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As Facebook and Apple begin to fire up more projects in the AR/VR world, Google has spent the last year shutting down most of their existing projects in that space.

Today, the folks at Google announced they had ended active development of Tilt Brush, a VR painting app that was one of virtual reality’s early hit pieces of software. The app allowed users to use virtual reality controllers as brushes to construct digital sculptures and environments.

While the company will not be pushing any new updates to the app, they did announce that they will be open sourcing the code on github for developers to build their own experiences and customizations. Google also notes that the app will continue to be available in the app stores on VR headsets.

“[W]e want to continue supporting the artists using Tilt Brush by putting it in your hands,”a blog post from Google reads. “This means open sourcing Tilt Brush, allowing everyone to learn how we built the project, and encouraging them to take it in directions that are near and dear to them.”

Google acquired the small studio behind Tilt Brush called Skillman & Hackett back in 2015.

Earlier this month, Tilt Brush co-creator Patrick Hackett announced he was leaving Google and would be joining the studio I-Illusions, the game studio behind VR title Space Pirate Trainer. According to LinkedIn, co-founder Drew Skillman stopped working on the VR project back in 2018 and now is part of the Stadia team at Google.

Last month, Google shut down Poly, its 3D object library which allowed users to share digital art including design made in the Tilt Brush software.

A Google spokesperson declined to comment further.

Source: https://techcrunch.com/2021/01/26/google-open-sources-tilt-brush-vr-software-as-it-shuts-down-the-tools-internal-development/

Speculation around the Qualtrics public offering is nothing new. All the way back in 2016, CEO Ryan Smith was dropping not-so-subtle hints about his intentions to file for IPO. After a decade bootstrapping, and growing to $50 million in annual revenue, the company was swayed into taking outside capital from Sequoia, and then again from Sequoia, Accel, and Insight Venture Partners.

TechCrunch has written about the entire journey, and considering the unusual circumstances of the public offering paired with Qualtrics’ position outperforming its peer group, we thought it smart to take a look back at how the whole thing came together.

2017

After years of dodging the question, or offering up vague answers, Smith said the following in an interview with TechCrunch back in 2017:

We know that there’s a huge opportunity here and we’re being very thoughtful about it because it’s not about going public. Going public is super easy to do. Just file the S-1 and we’re out,” Smith told [TechCrunch]. “It’s about being public and how that works and getting the house in order to make sure that that’s the case. We’re going to be a great public company. We’re going public.

Just a couple days later, literally, Qualtrics raised $180 million at a $2.5 billion valuation, again from Sequoia, Accel, and Insight Venture Partners. At the time, it was the biggest investment Accel had ever made. The growth of the company was staggering — the experience management startup had gone from $50 million in revenue in 2012 to $250 million in revenue in 2017.

TechCrunch and many others speculated that the massive raise may not signal a delayed IPO, but rather a final financial push before listing on the public markets.

Smith was coy about whether that speculation was warranted:

We raised the money because we can. An IPO isn’t an exit. It should be the beginning and we wouldn’t be going out if we didn’t think that more wealth could be created post-IPO.

The company also launched its XM platform in 2017, an experience management platform that Smith implied would one day be as ubiquitous as Workday or Salesforce software in every office, but for managing internal feedback and helping organizations uncover key business drivers, predict future customer needs, and retain employees.

Sequoia Capital partner Bryan Schreier said at the time:

Qualtrics is an outlier. They have delivered outstanding, accelerating growth at nine-digit revenue numbers all while staying cash flow positive. That is practically unheard of. It’s an incredible sign of confidence in Qualtrics’ continued growth trajectory and the huge market for its new XM Platform that all of its investors have come back to buy as many shares as they could at this new valuation.

2018

In October of 2018, Qualtrics filed its S-1, which included third quarter results for the firm. Revenue was more than $100 million (up $8 million from the quarter before) and nearly 75 percent of that was gross profit. It was a strong quarterly performance and the perfect primer for a public offering.

The original plan was to sell 20.5 million shares in its debut for $18 to $21, which would have grossed up to $495 million, putting its valuation between $3.9 billion and $4.5 billion.

And then the unexpected happened.

SAP swooped in with an $8 billion acquisition offer. An offer that Qualtrics did not refuse. Its public offering was delayed (or scrapped, depending on how you look at it) yet again.

The idea was that SAP’s operational data combined with Qualtrics’ customer and user data would be a devastating blow to the competition and give the duo an unmatched level of power. Think Facebook’s acquisition of Instagram. Think Eye of Sauron.

SAP CEO Bill McDermott said at the time:

The legacy players who carried their ‘90s technology into the 21st century just got clobbered. We have made existing participants in the market extinct.

If it wasn’t clear, he was talking about competitors like Oracle, Salesforce, Microsoft and IBM.

As part of the acquisition announcement, Qualtrics offered yet another revenue update, saying it expected excess of $400 million in revenue for 2018 and a forward growth rate of more than 40 percent, synergies from the acquisition notwithstanding.

2020

Post-acquisition Qualtrics was a quieter Qualtrics, so we’ll skip past 2019 to 2020. Just 20 short months after being acquired, another twist in the plot: SAP announced it would spin out Qualtrics in a new IPO.

Noting the company’s cloud growth had been in excess of 40 percent, SAP said the company would continue to be run by founder Ryan Smith and, interestingly, mentioned that Smith intends to be Qualtrics’ largest individual shareholder. SAP, of course, would retain majority ownership of the company.

Though the announcement lacked much meat with its potatoes, it implied that Qualtrics could grow even more rapidly if not encircled by SAP’s corporate arms.

The spin-out strategy was a rare move for a company like SAP.

As my colleague Danny Crichton wrote at the time:

While private equity firms will take a company private and sometimes quickly turn it around in an IPO, it is rare to see a large company like SAP make such a dramatic last-minute bid for a company only to reverse that decision just months later.

Here at TechCrunch we were excited about the impending IPO. Here was a company that had nearly gone public, now going public again.

And just as the year was coming to a close, Qualtrics dropped its first (second, technically) S-1 filing. After digging through the numbers this was our takeaway from the data:

Qualtrics is growing at over 30%, and after enduring some post-acquisition costs that appear at least partially related to how SAP handled equity compensation, is back to a more acceptable level of losses on a GAAP basis and is doing perfectly fine when we observe its adjusted (non-GAAP) results.

As often happens when a company goes public while having a large corporate owners, Qualtrics’ accounting was harder to parse the second time around, but the bones of a nicely growing software company at scale were still there. How investors would value Utah’s giant was the next question.

2021

A few weeks later, Qualtrics dropped what would prove to be its first IPO pricing interval, targeting a range of $22 and $26 per share, giving the company a far larger value than it had targeted during its first run at the public markets.  Of course, Qualtrics was not only benefiting from its own growth and whatever boost it received from synergies with SAP, but also from frothy SaaS valuations and a frenetic public market.

At that price, with 50 million shares up for grabs, the target raise was north of $1 billion. If that sounds high recall that Qualtrics posted a revenue run rate of around $800 million. The company’s growth has kept up as well, with the company’s Q4 2020 midpoint revenue expanding more than 23% compared to its Q4 2019 performance.

All said and done, the S-1/A pegged Qualtrics’ early 2021 valuation at anywhere from $11.2 billion to $13.3 billion. Alex Wilhelm is much better at breaking down the numbers than me (or anyone, really) so I urge you to take a look at his coverage.

Wilhelm was also astute enough to recognize that the share pricing for Qualtrics’ IPO would likely be adjusted higher. And it was!

Yesterday, Qualtrics raised its share price from $22 – $26 to between $27 and $29, putting the valuation range between $13.8 billion to $14.8 billion. Yowzah!

• New Qualtrics low-end IPO run rate multiple: 16.2x.
• New Qualtrics high-end IPO run rate multiple: 17.4x.

Wilhelm noted that the Qualtrics share price may go up yet again, but also explained that while the multiples in play may feel low, it’s tough to be certain:

Those do not seem to be particularly high multiples for Qualtrics, given recent market norms. However, trying to decipher the public market lately has been similar to reading the Rosetta Stone, but written in Wingdings. While on acid. So, you never know what is going to happen when a company starts to trade.

There is one thing we know for sure: Qualtrics has showed growth in revenue and more profitability than most software companies during its entire existence. We’ve been waiting for this IPO for years now, literally, and while many pieces of the puzzle are uncertain, we’ll get our answers soon enough.

Unless of course some giant firm swoops in with a $20 billion acquisition offer. Now wouldn’t that be fitting?

Source: https://techcrunch.com/2021/01/26/qualtrics-ipo-everything-you-need-to-know/

Club Feast, a startup with a more affordable approach to meal delivery, is announcing that it has raised $3.5 million in seed funding led by General Catalyst.

The company was founded by Atallah Atallah, Ghazi Atallah and Chris Miao. The basic concept is pretty simple: Restaurant delivery that only costs $5.99 per dish — cheaper than almost anything you’d find on other delivery services. (The startup also charges diners a $2 delivery fee, as well as a $1 fee for single meal orders.)

Atallah Atallah, who previously co-founded restaurant rewards company Seated and serves as Club Feast’s CEO, said the startup works with restaurants to select a few meals that they can afford to offer at the $5.99 price. Diners, meanwhile, sign up for a weekly meal plan and place their orders at least 24 hours ahead of time. The restaurant then knows exactly how much of a dish will be purchased, so they can plan ahead and cook in an efficient and economical way.

“We really work with them to create a meal that they can make at a price that works for their users,” Atallah said. Plus, he noted that with all the orders placed ahead of time, Club Feast and its partners can plan efficient delivery routes without having to build sophisticated algorithms for optimizing on-demand deliveries: “Sometimes the best solutions are the simplest ones.”

Club Feast CEO Atallah Atallah. Image Credits: Club Feast

Of course, that requires more planning and upfront commitment from diners. However, Atallah noted that while meal credits are bought via weekly subscription, they can be paused or spent at any time. He also suggested that he doesn’t see Club Feast as a direct competitor to on-demand food delivery — instead, he suggested that he continues to use DoorDash and Uber Eats for spur-of-the-moment orders or special occasions, while Club Feast is a more affordable option for regular meals.

“With our price point, our average user orders eight times a month,” he said. “Why not make the pie much bigger?”

Atallah added that Club Feast is diversifying the food options on the platform by adding side dishes and desserts. And it could eventually introduce higher prices for fancier meals, but he said, “We want to make sure that does not affect the $5.99 concept.”

The startup currently makes deliveries in San Francisco and San Mateo, where it works with restaurants including The Halal Guys, Kasa Indian Eatery, HRD and Kitava. With the new funding, it plans to expand throughout the Bay Area and into New York City.

“The pandemic exposed significant gaps in the food delivery industry, and we’re proud to support Club Feast on their mission to make the experience more affordable for both restaurants and consumers,” said General Catalyst Managing Director Niko Bonatsos in a statement.

Source: https://techcrunch.com/2021/01/26/club-feast-seed-funding/

Google today announced that BeyondCorp Enterprise, the zero trust security platform modeled after how Google itself keeps its network safe without relying on a VPN, is now generally available. BeyondCorp Enterprise builds out Google’s existing BeyondCorp Remote Access offering with additional enterprise features. Google describes it as “a zero trust solution that enables secure access with integrated threat and data protection.”

Over the course of the last few years, Google — and especially its Cloud unit — has evangelized the zero trust model and built a large partner network around this idea. Those partners include the likes of Check Point, Citrix, CrowdStrike, Symantec and VMWare.

As part of BeyondCorp Enterprise, businesses get an end-to-end zero trust solution that includes everything from DDoS protection and phishing-resistant authentication, to the new security features in the Chrome browser and the core continuous authorization features that protect every interaction between users and resources protected by BeyondCorp.

“The rapid move to the cloud and remote work are creating dynamic work environments that promise to drive new levels of productivity and innovation. But they have also opened the door to a host of new security concerns and sparked a significant increase in cyberattacks,” said Fermin Serna, chief information security officer at Citrix. “To defend against them, enterprises must take an intelligent approach to workspace security that protects employees without getting in the way of their experience following the zero trust model.”

Source: https://techcrunch.com/2021/01/26/googles-beyondcorp-enterprise-security-platform-is-now-generally-available/

TikTok has a vaping problem. Although a 2019 U.S. law made it illegal to sell or market e-cigarettes to anyone under the age of 21, TikTok videos featuring top brands of disposable e-cigarettes and vapes for sale have been relatively easy to find on the app. These videos, set to popular and upbeat music, clearly target a teenage customer base with offers of now-unauthorized cartridge flavors like fruit and mint in the form of a disposable vape. Some sellers even promote their “discreet” packaging services, where the vapes they ship to customers can be hidden from parents’ prying eyes by being placed under the package’s stuffing or tucked inside other products, like makeup bags or fuzzy slippers.

Interest in flavored, disposable vapes that appeal to teens and young adults, in particular, has been growing in the wake of the FDA’s Juul crackdown.

In February 2020, the FDA first began to take enforcement action against illegally marketed e-cigarette devices, including those offering flavors besides tobacco or menthol, as well as those targeted towards minors — an action that was designed to target Juul.

As a result, disposable vapes like Puff Bar were adopted by some young people who were still in search of flavors like bubblegum, peach, strawberry and others. These cheaper disposables were easy to find, and continued to be available at convenience stores and gas stations.

But they’re also all over TikTok, ready to be shipped with anyone with a way to pay.

What’s more, when this content is reported to TikTok, it’s not always taken down.

TechCrunch found vape sellers marketing on TikTok who have been using the app to communicate with customers through both videos and comments. They also direct viewers to what appear to be illegally operating websites. Their TikTok videos often show off the seller’s current inventory of vapes, including disposables like Puff Bar in teen-friendly flavors.

Essentially, the sellers are using TikTok as a way to create vape advertisements they don’t have to pay for that are capable of reaching young consumers — an audience whose interest in vaping hasn’t necessarily declined because of the FDA’s action.

According to nonprofit tobacco control organization Truth Initiative’s latest study, use of Juul decreased between 2019 and 2020, but it remains the most popular e-cigarette brand among 10th and 12th graders who were current vapers at 41%. The report also found that disposable products such as Puff Bar (8%) and Smok (13.1%) have gained during this time.

“Taken together, the 2020 National Youth Tobacco Survey (NYTS) and the new e-cigarette sales data report illustrate how the current federal policy enabled youth to quickly migrate to menthol e-cigarettes (especially Juul menthol pods) when mint-flavored products were removed from the marketplace, and for inexpensive, flavored disposable e-cigarettes such as Puff Bar to soar in popularity,” Truth stated in September 2020.

“With kid magnet names like cotton candy and banana ice, the market share of disposable products nearly doubled in just 10 months from August 2019 to May 2020,” it said.

The scale of the problem on TikTok is also significant.

Today, U.S. teens account for an estimated 32.5% of TikTok’s U.S. active users, according to third-party estimates published by Statista. The company has around 100 million monthly active users in the U.S., it said last year.

Meanwhile, videos tagged with popular vape and e-cigarette brands and keywords have racked up hundreds of millions of views.

For example, the hashtag for leading vape brand Juul (#juul) has 623.9 million views on TikTok, as of the time of writing.

Puff Bar, the maker of a single-use vaping product with Chinese origins, has 449.8 million views for the hashtag #puffbar. Other brands have some traction, as well. #NJOY has 55.3 million views, #smok has 40.1 million views, and British Tobacco’s #Vuse has 5 million views.

These are just the views associated with the hashtag itself. For every search, there are multiple variations. For instance, #puffbars, #puffbarplus and #puffbardealer have 66.8 million views, 9.6 million views and 8.9 million views, respectively. Tags like #juulgang (590.4 million views) have become popular enough that anti-vaping content creators have adopted them as a means of counter-programming against vaping content.

These trends are particularly concerning given the large, young demographic that uses TikTok. A third of its U.S. users may be 14 or under, in fact.

In the U.S. App Store, TikTok is rated for ages 12 and up and on Google Play, its content rating is “Teen.” But while TikTok has modified the default privacy settings for young people’s accounts and has been quick to block other controversial hashtags in the past (like those around U.S. election conspiracies), it has allowed vaping-related content to remain easy to find.

In addition to the popular vaping hashtags prevalent on TikTok, we uncovered numerous vape sellers operating under obvious account names such as “@puffsonthelow,” “@PuffUniverse” and “@Puffbarcafe,” for example. Their pages were filled with vape videos boldly marketing their current selections, hashtagged with vape-related terms like #puffbarchallenge, #puffplus, #vapetricks and others.

In some cases, we found vape sellers had even tagged their videos with #kids and other trending tags.

Knowing that their target market is often teenage vapers, many videos depicted how the seller could package the vape inside another product or hide it in the stuffing so parents wouldn’t find out. We saw videos of vapes packaged underneath candy, inside makeup bags, inside socks, underneath other lager products, and more.

Through links published to the account’s profile or referenced in the videos, TikTok users are redirected to the sellers’ websites or even Discord channels where they would only sometimes be presented with an age verification pop-up.

Often, they could just add items to a basket and check out. Many sellers also directed their customers to pay using PayPal, Venmo and/or Cash App, instead of accepting standard credit card payments.

None of this is legal, according to the Campaign for Tobacco Free Kids, a leading American nonprofit focused on reducing tobacco consumption, particularly among youth.

“It’s illegal to market these products or to engage in marketing that appeals directly to anybody under the age of 21,” Matt Myers, the president of the Campaign for Tobacco Free Kids, told TechCrunch. “And it’s illegal to actually conduct a sales transaction without age verification.”

Image Credits: TikTok screenshot

Plus, he adds, clicking a box on a website that says “I’m over 21,” does not qualify as a legal age verification for making these sales.

The FDA hasn’t issued specific guidance around online retail, but the law is clear that checking IDs is required to ensure retailers aren’t selling to underage users. That’s not happening with a pop-up box, and often there’s no box at all.

In addition, the FDA reminded TechCrunch that Congress recently established new limits on the mailing and delivery of e-cigarettes and other tobacco products through the United States Postal Service and through other carriers, which should limit access to these sorts of products through online retail purchases.

Myers, however, points out that the current FDA guidelines have made enforcement of this sort of “social” vape marketing more difficult than necessary.

“The images you’re seeing, the use of influencers, and the kinds of offers you’re seeing are governed by a federal standard by the FDA, which is very broad and very general,” Myers says. “The FDA’s failure to articulate clear, specific guidelines means that everyone is in a constant what I call ‘whack-a-mole.'”

Enforcement, then, often depends on the FDA stepping in, which Myers says happens “on a very sporadic basis.”

“In many respects, the behaviors, the actions and the things you’re seeing do violate the law. But the mechanisms for implementing it that were put in place under this past administration are woefully weak and inadequate,” he says.

Image Credits: screenshots of TikTok

Another complicating factor is that public health groups — like the Campaign for Tobacco Free Kids, for instance — don’t have a relationship with TikTok, as they do with other social networks.

Over the last couple of years, over 100 public health groups came together to ask leading social networks like Facebook, Instagram, Twitter and Snapchat to clamp down on tobacco-related content and the use of influencers in marketing. As a result of these efforts, Facebook and Instagram implemented new rules to prohibit social media influencers from promoting tobacco-related products and developed algorithms to pick up on that sort of content.

Overall, the health organizations have reported seeing a reduction in tobacco and vape content on top social platforms, but these efforts have not yet included TikTok.

The Campaign for Tobacco Free Kids has not given TikTok a comprehensive review, Myers admits, due to the app still being relatively new.  But from what the organization has seen so far, TikTok is of growing concern.

“We’ve seen some of the most egregious marketing, use of influencers, direct offers of sale to young people [which] appear to be gravitating over to TikTok,” Myers says. “And we don’t see any evidence that TikTok has actually done anything.”

TikTok can’t claim ignorance of the problem, either.

Image Credits: TikTok screenshot

When a vape seller who unabashedly advertised “no ID check” was reported to TikTok through its built-in reporting mechanism, TikTok’s content moderation team said the content didn’t violate its guidelines. This same response was given when other vape sellers were reported, as well. (See below.)

TikTok claims this shouldn’t be happening. The company told us that it will remove accounts dedicated to posting vaping or e-cigarette content as soon as it becomes aware of them, and will reset account bios that link to off-platform tobacco or vaping sites.

It also says its Community Guidelines prohibit content that suggests, depicts, imitates, or promotes the possession or consumption of tobacco by a minor, and content that offers instruction targeting minors on how to buy, sell, or trade tobacco.

Image Credits: screenshots of TikTok reports

Reached for comment over whether it was aware of the problems on TikTok, an FDA spokesperson said it does not discuss specific compliance and enforcement activities.

However, an FDA spokesperson said the agency will closely monitor retailer, manufacturer, importer, and distributor compliance with federal tobacco laws and regulations and take corrective action when violations occur. In addition, the FDA said it conducts routine monitoring and surveillance of tobacco labeling, advertising and other promotional activities, including activities on the internet.

What’s been making matters more confusing is that the FDA has been accepting premarket applications for flavored vape devices, but has so far refused to list which companies — Puff Bar or otherwise — may have filed for these. That means health organizations don’t know which products the FDA has under review.

However, the agency told TechCrunch that regardless of whether a premarket application has been submitted, it’s enforcing lack of marketing authorization for any product where the manufacturer “is not taking adequate measures to prevent youth access to these products.”

That statement would then include these online Puff Bar retailers and their TikTok marketing efforts.

The FDA added that it has taken action against Puff Bar, specifically, in recent days.

It sent a warning letter to Cool Clouds Distribution, Inc. d/b/a Puff Bar, last July, notifying the company that it was marketing new tobacco products that lacked marketing authorization and that such products, as a result, were adulterated and misbranded.

Earlier this month, as part of an ongoing joint operation with the FDA, U.S. Customs and Border Protection seized 33,681 units of e-cigarettes, which included disposable flavored e-cigarette cartridges resembling the Puff Bar brand, including Puff XXL and Puff Flow, we’re told.

TikTok confirmed the activity we’re documenting is in violation of its guidelines and policies, but could not explain why there’s been such a disconnect between that policy and its enforcement actions.

“We are committed to the safety and well-being of our TikTok community, and we strictly prohibit content that depicts or promotes the possession or consumption of tobacco and drugs by minors,” a TikTok spokesperson told TechCrunch. “We will remove accounts that are identified as being dedicated to promoting vaping, and we do not allow ads for vaping products.”

Source: https://techcrunch.com/2021/01/26/tiktok-is-being-used-by-vape-sellers-marketing-to-teens/