Sequoia reveals first cohort for its ‘Surge’ accelerator program in India and Southeast Asia

Back in January, Sequoia India announced plans for its first early-stage startup accelerator program in India and Southeast Asia, and today the firm announced its first cohort of 17 startups.

To recap, the program — which is called Surge — gives each startup a $1.5 million check and participation in a four-month program that’s split across India and Singapore, as well as the wider Sequoia global presence in China and San Francisco.

The program kicked off last month, but the startups were only unveiled for the first time today — here they are:

  • Azani Sports: a ‘full stack’ sports clothing startup based in India that sells online and through selected high street retails
  • Bobobox: a capsule hotel company based in Indonesia
  • Bulbul: a live-streaming service with a focus on e-commerce across India
  • DancingMind: a Singapore startup that uses VR to enable remote for stroke victims and patients of debilitating diseases like Parkinson’s
  • Doubtnut: an India-based education startup that uses photos, videos and AI
  • Flynote: a travel booking service with a focus on personalized trips
  • Hippo Video: a platform developing, editing and analyzing marketing and sales videos
  • InterviewBit Academy: a computer science training and development platform in India — that’s not unlike recent Y Combinator graduate Skill-Lync
  • Khatabook: an accounting service for SMEs in India that already claims 120,000 weekly users
  • Qoala: a micro-insurance startup based in Indonesia, which competes with rivals like PasarPolis — which is backed by three of Indonesia’s unicorns
  • ShopUp: a social commerce startup that helps sellers in Bangladesh do business through Facebook — that’s a similar concept to established Indian startups Meesho (another YC alum) and LimeRoad which enable sellers on WhatsApp
  • Skillmatics: a startup headquartered in India that develops learning games for pre-school and primary school kids aged under 10
  • Telio: a b2b commerce platform that aims to digitize the process of brands and wholesalers selling to retailers
  • Uiza: a Singapore-Vietnam startup that lets publishers and companies develop their own video infrastructure independent of platforms like YouTube
  • Vybes: an e-commerce platform for social media influencers that’s based out of Singapore
  • Zenyum: a startup that provides invisible braces for consumers in Southeast Asia at a lower cost than traditional alternatives

There’s one additional startup which is being kept ‘under the radar’ for now, Sequoia said.

Sequoia India managing director Shailendra Singh previously told TechCrunch that Surge would support a ‘curated’ selections of fellow VCs who could invest alongside in the cohort alongside the firm, and Sequoia said that the 17 startups have attracted a total of $36 million in investment. A spokesperson also pointed out that five of the selection have at least one female co-founders, which is almost certainly above average for the region although it is tricky to get reliable data covering India and (in particular) Southeast Asia.

Surge is an interesting effort for Sequoia, which has traditionally played in post-seed and growth stages of the investment cycle. Sequoia closed its most recent fund for India and Southeast Asia at $695 million last year, and it also has access to a globally active ‘growth’ fund that is targeted at $8 billion. Reports have suggested that Surge will get its own sparkling new $200 million fund, which would make a lot of sense given the potential conflict and confusion of investing via its main fund. But the firm is declining to comment on that possibility for now.

One major addition to the program that has been confirmed, however, is Rajan Anandan, the executive who previously ran Google’s business in India and Southeast Asia and is a well-known angel investor. His arrival was announced earlier this month and he will lead the Surge initiative.

His recruitment is a major win for Sequoia, which is betting that Surge’s early stage push will reap it richer dividends in India and Southeast Asia. That part remains to be seen, but certainly, there is a dearth of early-stage programs in both regions compared to other parts of the world.

Industrial robotics giant Fanuc is using AI to make automation even more automated

Industrial automation is already streamlining the manufacturing process, but first those machines must be painstakingly trained by skilled engineers. Industrial robotics giant Fanuc wants to make robots easier to train, therefore making automation more accessible to a wider range of industries, including pharmaceuticals. The company announced a new artificial intelligence-based tool at TechCrunch’s Robotics + AI Sessions event today that teaches robots how to pick the right objects out of a bin with simple annotations and sensor technology, reducing the training process by hours.

Bin-picking is exactly what it sounds like: a robot arm is trained to pick items out of bins and used for tedious, time-consuming tasks like sorting bulk orders of parts. Images of example parts are taken with a camera for the robot to match with vision sensors. Then the conventional process of training bin-picking robots means teaching it many rules so it knows what parts to pick up.

“Making these rules in the past meant having to through a lot of iterations and trial and error. It took time and was very cumbersome,” said Dr. Kiyonori Inaba, the head of Fanuc Corporation’s Robot Business Division, during a conversation ahead of the event.

These rules include details like how to locate the parts on the top of the pile or which ones are the most visible. Then after that, human operators need to tell it when it makes an error in order to refine its training. In industries that are relatively new to automation, finding enough engineers and skilled human operators to train robots can be challenging.

This is where Fanuc’s new AI-based tool comes in. It simplifies the training process so the human operator just needs to look at a photo of parts jumbled in a bin on a screen and tap a few examples of what needs to be picked up, like showing a small child how to sort toys. This is significantly less training than what typical AI-based vision sensors need and can also be used to train several robots at once.

“It is really difficult for the human operator to show the robot how to move in the same way the operator moves things,” said Inaba. “But by utilizing AI technology, the operator can teach the robot more intuitively than conventional methods.” He adds that the technology is still in its early stages and it remains to be seen if it can be used during in assembly as well.

Amazon China to close local marketplace and place more focus on cross-border

Amazon has finally given up the fight with Chinese online shopping giants to capture the domestic market. On Thursday, the Seattle-based ecommerce company announced it will shut down its marketplace on Amazon.cn, which connects mainland Chinese buyers and sellers, while other units of its local venture will stay intact.

“We are working closely with our sellers to ensure a smooth transition and to continue to deliver the best customer experience possible,” an Amazon spokesperson told TechCrunch, adding that this segment of the business will end on July 18.

The partial retreat, first reported by Reuters and Bloomberg, is indicative of the relentless ecommerce race in China where Alibaba and JD.com dominate, with newcomer Pinduoduo closing on the incumbents’ heels.

But this is hardly the end of Amazon’s China story. The American giant has over the years attracted waves of cross-border sellers, many of whom have hailed from China’s traditional export industry looking to sell cheaply manufactured goods to consumers around the world for lucrative margins. To date, Chinese export suppliers are able to sell to 12 countries that include India, Japan, Australia, Canada, the United States, and five Western European countries.

Other global ecommerce players also have their eyes set on the massive raft of goods flowing out of China, though each comes with a different geographic focus. Alibaba-backed Lazada, for example, is the bridge between Chinese merchants and Southeast Asian shoppers, while Jumia, which just listed in the U.S., exports from China to Africa.

“The biggest appeal [of exporting through Amazon] is the low costs because we are close to a lot of supply chain resources,” a Shenzhen-based vendor selling water-resistant placemats on Amazon told TechCrunch.

In the meantime, China has developed a big craving for imported goods as middle-class consumers now demand higher quality products. Amazon is in the import business, too, although it lags far behind more entrenched players such as Alibaba, of which Tmall Global takes the lead with 29 percent market share in the cross-border ecommerce space according to data from iResearch, dwarfing Amazon’s 6 percent.

That could change if Amazon finds a prominent local partner. Rumors have swirled for months that Amazon was reportedly in talks to merge its import unit with Kaola, the cross-border shopping business run by Chinese internet giant Netease with a 22.6 percent market share.

Not to be forgotten, Amazon also offers cloud computing services to Chinese enterprises although, in this space, it’s again in a direct face-off with Alibaba Cloud, the dominant player in China. Lastly, China remains the largest market for Kindle, so pivotal that the e-reader launched a localized model just for China.

“Over the past few years, we have been evolving our China online retail business to increasingly emphasize cross-border sales, and in return we’ve seen very strong response from Chinese customers,” said the Amazon spokesperson. “Amazon’s commitment to China remains strong—we have built a solid foundation here in a number of successful businesses and we will continue to invest and grow in China across Amazon Global Store, Global Selling, AWS, Kindle devices and content.”

Starbucks challenger Luckin’s fundraising spree continues with $150M investment

Coffee startup Luckin is continuing its fundraising spree as it sets its sight on becoming an alternative to Starbucks in China.

The a-year-and-a-half old company announced on Thursday that it closed a Series B-plus raise totaling $150 million. The fresh proceeds valued Luckin at $2.9 billion post-money, up from $2.2 billion just four months ago.

While many question Luckin’s cash-fueled expansion, Blackrock, which owns a 6.58 percent stake in Starbucks, shows its confidence in the Chinese startup by pumping $125 million through its private equity fund into Luckin’s new round.

With that, the New York-based investment firm has its bet on two contrasting models for China’s coffee consumption. While Starbucks zeroes in on the brick-and-mortar experience, Luckin is a network of last-mile coffee delivery centers plus places for people to pick up orders and sit down targeting busy white-collar workers.

In a move that would amp up its battle with Luckin, Starbucks teamed up with Alibaba’s food delivery unit Ele.me last August to put hot and cold drinks in people’s hands.

Luckin did not disclose how it will spend the fresh capital infusion, but the pace at which it’s raising suggests the startup is in dire need of cash. The new round arrived less than a year after it secured a $200 million Series A in July and another $200 million from a Series B in December.

Indeed, Luckin founder Qian Zhiya, a former executive at auto rental firm Car Inc, confessed the company burned through $150 million within just six months from launching. A big chunk of money had gone to shelling out deep discounts for consumers, while the coffee challenger’s offline expansion was as cash-intensive.

As of late, Luckin has opened 2,000 outlets consisting of small prep kitchens, pickup stations and cafes in 22 Chinese cities, up from 1,700 locations reached in December. That gives Luckin less than eight months to fulfill its ambition of becoming the “biggest coffee chain in China by the number of outlets run and cups sold.” The goal is to top 4,500 outlets by the end of 2019.

Starbucks, which made its foray into China 20 years ago, has also been aggressively putting up storefronts. It currently runs 3,600 stores across 150 cities in China, up from 3,300 last May.

When it comes to actual people using the service, Starbucks still enjoys a huge lead. The Luckin app that allows one to order and pay has 650 thousand unique downloads in March, data from research firm iResearch shows. Starbucks’s app is more than four times its size with 2.81 million unique downloads from the same period.

Other investors who joined in on Luckin’s latest round included existing backers such as Singapore’s sovereign wealth fund GIC, Chinese government-controlled China International Capital Corporation, Dazheng Capital and Joy Capital, whose founding partner Liu Erhai sits on Luckin’s board.

Consumers get another digital home health offering as Tyto Care and Best Buy launch TytoHome

Best Buy is partnering with the Israeli technology Tyto Care to become the official retailer for the company’s all-in-one digital diagnostics kit through its physical stores in California, the Dakotas, Ohio and Minnesota and through its online store.

Tyto previously sold its technology through healthcare plans, making its handheld examination device with attachments that act as a thermometer, a stethoscope, an otoscope and a tongue depressor available to families with insurance that wanted to reduce the cost of checkups through remote monitoring. The company’s handheld device comes with an exam camera so it can prompt users on where to position the device to get the most accurate readings.

 

Now, through Best Buy, consumers can buy the company’s kit for $299.99. Through a partnership with American Well, users of the TytoHome kit have access to the company’s LiveHealth Online consultation service (if they live outside of Minnesota or the Dakotas). Which means patients can use the device to perform a medical exam and send the information to a physician for a diagnosis any time of the day or night.

As part of the deal, Tyto Care is partnering with additional regional health care systems to provide medical care to consumers throughout the country. The first is Sanford Health, a Minnesota-based not-for-profit health system operating in Minnesota, North Dakota and South Dakota. 

For Best Buy the move builds on the company’s attempts to move quickly into providing digital healthcare services just like it provides technical support through its Geek Squad.

Last year the company bought GreatCall, which sells connected health and emergency response services to the AARP crowd.

“We’re excited to partner with Best Buy, LiveHealth Online, American Well and regional health systems to extend our on-demand telehealth platform across the U.S., enhancing primary care delivery,” said Dedi Gilad, the chief executive and co-founder of Tyto Care, in a statement.

The company, based in Herzliya, Israel, has raised $56.7 million to date from investors including Sanford Health, the Japanese Itochu Corp., Shenzhen Capital Group, Ping An, LionBird, Fosun Group, Orbimed and Walgreens.

The company said at the time that it would use the cash to expand in the U.S. and to other international markets in Asia and Europe.

“These strategic partnerships will enable us to gain further momentum and accelerate our growth, deepening our foothold in the U.S. and other new strategic markets,” said GiladTyto Care said in a statement at the time.

Terry Gou will resign as Foxconn’s chairman to run for president of Taiwan

Foxconn chairman Terry Gou officially announced on Wednesday that he will run for president of Taiwan. Gou will step down from leading the company (also known as Hon Hai Precision Industry Co. Ltd.), one of Apple’s most important manufacturers, in order to campaign for the nomination of the Kuomintang, the pro-China opposition party.

Taiwan’s economy and complicated relationship with China will be at the heart of the 2020 presidential campaign, as incumbent Tsai Ing-wen defends her position against not only candidates from the Kuomintang and other parties, but also a challenger from her own party, the Democratic Progressive Party, William Lai, who entered the race last month.

Gou earlier said that his presidential aspirations had been blessed by Mazu, the sea goddess who is one of the most important Taoist and Buddhist deities. Gou founded Foxconn in 1974 and has held no political office, but his campaign will be helped by his business reputation and reported $7 billion net worth.

Gou’s lack of government experience may be balanced in the mind of voters by his relationships with Donald Trump and China’s government. Foxconn has committed to building a $10 billion factory in Wisconsin. Even though Taiwan’s sovereignty is not recognized by China, which views the country as a rogue province, Foxconn has more plants there than in any other country.

Google Cloud brings on 27-year SAP veteran as it doubles down on enterprise adoption

Thomas Kurian, the newly-minted CEO of Google Cloud, used the company’s Cloud Next conference last week to lay out his vision for the future of Google’s cloud computing platform. That vision involves, in part, a hiring spree to give businesses that want to work with Google more people to talk to and get help from. Unsurprisingly, Kurian is also looking to put his stamp on the executive team, too, and today announced that former SAP executive Robert Enslin is joining Google Cloud as its new President of Global Customer Operations.

Enslin’s hire is another clear signal that Kurian is focused on enterprise customers. Enslin, after all, is a veteran of the enterprise business, with 27 years at SAP, where he served on the company’s executive board until he announced his resignation from the company earlier this month. After leading various parts of SAP, including as president of its cloud product portfolio, president of SAP North America and CEO of SAP Japan, Enslin announced that he had “a few more aspirations to fulfill.” Those aspirations, we now know, include helping Google Cloud expand its lineup of enterprise customers.

“Rob brings great international experience to his role having worked in South Africa, Europe, Asia and the United States—this global perspective will be invaluable as we expand Google Cloud into established industries and growth markets around the world,” Kurian writes in today’s announcement.

For the last two years, Google Cloud already had a President of Global Customer Operations, though, in the form of Paul-Henri Ferrand, a former Dell exec who was brought on by Google Cloud’s former CEO Diane Greene . Kurian says that Ferrand “has decided to take on a new challenge within Google.”

 

Proof of Capital is a new $50M blockchain fund that’s backed by HTC

It’s often said that the dramatic fall of crypto prices last year ushered in a new era for technology-focused startups in the blockchain space, and the same argument can be made for the venture capitalists who fund them. Proof of Capital is the latest fund to emerge after it officially announced a maiden $50 million fund today.

The fund is led by trio Phil Chen, who created HTC’s Vive VR headset and is currently developing its Exodus blockchain phone (he spent time as a VC with Horizons Ventures in between), Edith Yeung, who previously headed up mobile for 500 Startups, and Chris McCann, a Thiel Fellow whose last role was head of community for U.S. VC firm Greylock Partners.

The firm — and you have to give them credit for the name — has an LP base that is anchored by HTC — no big surprise there given the connections — alongside YouTube co-founder Steve Chen, Taiwan-based Formosa Plastics, Ripple’s former chief risk officer Greg Kidd (who is also a prolific crypto investor) and a number of undisclosed family offices.

“For HTC, it’s obvious, they already have a product to go with it,” Yeung told TechCrunch in an interview, referencing the fact that HTC is keen to invest in blockchain services and startups to build an ecosystem for its play.

The fund also includes a partnership with HTC which, slightly hazy on paper, will essentially open the possibility for Proof of Capital portfolio companies to work with HTC directly to develop services or products for Exodus and potentially other HTC blockchain ventures. But other LPs are also keen to dip their toes in the water in different ways.

“Some of these backers are curious at the possibilities of blockchain,” continued Yeung. “For example, they’re giving us some ideas on how tokenization and gamification could be applied on different platforms.”

Proof of Capital founding partners (left to right) Edith Yeung, Chris McCann and Phil Chen

The fund itself is broadly targeted at early stage blockchain companies in fintech, infrastructure, hardware and the “consumer layers of the blockchain ecosystem.” Its remit is worldwide. Although Chen and Yeung have strong networks in Asia, the fund’s first deal is an investment in Latin America-based blockchain fintech startup Ubanx.

Yeung clarified that the fund is held in fiat currency and that it is focused on regular VC deals, as opposed to token-based investments.

“It’s a VC fund so the setup is traditional,” she explained. “There’s been a lot of interesting movements in the last two years, [but] we come from a more traditional VC background and are excited about the technology.”

“It’s still really early [for blockchain] and a lot of the hype — the boom and bust — is down to the crypto market and ICOs, but the reality is that a lot of these technologies are really nascent. Now, projects are raising equity, even if they have a token,” Yeung added.

Indeed, last year we wrote about the rise of private sales and that even the biggest blockchain companies took on VC fundingcrypto didn’t kill VCs despite the hype — and Yeung said that blockchain startup founders in 2019 are “taking a more concerted approach” to raising money beyond simply issuing tokens.

“Many projects that raised ICO really smelt like equity,” said Yeung. “We are seeing companies today delaying token issuance as much as possible; the whole thing has gone a little more back to earth.”

HTC is an anchor LP in Proof of Capital, and it is working with the fund to help its portfolio companies develop services for its Exodus blockchain phone, pictured above

Dutch chipmaker NXP makes China push by backing radar company Hawkeye

Dutch chipmaker NXP Semiconductors has come a long way since Qualcomm’s outsize $44 billion to acquire it fell through last year. In an announcement released on Tuesday, NXP said it’s agreed to back and partner with Hawkeye Technology, a Chinese company specializing in automotive radars, as part of an ambition to capture the rapid growth of sensor-powered vehicles in China.

Financial terms of the investment were undisclosed, but the tie-up will see Hawkeye providing a suite of technical know-how to NXP. That includes the Chinese company’s engineering team, a research lab it set up with Southeast University in the Chinese city of Nanjing, and its 77Ghz radar, a long-range sensing technology that enables cars to detect crashes down to sub-millimeter accuracy.

Under the agreement, NXP and Hawkeye will work together to create reference designs rather than retail products.

“The fast development of ADAS [Automatic Data Acquisition System] and autonomous driving technologies has raised new requirements for vehicle-based millimeter radar,” said Alex Shi, co-founder and chief executive of Hawkeye. “By partnering with NXP, Hawkeye will focus on providing advanced millimeter wave radar system level solutions as well as comprehensive technical support for Tier 1 customers.”

The deal is a smart move for NXP, whose claim to fame is its chips for car-related applications, as it strives to be a key player in China’s autonomous driving race. Hawkeye may be little known, but not its CEO. Shi was the former boss of Banma Network, a joint venture between ecommerce behemoth Alibaba and Chinese state-owned automaker SAIC Motors, which is the key force to commercialize Alibaba’s connected car solutions.

In April 2015, Shi and a group of other prominent auto figures from China founded Hawkeye with an initial registered capital of 30 million yuan ($4.5 million).

The Hawkeye funding arrived less than a year after Qualcomm dropped its proposed buyout of NXP, which was set to be one of the largest in the semiconductor space but ended up as a collateral damage in rising trade tensions between China and the U.S. Qualcomm had mulled buying NXP as early as September 2016.

China remained a focus for NXP, which assured that its alliance with Hawkeye is evidence of its “confidence in the Chinese market” and “determination to continuously invest in the country,” said NXP president Kurt Sievers in a statement.

“Innovators in automotive, like Hawkeye and Southeast University, have become the driving force for the transformation of China’s automotive industry. We are pleased to collaborate with these excellent partners, leveraging NXP’s leadership in the fast-growing radar semiconductor market to improve road safety,” Sievers added.

Student sues JD.com’s billionaire CEO Richard Liu for alleged rape

A Chinese student has filed a lawsuit against JD.com founder and chief executive Richard Liu, alleging the billionaire businessman raped her in Minnesota back in August, four months after local prosecutors decided not to press charges.

The lawsuit, which was filed in Hennepin County on Tuesday, is seeking damages of more than $50,000. It identifies the student as Jingyao Liu (not related to Richard Liu), an undergraduate student at the University of Minnesota.

JD did not immediately respond to a request for comment on the lawsuit. Liu has maintained his innocence through his lawyers throughout the investigation. Liu said on social media in December that he had “broken no laws” but felt “extreme self-admonishment and regret” for the pain that his behavior “on that day” brought to his family and wife, who is an internet celebrity known as Sister Milk Tea.

In December, Hennepin County Attorney Michael Freeman said he was not charging Liu because “there were profound evidentiary problems which would have made it highly unlikely that any criminal charge could be proven beyond a reasonable doubt.” He further emphasized his decision “had nothing to do with Liu’s status as a wealthy, foreign businessman.”

Liu’s case has drawn widespread interest in China where the tale of Liu’s rags-to-riches has inspired many. If charged and convicted, Liu could face up to 30 years in prison.

JD’s stock immediately tumbled after the student first accused Liu in August over concerns that the case will hamper his ability to run the company, which is the arch-rival to Jack Ma’s Alibaba and faces growing competition from ecommerce upstart Pinduoduo.

The company’s shares have slowly crawled back since December after the Hennepin County Attorney decided not to charge the founder. Nonetheless, JD is coping with sagging morale as large-scale layoffs hit executives and a new pay scheme threatens to depress income among its armies of couriers.