest valuation of $4.3 billion is still lower than the projected amount.

Ola needs plenty of cash to fuel its ambitious expansion both within and outside of India. In addition to ride hailing, Ola got back into the food delivery game at the end of last year by acquiring Foodpanda’s Indian operations to compete with UberEats, Swiggy, Zomato and Google’s Areo. It was a bold move to make as India’s food delivery industry consolidated, especially since Ola had previously launched a food delivery service that shut down after less than one year. To ensure the survival of Foodpanda, Ola poured $200 million into its new acquisition.

A few months later after buying Foodpanda, Ola announced the acquisition of public transportation ticketing startup Ridlr in an all-stock deal. Outside of India, Ola has been focused on a series of international launches. It announced today that it will begin operating in New Zealand, fast on the heels of launches in the United Kingdom and Australia (its first country outside of India) this year.

Marc and Lynne Benioff will buy Times magazine from Meredith for $190M

Another tech billionaire will scoop up a major news outlet. Meredith Corporation, which acquired Time Inc. in January, announced today that it has agreed to sell its eponymous magazine to Salesforce.com co-founder Marc Benioff and his wife Lynne Benioff for $190 million in cash.

Meredith said in March that it planned to sell Time, Sports Illustrated, Fortune and Money as part of its goal to save $400 million to $500 million over the next two years and increase the profitability of its remaining portfolio of publications. In its announcement today, the company said it will use proceeds from the sale of Times magazine to pay off debt and expects to reduce its debt by $1 billion during fiscal 2019.

Meredith’s acquisition of Time Inc. was controversial because it received financial support from Koch Equity Development, the private equity fund run by Charles and David Koch, known for backing conservative causes.

The Benioffs, who are on the other side of the spectrum as supporters of progressive politics, are purchasing Time magazine as individuals. In other words, Salesforce.com, where Benioff serves as chairman and co-CEO, and other companies are not involved with the deal. Marc Benioff told the Wall Street Journal that he and his wife will not be involved in Time magazine’s daily operations or editorial decisions and added that “we’re investing in a company with tremendous impact on the world, one that is also an incredibly strong business. That’s what we’re looking for when we invest as a family.”

Other tech billionaires who have purchased major publications include Amazon CEO Jeff Bezos, who bought the Washington Post in a personal capacity five years ago and Laurene Powell Jobs, whose philanthropic organization, Emerson Collective, acquired a majority stake in The Atlantic last year. (While Jack Ma was a driving force behind Alibaba Group’s acquisition of the South China Morning Post in 2016, that acquisition was made by the company, not Ma.)

Despite being one of the most famous and iconic news brands in the U.S., Times magazine has (like other print publications) struggled to cope with falling circulation and revenue as it invests digital properties.

In an interview with the Wall Street Journal, the magazine’s editor in chief, Edward Felsenthal, said “we’ve done a lot to transform this brand over the last few years so that it is far beyond a weekly magazine” and added that its business is “solidly profitable.”

Deliveroo will enter Taiwan, its fourth market in the Asia-Pacific so far

Food delivery service Deliveroo is making headway in its Asian expansion strategy. The London-based company announced today that it will launch in Taiwan in the coming weeks, starting with Taipei, the country’s capital, before heading to other cities. This marks Deliveroo’s fourth market in the Asia-Pacific region (the others are Australia, Hong Kong and Singapore) and is also a launch with personal significance for founder and CEO Will Shu, whose family is Taiwanese.

In a press statement, Shu said “Our launch in Taiwan is also a personal milestone for me, my parents were born in Taiwan and much of my family still lives in Taipei. Taiwan is the market with my favourite food in the world—my personal favourite is a big bowl of 牛肉麵 [beef noodle soup] and a huge piece of 炸雞排 [fried chicken]. From a personal standpoint, It’s an amazing feeling to launch Deliveroo in Taiwan.”

Once its Taiwan business starts, Deliveroo, which is reportedly eyeing an IPO to take place in the next two years, will operate in a total of 13 markets around the world. The company already faces stiff competition in Taipei, however, where its rivals will include Foodpanda, Uber Eats and Honestbee. Foodpanda was the first, launching five years ago, but Uber Eats quickly became a formidable rival when it entered Taiwan in 2016. Honestbee, a grocery and food delivery service, is also popular, and during lunch and dinner times riders carrying these services’ cooler bags on the backs of their scooters are a ubiqutious sight on Taipei’s streets.

Like other food delivery startups, all three offer costly incentives like discount codes, flash sales and free delivery to entice customers. The resulting war of attrition has forced food delivery services in other markets to withdraw or consolidate. For example, Foodpanda sold off its Vietnam and Indonesia operations, before the company itself was sold by Rocket Internet to larger rival Delivery Hero at the end of 2016.

Deliveroo has the advantage of a large war chest, however, and its funding (its Series F last year raised about $480 million at a valuation of more than $2 billion) will help it with the high cost of competition as it expands into new markets.

Hong Kong-based OneDegree gets $25.5M Series A to make coverage more accessible, starting with pet insurance

OneDegree, a Hong Kong-based insurance technology startup, announced today that it has closed a Series A totaling HKD $200 million (about $25.5 million). Half of that amount was pledged by investors to OneDegree pending regulatory approval through the Hong Kong Insurance Authority’s new fast-track licensing program for online-only insurers. The company, which participated in Cyberport, the Hong Kong government’s startup incubator, claims this is the largest ever fundraising round for a pre-revenue insurance tech startup in Hong Kong.

OneDegree is currently not disclosing its list of investors because its new shareholders are being vetted by the Insurance Authority, founder and CEO Alvin Kwock tells TechCrunch, but it includes institutional investors and family offices. The South China Morning Post reports that speculation among brokers peg Tencent and Alibaba as probable backers.

OneDegree has developed an online insurance platform that lets consumers purchase personal lines and health insurance products without needing to consult with an agent. Instead, they find and buy policies through an app that is connected to a backend that automates claims processing, policy management and customer service.

The startup will initially sell medical insurance plans for pets. While there are more than 500,000 pet dogs and cats in Hong Kong, only about 2% to 3% are covered by insurance, compared to 42% in the United Kingdom, says OneDegree. The startup blames this on ineffective distribution, since pet insurance has relatively low premiums and is therefore overlooked by insurance agents, even though the number of pet dogs and cats in Hong Kong is increasing at an average annual growth rate of 3.5% and their owners are a relatively affluent demographic.

OneDegree plans to use its Series A to on tech development, launching new products and marketing. The funding will also serve as risk capital once it launches its insurance business.

In a press statement, Cyberport chairman George Lam said “As a key driver of digital technology development in Hong Kong, we are definitely excited to see local fintech start-ups like OneDegree successfully securing recognition from renowned institutional investors and attracting sizable funding that will enable faster growth.”

Alibaba announces CEO Daniel Zhang will succeed Jack Ma as chairman next year

Following speculation about Jack Ma’s imminent retirement, Alibaba Group announced today that its CEO, Daniel Zhang, will succeed Ma as chairman next year. After stepping down as chairman on September 10, 2019 (exactly a year from now), Ma will continue serving as a board member until its annual general shareholders’ meeting in 2020.

After that, Ma will remain a lifetime partner of the Alibaba Partnership, or a group of 36 partners drawn from the senior management ranks of Alibaba Group companies and affiliates. They hold a considerable amount of sway over the company because they have the right to nominate, or in certain situations, appoint up to a simple majority of its board of directors.

Alibaba’s announcement follows reports that Ma’s retirement from the company he co-founded in 1999 as an online marketplace was imminent, with Ma, a former English teacher, planning to dedicate his time to philanthropy in education. Ma downplayed those reports, however, telling the South China Morning Post (which is owned by Alibaba) that instead he will gradually reduce his role in the company through a succession plan.

Ma stepped down as CEO in 2013, handing the position over to Jonathan Lu. Lu was replaced in 2015 by Zhang, Alibaba’s former COO, after Ma reportedly told employees that it’s time for the company to be run by people born in the 1970s and after (Zhang was born in 1972, three years after Lu).

In a letter sent to media outlets today, Ma wrote that Zhang has “demonstrated his superb talent, business acumen and determined leadership” since taking over as CEO. Under his stewardship, Alibaba has seen consistent and sustainable growth for 13 consecutive quarters. His analytical mind is unparalleled, he holds dear our mission and vision, he embraces responsibility with passion, and he has the guts to innovate and test creative business models.”

Ma added that “this transition demonstrates that Alibaba has stepped up to the next level of corporate governance from a company that relies on individuals, to one built on systems of organizational excellence and a culture of talent development.”

Ma also re-emphasized his narrative that his departure from Alibaba Group will be very gradual. “I have put a lot of thought and preparation into this succession plan for 10 years. I am delighted to announce the plan today thanks to the support of the Alibaba Partnership and our board of directors,” he wrote. “I also want to offer special thanks to all Alibaba colleagues and your families, because your trust, support and our joint enterprise over the past 19 years have prepared us for this day with confidence and strength.”

Of his plans after Zhang takes over as chairman next year, Ma said he will continue contributing to the Alibaba Partnership, before adding “I also want to return to education, which excites me with so much blessing because this is what I love to do. The world is big, and I am still young, so I want to try new things – because what if new dreams can be realized?! The one thing I can promise everyone is this: Alibaba was never about Jack Ma, but Jack Ma will forever belong to Alibaba.”

WSJ reports that Theranos will finally dissolve

Theranos is reportedly finally closing down for good, nearly three years after a Wall Street Journal investigation called its blood testing technology into question. The WSJ said the company, whose dramatic downfall spawned a best-selling book that’s set to be filmed with Jennifer Lawrence starring as Theranos founder and CEO Elizabeth Holmes, sent shareholders an email saying it will formally dissolve and seek to pay unsecured creditors its remaining cash in the coming months.

Holmes resigned as CEO in June after she and Theranos’ former president, Ramesh “Sunny” Balwani, were charged with two counts of conspiracy to commit wire fraud and nine counts of wire fraud in June.

Both Holmes and Balwani had already been charged with fraud by the Securities and Exchange Commission (the criminal charges are separate from the civil ones filed by the SEC). In its complaint, the SEC said the two engaged in “an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business and financial performance,” which ultimately enabled them to raise more than $700 million from investors.

Holmes and the SEC settled the charges by having Holmes agree to pay a $500,000 penalty and be barred from serving as an officer or director of a public company for 10 years. She was also required to return the remaining 18.9 million shares she obtained while engaging in fraud and relinquish voting control of Theranos.

TechCrunch has sent an email to Theranos’ public relations address asking for comment.