Shares of Box, a well-known content-and-collaboration company that went public in 2015, rose today after Reuters reported that the company is exploring a sale. TechCrunch previously discussed rising investor pressure for Box to ignite its share price after years in the public-market wilderness.
At the close today Box’s equity was worth $23.65 per share, up around 5% from its opening value, but lower than its intraday peak of $26.47, reached after the news broke. The company went public a little over five years ago at $14 per share, only to see its share price rise to around the same level it returned today during its first day’s trading.
Box, famous during its startup phase thanks in part to its ubiquitous CEO and co-founder Aaron Levie, has continued to grow while public, albeit at a declining pace. Dropbox, a long-term rival, has also seen its growth rate decline since going public. Both have stressed rising profitability over revenue expansion in recent quarters.
But the problem that Box has encountered while public, namely hyper-scale platform companies with competing offerings, could also prove a lifeline; Google and Microsoft could be a future home for Levie’s company, after years of the duo challenging Box for deals.
As recently as last week, Box announced a deal for tighter integration with Microsoft Office 365. Given the timing of the release, it was easy to speculate the news could be landing ahead of a potential deal. The Reuters article adds fuel to the possibility.
While we can’t know for sure if the Reuters article is accurate, the possible sale of Box makes sense.
The article indicated that one of the possible acquisition options for Box could be taking it private again via private equity. Perhaps a firm like Vista or Thoma Bravo, two firms that tend to like mature SaaS companies with decent revenue and some issues, could swoop in to buy the struggling SaaS company. By taking companies off the market, reducing investor pressure and giving them room to maneuver, software companies can at times find new vigor.
Consider the case of Marketo, a company that Vista purchased in 2016 for $1.6 billion before turning it around and selling to Adobe in 2018 for $4.75 billion. The end result generated a strong profit for Vista, and a final landing for Marketo as part of a company with a broader platform of marketing tools.
If there are expenses at Box that could be trimmed, or a sales process that could be improved, is not clear. But Box’s market value of $3.78 billion could put it within grasp of larger private-equity funds. Or well within the reaches of a host of larger enterprise software companies that might covet its list of business customers, technology or both.
If the rumors are true, it could be a startling fall from grace for the company, moving from Silicon Valley startup darling to IPO to sold entity in just six years. While it’s important to note these are just rumors, the writing could be on the wall for the company, and it could just be a matter of when and not if.
There has been a growing industry trend in recent years for large scale companies to build their own chips. As part of that, Google announced today that it has hired long-time Intel executive Uri Frank as Vice President to run its custom chip division.
“The future of cloud infrastructure is bright, and it’s changing fast. As we continue to work to meet computing demands from around the world, today we are thrilled to welcome Uri Frank as our VP of Engineering for server chip design,” Amin Vahdat, Google Fellow and VP of systems infrastructure wrote in a blog post announcing the hire.
With Frank, Google gets an experienced chip industry executive, who spent more than two decades at Intel rising from engineering roles to Corporate Vice President at the Design Engineering Group, his final role before leaving the company earlier this month.
Frank will lead the custom chip division in Israel as part of Google. As he said in his announcement on LinkedIn, this was a big step to join a company with a long history of building custom silicon.
“Google has designed and built some of the world’s largest and most efficient computing systems. For a long time, custom chips have been an important part of this strategy. I look forward to growing a team here in Israel while accelerating Google Cloud’s innovations in compute infrastructure,” Frank wrote.
Google’s history of building its own chips dates back to 2015 when it launched the first TensorFlow chips. It moved into video processing chips in 2018 and added OpenTitan , an open source chip with a security angle in 2019.
Frank’s job will be to continue to build on this previous experience to work with customers and partners to build new custom chip architectures. The company wants to move away from buying motherboard components from different vendors to building its own “system on a chip” or SoC, which it says will be drastically more efficient.
“Instead of integrating components on a motherboard where they are separated by inches of wires, we are turning to “Systems on Chip” (SoC) designs where multiple functions sit on the same chip, or on multiple chips inside one package. In other words, the SoC is the new motherboard,” Vahdat wrote.
While Google was early to the ‘Build Your Own Chip’ movement, we’ve seen other large scale companies like Amazon, Facebook, Apple and Microsoft begin building their own custom chips in recent years to meet each company’s unique needs, and give more precise control over the relationship between the hardware and software.
It will be Frank’s job to lead Google’s custom chip unit and help bring it to the next level.
Techstars NYC just announced the 10 startups participating in this year’s program, making up what Managing Director Jenny Fielding described as the accelerator’s most global class yet.
“We’ve always had applications from around the world and I was always able to take companies from anywhere,” Fielding said. “But the truth is, when you run Techstars New York, if you don’t have five companies from New York, there’s a feeling that you’re letting the ecosystem down a little bit.”
Now that the program is almost entirely virtual, Fielding said she felt free to “open up the geos.” In fact, not a single one of the startups is based in New York — instead, there are multiple San Francisco and Washington, D.C. companies, as well as others based in the France, Israel, Kenya, Portugal and the United Kingdom.
Fielding argued that even without New York startups, the accelerator still has a New York identity, because it connects global startups with the New York ecosystem.
After conducting last year’s accelerator virtually, Fielding said the hardest element to recreate has been the in-person camaraderie between the founders. So she’s hoping to have an in-person meetup here at the end of May, although the logistics of that meetup will depend on what’s safe and legal at that time (and what the entrepreneurs are comfortable with).
Other aspects of the virtual experience are likely to stick around post-pandemic. After all, Techstars hosts around 200 mentors per class, and Fielding said the virtual program marked the first time “nobody was late.” Similarly, she suggested that demo day remains an “open question,” as an extended period of investor meetings seems to be driving more fundraising for the startups.
Meanwhile, here are the startups:
It’s plain to see that electric vehicles are the future, but there’s more to making that change happen than swapping out a gas motor for a battery-powered one — especially in aircraft. H3X is a startup that aims to accelerate that future with a reimagined, completely integrated electric motor that it claims outperforms everything on the market.
The small founding team — CEO Jason Sylvestre, CTO Max Liben, and COO Eric Maciolek — met in college while participating in an electric vehicle building and racing program. After stints in the tech and automobile industry (including at Tesla), the crew came back together when they saw that the Department of Energy was offering a bounty for improved high power density electric motors.
“The problem was uniquely suited to our abilities, and passions too — we’re excited about this stuff. We care about decarbonization of the different transit sectors, and aviation is going to become a growing part of the global carbon footprint over the next few decades as electric improves ground vehicles,” said Liben. “We just kinda decided to take a leap of faith, and applied to Y Combinator.”
Electric flight isn’t so much a wild idea as one that’s in its early, awkward stages. Lightweight craft like drones can do a great deal with the batteries and motors that are available, and converted small aircraft like seaplanes are able to make short flights, but that’s about the limit with the way things are today.
The problem is primarily a simple lack of power: the energy required to propel an aircraft fast enough to generate lift grows exponentially as the size and mass of the plane increase. A handful of kilowatt-hours will serve for a drone, and a few EV-scale batteries will work for a light aircraft… but beyond that the energy required to take flight requires batteries the bulk and weight of which make flight impractical.
Of course, it doesn’t have to be like that. And there are two general avenues for improvement: better batteries or better motors. So either you can fit more energy in the same mass or use what energy you have more efficiently. Both are being pursued by many companies, but H3X claims to have made a huge leap forward in power density that could unlock new industries overnight. While even an improvement of 10 or 20 percent in power per kilogram (e.g. a 50-pound motor putting out 120 horsepower rather than 100) would be notable, H3X says its motor is performing at around 300 percent of the competition’s output.
How? It’s all about integration, Liben explained. While the pieces are similar in some ways to motors and power assemblies out there now, the team basically started from scratch with the idea of maximizing efficiency and minimizing size.
Electric motors generally have three main sections: the motor itself, a power delivery system, and a gearbox, each of which may have its own housing and be sold and mounted separately from one another. One reason why these aren’t all one big machine is temperature: the parts and coolant systems of the gearbox, for instance, might not be able to operate at the temperatures generated by the motor or the power system, or vice versa. Put them together and one may cause the other to seize up or otherwise fail. The different sections just have different requirements, which seems natural.
H3X challenges this paradigm with a novel integrated design, but Liben was careful to clarify what that means.
“We’re not just taking the inverter box and slapping it on top and calling it integrated,” he said. “All the components are all intimately connected to the same housing and motor. We’re making a truly integrated design that’s one of the first of its kind at this power level.”
And by “one of the first” he doesn’t mean that Airbus has one in some powertrains, but rather that there have been research projects along these lines — nothing intended for production.
The idea that no one else has gone this far in putting everything in the same box at scales that could be used commercially may sound suspicious to some. One would think that the existing players in aerospace would have been barking up this tree for years, but Liben said large companies are too slow to innovate and too invested in other methods, while smaller ones tend to avoid risk by improving incrementally on successful existing designs and competing among themselves. “No one is targeting the level of performance we’re looking at right now,” he said.
But it isn’t like H3X stumbled over a single advance that magically tripled the performance of electric motors.
“We’re not relying on one big tech or something — there’s no magic bullet,” Liben said. “There are a few improvements that have very significant gains, like 50 percent better than the state of the art, and lots of areas that add 10-20 percent. It’s good from the technical risk side.”
He went into considerable detail on a lot of those improvements, but the less technical-minded among our readers, if they’ve even read this far, might close the tab if I tried to recount the whole conversation. To be brief, it amounts to combining advances in materials, manufacturing, and electric components so that they act synergistically, each enabling the other to be used to best effect.
For instance, recently improved power switching hardware can be run at hotter temperatures and handle higher loads — this raises performance but also allows for shared cooling infrastructure. The shared infrastructure can itself be improved by using new pure-copper 3D printing techniques, which allow more cooling to fit inside the housing. Using 3D printing means custom internal geometries so that the motor, gearbox, and power delivery can all be mounted in optimal positions to one another instead of bolted on where existing methods allow.
The result is an all-in-one motor, the HPDM-250, that’s smaller than a lot of the competition, yet produces far more power. The best production motors out there are around 3-4 kilowatts per kilogram of continuous power. H3X’s prototype produces 13 — coincidentally, just above the theoretical power density that would enable mid-range passenger aircraft.
There is the risk that stacking cutting edge techniques like this makes the cost rise faster than the performance. Liben said that while it’s definitely more expensive in some ways, the smaller size and integrated design also lead to new savings in cost, time, or material.
“People think, ‘3D printing copper, that’s expensive!’ But when you compare it to the super high performance windings you’d need otherwise, and the different ways that you manufacture them, that can require a lot of manual steps and people involved… it can be a lot simpler printing something,” he explained. “It can be counterintuitive, but at least from my BOM [bill of materials] cost, when you’re selling something three times smaller than the other guy, even if it’s high performance materials, it’s actually not as expensive as you’d think. Based on the customers we’ve talked to so far, we think we’re in a good spot.”
Servicing a fully integrated motor is also fundamentally more complex than doing so for an off the shelf one, but Liben noted that they were careful to think about maintenance from the start — and also that, while it may be a little harder to service their motor than an ordinary electric one, it’s much, much simpler than servicing even the most reliable and well-known gas-powered motors.
Despite the huge gains H3X claims, the target market of passenger aircraft is hardly one that they, or anyone, can just jump into. Heavily regulated industries like air travel require years of work and technology proving to change a fastener style, let alone the method of propulsion.
So H3X is focusing on the numerous smaller, less regulated industries that could use vastly improved electric propulsion. Cargo drones, electric boats, and air taxis might still be rare sights on this planet, but a big bump to motor power and efficiency might be what helps tip them from niche (or vaporware) to mainstream. Certainly all three of those applications could benefit hugely from improved range or payload capacity.
Graduating to passenger flights isn’t a distant dream, exactly, suggested Liben: “We’re already on our way — this isn’t 20-years-out type stuff. In the last few years the timelines have shrunk drastically. You could have a full battery electric vehicle soon, but it isn’t going to cut it for longer flights.”
There’s still a role for motors like H3X’s in hybrid aircraft that use jet fuel, batteries, and perhaps even hydrogen fuel cells interchangeably. Like the switch to electric cars, it doesn’t happen all at once and it doesn’t need to for the purposes of their business. “That’s the great thing about motors,” Liben said. “They’re so ubiquitous.”
H3X declined to disclose any funding or partners, although it’s hard to believe that the team could have gotten as far as it has without some kind of significant capital and facilities — this sort of project outgrows the garage workbench pretty fast. But with Y Combinator’s demo day happening tomorrow, it seems likely that they’ll be receiving a lot of calls over the next few weeks, after which it may be reasonable to expect a seed round to come together.
If H3X’s prototypes perform as well in the wild as they do on the bench, they may very well enable a host of new electric transportation applications. We’ll be watching closely to see how the startup’s play affects the future of electric mobility.
Social audio app Clubhouse has now promised a time frame of sorts for the launch of its anticipated Android version, following its recent hire of an Android software developer last month. In its weekly Townhall event on Sunday, Clubhouse co-founder Paul Davison remarked that the company was working “really hard” to come to Android, but said it’s going to take a “couple of months” to make that happen. That seems to indicate a time frame that’s closer to late spring or summer 2021.
Clubhouse had previously said in a late January blog post that it would begin work on its Android version “soon,” but had not yet promised any sort of time frame as to when it would be able to bring that version to the public. Instead, most of its statements about Android have been vague mentions of the importance of supporting the Android user base and making its app more accessible to a wider audience.
In the meantime, Clubhouse’s biggest rival, Twitter Spaces, has been taking advantage of Clubhouse’s delay to address the sizable Android user base by rapidly rolling out support to more people across platforms. This month, for example, Twitter Spaces opened up to Android users, allowing anyone on Android to join and talk inside its live audio rooms. Shortly thereafter, Twitter said that it plans to publicly launch Twitter Spaces to the general public in April. That would be well ahead of Clubhouse, unless the latter rapidly speeds up development and drops its invite-only status in the weeks ahead.
During Sunday’s Clubhouse Townhall, co-founder Davison explained the company’s approach to scaling to a larger market — like one where Android users participate — as an effort that requires a slower pace, when it comes to opening up access to more users. He noted that when Clubhouse grows, the discovery experience inside the app can be negatively impacted as a result. Users today are seeing more foreign language groups in their feeds, for instance, and are having a harder time finding friends and some of the best content, he said.
To address these challenges, Clubhouse plans to make several changes, including tweaks to the app’s Activity feed, tools to give users more control over their push notifications, and the launch of more personalization features — like showing users a personalized list of suggested rooms that appear on screen when you first open the app. These sorts of improvements are necessary to make Clubhouse succeed even as it scales its app to a larger user base, the company believes.
That said, Davison also spoke of dropping Clubhouse’s invite-only status as something it hopes to do “in the coming months.” He noted that he wants the app to open up to everyone, because there are “so many incredible creators not yet on Clubhouse, who have an audience elsewhere.”
“It’s going to be really important that we just open up to everyone,” Davison said. “Android’s going to be really important. Localization is obviously going to be very important.” Plus, making Clubhouse more accessible was important, too, he said.
The lack of an Android version of Clubhouse has already caused some complications for the company.
A number of Android app developers have taken advantage of the hole left in the market to hawk their “Clubhouse guides,” which intentionally aim to confuse Android users looking for Clubhouse by using the same app icon. (Google apparently doesn’t bother to weed out low-value and/or infringing content like this from the Play Store.)
"clubhouse" on android pic.twitter.com/uFtilOislC
— Sarah Perez (@sarahintampa) March 2, 2021
More recently, cybercriminals have gotten in on the action, too. They’ve created fake versions of Clubhouse that even pointed to a well-executed copy of the Clubhouse website in order to trick users into downloading their malicious app. One of these apps has been found to be spreading BlackRock malware, which steals users’ login credentials for over 450 services, including Facebook, Twitter and Amazon.
Davison addressed this issue during the Townhall, warning users that if they see anyone trying to impersonate Clubhouse on Android, not to use that app because “it could be harmful.”
“It is certainly not the real Clubhouse. Same thing with PC. There’s no PC app for Clubhouse,” he said, adding that a desktop version of Clubhouse is not a high priority for the company.
The company made a number of other announcements, as well, the most notable being its plans for more creator tools. These will be focused on helping creators grow their own audiences for their shows, and even monetize their events, if they choose, through things like direct payments, subscriptions, brand sponsorships, and even “paid events.” Clubhouse will also offer tools for managing memberships and tracking metrics around listeners and retention, but overall, details were light on what specific tools would be available or when they would roll out.
Clubhouse hasn’t responded to a request for further comment on the statements made during its Townhall event.