Apple clarifies commission cuts for iTunes affiliates

Apple has changed its mind on commission rates for iTunes affiliates. It was previously reported that all rates (for Mac and iOS app purchases, and for in-app purchases on both operating systems) would be cut from 7 percent to 2.5 percent. But the iPhone-maker now says only in-app iOS purchases will have their commission rate reduced to 2.5 percent. All other rates will stay the same.

The commission rates are pay-outs for partners signed up to the iTunes Affiliate Program. These partners include websites and apps which link to iOS and Mac apps, as well as music, books, and videos hosted on the iTunes store. When someone clicks one of these links and makes a purchase, the partner earns a commission — for example, seven percent of the sale price in the case of Mac and iOS app purchases.

It’s not clear why Apple announced one set of changes and then quickly backtracked, but the outcry from affiliate partners might have affected the company’s decision. 9to5Mac also notes that reducing the commission rate only for iOS purchases makes more sense as a lot of these payments are for renewing subscriptions (and therefore the partners who link to the app deserve less credit for the purchase).

‘Spotify Codes’ makes it even easier to share your favorite tracks

Why it matters to you

It’s another easy way to share your favorite music tracks with friends.

Spotify recently rolled out a new feature that makes it easier for users to share music via the app.

“Spotify Codes” lets you scan a barcode on a friend’s handset that takes you direct to the linked song, artist, or playlist.

So if, say, a friend plays you a new song they really love and you find that you also think that it’s pretty darn good, you can simply scan the song’s code to launch it in the Spotify app on your own phone. With such an action only taking a split second, that certainly beats firing up a messaging app to send the link or taking down the track’s details to conduct a manual search.

It’s easy to locate a Spotify Code. When you’re playing a track, simply tap the three dots in the top right of the display to make the unique code appear.

Alternatively, If you want to scan a code, tap the search button at the bottom of your screen and then hit the camera icon top right. You might have to give Spotify permission to access your phone’s camera, but once you’ve done so, it’s just a case of pointing your camera at the code. It’ll only take your app a split second to recognize the code, at which point it’ll automatically pull up the linked track.

Of course, you don’t just have to be in the same room as someone to share music using Spotify Codes. You might want to post screenshots of codes on your favorite social media sites so other users can scan them off a PC screen or tablet display — or by getting the scanner to read the code off a saved image on your camera roll. Print publications can make use of them, too, while the artists themselves might choose to incorporate them into merchandise.

While it’s unlikely to be the deal breaker for new users looking for the best music streaming site, Spotify Codes is a useful addition to the service that music fans will take little time to get to grips with.

Equity crowdfunding platform Seedrs to launch secondary market


I remember talking to a fairly active angel investor a few years ago and he bemoaned the fact that he didn’t have any money. “It’s all tied up in the companies I’ve invested in,” he said, before reminding me that when you back a startup so early on in its life, it can be an incredibly long time before you have an opportunity to get your money out, presuming that you do at all. In other words, early-stage investing is typically a very illiquid asset class.

Enter Seedrs, the U.K.-based equity crowdfunding platform that lets anybody invest in startups, which is announcing plans to launch a secondary market later this Summer. Rolling out in Beta as early as next month, investors will have the potential to sell shares in companies they’ve invested in via Seedrs to other investors. Likewise, investors in Seedrs-funded companies will have the chance to increase their stake.

However, there are a number of caveats to this tentative secondary market launch. In this first phase at least, only current investors in a Seedrs company will be allowed to buy secondary shares in it. That means it’s currently a way for existing investors to increase their ownership, not a way for new investors to get in on the action.

The price of shares will also be decided by Seedrs’ Valuation Policy, which is designed to reflect things like a subsequent funding round (and therefore a new valuation) since the original shares were made available via the crowdfunding platform.

In addition, trading on Seedrs secondary market will only happen for a one-week window every month. The window will start on the first Tuesday of each month, which Seedrs calls “Trading Tuesdays”. “As in any market, the ability to buy or sell will depend on there being sufficient supply or demand,” notes the equity crowdfunding platform.

In a call, Seedrs co-founder and CEO Jeff Lynn told me that the decision to take price out of the equation, by using the platform’s determination of “fair valuation”, rather than pure market forces, helps to avoid the situation where a company’s secondary share price falls below the price it was set at its most recent funding round. Were this to happen it could make it much more difficult for a company to raise further funding without running the risk of a down round or a valuation lower than it desired.

In the same way, if the secondary market pushes the price too high, that also creates a problem for the next funding round, as the company either has to achieve an unrealistically high valuation or disappoint its investors by doing what is to them a down round. The disadvantage of a fixed price, however, is that it could also put a lid on the liquidity a second market is supposed to encourage.

That only existing backers are able to buy more or sell their shares in a particular company also solves a potential problem regards what information about each company listed is made public and to whom. Take valuation following a new funding round, for example: in most cases existing shareholders will already be privy to this information, which, by restricting who can trade on Seedrs secondary market, won’t need to be spread any further. However, it also restricts demand, which, again is counter to increasingly liquidity.

With that said, any kind of secondary market is bound to be welcomed by investors, and Lynn says that after seeing how the secondary market behaves, Seedrs may look to expand the timing (longer windows or continuous trading), pricing (negotiated or bid/offered prices) and/or buyer eligibility (new investors).

Meanwhile, for entrepreneurs it could potentially make equity crowdfunding via Seedrs more attractive. The argument Lynn makes is that if early backers can get their money out quicker, rather than waiting for an exit or IPO, there may be less pressure put on companies to exit sooner than they’d perhaps like. My view is that this is probably overstated a little: it’s usually larger, institutional investors, such as VCs, who try to dictate the timing of an exit and typically have the voting rights to do so. That’s not to say that early investors, many of whom are often friends, family or even customers, can’t bring to bear soft pressure to exit, and most certainly do, so it’s definitely one to watch.

Noteworthy is the fact that Seedrs operates a nominee structure in which shares in each company are effectively held by the platform on behalf of investors rather than individually, and this means it’s easier for a secondary market to be rolled out. Paperwork at the shareholder agreement level doesn’t need to be ongoing, which would be a nightmare for the companies whose shares were being traded, and it reduces the risk of double trading or simply an honest mistake being made. (As an aside, Funderbeam, another equity crowdfunding platform with a secondary market, is solving the accountability problem of a secondary exchange by employing Blockchain technology.)

“The potential opportunities that a secondary market brings for buyers, sellers and entrepreneurs alike makes this development incredibly exciting,” says Lynn in a statement. “Perhaps most importantly, we believe this will help businesses who are raising capital through Seedrs: with the prospect of secondary sales now available, we expect more investors are likely to want to back the great businesses we work with”.

Featured Image: James A. Guilliam/Taxi/Getty Images

Garena rebrands to Sea and raises $550 million more to focus on Indonesian e-commerce


Garena, one of Southeast Asia’s biggest tech startups, has picked up $550 million in new funding and changed its name. The Singapore-headquartered consumer Internet company told Bloomberg that it is now called Sea Ltd. to reflect is global expansion plans (and also because SEA is an acronym for Southeast Asia). Its new valuation was undisclosed.

Sea’s funding and rebranding comes as it is reportedly preparing for an IPO that may raise $1 billion.

The company’s last funding was an undisclosed amount raised in September. Prior to that, it raised $170 million at a valuation of $3.75 billion in March 2016, which was enough to make it Southeast Asia’s most valuable tech startup.

The company said it will use its new capital to expand Shopee, its consumer-to-consumer marketplace, in Indonesia. As one of the largest and fastest-growing e-commerce markets in Southeast Asia, Indonesia has attracted a flurry of interest from e-commerce companies and investors over the last two years. Most notably, Alibaba took control of Lazada in a $1 billion deal last year to compete with Southeast Asian e-commerce businesses like Tokopedia and MatahariMall, two of Indonesia’s largest online marketplaces. Sea told Bloomberg that Shopee’s annualized gross merchandise value has doubled over the past nine months to more than $3 billion.

Sea’s competition with Alibaba is heightened by the fact that one of its investors is Tencent, which is one of Alibaba’s biggest rivals in China. Sea gained several notable new backers in its new round, including GDP Venture, JG Summit Holdings, Farallon Capital Management, Hillhouse Capital, Cathay Financial Holding, and Taiwanese food and retail conglomerate Uni-President Enterprises Corp.

Garena was founded in 2009 as an online gaming platform and its games business will retain that name. Its other main products are Shopee and AirPay, an e-wallet service. Sea also said that it will add former Singaporean foreign minister George Yeo, former Indonesian trade minister Mair Pangestu, and Pandu Sjahrir, a director of Indonesian coal and palm oil company PT Toba Bara Sejahtra, as advisors.

Featured Image: MarieO/EyeEm/Getty Images

Comcast and Charter won’t make wireless acquisitions without the other’s permission

Cable giants Comcast and Charter Communications have reportedly agreed not to make any mergers or acquisitions of wireless companies without the other’s permission. The agreement — as outlined by The Wall Street Journal — is set to be formally announced on Monday, and will run for one year, during which time the companies will still theoretically be able to make joint bids for other companies.

Both Comcast and Charter have already announced plans to offer their own wireless services, with the former’s expected to launch this year, and the latter’s in 2018. This new agreement is designed to help both companies find out the best methods for entry into the market, The Wall Street Journal says, allowing both to share information, technology, and partnership details in a bid to keep prices down.

The agreement could also be a prelude to a joint purchase of a carrier such as Sprint or T-Mobile. Under the terms of the agreement, neither Comcast nor Charter could try to acquire a carrier without the other’s consent, but both firms could work together to make their way into what is already a crowded and competitive market.

Confide CEO Jon Brod on the White House, bad press and what’s next for his secure messaging app


At a recent StrictlyVC event in San Francisco, I sat down with Confide co-founder and president Jon Brod to talk with him about his decidedly topsy-turvy 2017. Though his three-year-old messaging app was the belle of the ball at the start of the year — Wired, The Washington Post and Axios were among others to note it was a hit with frustrated White House staffers — its positive momentum was abruptly thwarted by security researchers who published a report saying the app wasn’t living up to its claims.

It was subsequently reported that Confide had quickly addressed those vulnerabilities. Yet roughly one month later, a separate lawsuit followed, claiming that another of its features isn’t foolproof.

Brod and I discussed that ongoing case. He also talked about the app’s future, which will likely include video (assuming Confide can shake off that suit first). More from our chat below, edited for length.

TC: You worked for the NBA, for Ask Jeeves, for IAC, then you spent four years at AOL, including as the co-founder of AOL Ventures. How did you wind up running a secure messaging app company?

JB: I’d spent four years at AOL in various executive positions. I was going to leave and, serendipitously, Howard Lerman, who’s also the founder and CEO of [the newly public company] Yext, emailed me about wanting to hire someone who used to work with me at AOL. It took many missed phone calls and traded emails before we connected six days later [because we didn’t want to discuss anything sensitive online], and that was sort of the “aha” moment for Confide. So we gathered up some engineers, prototyped Confide, and started the company.

TC: How much funding have you raised?

JB: We initially raised just less than $2 million, including from SV Angel, [investor] David Tisch, GV, [Yelp CEO] Jeremy Stoppelman, WTI and First Round Capital, among others. A year ago, we closed a $1.5 million seed extension round, so [it’s] $3.4 million all in.

TC: How many people use Confide?

JB: You know I’m not going to tell you that. [Laughs.] We don’t give out user numbers, but also, as a confidential messenger service, we actually can’t track a ton of stuff. Almost everything we track is in aggregate and anonymous.

TC: I love Confide, but I turn to it for very specific use cases. On average, how often do people open the app?

JB: There’s this cohort for whom [Confide] is what they use as their everyday [messaging service] and the [daily and monthly active users] on that is fantastic. Then there are people, I guess like you, that, when there are confidential sensitive things, you use Confide, and you use other messenger platforms and email [for other communications]. I use iMessenger all the time, but when it comes to sensitive material, I mean, you’re insane if you’re still using regular text and email.

TC: Speaking of leaks, you had some amazing press earlier this year, with a number of accounts about all the unhappy White House staffers who use Confide. Were you aware that it had taken off in Washington or did you see it in the news?

JB: Here’s how that went down: I got a Confide message in December from a former high school classmate, and he said, “Did you know a lot of Trump’s transition team is using Confide?” And I said, “No, how do you know?” And he said, “They’re contacting me on Confide.”

Not long after, Axios reached out to me and said, “We’re on Confide and we’re noticing a stream of GOP political operatives coming on to the system and we’d love to talk with you about it.” So I do that interview, [Axios co-founder] Mike Allen runs it in his daily newsletter, and everyone starts calling us.

Not long after, I’m sitting at home one weekend and watching the numbers as all CEOs do, and I see we get to the next stratosphere [in terms of users]. Something is going on. So I start searching for Confide and see that Politico has written a story that [White House Press Secretary] Sean Spicer had called a meeting at the White House with all of his lawyers and all the White House staff and it was a phone-check meeting. And he apparently said, “Everyone, take out your phones and if you have Confide on your phone, that’s a problem.” And he said, “Just so know this is a widespread policy, I’m even going to delete Confide from my phone.” So that was the number one story on CNN and Google News and that was pretty extraordinary.

TC: I believe Spicer also warned them that disappearing text messages involving anything government-related was a violation of the Federal Records Act. Did you hear from the White House about this?

JB: No, we haven’t been contacted by the White House, but you raise an interesting point that also receives a lot of press attention, which is the legality of this. My position is pretty straightforward: There are certain people in certain industries for whom certain communications are regulated — maybe FINRA in financial services or the Federal Records Act if you’re a member of the executive branch of the government.

If you’re regulated, please use Confide in a way that complies with that regulation, just as you would any other communication device.

TC: So there’s all this excitement around Confide. But as your profile is rising, security researchers are following you more closely and by mid-February, you’re slammed in the press by one team that says there are holes in the app. In layman’s terms, what exactly happened, and how did you resolve it?

JB: A security research firm comes and tries to find vulnerabilities in Confide. We’re able to detect them coming and are able to fix most of their issues in real time. There are some that we can’t, and they notify us, and then through a responsible disclosure — which is generally how these work with security firms — they give us a little time to fix the problems. We fix them incredibly quickly. Then they go out and publicize their research paper.

Importantly, no Confide user was impacted throughout any of this. We made all the changes, and that’s what happened.

TC: One concern of a colleague of mine at TechCrunch, our security reporter, Kate, is your use of the label “military grade” in marketing the app. What does that mean?

JB: It’s hard to describe encryption and security, so we use terms that give people a general sense [of what it means], and “military grade” is one of those terms that we use. Basically, this is end-to-end encryption, and what that means is that as soon as you hit “send” on a message, it gets encrypted, and the only thing that can decrypt that message is a unique key that is generated on and never leaves the device of the recipient. Then once the message sort of detects that key, it gets decrypted. That’s what we mean by end-to-end, or military grade, encryption.

But then after we decrypt something, we go another step. After we decrypt a message, there’s an ephemeral component. So once you read a message, you hit “close” or “reply,” and the message is gone forever. We delete it from our servers and wipe it from the phone. We also have screenshot protection; we’ve gone to great lengths to prevent screenshots, because they’re the enemy of the disappearing. So fundamentally, we’re trying to take the privacy of the spoken word and we’re trying to port that to the convenience of digital communication.

TC: Before we get into this screenshot protection, another feature of your technology that concerns Kate is why you’ve created your own code, rather than use tried-and-tested protocols. Relatedly, she mentioned that because Confide’s encryption protocol hasn’t been publicly tested and hacked and audited to ensure that it’s strong, it could be hard for you to sell to enterprises. Wickr went public with its own code in February for that same reason.

JB: So open source is kind of a double-edged sword. In one respect, you put the playbook out there, which gives people increased confidence. On the other hand, it creates vulnerabilities, particularly around the ephemerality and the screenshot protection. So to this point, we’ve elected not to open source our code; it’s the same philosophy that some other end-to-end encrypted messengers have, like iMessage. But it’s something we continuously discuss and we’ll continue to evaluate.

TC: Do you want to go after enterprises eventually? Is that where the money is?

JB: Our business is really good right now and it’s focused on the consumer; it’s a freemium model. In-app subscriptions is the greatest business model that I don’t think enough entrepreneurs fully understand or appreciate. So that’s where our focus is. We do have an enterprise solution. After the Sony hacks, we received a number of inbound inquiries from businesses; we built a solution for them. We have customers. But the freemium model is really our focus.

TC: You’ve mentioned your screenshot protection a couple of times. But you’re facing a recently filed class action lawsuit that alleges it doesn’t work as advertised, and the former customer who is suing you is represented by a law firm known for its scorched-earth tactics. In fact, Y Combinator president Sam Altman has characterized the firm’s founder as a “leech tarted up as a freedom fighter.” 

JB: I can’t comment on the lawsuit other than to say it’s completely unfounded and meritless. It’s equivalent to a shakedown. This is what this [law firm] does; it goes after high-flying and other tech companies. This will get thrown out of court rather quickly, and I look forward to that day.

TC: What’s on the roadmap? You sent me a text earlier today with an emoji, which is the first time I’ve seen that on Confide.

JB: We do have stickers as part of Confide plus, which also includes unlimited attachments and photos and all of that. We’re about to launch an iPad app, which is going to be great; it’s one of the top things our customers are asking us for.

We’re also playing around with video, which is something else we’ve been asked for a lot. We think it’s super interesting, and we’re playing around with screenshot protection on video and hoping to do something innovative and interesting there.

TC: Is illicit material being sent over your platform a concern?

JB: That’s really tricky. The short answer is that anything illicit and illegal is obviously against our terms of service and privacy policy. The challenge is that these are encrypted messages; we couldn’t read them if we wanted to. So that’s not something  we’ve encountered; it would present an interesting challenge for us.

Photos by Dani Padgett.

Doug Liman has a familiar title for Edge of Tomorrow 2

Last year, Doug Liman signed on to direct a sequel to his 2014 military science fiction time travel film Edge of Tomorrow, and while promoting his next film, The Wall, he told Collider that the film’s sequel will be called Live Die Repeat and Repeat.

Set in the future when Earth has been attacked by aliens, Edge of Tomorrow follows a cowardly public relations officer played by Cruise, who’s sent to the front lines. There, he finds himself in a time loop where he lives the same day over and over again, and enlists help from a fellow soldier, played by Blunt, to escape. While the film didn’t perform well at the box office, it’s a surprisingly good film. Since its release, a sequel has been put into development, while Cruise and Blunt are reportedly interested in coming back.

However, Edge of Tomorrow is the blandest of bland titles when it comes to a science fiction film, especially when you consider that the book it’s based on is called All You Need Is Kill. The title was bad enough that the film was essentially retitled Live Die Repeat for the home release. The sequel’s title shows that everyone involved seems to have realized that Edge of Tomorrow is a title best forgotten.

While news of a title and an update is exciting to hear for those wanting a sequel, it’s not entirely clear when the movie will happen. While Liman has signed on to return, and has a story that’s fittingly a “prequel and a sequel,” the film has yet to be officially greenlit. Additionally, Liman has several other projects on his plate. His next film, The Wall, hits theaters this week, and last August, he left Fox’s Gambit movie for DC’s Justice League Dark. He’s also attached to another science fiction film with Tom Cruise, Luna Park. Hopefully, Live Die Repeat and Repeat will make its way to the top of the list. Until then, we can watch Edge of Tomorrow over and over again.

5 songs you need to stream this week: Grizzly Bear, Wavves, and more

Every week, there are thousands of new songs hitting the airwaves — and it’s just too much for your two ears to handle. With all those options, you can’t be wasting your time on tracks that deserve a thumbs-down click.

But don’t worry, we’re going to save you the hassle. We listen to some of the most-hyped and interesting songs each week, and tell you which are worthy of your precious listening time.

Here are our top five songs to stream this week. Also, don’t forget to subscribe to our Spotify page for a playlist of our weekly picks, which can also be found at the bottom of this post.

Grizzly Bear — Three Rings

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A slow ambient electronic intro is met by layered vocals and clean drum beats that channel Radiohead percussion on Three Rings, the first new single from acclaimed indie rockers Grizzly Bear since the band’s 2012 album Shields. The song is full of rhythmic overlaps, a three-over-four feel that pervades its entire second half, creating a smooth and rolling sensation in your eardrums.

Wavves — No Shade

Those looking for a warm-weather rock ‘n’ roll single need look no further than Wavves’ latest jam, No Shade, which starts with fuzzed-out guitar and ends with a speedy drum fill. “I’m by my pool/I’m drinking lemonade/No shame,” sings songwriter Nathan Williams on the short and sweet track, which can’t help but transport you to the raucous, action-packed summers of your youth.

Ryan Adams — Outbound Train

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Ryan Adams brought a wall of video screens to his recent performance on The Late Show with Stephen Colbert, pulling out all the stops for a live take of Outbound Train from his latest record Prisoner. The nostalgic song begins with just voice and guitar, before being joined by a heavy-hitting drum groove and ’80s-influenced backing guitar, grabbing hold of you in multiple ways during its 4-minute runtime.

Waxahatchee — Shaking Through

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Fans get a cool behind-the-scenes view of Alabama power-punk band Waxahatchee in the new video for the band’s recently released single Shaking Through, with various studio performances cut together to form the visual accompaniment for the four-minute track. The band brings an immense amount of energy to the song, with various vocal and guitar layers that form a massive wall of sound throughout.

Heaven— Lonesome Town

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Lonesome Town is a powerful and introspective electronic song that would be at home in the credit sequence of David Fincher’s next drama. The first single from new group Heaven, this will also serve as the title track to the band’s first EP.

That’s it for now, but tune in next week for more tunes — and check out the playlist loaded with our recent selections below:

Spoil your pup or give one a home with these 5 dog-friendly apps

Whether you’re a seasoned dog whisperer or you’ve just taken your first step into the wonderful world of puppy parenting, there are loads of apps for dog owners that can make taking care of and having fun with your faithful companion even easier. There are apps for finding a home for a dog in need, making sure your dog is always safe at home, and even apps designed to get your pup’s attention long enough to snap the perfect portrait. Best of all, each of the apps in this list is available from both Google Play and the App Store for free  — so no matter what device you own, you and your best friend won’t miss out.

Rover

With Rover, you can connect with thousands of dog walkers and sitters around the country. User reviews, background checks, and comprehensive search filters make it easier to find one you can trust. Better yet, you can communicate with them directly within the app, and Rover handles payments, too. If you want to list services yourself, Rover also makes it easy to manage your business on the go, and keep your clients informed with text, photo, and video messages. It even features handy push notifications. According to Rover’s website, the service accepts less than 20 percent of potential sitters, and is available in more than 10,000 cities — which should give dog lovers a little peace of mind while they’re out and about.

Download now for:

Android iOS

BarkCam

Think of BarkCam as the app your dog would likely use if they ever wanted to take a selfie. With the app, you can play a sound, like a door bell, to pique your pup’s interest right as you take the photo. With any luck, you’ll nab a stunning portrait, which you can then dress up with Instagram-esque filters and adorable stickers. BarkCam allows you to edit photos you’ve already taken as well. If you’re particularly smitten with your work of art, BarkCam also features a shop where you can purchase prints, smartphone cases, and other accessories emblazoned with your pup’s mug. The app is made by Bark & Co., a company you may know from Bark Box, which is a subscription service that packs doggy treats and toys into a monthly package.

Download now for:

Android iOS

PetCoach

Every dog owner has questions, and PetCoach allows you get answers directly from those who know best. Whether it’s about diet and nutrition, training, or anything else that comes to mind, PetCoach’s roster of verified veterinarians and experts are on hand to hear your concerns. You can ask questions privately, of course, but public answers also show what like-minded dog owners have asked in the past, which could help in a pinch. The fact that PetCoach offers all these resources for free just sweetens the deal.

Download now for:

Android iOS

ShelterPal

The next app isn’t an app in the strictest sense, but it might be the most important entry on our list. Cloud communications firm Twilio launched ShelterPal in response to National Adopt a Shelter Pet Day, which was April 30. ShelterPal takes the form of an SMS bot that matches you with a shelter dog or cat through the use of artificial intelligence and image recognition. Simply text “Shelter Me” to (980) 477-3728, and answer a series of questions. ShelterPal will ask you about the kind of pet you’re seeking and request your ZIP code, as well as a picture of your living space. It’ll analyze everything and return with a photo and details of a pet it thinks will be a good match, along with the shelter’s contact info. Next step: Get out there and make a pup’s dream come true!

Whistle

One of the most worrisome thoughts in a dog owner’s life is the possibility of their pet getting out of the house and roaming around somewhere unsafe. Fortunately, location tracking and GPS technology have made major strides in the last decade or so, and companies now produce relatively inexpensive smart devices that can easily sync up with your phone to give you an up-to-the-second reading on your pup’s location, as well as their activity and sleep patterns. Whistle is one of the most popular solutions out there, and although the app is free, the tracker runs $80. Still, the company will let you and your pooch try one for 90 days, and you can send it back for a full refund if you’re not satisfied.

Download now for:

Android iOS

Cornershop, a grocery-delivery app in Chile and Mexico, raises $21M


The whole on-demand space has faced a lot of scrutiny in the past few years as questions about whether they are viable businesses balloon and the periodic down round leaks out. Then Instacart raised a massive round at a $3.4 billion valuation, and while the terms aren’t exactly clear, the funding environment for that space may be softening a bit.

That’s offered an opportunity for new companies to start to attract attention like Cornershop, a grocery-delivery app that operates in Chile and Mexico. The company raised $21 million in a financing round led by Accel as it starts to expand in that market — and potentially get ahead of looming competitors like Instacart. To a certain extent, however, CEO Oskar Hjertonsson may have Instacart’s up round to thank for some enthusiasm in the space as the model starts to creep abroad.

“The longer answer is that I think Instacart can build a profitable business in the US, as can we down here,” Hjertonsson said. “I think the general notion that ‘this and that service can’t exist’ is the wrong way of looking at it. I think it’s more a question of how to model the service for each market, including the positioning in terms of price/value, to build a business that makes sense for each market.”

Like Instacart, Cornershop works with shoppers to track down products in stores and then deliver them in 90 minutes or less. So the whole business may not seem all that unfamiliar to observers in the U.S. and abroad. However, that model since Instacart raised its last round of financing has shown that it can be plenty challenging. Indian ride-sharing operator Ola shut down its grocery delivery service, while Amazon and Google Express have more robust coffers to continue expanding and experimenting on the model.

Still, there may be an opportunity abroad, and that’s part of what attracted Accel to the financing round, Accel partner Andrew Braccia said. “Instacart’s recent growth is another positive data point that we’re reaching an inflection point in the shift of consumer purchase dollars online not just here, but in large international markets as well,” Braccia said. “They’ve demonstrated the patience and domain expertise required to tackle the opportunity before them in Latin America.”

Hjertonsson said he announced the round internally with a temporary hiring freeze (which was more symbolic than anything) to explain to the team that the pieces were already in pace to grow, and that the company didn’t want to go crazy with the new funding.Of course, growth is still going to come in the next months as it expands to regions. And for a business like Cornershop, a lot of the growth is going to have to come from methodical expansion from region to region and with future partners.

“I think it’s a market where the early lead easily ends up in a position where it’s easy to stay on top, I don’t spend much time thinking about competitors,” Hjertonsson said. “Our primary competitors are curiously also some of the stores from where we source. Walmart owned Superama in Mexico and the leading grocer Jumbo in Chile are our largest competitors.”