January 18, 2019
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Startups Weekly: Will Trump ruin the unicorn IPOs of our dreams?

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The government shutdown entered its 21st day on Friday, upping concerns of potentially long-lasting impacts on the U.S. stock market. Private market investors around the country applauded when Uber finally filed documents with the SEC to go public. Others were giddy to hear Lyft, Pinterest, Postmates and Slack (via a direct listing, according to the latest reports) were likely to IPO in 2019, too.

Unfortunately, floats that seemed imminent may not actually surface until the second half of 2019 — that is unless President Donald Trump and other political leaders are able to reach an agreement on the federal budget ASAP.  This week, we explored the government’s shutdown’s connection to tech IPOs, recounted the demise of a well-funded AR project and introduced readers to an AI-enabled self-checkout shopping cart.

1. Postmates gets pre-IPO cash

The company, an early entrant to the billion-dollar food delivery wars, raised what will likely be its last round of private capital. The $100 million cash infusion was led by BlackRock and valued Postmates at $1.85 billion, up from the $1.2 billion valuation it garnered with its unicorn round in 2018.

2. Uber’s IPO may not be as eye-popping as we expected

To be fair, I don’t think many of us really believed the ride-hailing giant could debut with a $120 billion initial market cap. And can speculate on Uber’s valuation for days (the latest reports estimate a $90 billion IPO), but ultimately Wall Street will determine just how high Uber will fly. For now, all we can do is sit and wait for the company to relinquish its S-1 to the masses.

3. Deal of the week

N26, a German fintech startup, raised $300 million in a round led by Insight Venture Partners at a $2.7 billion valuation. TechCrunch’s Romain Dillet spoke with co-founder and CEO Valentin Stalf about the company’s global investors, financials and what the future holds for N26.

4. On the market

Bird is in the process of raising an additional $300 million on a flat pre-money valuation of $2 billion. The e-scooter startup has already raised a ton of capital in a very short time and a fresh financing would come at a time when many investors are losing faith in scooter startups’ claims to be the solution to the problem of last-mile transportation, as companies in the space display poor unit economics, faulty batteries and a general air of undependability. Plus, Aurora, the developer of a full-stack self-driving software system for automobile manufacturers, is raising at least $500 million in equity funding at more than a $2 billion valuation in a round expected to be led by new investor Sequoia Capital.

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5. A unicorn’s deal downsizes

WeWork, a co-working giant backed with billions, had planned on securing a $16 billion investment from existing backer SoftBank . Well, that’s not exactly what happened. And, oh yeah, they rebranded.

6. A startup collapses

After 20 long years, augmented reality glasses pioneer ODG has been left with just a skeleton crew after acquisition deals from Facebook and Magic Leap fell through. Here’s a story of a startup with $58 million in venture capital backing that failed to deliver on its promises.

7. Data point

Seed activity for U.S. startups has declined for the fourth straight year, as median deal sizes increased at every stage of venture capital.

8. Meanwhile, in startup land…

This week edtech startup Emeritus, a U.S.-Indian company that partners with universities to offer digital courses, landed a $40 million Series C round led by Sequoia India. Badi, which uses an algorithm to help millennials find roommates, brought in a $30 million Series B led by Goodwater Capital. And Mr Jeff, an on-demand laundry service startup, bagged a $12 million Series A.

9. Finally, Meet Caper, the AI self-checkout shopping cart

The startup, which makes a shopping cart with a built-in barcode scanner and credit card swiper, has revealed a total of $3 million, including a $2.15 million seed round led by First Round Capital .

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News Source = techcrunch.com

Inside VW, Mobileye’s deal to launch a autonomous ride-hailing service in Israel

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In the world of autonomous vehicles, the news comes in repetitive short bursts with formulaic precision: Company X is launching a robotaxi fleet/test program in city Y by [insert date]. These announcements are promptly forgotten until the first self-driving vehicles are spotted, an accident occurs, or a new partner joins the test program. Rinse. repeat.

The recent announcement between VW Group, Intel’s computer vision subsidiary Mobileye, and Champion Motors was treated no differently. The Volkswagen Group, Intel’s Mobileye and Champion Motors said they plan to deploy Israel’s first self-driving ride-hailing service in 2019 through a joint venture called New Mobility in Israel.

There were elements of the announcement that were overblown, and others pieces that didn’t receive the attention they deserved. Here’s an effort to clarify what’s been misinterpreted and dig into the details that matter.

Nuts and bolts

The New Mobility robotaxi service will not be operating as a commercial business at scale in Israel next year. Sure, some coverage has interpreted it as such. But it’s not. Here’s what is happening.

The New Mobility in Israel group’s proposal was formally accepted by the Israeli government during a private ceremony at the Smart Mobility Summit 2018 in Tel Aviv last Monday. The group will begin testing next year in Tel Aviv and roll out the service in phases until reaching full commercialization in 2022. (Intel and Mobileye began testing self-driving cars in Jerusalem in May 2018.)

VW and Mobileye didn’t — and wouldn’t, when pressed — disclose which city they plan to test in. However, Israel Prime Minister Benjamin Netanyahu noted during remarks at the Smart Mobility Summit gala dinner that the group would be testing in Tel Aviv.

The project will begin with dozens of self-driving vehicles — each one with safety drivers behind the wheel. An early rider program, which would give vetted members of the public access to the service, will likely launch in 2021, one unnamed source familiar with the deal told TechCrunch.

Each of the three companies in the joint venture are providing a piece of this self-driving vehicle business puzzle. Champion Motors will run the fleet operations and control center. VW is going to supply the electric vehicles. And Mobileye is handling the self-driving system. All three companies will add the mobility platform and services to be able to deploy a commercial service.

The Israeli government is also contributing, with plans to provide legal and regulatory support, share the required infrastructure and traffic data, and provide access to infrastructure as needed.

What it means for Mobileye

Mobileye will provide its Level 4 AV kit, which was introduced in September at the CITI 2018 Global Technology Conference. This is the kit that provides the visual perception, sensor fusion, its REM mapping system, software algorithms and driving policy that will “drive” the cars. Importantly, this system’s driving policy, or the decision-making of the car, will be influenced by “Responsibility Sensitive Safety,” or RSS, a mathematical model introduced by the company in a white paper last year.

The RSS is an open, non-proprietary proposal for all AV companies and tries formalize an interpretation of the law applied to self-driving cars. The authors, who include Mobileye CEO Amnon Shashua, argue that the interpretation, if followed by everyone in the AV industry, would eliminate self-driving car accidents and should lead to a useful driving policy. In their view, a useful driving policy means an “agile driving policy rather than an overly-defensive driving, which inevitably would confuse other human drivers and will block traffic and in turn limit the scalability of system deployment,” according to the paper.

The Tel Aviv self-driving service will be an important test piece for Mobileye’s AV kit product, which will include its EyeQ5 system-on-chip. The EyeQ5 has 10 times faster teleoperations per second than its EyeQ4 chip, which just launched this year with BMW, Nio and VW.

What it means for VW

VW’s electrification plans are in transition at the moment. The company still sells the e-Golf and the e-up! It’s working toward bringing a new generation of fully connected, all-electric vehicles to the market in 2020. VW is calling this I.D series, which will have a new modular design for electric cars called MEB design.

Initially, this Tel Aviv program will use one of VW’s plug-in hybrid electric vehicle. The company wouldn’t disclose the model. But the joint venture will likely use a plug-in hybrid electric vehicle (or PHEV) that is currently available in Israel. The VW Passat GTE PHEV is one such vehicle.

As the program in Israel evolves, VW will have a ready test bed and customer for its new line of electric vehicles. However, the joint venture in Israel is just one small piece of VW’s overall autonomous vehicle and mobility plans. Let’s not forget that it has a partnership with self-driving startup Aurora . Volkswagen and Aurora have been working  integrate self-driving systems in custom-designed electric shuttles for VW’s new Moia brand. Volks­wagen is launching two kinds of test fleets that use Aurora’s tech, including one for ride-pooling using Moia shuttles.

A few takeaways

Ultimately, the launch in Tel Aviv will allow Mobileye to prove out its RSS, a hypothesis that other autonomous vehicle founders in the industry have privately questioned.

This self-driving taxi service has broad government support, which could accelerate the deployment of the program and push Israel ahead of other countries like the United States that has a lot of autonomous vehicle testing activity.

This new pact will undoubtedly fuel the AV-startup craze in Israel, too. Four or five years ago, there were about 60 autonomous vehicle-related. Now, there are at least 500, according to Netanyahu.

News Source = techcrunch.com

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