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The Station is a weekly newsletter dedicated to all things transportation. Sign up here — just click The Station — to receive it every weekend in your inbox.
Hi friends and new readers, welcome back to The Station, a newsletter dedicated to all the present and future ways people and packages move from Point A to Point B.
Before I launch into the news of the week, let’s take care of some housekeeping. First, you might have noticed that The Station landed in your email inbox on Sunday, not Saturday.
I have received some feedback that suggests the newsletter is typically read on Sundays. Do you have an alternate view? Please reach out with your opinion on this matter.
When would you like to see The Station? And what do you like and dislike about the newsletter?
One last item: I am now transportation editor at TechCrunch. The title change comes with more responsibility and a mission. I’ll be bringing on more freelancers to expand our “future of transportation” coverage. Mark Harris, an investigative reporter who has already delivered some wonderful articles for us, will be a more regular fixture here. Harris has a knack for rooting out news tucked inside legal documents and filings such as his Tesla tariffs article in 2019 and insights into the passenger capability of Elon Musk’s Las Vegas Loop project.
I hope to add more faces to the transportation bureau in the weeks and months to come.
Email me at kirsten.korosec@techcrunch.com to share thoughts, criticisms, offer up opinions or tips. You can also send a direct message to me at Twitter — @kirstenkorosec.
CES roundup
Mercedes-EQ. MBUX Hyperscreen
Maybe it was the virtual format, but autonomous vehicle technology didn’t play a starring role at CES this year as it has in the past.
Instead, several other themes emerged at CES, mostly around infotainment and advanced driver assistance systems. And continuing a trend in 2020, there were several gigantic screens, including the Mercedes Hyperscreen that is pictured below.
Pioneer, Harman and Panasonic all revealed future products aimed at bringing more audio and visual technology into the vehicle. Harman, for instance, unveiled three new “experience concepts,” that can turn the infotainment system in a vehicle into a concert hall, recording studio or gaming center.
Panasonic also announced a partnership with UK startup Envisics to jointly develop and commercialize a new generation of head-up displays for cars, trucks and SUVs. Head-up displays, or HUDs, seemed to be everywhere this show. The technology isn’t new. But recent advances are pushing the capabilities of these systems, which are integrated in the dash of a vehicle and project images onto the windshield to aid drivers with navigation and provide other alerts.
Image Credits: Envisics
GM had perhaps the biggest presence at the virtual 2021 CES, at least within the transportation sector. The automaker chose the tech trade show to announce a new business unit called BrightDrop that will focus on electric vans and other products and services for the commercial market. But that wasn’t all.
GM used the opportunity to tease its upcoming Chevrolet Bolt EUV — a vehicle that will have GM’s hands-free highway driving assist technology known as Super Cruise — as well as the Cadillac Celestiq dashboard and even a new logo. The intent of this bouquet of announcements was clear: GM wants the world — and shareholders — to know it’s serious about electrification and connected car tech.
GM’s numerous announcements were hard to miss — there was even an eVTOL. Conversely, Mobileye’s announcements flew a bit under the radar, but are arguably as notable.
GM showed off two concepts at CES 2021: an autonomous shuttle and a personal eVTOL.
Mobileye outlined plans to expand its autonomous vehicles testing to more cities, which was expected and is in line with the company’s previously stated plans.
What stood out to me was a talk that Mobileye president and CEO Amnon Shashua gave which outlined the company’s vision and progress.
The recap: Mobileye is taking a three-pronged strategy to developing and deploying automated vehicle technology that combines a full self-driving stack — that includes redundant sensing subsystems based on camera, radar and lidar technology— with its REM mapping system and a rules-based Responsibility-Sensitive Safety (RSS) driving policy.
Mobileye’s REM mapping system essentially crowdsources data by tapping into nearly 1 million vehicles equipped with its tech to build high-definition maps that can be used to support in ADAS and autonomous driving systems. Shashua said Mobileye’s technology can now map the world automatically with nearly 8 million kilometers tracked daily and nearly 1 billion kilometers completed to date.
The company provided more details at CES about a new lidar System on Chip product that is under development and will come to market in 2025. The lidar, which will use Intel’s specialized silicon photonics fab, is notable because Mobileye is known for its camera-based technology. To be clear, Mobileye is not backing away from that camera-first approach. Shashua explained Mobileye believes the best technological and business approach is to develop a camera-first system and use the lidar and radar as add-ons for redundancy.
In short: Mobileye has the money and existing network to commercialize automated vehicle technology and bring it to the masses.
Below is sampling of our transportation-related CES coverage:
Mercedes unveils Hyperscreen, a 56-inch screen for its flagship EQS electric vehicle
GM targets delivery with new EV business unit BrightDrop
Mobileye is bringing its autonomous vehicle test fleets to at least four more cities in 2021
Sony reveal more details on its secretive Vision S sedan
Holographic startup Envisics partners with Panasonic to fast track in-car AR tech
Startups look beyond lidar for autonomous vehicle perception
BMW previews its next-generation iDrive infotainment system
Sono Motor plans to license the tech that powers it solar electric car
Air taxi startup Archer partners with FCA
Another Uber spinoff is in the works
Postmates’ Serve robot is equipped with cameras as well as lidar from Ouster.
Remember when I predicted that autonomous delivery would gain momentum in 2021? It seems that sometimes I am right!
Postmates X, the robotics division of the on-demand delivery startup that Uber acquired last year for $2.65 billion, is seeking investors in its bid to become a separate company called Serve Robotics.
You might recall Serve, the yellow and black-emblazoned autonomous sidewalk delivery bot that was developed and piloted by Postmates X. This robot, which recently partnered with Pink Dot Stores for deliveries in West Hollywood, will likely be the centerpiece of the new startup.
I learned of a few important details of this plan, which is not yet settled. Uber will maintain a stake in this new startup. Uber’s stake was initially low, but has since popped to about 25%, according to sources familiar with the deal.
The company would be run by Ali Kashani, who heads up Postmates X and leads the Serve program. Anthony Armenta would lead the startup’s software efforts and Aaron Leiba would be in charge of hardware — keeping the same positions they hold at Postmates X.
I’ll fill y’all in with more details as I learn them.
Source: https://techcrunch.com/2021/01/18/the-station-ces-trends-and-uber-plots-another-spinoff/
TechCrunch is embarking on a major project to survey the venture capital investors of Europe, and their cities.
Our <a href=”https://forms.gle/k4Ji2Ch7zdrn7o2p6”>survey of VCs in Bucharest and Romania will capture how the country is faring, and what changes are being wrought amongst investors by the coronavirus pandemic.
We’d like to know how Romania’s startup scene is evolving, how the tech sector is being impacted by COVID-19, and, generally, how your thinking will evolve from here.
Our survey will only be about investors, and only the contributions of VC investors will be included. More than one partner is welcome to fill out the survey. (Please note, if you have filled the survey out already, there is no need to do it again).
The shortlist of questions will require only brief responses, but the more you can add, the better.
You can fill out the survey here.
The deadline is January 22, 2021.
Obviously, investors who contribute will be featured in the final surveys, with links to their companies and profiles.
What kinds of things do we want to know? Questions include: Which trends are you most excited by? What startup do you wish someone would create? Where are the overlooked opportunities? What are you looking for in your next investment, in general? How is your local ecosystem going? And how has COVID-19 impacted your investment strategy?
This survey is part of a broader series of surveys we’re doing to help founders find the right investors.
https://techcrunch.com/extra-crunch/investor-surveys/
For example, here is the recent survey of London.
You are not in Romania, but would like to take part? That’s fine! Any European VC investor can STILL fill out the survey, as we probably will be putting a call out to your country next anyway! And we will use the data for future surveys on vertical topics.
The survey is covering almost every country on in the Union for the Mediterranean, so just look for your country and city on the survey and please participate (if you’re a venture capital investor).
Thank you for participating. If you have questions you can email mike@techcrunch.com
(Please note: Filling out the survey is not a guarantee of inclusion in the final published piece).
Last week, Procter & Gamble (P&G) announced that it was terminating plans to acquire razor startup Billie following a U.S. Federal Trade Commission lawsuit to stop the deal.
Last year, Edgewell Personal Care ditched its debt-heavy $1.37 billion deal for Harry’s, Inc, formerly valued at $1 billion after the FTC sought to block the acquisition.
In addition to these FTC challenges, it is also now becoming clear that relying on VC-subsidized products and celebrating outrageous valuations can be problematic for D2C brands. With a few wonderful and rare exceptions such as Rothy’s (which raised $42 million but was profitable from the beginning and generated $140 million in revenue within two years of launching), D2C unicorns are addicted to the cycle of venture funding to feed growth in order to maintain a high valuation multiple.
The path to profitability has become a more important part of the startup story versus growth at all costs.
This works for a while; however, when the path to profitability appears murky and exit options either don’t appear or only appear from nontech companies with very conservative multiples, the walls start crumbling.
In a WWD article, Odile Roujol, the former CEO of Lancôme who launched venture fund FAB Ventures, said, “Generally speaking, the era of $1 billion valuations for beauty companies is over. The people that struggle have been the companies that spend so much money in just a few years.” She went on to say, “The big corporations now … are not ready to spend $1.2 billion, $1.5 billion on such a brand like Glossier.”
This change in sentiment from acquirers is further fueled by recent research on the challenges of turning hypergrowth companies profitable. In his Harvard Business School case study “Direct to Consumer Brands,” Professor Sunil Gupta wrote, “Acquiring DTC brands is easy for incumbent conglomerates, but making them profitable is challenging. More than three years after Unilever acquired Dollar Shave Club, it was still unprofitable.”
Unilever executives learned that the average cost of acquiring a new customer online was about the same as in stores. David Taylor, CEO of P&G, said his company was still figuring out how to turn recently acquired direct-to-consumer brands into profitable businesses.
Taylor summarized this dilemma, saying, “There are many, many launches that grow fast … a business model that makes money is a higher challenge.” Since making these realizations, incumbent conglomerates will be more cautious when considering the acquisition of hyped D2C brands that raised lots of venture capital.
Beauty tech is a better bet: Meitu and Perfect Corp.
What’s cooler than beauty companies that are (or were) valued at $1 billion? Beauty tech SaaS companies that are worth $5.2 billion at IPO. We don’t hear much about the leading global beauty tech companies such as Meitu and Perfect Corp. because their founders are not celebrity influencers, they don’t have massive Instagram followings here in the U.S. and they are not celebrated in our media. Although their companies are based in Asia and they raised money mostly from Chinese investors, their companies are global successes.
Source: https://techcrunch.com/2021/01/18/it-may-not-be-as-glamorous-as-d2c-but-beauty-tech-is-big-money/
Bustle Digital Group — owner of Bustle, Inverse, Input, Mic and other titles — could eventually join the ranks of startups going public via a special purpose acquisition company (SPAC).
During an interview about the state of BDG and the digital media industry at the end of 2020, founder and CEO Bryan Goldberg laid out ambitious goals for the next few years.
“Where do I want to see the company in three years? I want to see three things: I want to be public, I want to see us driving a lot of profits and I want it to be a lot bigger, because we’ve consolidated a lot of other publications,” he said.
He added that those goals connect, because by going public, BDG can raise “hundreds of millions dollars,” which Goldberg wants to use to “buy a lot of media companies.”
That might seem like bluster after a year in which many digital media companies (including BDG) had to make serious cuts. But Goldberg said that the company would be profitable in 2020, with revenue that’s “a little bit under $100 million.” And it won’t be the first digital media company to take a similar route — Group Nine created a SPAC that went public last week.
“I want to prove that we can be highly profitable,” he said. “A lot of startups don’t have that goal. A lot of VCs tell their startups: Don’t worry about profits, don’t worry about losing money. I don’t believe in that.”
In addition to his plans to go public, Goldberg also discussed how acquisitions have helped Bustle’s business, his joint venture to purchase W Magazine and digital media’s “overcapitalization” problem. You can read our full conversation, edited for length and clarity, below.
TechCrunch: The last time I caught up with someone at BDG, it was with [the company’s president Jason Wagenheim] and that was when you guys were dealing with the initial fallout [from the pandemic]. Now we’re a lot further into whatever this new world is, so what is your sense of where BDG is now, versus where it was in the early days of the pandemic?
Bryan Goldberg: It might be the craziest, most eventful six months for many of us in our lives. And certainly, for those of us in this industry, the difference between April and October, it’s really hard to fathom, it’s complete night and day. April was a very frightening time for everyone, personally and professionally across the country, across the world.
From an advertising standpoint, it was a really scary time, because we have clients across every industry, and every industry was impacted differently. We have clients who were greatly impacted — theme parks, car makers, hotel companies, airlines — and then we had clients who were not as badly affected, such as a lot of CPG clients, who everybody depended upon so much during the pandemic.
There was a huge pause in our business in in March, April and May. For a lot of clients, tossing advertising was a sort of knee-jerk reaction to the sudden shock of COVID, and so we saw a huge negative impact in our second quarter. What we started to see in the third quarter, and especially now in the fourth quarter, is now that the shock of COVID is behind us, the macro trends that were catalyzed by COVID are now moving into the forefront.
The story of media is no longer about the shock of COVID. The story of media is now about all of the changes to our world, and changes to our industry that were brought about as a consequence of COVID.
The good news for our company, and the good news for other digital media companies, is it looks like the future is being accelerated. It looks like people are watching less television, and so advertisers are moving their budgets into digital faster than they would have had it not been for COVID. Even things like live sports, [their] TV ratings are way down. And a lot of advertisers are saying, “Is there efficacy anymore in cable television or broadcast television?” And the magazine industry was heavily impaired, simply because magazines are a physical medium, and people didn’t want to pass around magazines or read magazines at the dentist’s office, so we probably saw some print budget move into digital as well.
Industry analysts now are going to take up their estimates of what digital revenue is going to look like in 2021, 2022 and beyond. I also think we’ve seen a world in which a lot of brand advertisers are starting to think about what happens when they start to spend beyond Facebook and Google. For most of the last three years, there’s been so much talk about the duopoly, the idea that Facebook and Google are going to eat almost every last dollar of advertising. What we’ve seen in the last three months is advertisers saying that this needs to be the moment in which they learn how to deploy advertising spend digitally beyond Facebook or Google.
No, it doesn’t mean they’re all pulling out of Facebook — Facebook and Google are doing just fine. But there are still tens of billions of dollars that need to be deployed outside of Facebook and Google. And you’re seeing winners such as Snapchat, Pinterest. Both had incredibly strong earnings. They’re benefiting from the same thing that benefits Bustle Digital Group and a lot of other digital media players who aren’t Facebook and Google, which is you’re seeing big ad spenders finally deciding that now’s the time to find other ways to deploy advertising spend.
I think those are the two big trends: Dollars moving to digital out of TV faster than we thought, and major advertisers using now as a time to find other channels beyond Facebook and Google.
So when you look at how that is impacting Bustle’s business, has it returned to pre-COVID levels?
For us, when we reflect upon the year 2020, we see that we had a great first quarter, we see that we’re having an incredible fourth quarter, and we have a big, epic crater in the second and third quarters. So when we look at the year, we basically have to say to ourselves, if it were not for that crater in the second and third quarters, what would this year have looked like? We would have had revenue well in excess of $100 million. Now, we’re gonna have revenue a little bit under $100 million.
But when we think about how we prepare for 2021 and set goals for 2021, we have to set goals for 2021 as though COVID had never happened, we have to set goals for 2021 without using Q2 and Q3 as a sort of excuse for lowering expectations. Because the fourth quarter, the quarter we’re currently in, has exceeded our wildest expectations.
People sort of sat up and took notice of the company because you had a pretty aggressive acquisition strategy. I imagine that strategy had to change a little bit in 2020. To what extent do you feel that ambition is something that you can pick up again?
So to be clear, not only do we feel great about our strategy, our strategy was critical in helping our company survive and ultimately thrive in the wake of the virus. You know, we made two acquisitions [in 2019] — in the science and technology category, we bought Inverse, which is a science and technology publication, and then Josh Topolsky launched a tech-and-gadget publication for us called Input Magazine that’s growing very quickly.
It’s critical that we had that strategy, because no single advertiser category has performed better for us in 2020 than tech — we more than tripled our revenue from technology clients this year, because technology has thrived through COVID. Had we not had an acquisition strategy, had we not diversified into tech media publishing, we certainly would not have had the outcome we had in 2020. That’s just the reality.
Categories like beauty, fashion, retail were very hard hit. Those have traditionally been our bread and butter, and they’re going to be great again, in 2021. But this spring, beauty companies weren’t doing so well, because people weren’t leaving the house. So the strategy worked, in part, because we diversified the categories in which we created content, which allowed us to diversify the advertiser base. And we’re gonna continue full speed ahead in 2021.
Now, you know, we did six acquisitions in 2019. I don’t know if we’ll do six acquisitions in 2021. But I want to do a lot more than one acquisition in 2021.
Virgin Orbit scored a major success on Sunday, with a test flight that not only achieved its goals of reaching space and orbit, but also of delivering payloads on board for NASA, marking its first commercial mission, too. The launch was a success in every possible regard, which puts Virgin Orbit on track to becoming an active launch provider for small payloads for both commercial and defense customers.
Today's sequence of events for #LaunchDemo2 went exactly to plan, from safe execution of our ground ops all the way through successful full duration burns on both engines. To say we're thrilled would be a massive understatement, but 240 characters couldn't do it justice anyway. pic.twitter.com/ZKpoi7hkGN
— Virgin Orbit (@Virgin_Orbit) January 18, 2021
Above, you can watch the actual launch itself – the moment the LauncherOne rocket detaches from ‘Cosmic Girl,’ a modified Boeing 747 airliner that takes off normally from a standard aircraft runway, and then climbs to a cruising altitude to release the rocket, which then ignites its own engines and flies the rest of the way to space. Virgin Orbit’s launch model was designed to reduce the barriers to carrying small payloads to orbit vs. traditional vertical take-off vehicles, and this successful test flight proves the model works.
Virgin Orbit now joins a small but growing group of private launch companies who have actually reached space, and made it to orbit. That should be great news for the small satellite launch market, which still has much more demand than there is supply. Virgin Orbit also offers something very different from current launch providers like SpaceX, which typically serves larger payloads or which must offer rideshare model missions for those with smaller spacecraft. The LauncherOne design potentially means more on-demand, response and quick-turnaround launch services for satellite operators.
