Village Global is leveraging its network of tech luminaries to support the next generation of entrepreneurs.
The $100 million early-stage venture capital firm, which counts as limited partners (LPs) Microsoft’s Bill Gates, Facebook’s Mark Zuckerberg, Alphabet’s Eric Schmidt, Amazon’s Jeff Bezos, LinkedIn’s Reid Hoffman and many other high-profile techies, quietly announced on Friday that the accelerator it piloted earlier this year would become a permanent fixture.
Called Network Catalyst, Village provides formation-stage startups with $150,000 and three-months of programming in exchange for 7 percent equity. Its key offering, however, is access to its impressive roster of LPs.
To formally announce Network Catalyst, Village brought none other than Bill Gates to San Francisco for a fireside chat with Eventbrite CEO Julia Hartz . During the hour-long talk, Gates handed out candid advice on building a successful company, insights on philanthropy and predictions on the future of technology. He later met individually with the founders of Village’s portfolio companies.
“I have a fairly hardcore view that there should be a very large sacrifice made during those early years,” Gates said. “In those early years, you need to have a team that’s pretty maniacal about the company.”
During the Q&A session, Gates regurgitated one of his great anecdotes. In the early days of Microsoft, he would memorize his employee’s license plates so he knew when they were coming and going, quietly noting who was working the longest hours. He admitted, to no one’s surprise, that he struggled with work-life balance.
“I think you can over worship the idea of working extremely hard,” he said. “For my particular makeup, it’s really true I didn’t believe in weekends or vacations … Once I got in my 30s, I could hardly imagine how I’d done that because by then some natural thing inside of me kicked in and I loved weekends and my girlfriend liked vacations and that turned out to be a great thing.”
Gates has been an active investor in Village since it emerged one year ago. VMware founder Diane Greene, Disney CEO Bob Iger and Spanx CEO Sara Blakely are also on the firm’s long list of LPs.
Village is led by four general partners: Erik Torenberg, Product Hunt’s first employee; LinkedIn’s former chief of staff Ben Casnocha; Chegg’s former chief business officer Anne Dwane; and former Canaan partner Ross Fubini. They initially filed to raise a $50 million fund in mid-2017 but ultimately closed on $100 million in March. The firm relies heavily on scouts — angel investors and others knowledgeable of the startup world — to source deals. The scouts, in return, earn a portion of the firm’s returns.
Former Alphabet chairman Eric Schmidt (center).
An accelerator program has been part of Village’s plan since the beginning.
Pinterest CEO Ben Silbermann, Fidelity CEO Abby Johnson, Hoffman, Iger, Blakely and Schmidt all worked with Network Catalyst’s debut cohort of founders. Village co-founder Anne Dwane said Hoffman and former Twitter CEO Ev Williams have signed on to work with the next cohort.
“It is about contacts, not content,” Dwane told TechCrunch. “The most important thing is who you can meet to help you take your business forward.”
San Francisco-based VeriSIM, a startup building AI-enabled biosimulation models, was among the debut class of companies that participated in Network Catalyst. Jo Varshney, the company’s founder and CEO, said the accelerator’s personalization and customization set it apart from competing options.
“It seemed like I had a team of people working alongside me even though I’m a solo founder,” Varshney told TechCrunch.
After completing the program, Schmidt introduced Varshney to a number of investors. She quickly closed a $1.5 million seed round.
“One year in and I already have a one-on-one meeting with Bill Gates,” she added.
Applications for the accelerator close on December 7 with programming kicking off January 14. Village plans to enroll at least 12 companies across industries.
Laptop users have been focused for a very long time on whether the iPad Pro is going to be forced upon them as a replacement device.
Depending on who you believe, Apple included, it has at one point been considered that, or a pure tablet with functions to be decided completely by the app development community, or something all its own.
But with the iPad Pro, the Smart Keyboard and the new version of Apple’s Pencil, some things are finally starting to become clear.
The new hardware, coupled with the ability and willingness of companies like Adobe to finally ship completely full-featured versions of Photoshop that handle enormous files and all of the tools and brushes of the desktop version, are opening a new door on what could be possible with iPad Pro — if Apple are ready to embrace it.
Does the double-tap gesture feel natural? Yep. I’ve been using electronic drawing surfaces since the first generation Wacom that had a serial port connector. Many of them over the years have had some sort of “action button” that allowed you to toggle or click to change drawing modes, invoke erasers or pallets and generally save you from having to move away from your drawing surface as much as possible.
That’s the stated and obvious goal of the Apple Pencil’s new double tap as well. Many of the internal components are very similar to the first-generation Pencil, but one of the new ones is a capacitive band that covers the bottom third of the pencil from the tip upwards. This band is what enables the double tap and it is nicely sensitive. It feels organic and smooth to invoke it, and you can adjust the cadence of tap in the Pencil’s control panel.
The panel also allows you to swap from eraser to palette as your alternate, and to turn off the “tap to notes” feature, which lets you tap the pencil to your screen to instantly launch the Notes app. When you do this it’s isolated to the current note only, just like photos. One day I’d love to see alternate functions for Pencil tap-to-wake, but it makes sense that this is the one they’d start with.
I never once double tapped it accidentally and it felt great to swap to an eraser without lifting out of work mode — the default behavior.
But Apple has also given developers a lot of latitude to offer different behaviors for that double tap. Procreate, one of my favorite drawing apps, offers a bunch of options, including radial menus that reflect the current tool or mode and switching between one tool and another directly. Apple’s guidelines instruct developers to be cautious in implementing double tap — but they also encourage them to think about what logical implementations of the tool look like for users.
The new Pencil does not offer any upgrades in tracking accuracy, speed or detection. It works off of essentially the same tracking system as was available to the first Pencil on previous iPad Pros. But, unfortunately, the Pencil models are not cross-compatible. The new Pencil will not work on old iPad Pros and the old Pencil does not work on the new model. This is due to the pairing and charging process being completely different.
Unlike the first one, though, the new Pencil both pairs and charges wirelessly — a huge improvement. There is no little cap to lose, you don’t have to plug it into the base of the iPad like a rectal thermometer to charge and the pairing happens simultaneously as you charge.
The “top” (for lack of a better term) edge of the iPad Pro in horizontal mode now features a small opaque window. Behind that window are the charging coils for the Pencil. Inside the Pencil itself is a complementary coil, flanked by two arrays of ferrite magnets. These mate with magnetic Halbach arrays inside the chassis of the iPad. Through the use of shaped magnetic fields, Apple pulls a bit of alignment trickery here, forcing the pencil to snap precisely to the point where the charging coils are aligned perfectly. This enables you to slap the pencil on top quickly, not even thinking about alignment.
The magnetic connection is tough — almost, but not quite, enough to hold the larger iPad Pro in the air by the pencil — and it should hold on well, but it’s fairly easy to knock off if you come at it from the side, as you would when pulling it off from the front.
There’s also a pleasant on-screen indicator now that shows charge level.
When the Pencil launched, I brought it to my Dad, a fine artist who sketches more than anyone I know as a part of his creative process. He liked the tracking and the access to digital tools, but specifically called out the glossy finish as being inferior to matte and the fact that there was no flat edge to rest against your finger.
The new Pencil has both a matte finish and a new flat edge. Yes, the edge is there to stop the pencil from rolling and also to allow it to snap to the edge of the iPad for charging, but the ability to register one edge of your drawing instrument against the inside of your control finger is highly under-valued by anyone who isn’t an artist. It’s hugely important in control for sketching. Plenty of pencils are indeed round, but a lot of those are meant to be held in an overhand grip — like a pointing device that you use to shade, for the most part. The standard tripod grip is much better suited to having at least one flat edge.
Your range of motion is limited in tripod grip, but it can provide for more precision, where the overhand grip is more capable and versatile; it’s also harder to use precisely. The new Pencil is now better to use in both of these widely used grips, which should make artists happy.
These fiddly notions of grip may seem minor, but I (and my drawing callous) can tell you that it is much more than it seems. Grip is everything in sketching.
The Pencil is one of the most impressive version 2 devices that Apple has ever released. It scratches off every major issue that users had with the V1 — a very impressive bit of execution here that really enhances the iPad Pro’s usability, both for drawing and quick notes and sketches. The only downside is that you have to buy it separately.
Drawing and sketching with the new Pencil is lovely, and remains a completely stand-out experience that blows away even dedicated devices like the Wacom Cintiq and remains a far cut above the stylus experience in the Surface Pro devices.
Beyond that there are some interesting things already happening with the Pencil’s double tap. In Procreate, for instance, you can choose a different double-tap action for many different tools and needs. It’s malleable, depending on the situation. It’s linked to the context of what you’re working on, or it’s not, depending on your (and the developer’s) choices.
One minute you’re popping a radial menu that lets you manipulate whole layers, another you’re drawing and swapping to an eraser, and it still feels pretty easy to follow because it’s grounded in the kind of tool that you’re using at the moment.
Especially in vertical mode, it’s easy to see why touch with fingers is not great for laptops or hybrids. The Pencil provides much-needed precision and delicacy of touch that feels a heck of a lot different than pawing at the screen with your snausages trying to tap a small button. Reach, too, can be a problem here, and the Pencil solves a lot of the problems in hitting targets that are 10” away from the keyboard or more.
The Pencil is really moving upwards in the hierarchy from a drawing accessory to a really mandatory pointing and manipulation tool for iPad users. It’s not quiiiite there yet, but there’s big potential, as the super flexible options in Procreate display.
There’s an enormous amount of high-level execution going on with Pencil, and by extension, iPad. Both the Pencil and the AirPods fly directly in the face of arguments that Apple can’t deliver magical experiences to users built on the backs of its will and ability to own and take responsibility of more of its hardware and software stack than any other manufacturer.
Speakers and microphones
There are now five microphones, though the iPad Pro still only records in stereo. They record in pairs, with the mics being dynamically used to noise cancel as needed.
The speakers are solid, producing some pretty great stereo sound for such a thin device. The speakers are also used more intelligently now, with all four active for FaceTime calls, something that wasn’t possible previously without the five-mic array due to feedback.
Let’s talk about ports, baby/Let’s talk about USB-C
I’m not exactly an enormous fan of USB-C as a format, but it does have some nice structural advantages over earlier USB formats and, yes, even over Lightning. It’s not the ideal, but it’s not bad. So it’s a pleasant surprise to see Apple conceding that people wanting to use an external monitor at high-res, charge iPhones and transfer photos at high speed is more important than sticking to Lightning.
The internal and external rhetoric about Lightning has always been that it was compact, useful and perfect for iOS devices. That rhetoric now has an iPad Pro-sized hole in it and I’m fine with that. A pro platform that isn’t easily extensible isn’t really a pro platform.
It’s not a coincidence that Apple’s laptops and its iPad Pro devices all now run on USB-C. This trickle down may continue, but for now it stems directly from what Apple believes people will want from these devices. An external monitor was at the top of the list in all of Apple’s messaging onstage and in my discussions afterwards. They believe there is a certain segment of Pro users that will benefit greatly from running an extended (not just mirrored) display up to 5K resolution.
In addition, there are a bunch of musical instruments and artist’s peripherals that will connect directly now. There’s even a chance (but not an official one) that the port could provide some externally powered accessories with enough juice to function.
The port now serves a full 7.5W to devices plugged in to charge, and you can plug in microphones and other accessories via the USB-C port, though there is no guarantee any of them will get enough power from the port if they previously required external power.
Pretty much all MacBook dongles will work on the iPad Pro, by the way. So whatever combos of stuff you’ve come up with will have additional uses here.
The port is USB 3.1 gen 2 capable, making for transfers up to 10GBPS. Practically, what this means for most people is faster transfer from cameras or SD Card readers for photos. Though the iPad Pro does not support mass storage or external hard drive support directly to the Files app, apps that have their own built-in browsing can continue to read directly from hard drives and now the transfer speeds will be faster.
There is a USB-C to headphone adapter, for sale separately. It also works with Macs, if that’s something that excites you. The basic answer I got on no headphone jacks, by the way, is that one won’t even fit in the distance from the edge of the screen to the bezel, and that they needed the room for other components anyway.
The new iPad Pro also ships with a new charger brick. It’s a USB-C power adapter that’s brand new to iPad Pro.
A12X and performance
The 1TB model of larger iPad Pro and, I believe, the 1TB version of the smaller iPad Pro, have 6GB of RAM. I believe, according to what I’ve been able to discern, that the models that come with less than 1TB of storage have less than that — around 4GB total. I don’t know how that will affect their performance because I was not supplied with those models.
The overall performance of the A12X on this iPad Pro though, is top notch. Running many apps at once in split-screen spaces or in slideover mode is no problem, and transitions between apps are incredibly smooth. Drawing and sketching in enormous files in Procreate was super easy, and I encountered zero chugging across AR applications (buttery smooth), common iPad apps and heavy creative tools. This is going to be very satisfying for people who edit large photos in Lightroom or big video files in iMovie.
The Geekbench benchmarks for this iPad are, predictably, insane:
As you can see, the era of waiting for desktop-class ARM processors to come to the iPad Pro is over. They’re here, and they’re integrated tightly with other Apple-designed silicon across the system to achieve Apple’s ends.
There have basically been two prevailing camps on the ARM switch. One side is sure Apple will start slowly, launching one model of MacBook (maybe the literal MacBook) on ARM and dribbling it out to other models. I was solidly in that camp for a long time. After working on the iPad Pro and seeing the performance, both burst and sustained, across many pro applications, I’ve developed doubts.
The results here, and the performance of the iPad Pro, really crystallize the fact that Apple can and will ship ARM processors across its whole line as soon as it feels like it wants to.
There are too many times where we have ended up waiting on new Apple hardware due to some vagary of Intel’s supply chain or silicon focus. Apple is sick of it; I’ve heard grumbling for years about this from inside the company, but they’re stuck with Intel as a partner until they make the leap.
At this point, it’s a matter of time, and time is short.
Camera and Face ID
The camera in the iPad Pro is a completely new thing. It uses a new sensor and a new five-element lens. This new camera had to be built from the ground up because the iPad Pro is too thin to have used the camera from the iPhone XR or XS or even the previous iPads.
This new camera is just fine, image quality-wise. It offers Smart HDR, which requires support both from the speedy sensor and the Neural Engine in the A12X. It’s interesting that Apple’s camera team decided to do the extra work to provide a decent camera experience, rather than just making the sensor smaller or falling back to an older design that would work with the thickness, or lack thereof.
Interestingly, this new camera system does not deliver portrait mode from the rear camera, like the iPhone XR. It only gives you portrait from the True Depth camera on front.
iPad photography has always gotten a bad rap. It’s been relegated to jokes about dads holding up tablets at soccer games and theme parks. But the fact remains that the iPad Pro’s screen is probably the best viewfinder ever made.
I do hope that some day it gets real feature-for-feature parity with the iPhone, so I have an excuse to go full dad.
Of similar note, both hardware and software updates have been made to the True Depth array on the front of the iPad Pro in order to make it work in the thinner casing. Those changes, along with additional work in neural net training and tweaking, also support Face ID working in all “four” orientations of the iPad Pro. No matter which way is up, it will unlock, and it does so speedily — just as fast as the iPhone XS generation Face ID system, no question.
I also believe that it works at slightly wider angles now, though it may be my imagination. By nature, you’re often farther away from the screen on the iPad Pro than you are on your phone, but still, I feel like I can be much more “off axis” to the camera and it still unlocks. This is good news on iPad because you can be in just about any working posture and you’re fine.
Like the Pencil, the Smart Keyboard Folio is an optional accessory. And, like the Pencil, I don’t think you’re really getting the full utility of the iPad Pro without it. There have been times where I’ve written more than 11,000 words at a stretch on iPad for very focused projects, and its ability to be a distraction-free word production machine are actually wildly undersung, I feel. There are not many electronic devices better for just crashing out words without much else to get in the way than iPad with a good text editor.
Editing, however, has always been more of a mixed bag. I’m not sure we’re quite there yet with the latest iPad Pro, but it’s a far better scenario for mixed-activity sessions. With the help of the Pencil and the physical keyboard, it is becoming a very livable situation for someone whose work demands rapid context switching and a variety of different activities that require call-and-response feedback.
The keyboard itself is fine. It feels nearly identical to the previous keyboard Apple offered for iPads, and isn’t ideal in terms of key press and pushback, but makes for an OK option that you can get used to.
The design of the folio is something else. It’s very cool, super stable and shows off Apple’s willingness to get good stupid with clever implementation.
A collection of 120 magnets inside the case are arranged in the same Halbach arrays that hold the pencil. Basically, sets of magnets arranged to point their force outwards. These arrays allow the case to pop on to the iPad Pro with a minimum of fuss and automatically handle the micro-alignment necessary to make sure the the contacts of the smart connector make a good connection to power and communicate with the keyboard.
The grooves that allow for two different positions of upright use are also magnetized, and couple with magnets inside the body of the iPad Pro.
The general effect here is that the Smart Keyboard is much, much more stable than previous generations and, I’m happy to report, is approved for lap use. It’s still not going to be quite as stable as a laptop, but you can absolutely slap this on your knees on a train or plane and get work done. That was pretty much impossible with its floppier predecessor.
One big wish for the folio is that it offered an incline that was more friendly to drawing. I know that’s not the purpose of this device specifically, but I found it working so well with Pencil that there was a big hole left by not having an arrangement that would hold the iPad at around the 15-20 degree mark for better leverage and utility while sketching and drawing. I think the addition of another groove and magnet set somewhere on the lower third of the back of the folio would allow for this. I hope to see it appear in the future, though third parties will doubtlessly offer many such cases soon enough for dedicated artists and illustrators.
Though much has been made about the curved corners of the iPad Pro’s casing and the matching curved corners of its screen, the fact is that the device feels much more aggressive in terms of its shape. The edges all fall straight down, instead of back and away, and they’re mated with tight bullnose corners.
The camera bump on the back does not cause the iPad to wobble if you lay it flat on a counter and draw. There’s a basic tripod effect that makes it just fine to scribble on, for those who were worried about that.
The overall aesthetic is much more businesslike and less “friendly” in that very curvy sort of Apple way. I like it, a lot. The flat edges are pretty clearly done that way to let Apple use more of the interior space without having to cede a few millimeters all the way around the edge to unusable space. In every curved iPad, there’s a bit of space all the way around that is pretty much air. Cutting off the chin and forehead of the iPad Pro did a lot to balance out the design and make it more holdable.
There will likely be, and I think justifiably, some comparisons to the design of Microsoft’s Surface Pro and the new blockier design. But the iPads still manage to come in feeling more polished than most of its tablet rivals, with details like the matching corner radii, top of the line aluminum finish and super clever use of magnets to keep the exterior free of hooks or latches to attach accessories like the Smart Keyboard.
If you’re debating between the larger and smaller iPad Pro models I can only give you one side of advice here because I was only able to test the new 12.9” model. It absolutely feels better balanced than the previous larger iPad and certainly is smaller than ever for the screen size. It makes the decision about whether to move up in size a much closer one than it ever has been before. Handling the smaller Pro in person at the event last week was nice, but I can’t make a call on how it is to live with. This one feels pretty great though, and certainly portable in a way that the last large iPad Pro never did — that thing was a bit of a whale, and made it hard to justify bringing along. This one is smaller than my 13” MacBook Pro and much thinner.
The iPhone XR’s pixel masking technique is also at work on the iPad Pro’s screen, giving it rounded corners. The LCD screen has also gained tap-to-wake functionality, which is used to great effect by the Pencil, but can also be used with a finger to bring the screen to life. Promotion, Apple’s 120hz refresh technology, is aces here, and works well with the faster processor to keep the touch experience as close to 1:1 as possible.
The color rendition and sharpness of this LCD are beyond great, and its black levels only show poorly against an OLED because of the laws of physics. It also exhibits the issue I first noticed in the iPhone XR, where it darkens ever so slightly at the edges due to the localized dimming effect of the pixel gating Apple is using to get an edge-to-edge LCD. Otherwise, this is one of the better LCD screens ever made in my opinion, and now it has less bezel and fun rounded corners — plus no notch. What’s not to like?
In my opinion, if you want an iPad to do light work as a pure touch device, get yourself a regular iPad. The iPad Pro is an excellent tablet, but really shines when it’s paired with a Pencil and/or keyboard. Having the ability to bash out a long passage of text or scribble on the screen is a really nice addition to the iPad’s capabilities.
But the power and utility of the iPad Pro comes into highest relief when you pair it with a Pencil.
There has been endless debate about the role of tablets with keyboards in the pantheon of computing devices. Are they laptop replacements? Are they tablets with dreams of grandiosity? Will anyone ever stop using the phrase 2-in-1 to refer to these things?
And the iPad hasn’t exactly done a lot to dispel the confusion. During different periods of its life cycle it has taken on many of these roles, both through the features it has shipped with and through the messaging of Apple’s marketing arm and well-rehearsed onstage presentations.
One basic summary of the arena is that Microsoft has been working at making laptops into tablets, Apple has been working on making tablets into laptops and everyone else has been doing weird-ass shit.
Microsoft still hasn’t been able (come at me) to ever get it through their heads that they needed to start by cutting the head off of their OS and building a tablet first, then walking backwards. I think now Microsoft is probably much more capable than then Microsoft, but that’s probably another whole discussion.
Apple went and cut the head off of OS X at the very beginning, and has been very slowly walking in the other direction ever since. But the fact remains that no Surface Pro has ever offered a tablet experience anywhere near as satisfying as an iPad’s.
Yes, it may offer more flexibility, but it comes at the cost of unity and reliably functionality. Just refrigerator toasters all the way down.
THAT SAID. I still don’t think Apple is doing enough in software to support the speed and versatility that is provided by the hardware in the iPad Pro. While split-screening apps and creating “spaces” that remain in place to bounce between has been a nice evolution of the iPad OS, it’s really only a fraction of what is possible.
And I think even more than hardware, Apple’s iPad users are being underestimated here. We’re on eight years of iPad and 10 years of iPhone. An entire generation of people already uses these devices as their only computers. My wife hasn’t owned a computer outside an iPad and phone for 15 years and she’s not even among the most aggressive adopters of mobile-first.
Apple needs to unleash itself from the shackles of a unified iOS. They don’t have to feel exactly the same now, because the user base is not an infantile one. They’ve been weaned on it — now give them solid food.
The Pencil, to me, stands out as the bright spot in all of this. Yes, Apple is starting predictably slow with its options for the double-tap gesture. But third-party apps like Procreate show that there will be incredible opportunities long term to make the Pencil the mouse for the tablet generation.
I think the stylus was never the right choice for the first near decade of iPad, and it still isn’t mandatory for many of its uses. But the additional power of a context-driven radial menu or right option at the right time means that the Pencil could absolutely be the key to unlocking an interface that somehow blends the specificity of mouse-driven computing with the gestural and fluidity of touch-driven interfaces.
I’m sure there are Surface Pro users out there rolling their eyes while holding their Surface Pens — but, adequate though they are, they are not Pencils. And more importantly, they are not supported by the insane work Apple has done on the iPad to make the Pencil feel more than first party.
And, because of the (sometimes circuitous and languorous) route that Apple took to get here, you can actually still detach the keyboard and set down the Pencil and get an incredible tablet-based experience with the iPad Pro.
If Apple is able to let go a bit and execute better on making sure the software feels as flexible and “advanced” as the hardware, the iPad Pro has legs. If it isn’t able to do that, then the iPad will remain a dead-end. But I have hope. In the shape of an expensive-ass pencil.
Grab, the Singapore startup that bought Uber’s Southeast Asia business earlier this year, continues to announce strategic investors for its ongoing Series H funding round. The latest edition revealed today is Korean automotive firm Hyundai, which is investing $250 million.
Hyundai first invested in Grab in January, and it joins recently announced investors Microsoft (undisclosed) and Booking Holdings ($200 million) in the round, which is aimed at reaching at least $3 billion before the end of this year. Grab first announced a $1 billion investment from Toyota in June and that was doubled to $2 billion when a range of institutional backers joined. Those include OppenheimerFunds, Ping An Capital, Mirae Asset-Naver Asia Growth Fund, Lightspeed Venture Partners and Macquarie Capital, and today Grab disclosed two others: Goldman Sachs Investment Partners and Citi Ventures.
In total, these additions take that Series H round to $2.7 billion so far, Grab said. That means that Grab, which is valued at over $11 billion, has now raised more than $6 billion from investors including SoftBank and China’s Didi. That’s a figure that extends its record for a startup in Southeast Asia. Grab claims 125 million downloads across its eight markets in Southeast Asia and over 2.5 billion rides completed to date, up from two billion in July.
Like Toyota, Microsoft and travel giant Booking — which was formerly known as Priceline — Hyundai’s involvement includes a fairly hefty strategic portion: electric vehicles.
Grab said that it will work with the Korea firm introduce a series of EV pilots in Southeast Asia that’ll feature Hyundai and Hyundai-owned Kia vehicles. The companies began working on the rollout of Hyundai’s IONIQ vehicle in Singapore earlier this year and now they will add Kia EVs and explore opportunities beyond Singapore.
(Right to left) Euisun Chung, Executive Vice Chairman of Hyundai Motor Group, and Anthony Tan, Grab CEO, mark the new $250 million investment deal [Image via Bloomberg New Economy Forum]
Grab has an EV fleet in Singapore — size undisclosed — and it is working with Singapore Power to roll out a network of charging hubs and packages for Grab EV drivers as it expands that EV presence in the country. But this Hyundai partnership would represent its first EV foray into other markets in Southeast Asia, which has a cumulative population of more than 600 million consumers, although it didn’t name which markets or give a timeframe.
As in Singapore, Grab said its EV strategy will include engaging governments and “infrastructure players” to set up the right conditions for EVs, such as charging networks, maintenance packages for drivers and general research into how EVs perform in more humid environments.
Beyond the EV plans, Grab’s Series H is being put aside for a number of ventures which include its push to become an all-in-one ‘super app’ that goes beyond transportation to cover food deliveries, services on-demand, payments and fintech services, and more. There’s also likely an allocation for competition because, although Grab consumed Uber’s local business in the region, Indonesia-based rival Go-Jek is expanding in the region.
Go-Jek, which is aiming to raise $2 billion in its latest funding round according to sources, has entered Vietnam, is in the process of launching in Thailand and has just begun recruiting drivers for a Singapore rollout. That means Grab needs to keep a substantial amount of powder dry in case of the (likely) event that its battle with Go-Jek descends into a discount war, as was often the case during its rivalry with Uber.
That explains why it is raising an enormous $3 billion round despite having already removed Uber from the region via the buyout deal, which saw the U.S. ride-hailing giant take a 27.5 percent stake in Grab.
That deal, by the way, didn’t really go as planned. Not only was Grab over ambitious on the logistics, including plans to consume most of Uber’s 500 staff, but it misread the public reaction and incurred the wrath of regulators. Singapore’s consumer watchdog hit Uber and Grab with a total of $9.5 million in fines for the “anti-competitive” merger, while the pair got a lighter reprimand in the Philippines.
This month marks the 5-year anniversary of Aileen Lee’s landmark article, “Welcome To The Unicorn Club”.
At the time, the piece defined a new breed of startup — the $1 billion privately held company. When Lee did her first count, there were 39 “unicorns”; an improbable, but not impossible number.. Today, the once-scarce unicorn has become a global herd with 376 companies on the roster and counting.
But the proliferation of unicorns raises certain questions. Is this new breed of unicorn artificially created? Could these magical companies see their valuations slip and fall out of the herd? Does this indicate an irrational exuberance where investors are engaging in wish fulfilment and creating magic where none actually existed?
List of “unicorn” companies worth more than $1 billion as of the third quarter of 2018
There’s a new “unicorn” born every four days
The first change has been to the geographic composition and private company requirement of the list. The original qualification for the unicorn study was “U.S.-based software companies started since 2003 and valued at over $1 billion by public or private market investors.” The unicorn definition has changed and here is the popular and wiki page definition we all use today: “A unicorn is a privately held startup company with a current valuation of US$1 billion or more.”
Beyond the expansion of the definition of terms to include a slew of companies from all over the globe, there’s been a concurrent expansion in the number of startup technology companies to achieve unicorn status. There is a tenfold increase in annual unicorn production.
Indeed, while the unicorn is still rare but not as rare as before. Five years ago, roughly ten unicorns were being created a year, but we are approaching one hundred new unicorns a year in 2018.
As of November 8, we have seen eighty one newly minted unicorns this year, which means we have one new unicorn every four days.
There are unicorn-sized rounds every day
These unicorns are also finding their horns thanks to the newly popularized phenomena of mega rounds which raise $100 million or more. These deals are ten times more common now, than they were only five years ago.
Back in 2013, there were only about four mega rounds a month, but now there are forty mega rounds a month based on Crunchbase data. In fact, starting from 2015, public market IPO has for the first time no longer been the major funding source for unicorn size companies.
Unicorns have been raising money from both traditional venture capital but also more from the non-traditional venture capital such as SoftBank, sovereign wealth funds, private equity funds, and mutual funds.
Investors are chasing the value creation opportunity. Most people probably did not realize that Amazon, Microsoft, Cisco, and Oracle all debuted on public markets for less than a $1 billion market cap (in fact only Microsoft topped $500 million), but today they together are worth more than $2 trillion dollars
It means tremendous value was created after those companies came to the public market. Today, investors are realizing the future giant’s value creation has been moved to the “pre-IPO” unicorn stage and investors don’t want to miss out.
To put things in perspective, investors globally deployed $13 billion in almost 20,000 seed & angel deals, and SoftBank was able to deploy the same $13 billion amount in just 2 deals (Uber and WeWork). The SoftBank type of non-traditional venture world literally redefined “pre-IPO” and created a new category for venture capital investment.
Unicorns are staying private longer
That means the current herd of unicorns are choosing to stay private longer. Thanks to the expansion of shareholders private companies can rack up under the JOBS Act of 2012; the massive amount of funding available in the private market; and the desire of founders to work with investors who understand their reluctance to be beholden to public markets.
Elon Musk was thinking about taking Tesla private because he was concerned about optimizing for quarterly earning reports and having to deal with the overhead, distractions, and shorts in the public market. Even though it did not happen in the end, it reflects the mentality of many entrepreneurs of the unicorn club. That said, most unicorn CEOs know the public market is still the destiny, as the pressure from investors to go IPO will kick in sooner or later, and investors expect more governance and financial transparency in the longer run.
Unicorns are breeding outside of the U.S. too
Finally, the current herd of unicorns now have a strong global presence, with Chinese companies leading the charge along with US unicorns. A recent Crunchbase graph indicated about 40% of unicorns are from China,, 40% from US, and the rest from other parts of the world.
Back in 2013, the “unicorn” is primarily a concept for US companies only, and there were only 3 unicorn size startups in China (Xiaomi, DJI, Vancl) anyways. Another change in the unicorn landscape is that, China contributed predominantly consumer-oriented unicorns, while the US unicorns have always maintained a good balance between enterprise-oriented and consumer-oriented companies. One of the stunning indications that China has thriving consumer-oriented unicorns is that China leads US in mobile payment volume by hundredfold.
The fundamentals of entrepreneurship remain the same
Despite the dramatic change of the capital market, a lot of the insights in Lee’s 5-year old blog are still very relevant to early stage entrepreneurs today.
For example, in her study, most unicorns had co-founders rather than a single founder, and many of the co-founders had a history of working together in the past.
This type of pattern continues to hold true for unicorns in the U.S. and in China. For instance, the co-founders of Meituan (a $50 billion market cap company on its IPO day in September 2018) went to school together and had co-founded a company before
There have been other changes. In the past three months alone, four new US enterprise-oriented unicorns have emerged by selling directly to developers instead of to the traditional IT or business buyers; three China enterprise-oriented SaaS companies were able to raise mega rounds. These numbers were unheard of five years ago and show some interesting hints for entrepreneurs curious about how to breed their own unicorn.
The new normal is reshaping venture capital
Once in a while, we see eye-catching headlines like “bubble is larger than it was in 2000.” The reality is companies funded by venture capital increased by more than 100,000 in the past five years too. So the unicorn is still as rare as one in one thousand in the venture backed community.
What’s changing behind the increasing number of unicorns is the new normal for both investors and entrepreneurs. Mega rounds are the new normal; staying private longer is the new normal; and the global composition of the unicorn club is the new normal.
Just look at the evidence in the venture industry itself. Sequoia Capital, the bellwether of venture capital, raised a whopping $8 billion global growth mega fund earlier this year under pressure from SoftBank and its $100 billion mega-fund. And Greylock Partners, known for its focus and success in leading early stage investment, recently led a unicorn round for the first time in its 53-year history.
It’s proof that just as venture capitalists have created a new breed of startups, the new startups and their demands are reshaping venture capital to continue to support the the companies they’ve created.