Author: Ingrid Lunden

Slack is raising $400M+ with a post-money valuation of $7B or more

Slack — the app that lets coworkers and others in professional circles chat with each other and call in data from hundreds of integrated apps in the name of getting more work done (or at least procrastinating in an entertaining way) — has been on a growth tear in the last few years, most recently passing 8 million daily active users, 3 million of them paying. Now, the company is planning to capitalise on that with some more funding.

TechCrunch has learned that Slack is raising another round, this time in the region of $400 million or possibly more, with a post-money valuation of at least $7 billion — adding a whopping $2 billion on top of the company’s last valuation in September 2017, when SoftBank led a $250 million round at a $5.1 billion valuation.

We’ve heard from multiple sources that a new investor, General Atlantic, is leading this round, with possibly another new backer, Dragoneer, also in the mix. It’s not clear which other investors might be involved; the company counts no less than 41 other backers on its cap table already, according to PitchBook. (You might even say Several People Are Funding…) We also don’t know whether this round has closed.

At $400 million, this would make it Slack’s biggest round to date. That size underscores a few different things.

First, it points to the existing opportunity in enterprise messaging. Consumerisation has taken hold, and apps that let users easily start and carry on a mix of serious and diverting conversations, infused with GIFs or whatever data they might need from other applications, are vying to replace other ways that people communicate in the workplace, such as email, phone conferences and in-person chats, even when people are in the same vicinity as each other. With consumer messaging apps like WhatsApp topping 1.5 billion users, there’s plenty of room for enterprise messaging to grow.

Second, the round and valuation emphasize Slack’s position as a leader in this area. While there were other enterprise social networking apps in existence before Slack first launched in 2013 — Yammer, Hipchat and Socialcast among them — nothing had struck a chord quite as Slack did. “Things have been going crazy”, was how co-founder and CEO Stewart Butterfield described it to me when Slack exited beta: teams trialling it were seeing usage from “every single team member, every day.”

That growth pace has continued. Today, the company counts 70,000 paid teams including Capital One, eBay, IBM, 21st Century Fox, and 65 percent of Fortune 100 companies among its bigger users; and with customers in 100 countries, half of its DAUs are outside North America (UK, Japan, Germany, France and India are its biggest international markets).

But thirdly — and this could be key when considering how this funding will be used — Slack is not the only game in town.

Software giant Microsoft has launched Teams, and social networking behemoth Facebook has Workplace. Using their respective dominance in enterprise software and social mechanics, these two have stolen a march on picking up some key customer wins among businesses that have opted for products that are more natural fits with what their employees were already using. Microsoft reported 200,000 paying organizations earlier this year, and Facebook has snagged some very large customers like Walmart.

Slack’s bottom-up distribution strategy could give it an edge against these larger companies and their broader but more complex products. The lightweight nature of Slack’s messaging-first approach allows it more easily be inserted into a company’s office stack. Nearly every type of employee needs office messaging, creating potential for Slack to serve as an identity layer for enterprise software. It’s own Slack Fund invests in potential companies that plug in, as the company hopes to build an ecosystem of partners that can fill in missing functionality.

AUSTIN, TX – MARCH 15: Stewart Butterfield, CEO of Slack speaks onstage at ‘Stewart Butterfield in Conversation with Farhad Manjoo’ during the 2016 SXSW Music, Film + Interactive Festival at Austin Convention Center on March 15, 2016 in Austin, Texas. (Photo by Mindy Best/Getty Images for SXSW)

Alongside dozens of other, smaller rivals offering comparative mixes of tools, it’s no surprise that last month Slack tightened up its bootlaces to take on the role of consolidator, snapping up IP and shutting down Hipchat and Stride from Atlassian, with the latter taking a stake in Slack as part of the deal.

Slack, which has a relatively modest 1,000+ employees, has ruled out an IPO this year, so this latest round will help it shore up cash in the meantime to continue growing, and competing.

Contacted for this story, Slack said that it does not comment on rumors or speculation.

UK’s Information Commissioner will fine Facebook the maximum £500K over Cambridge Analytica breach

Facebook continues to face fallout over the Cambridge Analytica scandal, which revealed how user data was stealthily obtained by way of quizzes and then appropriated for other purposes, such as targeted political advertising. Today, the U.K. Information Commissioner’s Office (ICO) announced that it would be issuing the social network with its maximum fine, £500,000 ($662,000) after it concluded that it “contravened the law” — specifically the 1998 Data Protection Act — “by failing to safeguard people’s information.”

The ICO is clear that Facebook effectively broke the law by failing to keep users data safe, when their systems allowed Dr Aleksandr Kogan, who developed an app, called “This is your digital life” on behalf of Cambridge Analytica, to scrape the data of up to 87 million Facebook users. This included accessing all of the friends data of the individual accounts that had engaged with Dr Kogan’s app.

The ICO’s inquiry first started in May 2017 in the wake of the Brexit vote and questions over how parties could have manipulated the outcome using targeted digital campaigns.

Damian Collins, the MP who is the chair of the Digital, Culture, Media and Sport Committee that has been undertaking the investigation, has as a result of this said that the DCMS will now demand more information from Facebook, including which other apps might have also been involved, or used in a similar way by others, as well as what potential links all of this activity might have had to Russia. He’s also gearing up to demand a full, independent investigation of the company, rather than the internal audit that Facebook so far has provided. A full statement from Collins is below.

The fine, and the follow-up questions that U.K. government officials are now asking, are a signal that Facebook — after months of grilling on both sides of the Atlantic amid a wider investigation — is not yet off the hook in the U.K. This will come as good news to those who watched the hearings (and non-hearings) in Washington, London and European Parliament and felt that Facebook and others walked away relatively unscathed. The reverberations are also being felt in other parts of the world. In Australia, a group earlier today announced that it was forming a class action lawsuit against Facebook for breaching data privacy as well. (Australia has also been conducting a probe into the scandal.)

The ICO also put forward three questions alongside its announcement of the fine, which it will now be seeking answers to from Facebook. In its own words:

  1. Who had access to the Facebook data scraped by Dr Kogan, or any data sets derived from it?
  2. Given Dr Kogan also worked on a project commissioned by the Russian Government through the University of St Petersburg, did anyone in Russia ever have access to this data or data sets derived from it?
  3. Did organisations who benefited from the scraped data fail to delete it when asked to by Facebook, and if so where is it now?

The DCMS committee has been conducting a wider investigation into disinformation and data use in political campaigns and it plans to publish an interim report on it later this month.

Collins’ full statement:

Given that the ICO is saying that Facebook broke the law, it is essential that we now know which other apps that ran on their platform may have scraped data in a similar way. This cannot by left to a secret internal investigation at Facebook. If other developers broke the law we have a right to know, and the users whose data may have been compromised in this way should be informed.

Facebook users will be rightly concerned that the company left their data far too vulnerable to being collected without their consent by developers working on behalf of companies like Cambridge Analytica. The number of Facebook users affected by this kind of data scraping may be far greater than has currently been acknowledged. Facebook should now make the results of their internal investigations known to the ICO, our committee and other relevant investigatory authorities.

Facebook state that they only knew about this data breach when it was first reported in the press in December 2015. The company has consistently failed to answer the questions from our committee as to who at Facebook was informed about it. They say that Mark Zuckerberg did not know about it until it was reported in the press this year. In which case, given that it concerns a breach of the law, they should state who was the most senior person in the company to know, why they decided people like Mark Zuckerberg didn’t need to know, and why they didn’t inform users at the time about the data breach. Facebook need to provide answers on these important points. These important issues would have remained hidden, were it not for people speaking out about them. Facebook’s response during our inquiry has been consistently slow and unsatisfactory.

The receivers of SCL elections should comply with the law and respond to the enforcement notice issued by the ICO. It is also disturbing that AIQ have failed to comply with their enforcement notice.

Facebook has been in the crosshairs of the ICO over other data protection issues, and not come out well.

Facebook is shutting down Hello, Moves and the anonymous teen app tbh due to ‘low usage’

Facebook, the world’s largest social network with 2.2 billion users, is all about capitalizing on scale, and so today it announced that it would be sunsetting three apps in its stable that simply weren’t keeping up. After failing to gain traction, Hello, Moves and tbh will all be depreciated in the coming weeks, the company announced today. The three apps are being shut down at varying times we’re noting below. Facebook says that all user data from all three of these apps will be deleted within 90 days.

“We regularly review our apps to assess which ones people value most. Sometimes this means closing an app and its accompanying APIs,” said Facebook. “We know some people are still using these apps and will be disappointed — and we’d like to take this opportunity to thank them for their support. But we need to prioritize our work so we don’t spread ourselves too thin. And it’s only by trial and error that we’ll create great social experiences for people.”

But “low usage” is a pretty wide range, it turns out. Sensor Tower notes that Hello had only 570,000 installs — that is, total downloads — but tbh had 6.4 million and Moves 13 million. Still, these numbers are all just blips in comparison to billions of downloads and users of Facebook and the other popular apps that it owns: Instagram, WhatsApp and Messenger.

The three getting sunset are all examples of the different angles that Facebook has explored over the years to evolve its business into newer areas — not all of which have panned out.

Moves came to Facebook by way of an acquisition four years ago of the fitness and tracking app. At the time, Facebook appeared to be interested in exploring more about how people might use their Facebook social graphs to share more data about their own fitness regimes, and to possibly use Facebook not just as a place to share but to track progress. With its acquisition of Moves, it might have been the case that Facebook believed that it could take a more direct role in that process.

Early on, there was promise: Moves already had amassed four million downloads before the acquisition. However, things simply did not continue to bulk up much after that point, either because Facebook saw that there wasn’t a large enough critical mass of people interested in making fitness social, or because its own spin on how to do that wasn’t where the market has moved. (You could argue that there has always been a huge social element in exercise — gyms and exercise classes being two obvious examples — but these are more about people in physical spaces doing things together.)

In the end, Moves the app hasn’t been updated in more than a year, and it languishes at around 616 in the fitness category today. It will be shut down in the coming weeks, Facebook said.

Hello, launched in 2015, was part of Facebook’s wider strategy to build more communications services to bridge the gap with users, targeting those specifically in emerging markets.

In the case of Hello, the app was Android-only and worked in the U.S., Nigeria and Brazil. The app is a bit like TrueCaller: people could link up their Facebook accounts to a dialer, which would then show you the Facebook identity of a caller so you could decide whether or not you would like to take the call.

As with Moves, Hello came amid a time when many thought Facebook had big plans for communications, with rumors abounding of Facebook phones and Facebook wanting to take on carriers with its own voice services. Hello, however, never expanded — neither in geography nor features — and so now we say goodbye. The Hello app and its API are both getting depreciated on July 31. The app was actually removed from the Android store on June 26, when it had a ranking of 509.

Lastly, tbh is the youngest of the apps to be getting the chop — in more ways than one. The “anonymous compliment” app was made specifically for teens, a relatively new category for Facebook, and the company was only acquired by the social network in October 2017. Indeed, tbh was young and hardly ubiquitous when Facebook snapped it up, and although the company seemed interested in letting it run its course, to be honest, it’s no surprise to see it also go away.

Facebook is not giving a date for its disappearance: the app is still live at the moment. App Annie, however, notes that its ranking currently in the U.S. is 205 in social networking.

Facebook is no stranger to spring cleaning and clearing out unpopular apps, as well as a wide swathe of other services such as APIs that are no longer core to what it’s working on. Other dead app efforts have included M, the personal assistant app, its Snapchat clone Lifestage and its Groups app. And just today, it issued a notice of several APIs that would be shut down to better reign in how its user data is tapped by third parties.

LinkedIn adds Microsoft-powered translations and QR codes to connect more of its users faster

LinkedIn — the social network with more than 560 million members who connect around work-related topics and job-seeking — continues to add more features, integrating technology from its new owner Microsoft, both to improve engagement on LinkedIn as well as to create deeper data ties between the two businesses.

Today, the company announced two more: users can now instantly view translations of content on the site when it appears in a language that is not the one set as a default; and they can now use QR codes to quickly swap contact details with other LinkedIn members.

In both cases, the features are likely overdue. The lingua franca of LinkedIn seems to be English, but the platform has a large global reach, and as it continues to try to expand to a wider range of later adopters and different categories of users, having a translation feature seems to be a no-brainer. It would also put it in closer line with the likes of Twitter and Facebook, which have had translation options for years.

The QR code generator, meanwhile, has become a key way for people to swap their details when they are not already connected on a network. And with LinkedIn this makes a lot of sense: there are so many people with the same name and it can be a challenge figuring out which “Mark Smith” you might want to connect with after coming across him at an event. And given that LinkedIn has been looking for more ways of making its app useful in in-person situations, this is an obvious way to enable that.

Translations are coming by way of the Microsoft Text Analytics API, the same Azure Cognitive Service  that powers translations on Bing, Skype and Office (as well as third-party services like Twitter). It will be available in more than 60 languages, with more coming soon, LinkedIn says, to a “majority” of members using either the desktop or mobile web versions of LinkedIn.

The company says that it will be coming to LinkedIn’s iOS and Android apps in due course, as well. Users will get the “see translation” link based on a number of signals you’re providing to LinkedIn that include your language setting on the platform, the country where you are accessing content and the language you have used in your profile.

Content covered by the option to translate will include the main feed, the activity section on a person’s profile and posts if you click on them in the feed or share it.

Meanwhile, with QR codes, you trigger the ability to capture one by clicking in the search box on the iOS or Android app. Through that window, you can also pick up your own code to share with others.

LinkedIn suggests that the QR code can effectively become the replacement for the business card for people when they are at in-person events. But another option is that you can use this now in any place where you might want to provide a shortcut to your profile.

GoFundMe now allows team fundraising, where multiple people collaborate to raise money

GoFundMe, the popular service for raising money for causes with some $5 billion raised to date, is expanding its platform to serve more community efforts: today the company is launching GoFundMe Team Fundraising, which lets groups of people collectively raise money for a single effort. The idea is that it will make it possible for schools, churches, sports teams, and other groups to set up fundraising campaigns on GoFundMe.

In many cases, groups have traditionally relied on people to use offline methods to raise money for a single cause, or if people have used digital platforms, harnessing those individual campaigns has not been straightforward.

The idea with GoFundMe’s team product is that the organization that is raising the money can create the main repository, and then link up individuals to that anchor so that they can collect contributions directly. Then those contributions can all feed into the main goal as they go along, and campaign leaders can run leaderboards to show how they are progressing. Early tests of the Team feature have included sports teamsschool groups raising money for travel to an event; work teams raising for a cause; and local communities.

As with GoFundMe’s other fundraising options, there is no platform fee for starting or running a team campaign, as GoFundMe has now switched to a “tips” model. (There are still standard card processing fees.)

“Before, when a sports team, school club, professional organization or other group was looking to raise money together, the options were limited and could take a lot of time and resources in order to execute successfully,” said Rob Solomon, CEO of GoFundMe, in a statement. “With GoFundMe Team Fundraising, we’re introducing an easy social fundraising solution to maximize reach and success for groups.These new tools will also give our existing community another way to fundraise. Our goal is to make fundraising faster, easier and more efficient for anyone looking to raise money, whether an individual, nonprofit or team.”

The move to expand to a team option is somewhat overdue for GoFundMe: fundraising in groups either for something for that group, or for a cause supported by that group, is one of the more popular ways of driving and getting donations. GoFundMe has built a strong business around individuals starting campaigns for specific causes, so this, in a way, is part of a second wave of expansion for the company.

It’s not coming a moment too soon. GoFundMe is currently the market leader when it comes to fundraising platforms, but it is facing very strong competition in the form of Facebook. The social networking behemoth has been working hard to expand its own fundraising services (which also has a team element) as part of its strategy to highlight its role as a community builder and strengthener (and not just a place to get your entertainment and news fixes). A move today to build stronger bridges with non-profits — it launched Workplace for Good, a free tier of its Slack-competing enterprise product for publicly-focused organisations — will only strengthen its credibility with them.

And separate to that, Facebook is in the process of scoring a huge win for its team-based fundraising efforts at the moment, as three people (who all happen to be ex-Facebook employees) are using Facebook to raise money to support the families who are getting separated at the US/Mexico border. The campaign has gone viral and is now close to raising $10 million, originally aiming for a mere $1,500. Given GoFundMe’s extremely astute use of social media to help spread the word about its own campaigns, it will well understand the significance of that turn of events.

GoFundMe is also running several campaigns related to the wider effort to help these families.

Feeling pressure from Russia, Telegram says Apple has blocked updates since mid-April, app missed GDPR deadline

Encrypted messaging app Telegram is feeling the squeeze out of Russia, where regulators are not letting up in their ongoing attempts to block the app because its publishers refuse to provide regulators with access to messages on the platform. Pavel Durov has announced that Telegram app for iOS is no longer updating after the iOS 11.4 update this week: updates are being “prevented” by Apple after the Russian regulator ordered Apple to remove Telegram from the App Store altogether. Durov said this has also meant that Telegram has not been able to issue its GDPR update to comply with the new European regulations that went into effect last week.

For now, Telegram is still in the App Store, albeit with an out-of-date, non-GDPR-compliant version of the app.

The news caps off what has been a troubling week for Telegram. Days ago, the Russian communications regulator Roskomnadzor (RKN) announced that it had made a formal request to Apple to stop distributing the app, and also to stop enabling push notifications for those who already have the app downloaded in Russia.

Durov’s full statement, plus some more context below that:

“Unfortunately, some Telegram features, such as stickers, don’t work correctly under iOS 11.4 that was just released – even though we fixed this issue weeks ago,” Durov wrote minutes ago in his Telegram channel.

“Apple has been preventing Telegram from updating its iOS apps globally ever since the Russian authorities ordered Apple to remove Telegram from the App Store. Russia banned Telegram on its territory in April because we refused to provide decryption keys for all our users’ communications to Russia’s security agencies. We believe we did the only possible thing, preserving the right of our users to privacy in a troubled country.

“Unfortunately, Apple didn’t side with us. While Russia makes up only 7% of Telegram’s userbase, Apple is restricting updates for all Telegram users around the world since mid-April. As a result, we’ve also been unable to fully comply with GDPR for our EU-users by the deadline of May 25, 2018. We are continuing our efforts to resolve the situation and will keep you updated.

“Sorry for the inconvenience and thank you for your patience.”

Notably, for now it seems that the app — an older version of it — is still available in the App Store. Apple, according to a report this week, has one month from May 28 to comply with a request to remove it completely. It’s not clear what the consequences would be if it failed to do so.

“We sent them [Apple] a legally binding letter and are awaiting their legally binding reply. Because Apple, like other transnational companies, is a company with a high degree of red tape, we expect the reply within a month,” RKN’s head Alexander Zharov said to Russian news agency Interfax.

RKN has been seeking to shut down use of Telegram in the country for months, but for most of that time Telegram has been working around the issue by appealing to people to use VPNs to access the service, and also by hopping around IPs at hosting companies sympathetic to its attempt to continue offering its service without sharing data with Russian authorities.

Its hopping had the unintended consequence of RKN knocking out entire swathes of IP addresses to stop Telegram, some 19 million at its peak, causing a number of other services to go down as well. But even so, the app has gone viral with the attention, which had also prompted a number of protests.

But despite the attention, it is unclear how this might have translated to usage and app installs. The most recent figures released by Telegram note that there are about 200 million monthly active users, with 14 million in Russia, although those figures predate the scuffle with Russian regulators. Downloads as tracked by AppAnnie, in fact, seem to point to a slight dip in downloads in Russia after the RKN blocks started in April, although those numbers only count App Store downloads.

Surprisingly, and maybe because of how popular the resistance was proving to be, it looked like several of the key cloud hosting companies, such as Google and Amazon’s AWS, where Telegram along with many other sites and apps host their data and operations, had decided to hold firm to see how things would develop, even when their own consumer-facing services were suffering.

So it seemed only a matter of time before RKN would soon turn to app store operators to turn the screws further. Apple, it seems, has been the first to go down, specifically with regards to updating the app in the App Store. Logically, it seems that the Play Store and others might also feel the squeeze, too.

We are contacting Apple for further comment, and also Google to see if the Play Store is also being affected, and we will update this post as we learn more.

More to come.

Favstar says it will shut down June 19 as a result of Twitter’s API changes for data streams

As Twitter develops an ever-closer hold on how it manages services around its real-time news and social networking service, a pioneer in Twitter analytics is calling it quits. Favstar, an early leader in developing a way to track and review how your and other people’s Tweets were getting liked and retweeted by others on the network, has announced that it will be shutting down on June 19 — a direct result, its creator Tim Haines notes, of changes that Twitter will be making to its own APIs, specifically around its Account Activity API, which is coming online at the same time that another API, User Streams, is being depreciated.

Favstar and others rely on User Streams to power its services. “Twitter… [has] not been forthcoming with the details or pricing,” Favstar’s creator Tim Haines said of the newer API. “Favstar can’t continue to operate in this environment of uncertainty.”

Favstar’s announcement was made over the weekend, but the issue for it and other developers has actually been brewing for a year.

Twitter announced back in December that, as part of the launch of the Account Activity API (originally announced April 2017), it would be shutting down User Streams on June 19.

User Streams are what Favstar, and a number of other apps such as TalonTweetbotTweetings, and Twitterrific (as pointed out in this blog post signed by all four on “Apps of a Feather”), are built on. Introduced as the Twitter Streaming API for developers, the aim was to provide a way for developers to get continuous updates from a number of Twitter accounts — needed for services that either provided alternative Twitter interfaces or a way of parsing the many Tweets on the platform — in a way that did not slow the whole service down.

The newer Account Activity API provides a number of features to developers to help facilitate tracking Twitter and using services like direct messaging for business purposes:

As you can see, some of the features that the newer API covers are directly linked to functionality you get via Favstar. The crux of the problem, writes Haines, is that Twitter hadn’t given Favstar and other developers that had been working with User Streams (and other depreciating functionality) answers about pricing and other details so that they could see if a retooling of their services would be possible. (Twitter has provided a guide, it seems, but it doesn’t appear to address these points.)

The post on Apps of a Feather further spells out the technical issues:

“The new Account Activity API is currently in beta testing, but third-party developers have not been given access and time is running out,” the developers write. “With access we might be able to implement some push notifications, but they would be limited at the standard level to 35 Twitter accounts – our products must deliver notifications to hundreds of thousands of customers. No pricing has been given for Enterprise level service with unlimited accounts – we have no idea if this will be an affordable option for us and our users.”

One of the consequences is that “automatic refresh of your timeline just won’t work,” they continue. “There is no web server on your mobile device or desktop computer that Twitter can contact with updates. Since updating your timeline with other methods is rate-limited by Twitter, you will see delays in real-time updates during sporting events and breaking news.”

Favstar has been around since 2009 — its name a tip of the hat to the original “like” on Twitter, which was a star, not a heart. Haines writes that at its peak, it had some 50 million users and was a “huge hit” with those who realised how the network could be leveraged to build up audiences outside of Twitter — including comedians and celebrities, tech people, journalists, and so on. It’s also tinkered with its service over time, and added in a Pro tier, to make it more user-friendly.

Somewhat unusual for a popular app, Favstar appears to have always been bootstrapped.

But there have been two trends at play for years now, one specific to Twitter and another a more general shift in the wider industry of apps:

The first, regarding Twitter, is that the company has been sharpening its business focus for years to find viable, diverse and recurring sources of revenue, while at the same time putting a tighter grip around how its platform is appropriated by others. This has led the company to significantly shift its relationship with developers and third parties. In some cases, it has ceased to support and work with third-party apps that it feels effectively overlap with features and functions that Twitter offers directly.

In the case of Favstar, the service rose in prominence at a time when Twitter appeared to completely ignore the star feature. MG once described the Favorite as “the unwanted step child feature of Twitter. Though it has been around since the early days of the service, they have never really done anything to promote its use.”

Fast forward to today, and Twitter has not only revamped the feature replacing the star with a heart (I still prefer the star, for what it’s worth), but Twitter uses those endorsements to help tune its algorithm, and populate your notifications tab, and to provide analytics to users on how their Tweets are doing. In other words, it’s doing quite a bit of what Favstar does.

And if you think of how Twitter has developed its own business model in recent years, with a push for video and working with news organisations and other media brands, the same early users of Favstar as detailed by Haines (celebs, news and other media organizations, etc.) are exactly the targets that Twitter has been trying to connect with, too.

The other, more general, trend that this latest turn has teased out is the one that we’ve heard come up many times before. Building services dependent on another platform can be a precarious state of affairs for a developer. You never know when the platform owner might simply decide to pull the plug on you. Your success could lead to many users, business growth, and even an acquisition by the platform itself — but it could nearly as quickly lead to your downfall if the platform views you as a threat, and decides to cut you off instead.

Interestingly, there could be some life left in Favstar in another galaxy far, far away. We’ve reached out both to Haines and to Twitter for further comment and will update this post as and when we learn more.