Energica CEO plots her Italian EV company’s reboot from lockdown

There could be more demand for electric vehicles post COVID-19 crisis, believes Energica founder Livia Cevolini.

The CEO of the high-performance Italian motorcycle manufacturer offered that point of optimism, as her Modena based EV company remains closed by government decree.

The coronavirus pandemic has forced Energica to hit the brakes on production of its battery powered machines that can reach top speeds of 168 mph.

From lockdown in her Northern Italy home, Cevolini shared perspective on the future of motorcycling, acquisition offers and plans to recharge her company when the COVID-19 crisis subsides.

At a time when her country has been hit particular hard by the coronavirus, she offered some upbeat thinking.

Energica CEO Livia Cevolini on lockdown in Modena, Italy

“I don’t want to look only at the negative…Maybe there are things that are positive that come out of this bad crisis,” Cevolini told TechCrunch on a video call.

One of those is greater demand for EVs after the pandemic. Cevolini highlighted greater awareness of the smog internal combustion mobility creates and scientific evidence that air pollution exacerbates viruses as factors that could swing more folks to electric.

Reporting has made much of urban areas attaining visibly cleaner air — featuring before shots of global cities with smog and after shots of clear skies since COVID-19 forced traffic off the roads.

“Maybe at the end of this situation we will have a greater awareness on climate change. Then people will approach electric with more consciousness,” Cevolini said.

Before the health crisis shutdown most of Italy, Energica had already seen larger demand for its high-performance e-motos, with a price range of $17,000 to $23,000. The company — that has has a California office and U.S. general manager (Stefano Benatti) — filled more orders in the first two months of 2020 than all its sales for 2019, according to Cevolini.

As an EV venture, Energica is located in the famed Italian motor valley and positions itself similar to its neighbors — Lamborghini, Ducati, Ferrari — in offering a merger of sleek design and elite performance.

MotoE Worldcup racing, Image Credits: Energica

The venture is also one of the few e-motorcycle companies drawing engineering tips from competition. In 2018, Energica was named the sole manufacturer to the MotoE Worldup — an electric version of MotoGP motorcycle racing. MotoE riders use the company’s EGO model as their base bike.

Technology from the track is transferring to production models, according to Cevolini. “The goal is to use racing to test in extreme but safe conditions and then we move stuff to the road bikes,” she said.

Energica credits the application of race tech to production e-motos for some of the increased order flow it saw early this year. The company reduced the weight of its 2020 production line by 5% and increased range by 60% based on adaptions it brought over from MotoE.

Track competition is a secondary arena for Energica. The primary venue is an increasingly crowded e-motorcycle marketplace, which will most certainly face declining demand given the economic impact of COVID-19.

Harley Davidson introduced its all electric $29K LiveWire in 2019, becoming the first of the big gas manufacturers to offer a street-legal e-moto for sale in the U.S.

Harley’s entry followed several failed electric motorcycle startups — including Mission Motors — and put it in the market with existing EV ventures, such California startup Zero, with 200 dealers worldwide.

Image Credits: TechCrunch

When it comes to core e-motorcycle specs — such as performance, charge-times and range — Energica has held advantages with its 145 horsepower machines that can charge in 20 minutes for max ranges of 140 to 250 miles.

But the competition is closing in on some of the Italian EV maker’s numbers. In 2019, Zero launched its high-performance SR/F, with 110 horsepower and a top-speed of 120 mph. And the entire motorcycle industry — gas and electric — could face competitive pressures from new EV entrant Damon Motors. The Vancouver based startup debuted its 200 mph, $24K Hypersport this year, which offers proprietary safety and ergonomics tech for adjustable riding positions and blind-spot detection.

On top of strong competition in the e-moto space, there’s a growing uncertainty on the buying appetite for motorcycles that could persist into 2020 — and beyond — given the COVID-19 pandemic gripping the world.

In the U.S., new motorcycles sales didn’t weather the last recession very well, dropping 50% in 2008 and remaining stagnant since. In addition to Energica, other manufacturers, such as Harley Davidson have been forced to stop production due the coronavirus.

Energica CEO Livia Cevolini believes her company has a leg up on its e-moto competitors and an ability to rebound, once it restarts operations.

She flags the manufacturer’s racing connection as something that will continue to give Energica an edge in product development. Speaking to competition with Zero Motorcycles in particular, “We are in a different category,” she said. “They have less power, less range and less fast charge capability.”

Energica has also created another revenue stream through a joint-venture to provide battery, computing and drive-train technology to Dell’Orto, a supplier to the global scooter market.

As more of the major gas motorcycle companies enter the EV market, Cevolini is open to a merger or acquisition, but only on her terms.

“If someone comes to me with a real proposal…that you want to grow our business and our company and not destroy it, we can talk,” she said. “Otherwise, we prefer to go our own way.”

Energica

Image Credits: Energica

Energica is prepared to restart production, and has done contingencies for adaptations — such as safe and socially distanced operations — when it gets the go head from the Italian government to reopen.

“We’re ready to fulfill the orders we received before the shutdown and take more,” she said.

When Energica is able to switch on the plant electricity again, Cevolini suspects her niche market of motorcycle enthusiasts will be eager to roll.

“Our customers are telling us they are just waiting to ride again. And as soon as they can ride again, they will ride again,” she said.

Pre-school EdTech startup Lingumi raises £4m, adds some free services during Covid-19

At these difficult times, parents are concerned for their children’s education, especially given so much of it has had to go online during the Covid-19 pandemic. But what about pre-schoolers who are missing out?

Pre-school children are sponges for information but don’t get formal training on reading and writing until they enter the classroom when they are less sponge-like and surrounded by 30 other children. Things are tougher for non-English speaking children who’s parents want them to learn English.

Lingumi, a platform aimed at toddlers learning critical skills, has now raised £4 million in a funding round led by China-based technology fund North Summit Capital – a fund run by Alibaba’s former Chief Data Scientist Dr Min Wanli – alongside existing investors LocalGlobe, ADV, and Entrepreneur First.

The startup, launched in 2017, is also announcing the launch of daily free activity packs and videos to support children and families during the COVID-19 outbreak, and has pledged to donate 20% of its sales during this period to the Global Children’s Fund.

Lingumi’s interactive courses offer one-to-one tutoring with a kind ‘social learning’ and its first course helps introduce key English grammar and vocabulary from the age of 2.

Instead of tuning into live lessons with tutors, which are typically timetabled and expensive, Lingumi’s lessons are delivered through interactive speaking tasks, teacher videos, and games. At the end of each lesson, children can see videos of Lingumi friends speaking the same words and phrases as them. Because the kids are watching videos, Lingumi is cheaper than live courses, and thus more flexible for parents.

The company launched the first Lingumi course in China last year, focused on teaching spoken English to non-English speakers. The platform is now being used by more than 100,000 families globally, including in mainland China, Taiwan, UK, Germany, Italy, and France. More than 1.5 million English lessons have taken place in China over the past six months, and 40% of active users are also playing lessons daily. Lingumi says its user base grew 50% during China’s lockdown and it has had a rapid uptake in Europe.

“Lingumi’s rapid expansion in the Chinese market required a strategic local investor, and Dr Min and the team had a clear-sighted understanding of the technology and scale opportunity both in China, and globally.”

Dr Wanli Min, general partner at North Summit Capital, commented: “It is only the most privileged children who can access native English speakers for one-on-one tutoring… Lingumi has the potential to democratize English learning and offer every kid a personalized curriculum empowered by AI & Lingumi’s ‘asynchronous teaching; model.”

Competitors to include Lingumi include live teaching solutions like VIPKid, and learning platforms like Jiliguala in China, or Lingokids in the West.

Africa Roundup: Africa’s tech ecosystem responds to COVID-19

In March, the virus gripping the world — COVID-19 — started to spread in Africa. In short order, actors across the continent’s tech ecosystem began to step up to stem the spread.

Early in March Africa’s coronavirus cases by country were in the single digits, but by mid-month those numbers had spiked leading the World Health Organization to sound an alarm.

“About 10 days ago we had 5 countries affected, now we’ve got 30,” WHO Regional Director Dr Matshidiso Moeti said at a press conference on March 19. “It’s has been an extremely rapid…evolution.” 

By the World Health Organization’s stats Tuesday there were 3671 COVID-19 cases in Sub-Saharan Africa and 87 confirmed deaths related to the virus — up from 463 cases and 8 deaths on March 18.

As the COVID-19 began to grow in major economies, governments and startups in Africa started measures to shift a greater volume of transactions toward digital payments and away from cash — which the World Health Organization flagged as a conduit for the spread of the coronavirus.

Africa’s leader in digital payment adoption — Kenya — turned to mobile-money as a public-health tool.

At the urging of the Central Bank and President Uhuru Kenyatta, the country’s largest telecom, Safaricom, implemented a fee-waiver on East Africa’s leading mobile-money product, M-Pesa, to reduce the physical exchange of currency.

The company announced that all person-to-person (P2P) transactions under 1,000 Kenyan Schillings (≈ $10) would be free for three months.

Kenya has one of the highest rates of digital finance adoption in the world — largely due to the dominance of M-Pesa  in the country — with 32 million of its 53 million population subscribed to mobile-money accounts, according to Kenya’s Communications Authority.

On March 20, Ghana’s central bank directed mobile money providers to waive fees on transactions of GH₵100 (≈ $18), with restrictions on transactions to withdraw cash from mobile-wallets.

Ghana’s monetary body also eased KYC requirements on mobile-money, allowing citizens to use existing mobile phone registrations to open accounts with the major digital payment providers, according to a March 18 Bank of Ghana release.

Growth in COVID-19 cases in Nigeria, Africa’s most populous nation of 200 million, prompted one of the country’s largest digital payments startups to act.

Lagos based venture Paga made fee adjustments, allowing merchants to accept payments from Paga customers for free — a measure “aimed to help slow the spread of the coronavirus by reducing cash handling in Nigeria,” according to a company release.

In March, Africa’s largest innovation incubator, CcHub, announced funding and engineering support to tech projects aimed at curbing COVID-19 and its social and economic impact.

The Lagos and Nairobi based organization posted an open application on its website to provide $5,000 to $100,000 funding blocks to companies with COVID-19 related projects.

CcHub’s CEO Bosun Tijani expressed concern for Africa’s ability to combat a coronavirus outbreak. “Quite a number of African countries, if they get to the level of Italy or the UK, I don’t think the system… is resilient enough to provide support to something like that,” Tijani said.

Cape Town based crowdsolving startup Zindi — that uses AI and machine learning to tackle complex problems — opened a challenge to the 12,000 registered engineers on its platform.

The competition, sponsored by AI4D, tasks scientists to create models that can use data to predict the global spread of COVID-19 over the next three months. The challenge is open until April 19, solutions will be evaluated against future numbers and the winner will receive $5,000.

Zindi will also sponsor a hackathon in April to find solutions to coronavirus related problems.

Image Credits: Sam Masikini via Zindi

On the digital retail front, Pan-African e-commerce company Jumia announced measures it would take on its network to curb the spread of COVID-19.

The Nigeria headquartered operation — with online goods and services verticals in 11 African countries — said it would donate certified face masks to health ministries in Kenya, Ivory Coast, Morocco, Nigeria and Uganda, drawing on its supply networks outside Africa.

The company has also offered African governments use of of its last-mile delivery network for distribution of supplies to healthcare facilities and workers.

Jumia is reviewing additional assets it can offer the public sector. “If governments find it helpful we’re willing to do it,” CEO Sacha Poignonnec told TechCrunch.

More Africa-related stories @TechCrunch

African tech around the ‘net

Airbnb to provide free or subsidized housing for 100,000 COVID-19 healthcare workers

The hospitality and travel industry may be reeling, but Airbnb is still doing what it can to support the global effort to fight the spread of the coronavirus causing a worldwide pandemic. The company announced today that it will provide “free or subsidized housing” for 100,000 people working as frontline healthcare, relief for first response professionals focused on stemming the COVID-19 crisis.

Airbnb’s effort will work by allowing Hosts on its platform to opt-in to making their space available, with any fees that Airbnb would normally charge for using its platform waived for those who participate. The program will include new protocols around cleanliness that are designed to keep spaces safe for those workers who use it, and Airbnb will be working with the Red Cross, the International Rescue Committee, the International Medical Corps and other non-profit groups to help allocated space where it’s needed most.

Already, Airbnb had been operating smaller scale programs in both Italy and France to address the crises there, with 6,000 hosts across both countries making their spaces available. This extended program was partly the result of many requests from hosts to the platform about how they could volunteer their spaces and help with the effort, and Airbnb will be making it possible for hosts to offer their spaces for free if they want – though even those who still want to participate but keep a stay charge in place won’t be charged any fees by Airbnb itself.

The advanced cleaning protocols that Airbnb has put in place are developed to align with guidance from leading national health authorities, including the CDC in the U.S., and Airbnb says they will evolve as updated guidance becomes available. Some of the enhanced rules to help try to ensure safety include guidance that there should be a minimum of 72 hours between stays, as well as maintaining proper social distancing between hosts and any guests.

Airbnb also has a fund established for those who want to provide monetary support, with 100 percent of all proceeds going to nonprofits working on COVID-19 relief. These funds will help further subsidize housing costs for any responders in the case of hosts making housing available at a fee.

3D-printing company Formlabs expects its swabs to receive FDA exemption

Formlabs, the privately held, Massachusetts-based 3D-printing company, will soon receive an exemption from the U.S. Food and Drug Administration for its swab designed for use in COVID-19 test kits, TechCrunch has learned.

Global supply chains for test kit components including swabs and chemical reagents have hampered the ability of governments to increase testing to a point where they can adequately ascertain the scope of the outbreak of the novel coronavirus within their borders.

“Yesterday we got a notification from the FDA that this is going to be a class one exempt product,” said Formlabs chief product officer David Lakatos. “As long as it’s manufactured in an ISO 135 controlled facility.”

As cases are identified across the U.S., tests are flowing to the geographies where the disease has spread the fastest, leaving other parts of the country under-resourced to address what could be an increasing outbreak in other communities that have yet to receive a complete picture of the disease’s spread.

With swabs, the problem has been compounded that of the few manufacturers of the sorely needed test kit component, only one is in the U.S. while another is in Italy.

“About a week and a half ago we joined this effort,” says Lakatos.

Formlabs is uniquely positioned to scale up production he said, thanks in part to the 60,000 printers the company has on hand and the recent acquisition of a facility in Ohio that enables the company to make surgical-grade products.

The company is currently finishing up human trials and gearing up to expand capacity at its Ohio manufacturing facility. According to Lakatos, the company will be able to supply 100,000 swabs per day. “We are starting to print these,” Lakatos said. “But we won’t send anything out until we get the green light.”

Currently most of the swabs are earmarked for partner hospitals that worked with the company to develop the swabs, but the company is also working with large distributors to access their distribution channels and get the swabs into roughly 3,000 hospitals around the U.S.

“At the end of the day we’re just looking to get them out,” Lakatos said.

With lower bandwidth, Disney+ opens streaming service in UK, Ireland, 5 other European countries, France to come online April 7

Disney+, the streaming service from the Walt Disney Company, has been rapidly ramping up in the last several weeks. But while some of that expansion has seen some hiccups, other regions are basically on track. Today, as expected, Disney announced that it is officially launching in the UK, Ireland, Germany, Italy, Spain, Austria, and Switzerland; it also reconfirmed the delayed debut in France will be coming online on April 7.

Seven is the operative number here, it seems: it’s the largest multi-country launch so far for the service.

“Launching in seven markets simultaneously marks a new milestone for Disney+,“ said Kevin Mayer, Chairman of Walt Disney Direct-to-Consumer & International, in a statement. “As the streaming home for Disney, Marvel, Pixar, Star Wars, and National Geographic, Disney+ delivers high-quality, optimistic storytelling that fans expect from our brands, now available broadly, conveniently, and permanently on Disney+. We humbly hope that this service can bring some much-needed moments of respite for families during these difficult times.”

Pricing is £5.99/€6.99 per month, or £59.99/€69.99 for an annual subscription. Belgium, the Nordics, and Portugal, will follow in summer 2020.

The service being rolled out will feature 26 Disney+ Originals plus an “extensive collection” of titles (some 500 films, 26 exclusive original movies and series and thousands of TV episodes to start with) from Disney, Pixar, Marvel, Star Wars, National Geographic, and other content producers owned by the entertainment giant, in what has been one of the boldest moves yet from a content company to go head-to-head with OTT streaming services like Netflix, Amazon and Apple.

The expansion of Disney+ has been caught a bit in the crossfire of world events. The new service is launching at what has become an unprecedented time for streaming: because of the coronavirus pandemic, a lot of of the world is being told to stay home.

That means huge demand for new services to entertain and distract people who are now sheltering in place. But it has also been putting a huge strain on broadband networks, and to be a responsible streamer (and to make sure quality is not too impacted), Disney confirmed (as it previously said it would) it would be launching the service with “lower overall bandwidth utilization by at least 25%.

Titles in the mix debuting today include “The Mandalorian” live-action Star Wars series; a live-action “Lady and the Tramp,” “High School Musical: The Musical: The Series,”; “The World According to Jeff Goldblum” docuseries from National Geographic; “Marvel’s Hero Project,” which celebrates extraordinary kids making a difference in their communities; “Encore!,” executive produced by the multi-talented Kristen Bell; “The Imagineering Story” a 6-part documentary from Emmy and Academy Award-nominated filmmaker Leslie Iwerks and animated short film collections “SparkShorts” and “Forky Asks A Question” from Pixar Animation Studios.

Some 600 episodes of “The Simpsons” is also included (with the latest season 31 coming later this year).

With entire households now being told to stay together and stay inside, we’re seeing a huge amount of pressure being put on to broadband networks and a true test of the multiscreen approach that streaming services have been building over the years. In this case, you can use all the usuals: mobile phones, streaming media players, smart TVs and gaming consoles to watch the Disney+ service (including Amazon devices, Apple devices, Google devices, LG Smart TVs with webOS, Microsoft’s Xbox Ones, Roku, Samsung Smart TVs and Sony / Sony Interactive Entertainment, with the ability to use four concurrent streams per subscription, or up to 10 devices with unlimited downloads. As you would expect, there is also the ability to set up parental controls and individual profiles.

Carriers with paid-TV services that are also on board so far include Deutsche Telekom, O2 in the UK, Telefonica in Spain, TIM in Italy and Canal+ in France when the country comes online. No BT in the UK, which is too bad for me (sniff). Sky and NOW TV are also on board.

CcHub funds tech to curb COVID-19 on concerns of an Africa outbreak

Africa’s largest innovation incubator, CcHub, will offer funding and engineering support to tech projects aimed at curbing COVID-19 and its social and economic impact.

The Lagos and Nairobi based organization posted an open application on its website this week, CcHub CEO Bosun Tijani told TechCrunch on a call.

CcHub will provide $5000 to $100,000 funding blocks to companies with COVID-19 related projects covering last mile communication, support for the infected and the most vulnerable, production of essential medical supplies and support for disrupted food supply-chains.

The organization, and its iHub affiliate, will also open up engineering support and resources from its CcHub Design Lab to funded companies, according to Tijani.

He noted that established startups who want to create COVID-19 related projects on the side of their core-business can apply.

The initiative stems from concerns Africa could be less prepared than other regions in dealing with an outbreak of the virus that has spread in China, Europe and the U.S. and is wreaking economic havoc globally.

Tijani hopes CcHub can employ its network and resources to limit the spread and damage of COVID-19 in Africa.

The Lagos based innovation-space acquired Kenya’s iHub in 2019, bringing together two of Africa’s most powerful tech hubs by membership networks, VC, volume of programs, startups incubated and global visibility.

“Quite a number of African countries, if they get to the level of Italy or the UK, I don’t think the system…is resilient enough to provide support to something like that,” Tijani said.

Reported cases in major population countries, such as Kenya and Nigeria, were in single-digits as late as last week, but those numbers are spiking. By the World Health Organization’s latest stats Wednesday there were 463 COVID-19 cases in Africa and 10 confirmed deaths related to the virus.

Governments are taking action. South Africa, which has the second-largest reported coranvirus outbreak on the continent, declared a national disaster this week, banned public gatherings and announced travel restrictions on the U.S. and UK. Kenya has also imposed its own travel and crowd restrictions.

Only two cases have been recorded in Nigeria, but CcHub’s Tijani fears the actual scenario for the West African country and Kenya could be much worse.

CcHub CEO Bosun Tijani1

“I think Lagos and Nigeria are in denial. Some governments in Africa are taking action, but the focus in Africa has been relying on port of entry [measures], which isn’t reliable because…I suspect its already here…people may not have symptoms yet,” said Tijani.

If there is a rapid outbreak, he fears it will overwhelm a number of systems in countries such as Nigeria and Kenya.

“We don’t have the health systems to contain it. We don’t have the the welfare system that can work for the most vulnerable, such as elderly…we don’t manufacture most of these medical supplies and our food [supply-chain] is not reliable,” Tijani added.

Addressing these pending challenges related to COVID-19 in Africa is what CcHub hopes to support in its latest open call to fund projects.

The innovation incubator isn’t the only tech player on the continent shifting to respond to a possible coronavirus crises.

Pan-African on-demand trucking logistics company Kobo360 has asked employees who can work remotely to do so in Ghana and Nigeria, according to the Chief Strategy Officer Kagure Wamunyu. The Goldman Sachs backed startup is also planning contingencies to ensure supply-chain continuity, should COVID-19 disrupt business and mobility in its markets.

In Kenya, the country is turning to its leading mobile-money product, M-Pesa, to reduce the the chances of an outbreak. Safaricom waived transaction fees on the app this week to increase digital-payments use and lower the risk of spreading the COVID-19 through physical handling of cash.

Facebook’s dodgy defaults face more scrutiny in Europe

Italy’s Competition and Markets Authority has launched proceedings against Facebook for failing to fully inform users about the commercial uses it makes of their data.

At the same time a German court has today upheld a consumer group’s right to challenge the tech giant over data and privacy issues in the national courts.

Lack of transparency

The Italian authority’s action, which could result in a fine of €5 million for Facebook, follows an earlier decision by the regulator, in November 2018 — when it found the company had not been dealing plainly with users about the underlying value exchange involved in signing up to the ‘free’ service, and fined Facebook €5M for failing to properly inform users how their information would be used commercially.

In a press notice about its latest action, the watchdog notes Facebook has removed a claim from its homepage — which had stated that the service ‘is free and always will be’ — but finds users are still not being informed, “with clarity and immediacy”, about how the tech giant monetizes their data.

The Authority had prohibited Facebook from continuing what it dubs “deceptive practice” and ordered it to publish an amending declaration on its homepage in Italy, as well as on the Facebook app and on the personal page of each registered Italian user.

In a statement responding to the watchdog’s latest action, a Facebook spokesperson told us:

We are reviewing the Authority decision. We made changes last year — including to our Terms of Service — to further clarify how Facebook makes money. These changes were part of our ongoing commitment to give people more transparency and control over their information.

Last year Italy’s data protection agency also fined Facebook $1.1M — in that case for privacy violations attached to the Cambridge Analytics data misuse scandal.

Dodgy defaults

In separate but related news, a ruling by a German court today found that Facebook can continue to use the advertising slogan that its service is ‘free and always will be’ — on the grounds that it does not require users to hand over monetary payments in exchange for using the service.

A local consumer rights group, vzbv, had sought to challenge Facebook’s use of the slogan — arguing it’s misleading, given the platform’s harvesting of user data for targeted ads. But the court disagreed.

However that was only one of a number of data protection complaints filed by the group — 26 in all. And the Berlin court found in its favor on a number of other fronts.

Significantly vzbv has won the right to bring data protection related legal challenges within Germany even with the pan-EU General Data Protection Regulation in force — opening the door to strategic litigation by consumer advocacy bodies and privacy rights groups in what is a very pro-privacy market. 

This looks interesting because one of Facebook’s favored legal arguments in a bid to derail privacy challenges at an EU Member State level has been to argue those courts lack jurisdiction — given that its European HQ is sited in Ireland (and GDPR includes provision for a one-stop shop mechanism that pushes cross-border complaints to a lead regulator).

But this ruling looks like it will make it tougher for Facebook to funnel all data and privacy complaints via the heavily backlogged Irish regulator — which has, for example, been sitting on a GDPR complaint over forced consent by adtech giants (including Facebook) since May 2018.

The Berlin court also agreed with vzbv’s argument that Facebook’s privacy settings and T&Cs violate laws around consent — such as a location service being already activated in the Facebook mobile app; and a pre-ticked setting that made users’ profiles indexable by search engines by default

The court also agreed that certain pre-formulated conditions in Facebook’s T&C do not meet the required legal standard — such as a requirement that users agree to their name and profile picture being used “for commercial, sponsored or related content”, and another stipulation that users agree in advance to all future changes to the policy.

Commenting in a statement, Heiko Dünkel from the law enforcement team at vzbv, said: “It is not the first time that Facebook has been convicted of careless handling of its users’ data. The Chamber of Justice has made it clear that consumer advice centers can take action against violations of the GDPR.”

We’ve reached out to Facebook for a response.

Glovo exits the Middle East and drops two LatAm markets in latest food delivery crunch

The new year isn’t even a month old and the food delivery crunch is already taking big bites. Spain’s Glovo has today announced it’s exiting four markets — which it says is part of a goal of pushing for profitability by 2021.

Also today, Uber confirmed rumors late last year by announcing it’s offloading its Indian Eats business to local rival Zomato — which will see it take a 9.99% stake in the Indian startup.

In other recent news Latin America focused on-demand delivery app Rappi announced 6% staff layoffs.

On-demand food delivery apps may be great at filling the bellies of hungry consumers fast but startups in this space have yet to figure out how to deliver push-button convenience without haemorrhaging money at scale.

So the question even some investors are asking is how they can make their model profitable?

Middle East exit

The four markets Glovo is leaving are Turkey, Egypt, Uruguay and Puerto Rico.

The exits mean its app footprint is shrinking to 22 markets, still with a focus on South America, South West Europe, and Eastern Europe and Africa.

Interestingly, Glovo is here essentially saying goodbye to the Middle East — despite its recent late stage financing round being led by Abu Dhabi state investment company, Mubadala. (It told us last month that regional expansion was not part of Mubadala’s investment thesis.)

Commenting on the exits in a statement, Glovo co-founder and CEO, Oscar Pierre, said: “This has been a very tough decision to take but our strategy has always been to focus on markets where we can grow and establish ourselves among the top two delivery players while providing a first-class user experience and value for our Glovers, customers and partners.”

Last month Pierre told us the Middle East looks too competitive for Glovo to expand further.

In the event it’s opted for a full exit — given both Egypt and Turkey are being dropped (despite the latter being touted as one of Glovo’s fastest growing markets just over a year ago, at the time of its Series D).

“Leaving these four markets will help us to further strengthen our leadership position in South West and Eastern Europe, LatAm and other African markets, and reach our profitability targets by early 2021,” Pierre added.

Glovo said its app will continue to function in the four markets “for a few weeks” after today — adding that it’s offering “support and advice to couriers, customers and partners throughout this transition”.

“I want to place on record our thanks to all of our Glovers, customers and partners in the markets from which we’re withdrawing for their hard work, dedication, commitment and ongoing support,” Pierre added.

The exits sum to Glovo withdrawing from eight out of a total 306 cities.

It also said the eight cities collectively generated 1.7% of its gross sales in 2019 — so it’s signalling the move doesn’t amount to a major revenue hit.

The startup disclosed a $166M Series E raise last month — which pushed the business past a unicorn valuation. Pierre told us then that the new financing would be used to achieve profitability “as early as 2021”, foreshadowing today’s announcement of a clutch of market exits.

Glovo has said its goal is to become the leading or second delivery platform in all the markets where it operates — underlining the challenges of turning a profit in such a hyper competitive, thin margin space which also involves major logistical complexities with so many moving parts (and people) involved in each transaction.

As food delivery players reconfigure their regional footprints — via market exits and consolidation — better financed platforms will be hoping they’ll be left standing with a profitable business to shout about (and the chance to grow again by gobbling up less profitable rivals or else be consumed themselves). So something of a new race is on.

Back in November in an on-stage interview at TechCrunch Disrupt Berlin, Uber Eats and Glovo discussed the challenges of turning a profit — with Glovo co-founder Sacha Michaud telling us he expects further consolidation in the on-demand delivery space. (Though the pair claimed there had been no acquisition talks between Uber and Glovo.)

Michaud said then that Glovo is profitable on a per unit economics basis in “some countries” — but admitted it “varies a lot country by country”.

Spain and Southern Europe are the best markets for Glovo, he also told us, confirming it generates operating profit there. “Latin America will become operation profitable next year,” he predicted.

Glovo’s exit from Egypt actually marks the end of a second act in the market.

The startup first announced it was pulling the plug on Egypt in April 2019 — but returned last summer, at the behest of its investor Delivery Hero (a rival food delivery startup which has a stake in Glovo), according to Michaud’s explanation on stage.

However there was also an intervention by Egypt’s competition watchdog. And local press reported the watchdog had ordered Glovo to resume operations — accusing it and its investor of colluding to restrict competition in the market (Delivery Hero having previously acquired Egyptian food delivery rival, Otlob).

What the watchdog makes of today’s announcement of a final bow out could thus be an interesting wrinkle.

Asked about Egypt, a Glovo spokesperson told us: “Egypt has been a very complex market for us, we were sad to leave the first time and excited to return when we did so last summer. However, our strategy has always been to be among the top two delivery players in every market we enter and have a clear path to profitability. Unfortunately, in Egypt there is not a clear path to profitability.”

Whither profitability?

So what does a clear path to profitability in the on-demand delivery space look like?

Market maturity/density appears to be key, with Glovo only operating in one city apiece in the other two markets it’s leaving, Uruguay and Puerto Rico, for example — compared to hundreds across its best markets, Spain and Italy, where it says it’s operating out of the red.

This suggests that other markets in South America — where Glovo similarly has just a toe-hold, of a single or handful of cities, and less time on the ground, such as Honduras or Panama — could be vulnerable to further future exits as the company reconfigures to try to hit full profitability in just around a year’s time.

But there are likely lots of factors involved in making the unit economics stack up so it’s tricky to predict.

Food delivered on-demand makes up the majority of Glovo’s orders per market but its app also touts being able to deliver ‘anything’ — from groceries to pharmaceuticals to the house keys you left at home — which it claims as a differentiating factor vs rival food-delivery-only apps.

A degree of variety also looks to be a key ingredient in becoming a sustainable on-demand delivery business — as scale and cross selling appear to where the unit economics can work.

Groceries are certainly a growing focus for Glovo which has been investing in setting up networks of dark supermarkets to support fast delivery of convenience style groceries as well as ready-to-eat food — thereby expanding opportunities for cross-selling to its convenience-loving food junkies at the point of appetite-driven (but likely loss-making) lunch and dinner orders.

Last year Michaud told us that market “maturity” supports profitability. “At the end of the day the more orders we have the better the whole ecosystem works,” he said.

While Uber Eats’ general manager for Northern and Eastern Europe, Charity Safford, also pointed to “scale” as the secret sauce for still elusive profits.

“Where we start to see more and more trips happening this is definitely where we see the unit economics improving — so our job is really to figure out all of the use cases we can put into people’s hands to get that application used as much as possible,” she said.

It’s instructive that Uber is shifting towards a ‘superapp’ model — revealing its intent last year to fold previously separate lines of business, such as rides and Eats, into a single one-stop-shop app which it began rolling out last year. So it’s also able to deliver or serve an increasing number of things (and/or services).

The tech giant has also been testing subscription passes which combine access to a range of its offerings under one regular payment.

In some markets Glovo also has a ‘Prime’ monthly subscription, offering unlimited deliveries of anything its couriers can bike to your door, for a fixed monthly cost — which it launched back in 2018.

When it comes to the quest for on-demand profitability all roads seem to lead to trying to become the bit of Amazon’s business that Amazon hasn’t already built out and swiped.

Talking to Zero Motorcycles’ CEO and taking home the 2020 SR/F

The motorcycle industry is shifting to electric. Harley Davidson signaled the trend this year, becoming the first big gas manufacturer to release a street-legal e-motorcycle in the US, the LiveWire.

But before Harley’s EV pivot, California based startup Zero Motorcycles had been selling e-motos for years.

“We’re an electric motorcycle and power-train manufacturer founded in 2006 in Santa Cruz, California…we’re sold in over 30 countries,” Zero CEO Sam Paschel told TechCrunch.

“Fundamentally we aim to transform and elevate the motorcycling experience and by doing that we expect to make a huge dent in transforming transportation globally.”

Toward that aim, Zero recently released the all-new 2020, SR/F — a $19K high-performance e-motorcycle and competitor to Harley Davidson’s $29K LiveWire.

TechCrunch took an SR/F home to experience going full e-moto. The biggest distinction between e-motorcycles — versus gas two-wheelers — is lightning acceleration and uninterrupted forward movement.

Zero’s SRF has a magnet motor and one gear — with no clutch or shifting — and fewer mechanical parts to put the 14.4 kWh battery’s 140 ft-lbs of torque to the pavement.

You simply twist and go.

The SR/F is a fully digital, IoT motorcycle that syncs to a smartphone and the cloud to monitor charge status or adjust performance. It has preset riding modes  — Eco, Street, Sport, and Rain — for different combinations of power and range. The EV also allows for customized riding modes dialed in via smartphone.

Zero Ride Mode GIFOne can power Zero’s sporty e-moto from a household outlet or use fast-charging networks — like ChargePoint — for a full battery in around 80 minutes.

Zero’s SR/F has a range of up to 161 miles in the city, where it can recharge itself marginally through regenerative braking. For a combination of city, highway, an sport riding, I averaged around 100 miles a charge, alternating between riding modes.

On performance, Zero’s new sport-entry hauls ass. Going 0 to 60 at full power on the new SR/F is a rush, while 60 to 100 speed is so fast it’s downright frightening.  Overall, the e-moto’s acceleration is stronger and more constant than internal combustion machines, with no emissions and little sound.

Zero’s CEO Sam Paschel thinks the distinct electric motorcycle experience can convert gas riders

“We have what we consider enthusiasts…These are people that are avid motorcycle riders…What we find with them is they throw a leg over a Zero…have an electric motorcycle experience, it’s fundamentally different…They fall in love, they buy one,” he said.

Zero’s e-motos — starting at around $9K for the entry level FX — are also attracting a younger generation, according to the startup’s CEO.

“They’re an early adopter of new technology. They love the idea — whether it’s the performance elements the riding experience, green or eco elements of having electric vehicle — and we’re actually drawing them into the sport in a way that they wouldn’t have been drawn in by internal combustion,” he said.

Zero Chargepoint 1Paschel is undaunted by Harley’s EV debut or the other big gas motorcycle manufacturers entering the E-market.

“You have a major OEM that’s launched a bike into the space that we have been defining and creating for over a decade. Of course, the nature of that relationship is fundamentally competitive,” he said.

“The question I get more often is…are we concerned? Are we worried or scared of any OEMs entering? And The answer is no. This is actually the most exciting thing that’s happened in the space in a long time,” said Paschel.

“A rising tide is going to lift all ships, and…I’m more than confident that we will capture more than our fair share of a rapidly growing market simply because this is all we do. And we spent 13 years, millions of miles, and a lot of time doing this just right.”

Both Zero and Harley are banking on e-motos to reboot a flailing U.S. motorcycle industry. New bike sales dropped 50% since 2008 — with sharp declines in ownership by everyone under 40.

Zero has worked to close gaps on price, range, charge times, and performance compared to petrol-powered motorcycles.

The startup is not alone. Italy’s Energica is expanding distribution of its high-performance e-motos in the U.S. Other competitors include California based Lightning Motorcycles and e-moto startup Fuell, with plans to release its $10K, 150 mile range Flow this year.

Of course, there’s already been some speed-bumps and market attrition, with three e-moto startups — Alta Motors, Mission Motors, and Brammo — forced to power down over the last several years.

Zero looks to its head start and proprietary technology to win in the electric conversion of motorcycles.

The company has also received partnership inquiries

“It’s not something that we are actively seeking…I will tell you that there’s a lot of inbound interest. I think people were waking up and realizing that that transition is much closer than they thought it was…We’ve had conversations from a list of OEMS, many of whom you would recognize,” said Paschel.

Still, Zero is likely to ride on alone, according to its CEO.

“Right now it’s an inherently competitive relationship with a lot of those guys, so it would have to be the right deal…But right now we’re fiercely competitive company. We’re in a competition with all these brands.”

ZERO SRF TC IIZero’s SR/F could be the sweet spot of tech, price, range, and performance it has been striving toward to finally go mass market and compete with those brands.

And with Zero and Harley growing e-moto market share, expect big names still on the sidelines — Honda, Ducati, Kawasaki — to debut production EVs soon.

With that, the electrification of the motorcycle industry will become another facet of the transformation of global mobility.