Gig workers need health & benefits — Catch is their safety net

One of the hottest Y Combinator startups just raised a big seed round to clean up the mess created by Uber, Postmates and the gig economy. Catch sells health insurance, retirement savings plans and tax withholding directly to freelancers, contractors, or anyone uncovered. By building and curating simplified benefits services, Catch can offer a safety net for the future of work.

“In order to stay competitive as a society, we need to address inequality and volatility. We think Catch is the first step to offering alternatives to the mandate that benefits can only come from an employer or the government,” writes Catch co-founder and COO Kristen Tyrrell. Her co-founder and CEO Andrew Ambrosino, a former Kleiner Perkins design fellow, stumbled onto the problem as he struggled to juggle all the paperwork and programs companies typically hire an HR manager to handle. “Setting up a benefits plan was a pain. You had to become an expert in the space, and even once you were, executing and getting the stuff you needed was pretty difficult.” Catch does all this annoying but essential work for you.

Now Catch is getting its first press after piloting its product with tens of thousands of users. TechCrunch caught wind of its highly competitive seed round closing, and Catch confirms it has raised $5.1 million at a $20.5 million post-money valuation co-led by Khosla Ventures, Kindred Ventures, and NYCA Partners. This follow-up to its $1 million pre-seed will fuel its expansion into full heath insurance enrollment, life insurance and more.

“Benefits, as a system built and provided by employers, created the mid-century middle class. In the post-war economic boom, companies offering benefits in the form of health insurance and pensions enabled familial stability that led to expansive growth and prosperity,” recalls Tyrrell, who was formerly the director of product at student debt repayment benefits startup FutureFuel.io. “Emboldened by private-sector growth (and apparent self-sufficiency), the 1970s and 80s saw a massive shift in financial risk management from the government to employers. The public safety net contracted in favor of privatized solutions. As technological advances progressed, employers and employees continued to redefine what work looked like. The bureaucratic and inflexible benefits system was unable to keep up. The private safety net crumbled.”

That problem has ballooned in recent years with the advent of the on-demand economy, where millions become Uber drivers, Instacart shoppers, DoorDash deliverers and TaskRabbits. Meanwhile, the destigmatization of remote work and digital nomadism has turned more people into permanent freelancers and contractors, or full-time employees without benefits. “A new class of worker emerged: one with volatile, complex income streams and limited access to second-order financial products like automated savings, individual retirement plans, and independent health insurance. We entered the new millennium with rot under the surface of new opportunity from the proliferation of the internet,” Tyrrell declares. “The last 15 years are borrowed time for the unconventional proletariat. It is time to come to terms and design a safety net that is personal, portable, modern and flexible. That’s why we built Catch.”

Catch co-founders Andrew Ambrosino and Kristen Tyrrell

Currently Catch offers the following services, each with their own way of earning the startup revenue:

  • Health Explorer lets users compare plans from insurers and calculate subsidies, while Catch serves as a broker collecting a fee from insurance providers
  • Retirement Savings gives users a Catch robo-advisor compatible with IRA and Roth IRA, while Catch earns the industry standard 1 basis point on saved assets
  • Tax Withholding provides an FDIC-insured Catch account that automatically saves what you’ll need to pay taxes later, while Catch earns interest on the funds
  • Time Off Savings similarly lets you automatically squirrel away money to finance “paid” time off, while Catch earns interest

These and the rest of Catch’s services are curated through its Guide. You answer a few questions about which benefits you have and need, connect your bank account, choose which programs you want and get push notifications whenever Catch needs your decisions or approvals. It’s designed to minimize busy work so if you have a child, you can add them to all your programs with a click instead of slogging through reconfiguring them all one at a time. That simplicity has ignited explosive growth for Catch, with the balances it holds for tax withholding, time off and retirement balances up 300 percent in each of the last three months.

In 2019 it plans to add Catch-branded student loan refinancing, vision and dental enrollment plus payments via existing providers, life insurance through a partner such as Ladder or Ethos and full health insurance enrollment plus subsidies and premium payments via existing insurance companies like Blue Shield and Oscar. And in 2020 it’s hoping to build out its own blended retirement savings solution and income-smoothing tools.

If any of this sounds boring, that’s kind of the point. Instead of sorting through this mind-numbing stuff unassisted, Catch holds your hand. Its benefits Guide is available on the web today and it’s beta testing iOS and Android apps that will launch soon. Catch is focused on direct-to-consumer sales because “We’ve seen too many startups waste time on channels/partnerships before they know people truly want their product and get lost along the way,” Tyrrell writes. Eventually it wants to set up integrations directly into where users get paid.

Catch’s biggest competition is people haphazardly managing benefits with Excel spreadsheets and a mishmash of healthcare.gov and solutions for specific programs. Twenty-one percent of Americans have saved $0 for retirement, which you could see as either a challenge to scaling Catch or a massive greenfield opportunity. Track.tax, one of its direct competitors, charges a subscription price that has driven users to Catch. And automated advisors like Betterment and Wealthfront accounts don’t work so well for gig workers with lots of income volatility.

So do the founders think the gig economy, with its suppression of benefits, helps or hinders our species? “We believe the story is complex, but overall, the existing state of the gig economy is hurting society. Without better systems to provide support for freelance/contract workers, we are making people more precarious and less likely to succeed financially.”

When I ask what keeps the founders up at night, Tyrrell admits “The safety net is not built for individuals. It’s built to be distributed through HR departments and employers. We are very worried that the products we offer aren’t on equal footing with group/company products.” For example, there’s a $6,000/year IRA limit for individuals while the corporate equivalent 401k limit is $19,000, and health insurance is much cheaper for groups than individuals.

To surmount those humps, Catch assembled a huge list of angel investors who’ve built a range of financial services, including NerdWallet founder Jake Gibson, Earnest founders Louis Beryl and Ben Hutchinson, ANDCO (acquired by Fiverr) founder Leif Abraham, Totem founder Neal Khosla, Commuter Club founder Petko Plachkov, Playable (acquired by Stripe) founder Tad Milbourn and Synapse founder Bruno Faviero. It also brought on a wide range of venture funds to open doors for it. Those include Urban Innovation Fund, Kleiner Perkins, Y Combinator, Tempo Ventures, Prehype, Loup Ventures, Indicator Ventures, Ground Up Ventures and Graduate Fund.

Hopefully the fact that there are three lead investors and so many more in the round won’t mean that none feel truly accountable to oversee the company. With 80 million Americans lacking employer-sponsored benefits and 27 million without health insurance and median job tenure down to 2.8 years for people ages 25 to 34 leading to more gaps between jobs, our workforce is vulnerable. Catch can’t operate like a traditional software startup with leniency for screw-ups. If it can move cautiously and fix things, it could earn labor’s trust and become a fundamental piece of the welfare stack.

MoviePass parent’s CEO says its rebooted subscription service is already profitable

Two days after MoviePass announced the return of the company’s unlimited ticket plan, Ted Farnsworth, CEO of its parent company Helios and Matheson Analytics, sat down with TechCrunch to offer insight into the state of the beleaguered service.

According to the executive, MoviePass Uncapped is already seeing positive results. While he didn’t share concrete numbers, he says that subscribers have increased “well over 800 percent in the last few days. And that’s conservative.”

Asked what it would take to make the company’s subscription business profitable, Farnsworth says, “Well, it’s profitable right now.” As for when it turned the corner, he added, “I will tell you this, because it’s out there: MoviePass has actually paid Helios back money over the past several months, towards the loans that they have. So, that gives you an idea of when we really started focusing on getting rid of the 20 percent of the abusers.”

The plan marks a return to the initial unlimited model that helped turn MoviePass into a household name in the past year. But that success arrived with a massive price, as the service began hemorrhaging money. MoviePass withdrew the unlimited plan and began reworking its plans on what seemed to be a weekly basis.

In July, at the height of what was supposed to be the Summer of MoviePass, the service experienced an outage as it struggled to pay bills. Helios secured a $5 million loan from creditors Hudson Bay Capital Management in order to turn the lights back on.

Ted Farnsworth

WEST HOLLYWOOD, CA – FEBRUARY 24: Ted Farnsworth attends the 27th annual Elton John AIDS Foundation Academy Awards Viewing Party sponsored by IMDb and Neuro Drinks celebrating EJAF and the 91st Academy Awards on February 24, 2019 in West Hollywood, California. (Photo by Jamie McCarthy/Getty Images for EJAF)

“I think the big SNAFU there was the credit card company,” the executive explains. “When one company sold to the other, we had been doing business with them for four years. They decided it was too much credit for them and literally call the credit line on a Friday night and I do a personal guarantee on a Saturday.”

However things might have gone down on the back end, the optics of such a situation were clearly less than ideal. MoviePass’ struggles were very public from the beginning, as part of a publicly traded company. A literal shut down for the service appeared to be just the latest sign that the too good to be true service was exactly that.

And while Farnsworth admits that the company would have benefited from a bit more privacy, he claims that he never had any doubts about MoviePass’ future, even as he negotiated with creditors for a fresh cash injection.

“There were no moments in my mind where I thought it would go down. In my mind, I thought it was too big to fail,” he says. “You created a household name in less than a year. I think any time you have something like that, where you’re going to run into issues from sheer growth. Our investors did well investing along the way. The investors believed in us and they still do. We knew we had to slow it down to get in front of the fraud side because there were so many moving parts. It was moving so fast.”

It’s that “fraud” that was at the center of MoviePass’ woes, says Farnsworth. MoviePass’ initial downfall, he believes, was the product of too many users “gaming the system.” He believes the total number of users that fall into that category to have been around 20 percent of the overall subscriber base.

It was a minority, certainly, but still a sizable figure, given that, by June of last year, that total figure had exceeded three million. By that point, the service also comprised around five percent of U.S. box office receipts. Much of the past year has been spent attempting to plug holes in the subscription service as the MoviePass boat began rapidly taking on water.

To be clear, “gaming the system” doesn’t just mean watching a lot of movies — Farnsworth says he’s happy to have “hardcore” users, even if they’re buying way more than $9.95 or $14.95 worth of tickets. Instead, his concern is users who are doing things like sharing their subscription or just using a MoviePass ticket to use the theater’s restroom — something surprisingly common in places like Times Square, where public bathrooms are hard to come by.

One of the primary fixes, Farnsworth says, is utilizing mobile tracking to ensure that subscribers are, in fact, using the service as intended, and looking for “red flags” like constantly changing the device using the app. Users are already required to enable location-based tracking in order to enable ticket purchase. This will utilize that to ping the ticket purchaser’s location, in order to make sure that they’re actually attending the movies for which they’ve purchased tickets.

HMNY moviepass parent chart

“For instance, another issue is where people would go to the theater, they’ll pick up the ticket, they’ll hand their ticket to the kid or their child or their friend or whatever it is … and the person that’s paying the subscription goes back home or whatever they do,” he says. The new strategy: “When the movie starts, 30 minutes later [we’re] able to ping them inside the theater, just to make sure they still are at that theater.”

Looking ahead, Farnsworth says that the days of constantly changing pricing and restrictions are over, and that the company is committed to the unlimited plan. In fact, in his telling, the goal was always to get back to the unlimited plan — it was just that MoviePass had to figure out how to cut down on fraud to make the plan work.

At the same time, he says MoviePass’ film studio will also be an important part of the business. It has been overshadowed by the headlines about the company’s subscription struggles, but MoviePass Films has titles starring Bruce Willis, Al Pacino and Sylvester Stallone scheduled for this year.

MoviePass also invested in “Gotti,” and although the film was reviled by critics and only grossed $4.3 million at the box office, Farnsworth doesn’t see it as a failure.

“We never looked at Gotti as a money-maker” he says. “They only projected that it would do a $1.3 million in the box office here. Because then, when we pushed it with MoviePass, we took that up to five million. So, I mean, when you can take a movie — I gotta be careful here, but when you take a movie that might not be that great or perfect, and you can move that needle, [that] was always our theory of subscription.”

Check back later for our full interview with Farnsworth. 

MoviePass co-founder’s new startup PreShow gives you free movie tickets for watching ads

As founding CEO of MoviePass, Stacy Spikes has already changed the way we think about paying for movie tickets. Now he’s pursuing a new approach — providing a free ticket to people who watch 15 to 20 minutes of ads.

Spikes told me that when it comes to watching movies outside the theater, there are three basic business models — pay-per-view, subscription and ad-supported. MoviePass brought a subscription approach into theaters, but Spikes (who stepped down as MoviePass CEO in 2016) said he kept wondering, “Well, why can’t you have an ad-supported version that will allow you to go to movies for free?”

It’s hard to imagine digital advertising being worth enough to really pay for that ticket, but Spikes insisted, “You’re paying your way. This is not going to be a loss leader model. It’s an ad-revenue based business.”

To make that work, he said the new service, called PreShow, is bringing a couple innovations to the table. First, there’s facial recognition technology that ensures you’re actually present and watching the ad.

Spikes demonstrated this feature for me last week, showing me how his face unlocked the PreShow app. Once he’d chosen the film he wanted to watch, he was presented with a package of video ads that were specifically selected to run with that movie — and any time he looked away from the screen or moved too far away from his phone, the ads would stop playing. (Apparently the sensitivity can be dialed up or down depending on user feedback.)

PreShow facial recognition

Spikes also said the ads should tie into the film in some way, whether that’s thematically, or by highlighting products that are also featured in the movie. And they’ll always include an opportunity to further engage with the advertiser.

So although 15 to 20 minutes might sound like a long time to watch ads,  it should be more interesting for the viewer than just watching a random collection of promotional videos. And for the advertisers who are already paying for product placement in a film, this could be a way to reinforce their message with consumers who are actually watching the movie. (Spikes also compared this to the marketing packages that usually play before showtime in theaters — hence the company name.)

By watching one of these 15- to 20-minute packages, you should earn enough points to purchase a ticket at the theater using a virtual credit card provided by PreShow. Technically, those points can be used to buy any movie ticket, but Spikes said you won’t be able to earn more than two tickets at once, “so people don’t stockpile.”

As for whether PreShow is competing with his old company, Spikes said, “I don’t think they’re competitive in any way. If you compare a subscription platform to an ad platform to a pay-per-view platform, they’re different animals.”

Stacy Spikes

Stacy Spikes

The plan is to start testing the service with a select group of users in the next three to six months, and to find those users, PreShow is launching a Kickstarter campaign today. Pledge levels range from $15 to $60, with the amount you pay determining how early you get access, and how many friend invites you receiving.

Spikes said he’s less interested in raising money (which is why the campaign’s official goal is only $10,000) and more in attracting film lovers who want to try out the app.

“It’s a way to have innovation happen more organically, versus if you just open it up for the general public,” Spikes said.

PicsArt hits 130 million MAUs as Chinese flock to its photo editing app

If you’re like me, who isn’t big on social media, you’d think that the image filters that come inside most apps will do the job. But for many others, especially the younger crowd, making their photos stand out is a huge deal.

The demand is big enough that PicsArt, a rival to filtering companies VSCO and Snapseed, recently hit 130 million monthly active users worldwide, roughly a year after it amassed 100 million MAUs. Like VSCO, PicsArt now offers video overlays though images are still its focus.

Nearly 80 percent of PicsArt’s users are under the age of 35 and those under 18 are driving most of its growth. The “Gen Z” (the generation after millennials) users aren’t obsessed with the next big, big thing. Rather, they pride themselves on having niche interests, be it K-pop, celebrities, anime, sci-fi or space science, topics that come in the form of filters, effects, stickers and GIFs in PicsArt’s content library.

“PicsArt is helping to drive a trend I call visual storytelling. There’s a generation of young people who communicate through memes, short-form videos, images and stickers, and they rarely use words,” Tammy Nam, who joined PicsArt as its chief operating officer in July, told TechCrunch in an interview.

PicsArt has so far raised $45 million, according to data collected by Crunchbase. It picked up $20 million from a Series B round in 2016 to grow its Asia focus and told TechCrunch that it’s “actively considering fundraising to fuel [its] rapid growth even more.”

picsart

PicsArt wants to help users stand out on social media, for instance, by virtually applying this rainbow makeup look on them. / Image: PicsArt via Weibo

The app doubles as a social platform, although the use case is much smaller compared to the size of Instagram, Facebook and other mainstream social media products. About 40 percent of PicsArt’s users post on the app, putting it in a unique position where it competes with the social media juggernauts on one hand, and serving as a platform-agnostic app to facilitate content creation for its rivals on the other.

What separates PicsArt from the giants, according to Nam, is that people who do share there tend to be content creators rather than passive consumers.

“On TikTok and Instagram, the majority of the people there are consumers. Almost 100 percent of the people on PicsArt are creating or editing something. For many users, coming on PicsArt is a built-in habit. They come in every week, and find the editing process Zen-like and peaceful.”

Trending in China

Most of PicsArt’s users live in the United States, but the app owes much of its recent success to China, its fastest growing market with more than 15 million users. The regional growth, which has been 10-30 percent month-over-month recently, appears more remarkable when factoring in PicsArt’s zero user acquisition expense in a crowded market where pay-to-play is a norm for emerging startups.

“Many larger companies [in China] are spending a lot of money on advertising to gain market share. PicsArt has done zero paid marketing in China,” noted Nam.

Screenshot: TikTok-related stickers from PicsArt’s library

When people catch sight of an impressive image filtering effect online, many will inquire about the toolset behind it. Chinese users find out about the Armenian startup from photos and videos hashtagged #PicsArt, not different from how VSCO gets discovered from #vscocam on Instagram. It’s through such word of mouth that PicsArt broke into China, where users flocked to its Avengers-inspired disappearing superhero effect last May when the film was screening. China is now the company’s second largest market by revenue after the U.S.

Screenshot: PicsArts lets users easily apply the Avengers dispersion effect to their own photos

A hurdle that all media apps see in China is the country’s opaque guidelines on digital content. Companies in the business of disseminating information, from WeChat to TikTok, hire armies of content moderators to root out what the government deems inappropriate or illegal. PicsArt says it uses artificial intelligence to sterilize content and keeps a global moderator team that also keeps an eye on its China content.

Despite being headquartered in Silicon Valley, PicsArt has placed its research and development center in Armenia, home to founder Hovhannes Avoyan. This gives the startup access to much cheaper engineering talents in the country and neighboring Russia compared to what it can hire in the U.S. To date, 70 percent of the company’s 360 employees are working in engineering and product development (50 percent of whom are female), an investment it believes helps keep its creative tools up to date.

Most of PicsArt’s features are free to use, but the firm has also looked into getting paid. It rolled out a premium program last March that gives users more sophisticated functions and exclusive content. This segment has already leapfrogged advertising to be PicsArt’s largest revenue source, although in China, its budding market, paid subscriptions have been slow to come.

picsart 1

PicsArt lets users do all sorts of creative work, including virtually posing with their idol. / Image: PicsArt via Weibo

“In China, people don’t want to pay because they don’t believe in the products. But if they understand your value, they are willing to pay, for example, they pay a lot for mobile games,” said Jennifer Liu, PicsArt China’s country manager.

And Nam is positive that Chinese users will come to appreciate the app’s value. “In order for this new generation to create really differentiated content, become influencers, or be more relevant on social media, they have to do edit their content. It’s just a natural way for them to do that.”

Microsoft warns Windows 7 users of looming end to security updates

Microsoft has rolled out a patch that will warn Windows 7 users that security updates will soon come to an end.

The patch rolled out Wednesday warning users of the impending deadline, January 14, 2020, when the software giant will no longer roll out fixes for security flaws and vulnerabilities. The deadline comes some ten years after Windows 7 first debuted in 2009, more than half a decade before Microsoft’s most recent operating system Windows 10 was introduced.

Microsoft’s move to stop issuing security updates is part of the company’s ongoing effort to push users to its latest software, which stands on a greater security foundation and improvements to mitigate attacks.

Starting April 18, users on Windows 7 will begin receiving warnings about the approaching cut-off.

Windows 7 still commands some 40 percent of the desktop market, according to Net Applications. With exactly 300 days before the deadline, the clock is ticking on consumer security support.

Enterprise customers have the option to pay for extended security updates until 2023.

For years, Microsoft allowed Windows 7 users to upgrade to Windows 10 for free to try to encourage growth and upgrades. With those incentives gone, many only have the lack of security updates to look ahead to, which will put business data and systems at risk of cyberattack.

It’s almost unheard of for Microsoft to patch end-of-life software. In 2017, Microsoft released rare security patches Windows XP — retired three years earlier — to prevent the spread of WannaCry, a ransomware strain that piggybacked off leaked hacking tools, developed by the National Security Agency.

The ransomware outbreak knocked schools, businesses and hospitals offline.

Windows 7’s successor, Windows 8, will continue to receive updates until January 10, 2023.

Morphin instantly Deepfakes your face into GIFs

Want to star in your favorite memes and movie scenes? Upload a selfie to Morphin, choose your favorite GIF, and your face is grafted in to create a personalized copy you can share anywhere. Become Tony Stark as he suits up like Iron Man. Drop the mic like Obama, dance like Drake, or slap your mug on Fortnite characters.

Now after three years in a stealth developing image mapping technology, Morphin is ready to launch its put-you-in-a-GIF maker. While it might look like just a toy, investors see real business potential. Morphin raised $1 million last summer from Betaworks, the incubator that spawned Giphy, plus Founders Fund, Precursor, Shrug Capital, and Boost.vc’s accelerator.

Elon Musk as Iron Man

“We believe in the future you’ll be able to be the main character in your own film. Imagine a super hero movie where you’re a the main protagonist?” co-founder Loic Ledoux asks. “That sounded like science fiction a few years ago and now with AI and computer vision we definitely see our tech going there.”

Ledoux also wants to reclaim faceswaps as something fun rather than a weapon for misinformation. “Deepfakes brought something pretty negative to computer vision. But it’s not all bad. It’s about how you use the tech to give people a new tool for self expressions and storytelling.” And since Morphin re-generates the whole clip from scratch with CGI animation, they look right at a glance but clearly aren’t manipulated copies of the original video designed to fool anyone.

Kanye performs magic

Morphin started three years ago with the intention to build personalized avatars for games and VR so you could be a FIFA soccer player or Skyrim knight. Ledoux had started a 3D printing company to explore opportunities in scanning and modeling when he saw a chance to connect your real and virtual faces. He teamed up with his co-founder Nicholas Heriveaux who’d spent 13 years working on 3D tech while modding games like Grand Theft Auto to insert his avatar and assets.

What they quickly recognized was that “People were just reacting to themselves on the screen”, ignoring the gameplay, Ledoux recalls. “Being able to see yourself as a hero was the underlying sentiment, so we focused on video completely.” Recognizable GIFs became its preferred medium, as they combine familiarity and the ability to convey complex emotions with a template that’s easy to personalize so they stand out.

Morphin’s tech no longer requires 3D scanning hardware and it works with just a regular selfie. You just snap a headshot, select a GIF from its iOS or Android app’s library, and a few seconds later you have a CGI version of yourself in the scene with no watermark that you can export and post. “We wanted it to be super straight forward because we wanted people to relate to the content” Ledoux notes. Over 1 million scenes have been created by 50,000 beta users, and each time a celebrity shares one of the GIFs Morphin has been sending them for marketing, scores of their followers demand to know what app they were using.

Morphin’s 9-person French team will have to keep innovating to stay ahead of avatar-making competitors like the ubiquitous Snapchat Bitmoji, Genies, Moji Edit, and Mirror AI. Facebook, Microsoft, and Google all have launched or are building their own avatar creators. But these typically live as 2D stickers or 3D AR animations you overlay on the real world. By using GIFs as a canvas, Morphin takes the pressure off your visage looking perfect and instead emphasizes the message you’re trying to get across.

The challenge will be for Morphin to become a consistent part of people’s communication stack. It’s easy to imagine playing with it and posting a few GIFs. But iconic new GIFs don’t emerge each day and without a social network to stay for, Morphin is at risk of becoming a merely a forgotten tool. The app might need TikTok-style challenges like submitting the best personalized GIF to match a prompt or a GIF browsing feed to keep people coming back.

Turning Donald Glover into Jay Gatsby

Morphin isn’t racing to monetize yet, but sees a chance to sell longer premium video scenes a la carte or as an unlimited subscription. Ledoux eventually hopes to unlock new forms of storytelling beyond existing GIFs. There’s also a chance for Morphin to highlight sponsored clips from upcoming movies or TV shows. “In the long-term we’re more interested in the analogy of Lil Miquela and how people are interacting with digital characters” Ledoux explains, citing a virtual pop star who’s developer Brud recently raised at a $125 million valuation.

One of the most exciting things about Morphin is that it will allow people to take the spotlight no matter how they look. Often times certain races, genders, and looks are unfairly excluded from starring in today’s most popular media. But Morphin could let the underrepresented take their rightful place as stars of the screen.

Your faithful author Josh Constine dropping the mic like Obama

Ahead of third antitrust ruling, Google announces fresh tweaks to Android in Europe

Google is widely expected to be handed a third antitrust fine in Europe this week, with reports suggesting the European Commission’s decision in its long-running investigation of AdSense could land later today.

Right on cue the search giant has PRed another Android product tweak — which it bills as “supporting choice and competition in Europe”.

In the coming months Google says it will start prompting users of existing and new Android devices in Europe to ask which browser and search apps they would like to use.

This follows licensing changes for Android in Europe which Google announced last fall, following the Commission’s $5BN antitrust fine for anti-competitive behavior related to how it operates the dominant smartphone OS.

tl;dr competition regulation can shift policy and product.

Albeit, the devil will be in the detail of Google’s self-imposed ‘remedy’ for Android browser and search apps.

Which means how exactly the user is prompted will be key — given tech giants are well-versed in the manipulative arts of dark pattern design, enabling them to create ‘consent’ flows that deliver their desired outcome.

A ‘choice’ designed in such a way — based on wording, button/text size and color, timing of prompt and so on — to promote Google’s preferred browser and search app choice by subtly encouraging Android users to stick with its default apps may not actually end up being much of a ‘choice’.

According to Reuters the prompt will surface to Android users via the Play Store. (Though the version of Google’s blog post we read did not include that detail.)

Using the Play Store for the prompt would require an Android device to have Google’s app store pre-loaded — and licensing tweaks made to the OS in Europe last year were supposedly intended to enable OEMs to choose to unbundle Google apps from Android forks. Ergo making only the Play Store the route for enabling choice would be rather contradictory. (As well as spotlighting Google’s continued grip on Android.)

Add to that Google has the advantage of massive brand dominance here, thanks to its kingpin position in search, browsers and smartphone platforms.

So again the consumer decision is weighted in its favor. Or, to put it another way: ‘This is Google; it can afford to offer a ‘choice’.’

In its blog post getting out ahead of the Commission’s looming AdSense ruling, Google’s SVP of global affairs, Kent Walker, writes that the company has been “listening carefully to the feedback we’re getting” vis-a-vis competition.

Though the search giant is actually appealing both antitrust decisions. (The other being a $2.7BN fine it got slapped with two years ago for promoting its own shopping comparison service and demoting rivals’.)

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search,” Walker continues. “In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app.”

Other opinions are available on those changes too.

Such as French pro-privacy Google search rival Qwant, which last year told us how those licensing changes still make it essentially impossible for smartphone makers to profit off of devices that don’t bake in Google apps by default. (More recently Qwant’s founder condensed the situation to “it’s a joke“.)

Qwant and another European startup Jolla, which leads development of an Android alternative smartphone platform called Sailfish — and is also a competition complainant against Google in Europe — want regulators to step in and do more.

The Commission has said it is closely monitoring changes made by Google to determine whether or not the company has complied with its orders to stop anti-competitive behavior.

So the jury is still out on whether any of its tweaks sum to compliance. (Google says so but that’s as you’d expect — and certainly doesn’t mean the Commission will agree.)

In its Android decision last summer the Commission judged that Google’s practices harmed competition and “further innovation” in the wider mobile space, i.e. beyond Internet search — because it prevented other mobile browsers from competing effectively with its pre-installed Chrome browser.

So browser choice is a key component here. And ‘effective competition’ is the bar Google’s homebrew ‘remedies’ will have to meet.

Still, the company will be hoping its latest Android tweaks steer off further Commission antitrust action. Or at least generate more fuzz and fuel for its long-game legal appeal.

Current EU competition commissioner, Margrethe Vestager, has flagged for years that the division is also fielding complaints about other Google products, including travel search, image search and maps. Which suggests Google could face fresh antitrust investigations in future, even as the last of the first batch is about to wrap up.

The FT reports that Android users in the European economic area last week started seeing links to rival websites appearing above Google’s answer box for searches for products, jobs or businesses — with the rival links appearing above paid results links to Google’s own services.

The newspaper points out that tweak is similar to a change promoted by Google in 2013, when it was trying to resolve EU antitrust concerns under the prior commissioner, Joaquín Almunia.

However rivals at the time complained the tweak was insufficient. The Commission subsequently agreed — and under Vestager’s tenure went on to hit Google with antitrust fines.

Walker doesn’t mention these any of additional antitrust complaints swirling around Google’s business in Europe, choosing to focus on highlighting changes it’s made in response to the two extant Commission antitrust rulings.

“After the Commission’s July 2018 decision, we changed the licensing model for the Google apps we build for use on Android phones, creating new, separate licenses for Google Play, the Google Chrome browser, and for Google Search. In doing so, we maintained the freedom for phone makers to install any alternative app alongside a Google app,” he writes.

Nor does he make mention of a recent change Google quietly made to the lists of default search engine choices in its Chrome browser — which expanded the “choice” he claims the company offers by surfacing more rivals. (The biggest beneficiary of that tweak is privacy search rival DuckDuckGo, which suddenly got added to the Chrome search engine lists in around 60 markets. Qwant also got added as a default choice in France.)

Talking about Android specifically Walker instead takes a subtle indirect swipe at iOS maker Apple — which now finds itself the target of competition complaints in Europe, via music streaming rival Spotify, and is potentially facing a Commission probe of its own (albeit, iOS’ marketshare in Europe is tiny vs Android). So top deflecting Google.

“On Android phones, you’ve always been able to install any search engine or browser you want, irrespective of what came pre-installed on the phone when you bought it. In fact, a typical Android phone user will usually install around 50 additional apps on their phone,” Walker writes, drawing attention to the fact that Apple does not offer iOS users as much of a literal choice as Google does.

“Now we’ll also do more to ensure that Android phone owners know about the wide choice of browsers and search engines available to download to their phones,” he adds, saying: “This will involve asking users of existing and new Android devices in Europe which browser and search apps they would like to use.”

We’ve reached out to Commission for comment, and to Google with questions about the design of its incoming browser and search app prompts for Android users in Europe and will update this report with any response.

Opera’s VPN returns to its Android browser

Opera had a couple of tumultuous years behind it, but it looks like the Norwegian browser maker (now in the hands of a Chinese consortium) is finding its stride again and refocusing its efforts on its flagship mobile and desktop browsers. Before the sale, Opera offered a useful stand-alone and built-in VPN service. Somehow, the built-in VPN stopped working after the acquisition. My understanding is that this had something to do with the company being split into multiple parts, with the VPN service ending up on the wrong side of that divide. Today, it’s officially bringing this service back as part of its Android app.

The promise of the new Opera VPN in Opera for Android 51 is that it will give you more control over your privacy and improve your online security, especially on unsecured public WiFi networks. Opera says it uses 256-bit encryption and doesn’t keep a log or retain any activity data.

Since Opera now has Chinese owners, though, not everybody is going to feel comfortable using this service, though. When I asked the Opera team about this earlier this year at MWC in Barcelona, the company stressed that it is still based in Norway and operates under that country’s privacy laws. The message being that it may be owned by a Chinese consortium but that it’s still very much a Norwegian company.

If you do feel comfortable using the VPN, though, then getting started is pretty easy (I’ve been testing in the beta version of Opera for Android for a while). Simply head to the setting menu, flip the switch, and you are good to go.

“Young people are being very concerned about their online privacy as they increasingly live their lives online, said Wallman. “We want to make VPN adoption easy and user-friendly, especially for those who want to feel more secure on the Web but are not aware on how to do it. This is a free solution for them that works.”

What’s important to note here is that the point of the VPN is to protect your privacy, not to give you a way to route around geo-restrictions (though you can do that, too). That means you can’t choose a specific country as an endpoint, only ‘America,’ ‘Asia,’ and ‘Europe.’

The top 10 startups from Y Combinator W19 Demo Day 1

Electric vehicle chargers, heads up displays for soldiers, and the Costco of weed were some of our favorites from presitigious startup accelerator Y Combinator’s Winter 2019 Demo Day 1. If you want to take the pulse of Silicon Valley, YC is the place to be. But with over 200 startups presenting across 2 stages and 2 days, it’s tough to keep track.

You can check out our write-ups of all 85 startups that launched on Demo Day 1 here, and come back later for our full index and picks from Day 2. But now, based on feedback from top investors and TechCrunch’s team, here’s our selection of top 10 companies from the first half of this Y Combinator batch, and why we picked each.

Ravn

Looking around corners is one of the most dangerous parts of war for infantry. Ravn builds heads-up displays that let soldiers and law enforcement see around corners thanks to cameras on their gun, drones, or elsewhere. The ability to see the enemy while still being behind cover saves lives, and Ravn already has $490,000 in Navy and Air Force contracts. With a CEO who was a Navy Seal who went on to study computer science plus experts in augmented reality and selling hardware to the Department Of Defense, Ravn could deliver the inevitable future of soldier heads-up displays.

Why we picked Ravn: The AR battlefield is inevitable, but right now Microsoft’s HoloLens team is focused on providing mid-fight information like how many bullets a soldier has in their clip and where there squad mates are. Ravn’s tech was built by a guy who watched the tragic consequences of getting into those shootouts. He wants to help soldiers avoid or win these battles before they get dangerous, and his team includes an expert in selling hardened tech to the US government.

Middesk

It’s difficult to know if a business’ partners have paid their taxes, filed for bankruptcy, or are involved in lawsuits. That leads businesses to write off $120 billion a year in uncollectable bad debt. Middesk does due diligence to sort out good businesses from the bad to provide assurance for B2B deals loans, investments, acquisitions, and more. By giving clients the confidence that they’ll be paid, Middesk could insert itself into a wide array of transactions.

Why we picked Middesk: It’s building the trust layer for the business world that could weave its way into practically every deal. More data means making fewer stupid decisions, and Middesk could put an end to putting faith in questionable partners.

Convictional

Convictional helps direct-to-consumer companies approach larger retailers more simply. It takes a lot of time for a supplier to build a relationship with a retailer and start selling their products. Convictional wants to speed things up by building a B2B self-service commerce platform that allows retailers to easily approach brands and make orders.

Why we picked Convictional: There’s been an explosion of D2C businesses selling everthing from suitcases to shaving kits. But to drive exposure and scale, they need retail partners who’re eager not to be cut out of this growing commerce segment. Playing middleman could put Convictional in a lucrative position while also making it a nexus of valuable shopping data.

Dyneti Technologies

Has invented a credit card scanner SDK that uses a smartphone’s camera to help prevent fraud by over 50 percent and improve conversion for businesses by 5 percent. The business was started by a pair of former Uber employees including CEO Julia Zheng, who launched the fraud analytics teams for Account Security and UberEATS. Dyneti’s service is powered by deep learning and works on any card format. In the two months since it launched, the company has signed contracts with Rappi, Gametime and others.

Why we picked Dyneti: Cybersecurity threats are growing and evolving, yet underequipped businesses are eager to do more business online. Dyneti is one of those fundamental B2B businesses that feels like Stripe — capable of bringing simplicity and trust to a complex problem so companies can focus on their product.

AmpUp

The “Airbnb for electric vehicle chargers.” AmpUp, preparing for a world in which the majority of us drive EVs, operates a mobile app that connects a network of thousands of EV chargers and drivers. Using the app, an electric vehicle owner can quickly identify an available and compatible charger and EV charger owners can earn cash sharing their charger at their own price and their own schedule. The service is currently live in the Bay Area.

Why we picked AmpUp: Electric vehicles are inevitable, but reliable charging is one of the leading fears dissuading people from buying. Rather than build out some massive owned network of chargers that will never match the distributed gas station network, AmpUp could put an EV charger anywhere there’s someone looking to make a few bucks.

FlockJay

Operates an online sales academy that teaches job seekers from underrepresented backgrounds the skills and training they need to pursue a career in tech sales. The 12-week long bootcamp offers trainees coaching and mentorship. The company has launched its debut cohort with 17 students, 100 percent of which are already in job interviews and 40 percent of which have already secured new careers in the tech industry.

Why we picked FlockJay: Unlike coding bootcamps that can require intense prerequisites, killer salespeople can be molded from anyone with hustle. Those from underrepresented backgrounds already know how to expertly sell themselves to attain opportunities others take for granted. FlockJay could provide economic mobility at a crucial juncture when job security is shaky.

Deel

20 million international contractors work with US companies but it’s difficult to onboard and train them. Deel handles the contracts, payments, and taxes in one interface to eliminate paperwork and wasted time. Deel charges businesses $10 per contractor per month and a 1% fee on payouts, which earns it an average of $560 per contractor per year.

Why we picked Deel: The destigmatization of remote work is opening new recruiting opportunities abroad for US businesses. But unless teams can properly integrate these distant staffers, the cost savings of hiring overseas are negated. As the globalization megatrend continues, businesses will need better HR tools.

Glide

There has been a pretty major trend towards services that make it easier to build web pages or mobile apps. Glide lets customers easily create well-designed mobile apps from Google Sheets pages. This not only makes it easy to build the pages, but simplifies the skills needed to keep information updated on the site.

Why we picked Glide: While desktop website makers is a brutally competitive market, it’s still not easy to make a mobile site if you’re not a coder. Rather than starting from visual layout tool many people would still be unfamiliar with, Glide starts with a spreadsheet that almost everyone has used before. And as the web begins to feel less personal with all the brands and influencers, Glide could help people make bespoke apps that put intimacy and personality first.

Docucharm

The platform, co-founded by former Uber product manager Minh Tri Pham, turns documents into structured data a computer can understand to accurately automate document processing workflows and to take away the need for human data entry. Docucharm’s API can understand various forms of documents (like paystubs, for example) and will extract the necessary information without error. Its customers include tax prep company Tributi and lending businesses Aspire.

Why we picked Docucharm: Paying high-priced, high-skilled workers to do data entry is a huge waste. And optical character recognition like Docucharm’s will unlock new types of businesses based on data extraction. This startup could be the AI layer underneath it all.

The Flower Co

Flower Co.: Memberships for cheaper weed sales and delivery. Most dispensaries cater to high-end customers and newbies that want expensive products and tons of hand-holding. In contrast, The Flower Co caters to long-time marijuana enthusiasts who want huge quantities for at low prices. They’re currently selling $200k in marijuana per month to 700 members. They charge $100 a year for membership, and take 10% on product sales.

Why we picked The Flower Co: Marijuana is the next gold rush, a once in a generation land grab opportunity. Yet most marijuana merchants have focused on hyper-discerning high-end customers despite the long-standing popularity of smoking big blunts of cheap weed with a bunch of friends. For those who want to make cannabis consumption a lifestyle, and there will be plenty, The Flower Co could become their wholesaler.

Honorable Mentions

Atomic Alchemy – Filling the shortage of nuclear medicine

YourChoice – Omni-gender non-hormonal birth control

Prometheus – Turning CO2 into gas

Lumos – Medical search engine for doctors

Heart Aerospace – Regional electric planes

Boundary Layer Technologies – Super-fast container ships

Additional reporting by Kate Clark, Greg Kumparak, and Lucas Matney

Pandora switches up its classic listening experience with Modes

If you’ve ever tried Pandora, you know the basic deal. The service offers a more passive form of music discovery than other streaming services, encouraging users to let algorithms do most of the heavy lifting, as radio stations are generated based on thumbs up and down.

Today, the company puts a new spin on the stalwart service, offering a half-dozen distinct “Modes.” Standard Pandora is still the core here (and there’s always the “My Station” mode for those who want to stick with Pandora Classic), but each offers a different way to interact with the stations.

Here’s the break down, per Pandora,

  1. My Station: The classic station experience you know and love.

  2. Crowd Faves: You’ll hear the most thumbed-up songs by other listeners within that station

  3. Deep Cuts: You’ll go deeper into the catalog of that station artist/genre.

  4. Discovery: You’ll hear more artists who don’t usually play on that station.

  5. Newly Released: You’ll hear the newest releases from that station artist/genre.

  6. Artist Only: You’ll hear only songs by that station artist.

As ever, the thumbs up and thumbs down icons serve as the basis of the customized curation. That limited interaction helps each of the stations figure out where to go, within the above outlined parameters.

The feature, which launches today, is designed to encourage users to “‘lea[n] in’ to the experience instead of just ‘leaning back,’” according to the company.

Of course, the move can just add easily been seen as a response to a changing music landscape. Believe it or not, it’s been 19 years since the company was founded, and these last several have seen a big shift toward streaming services like Spotify and Apple Music.

Modes is an interesting attempt to have it both ways, serving Pandora’s loyal base of just below 70 million users, while addressing increased interest in customizing the user experience.