Connect with us

Apps

SoundCloud saved by emergency funding as CEO steps aside

Published

on


SoundCloud has just closed the necessary funding round to keep the struggling music service afloat. CEO Alex Ljung will step aside though remain chairman as former Vimeo CEO Kerry Trainor replaces him. Mike Weissman will become COO as SoundCloud co-founder and CTO Eric Wahlforss stays as chief product officer. New York investment bank Raine Group and Singapore’s sovereign wealth fund Temasek have stepped in to lead the new Series F funding round of $169.5 million.

SoundCloud laid off 40 percent of its staff last month, with 173 employees departing in an effort to cut costs. The company only had enough runway left to last into Q4, and today’s investor decision was viewed as a do-or-die moment for the company. Now it will have the opportunity to try to right the ship, or sail into an established port via acquisition.

SoundCloud declined to share the valuation or quantity of the new funding round. Yesterday, Axios reported the company was raising $169.5 million at a $150 million pre-money valuation. That’s a steep decline in value from the $700 million it was valued at in previous funding rounds. The new Series F round supposedly gives Raine and Temasek liquidation preferences that override all previous investors, and the Series E investors are getting their preferences reduced by 40 percent. They’re surely not happy about that, but it’s better than their investment vaporizing.

Raine will get two board seats for bailing out SoundCloud, with partner and former music industry attorney Fred Davis, and the vice president who leads music investments, Joe Puthenveetil, taking those seats.

While abdicating the CEO role probably wasn’t exactly what Ljung had hoped for, at least he gets to stay on with the company as chairman of the board. “This financing means SoundCloud remains strong, independent and here to stay,” he wrote.

SoundCloud says its total revenue is now at a $100 million annual run-rate. If it can keep costs low and grow that number, it may eventually get to break even and no longer need infusions of investor capital.

TechCrunch broke news about the magnitude of the SoundCloud crisis last month. Sources from the company told us the layoffs had been planned for months, but SoundCloud still recklessly hired employees up until the last minute, with some being let go within weeks of starting. Employees told TechCrunch that the company was “a shitshow” with inconsistent product direction and dwindling cash. Ljung was seen as reluctant to be honest with the team, and unfocused as he partied around the world like a rock star.

Our report led to a flurry of follow-on coverage, prompting fans and artists to speak up in favor of the service. The rally was reminiscent of the love shown to Vine after Twitter announced it would shut down. Popular musician Chance The Rapper tried to get involved to save the company. He, like many other indie hip-hop artists, made their name on the platform as part of a genre that came to be called “SoundCloud Rap.” In the end, SoundCloud was saved when Vine wasn’t.

SVP of Entertainment, AOL Kerry Trainor attends the 2011 TV Summit Presented By Academy Of Television Arts & Sciences Foundation & Variety at Renaissance Hollywood Hotel on February 15, 2011 in Hollywood, California. (Photo by Todd Williamson/WireImage)

For now, music and other audio saved on SoundCloud is safe. But the company will need to find a way to make its subscription tiers more appealing and scale up its advertising despite having much less staff to drive the changes. If it can’t, SoundCloud could be back begging for cash in a year.

The new management should provide some additional confidence. I’ve interviewed both Ljung and Wahlforss in the past, and neither had answers to the big questions facing SoundCloud about its product direction, business model and the spurious copyright takedowns that have eroded its trust with musicians.

Trainor may be able to institute some more discipline at the startup. He was the CEO of Vimeo from 2012 to 2016, and has poached his former COO there to help run SoundCloud. They helped Vimeo fend off bigger rivals like YouTube by doubling down on what was special about the service: a focus on high-quality artful film rather than amateur viral videos. That experience makes Trainor a great fit to lead SoundCloud, which is fending off bigger rivals like Spotify and Apple Music.

SoundCloud’s best bet isn’t to battle them directly, but double down on the user-uploaded indie music scene, including garage demos, DJ sets, unofficial remixes and miscellaneous audio you can’t find elsewhere. Whether it stays independent long term or tries to seduce an acquirer, SoundCloud will benefit from spotlighting its unique community of creators and hardcore listeners.

Featured Image: TechCrunch

Readmore

Apps

Apple’s enterprise evolution

Published

on

Back in 2010, Apple’s iconic co-founder Steve Jobs was not entirely enthralled with the enterprise. In fact, Jobs is famously quoted as saying, “What I love about the consumer market, that I always hated about the enterprise market, is that we come up with a product, we try to tell everybody about it, and every person votes for themselves.”

He added, “They go ‘yes’ or ‘no,’ and if enough of them say ‘yes,’ we get to come to work tomorrow. That’s how it works.”

That was an accurate enough representation of the way things worked when Jobs made the statement. Back in those days, IT kept tight control over the enterprise, issuing equipment like BlackBerries and ThinkPads (and you could have any color you wanted — as long as it was black). Jobs, who passed away in 2011, didn’t live long enough to see the “Bring Your Own Device” (BYOD) and “Consumerization of IT,” two trends that were just hovering on the corporate horizon at the time of his death.

I have the feeling he would have quite liked both movements and would have taken great pleasure in the fact that in many ways those trends were driven by his company’s mobile devices, the iPhone and the iPad. People were using those devices at home and they were increasingly bringing them to work. IT had little choice but to begin accommodating them.

That movement has helped fuel Apple’s enterprise evolution. Over time, Apple has partnered with enterprise stalwarts like IBM, SAP and Cisco. It has provided tools for IT to better manage those i-devices, and Macs, too, and it has built the enterprise into a substantial business (to the extent that we can tell).

What do we have here?

Trying to find data on the size of Apple’s enterprise business is a challenge because it doesn’t often break out enterprise revenue in earnings calls, but to give you a sense of the market, Tim Cook did reveal a number in the Q4 2015 earnings call.

“We estimate that enterprise markets accounted for about $25 billion in annual Apple revenue in the last 12 months, up 40 percent over the prior year and they represent a major growth vector for the future,” Cook said at the time.

In a June 2017 Bloomberg interview, Cook didn’t provide any numbers, but he did call the enterprise, “the mother of all opportunities.” That’s because enterprises tend to buy in bulk, and as they build an Apple support system in-house, it feeds other parts of the enterprise market as companies buy Macs to build custom apps for both internal users and consumers of their products and services.

This connection did not escape Cook in the Bloomberg interview. “For most enterprises, iOS is the preferred mobile operating system. IOS is a fantastic platform because of the ease with which you can write apps that are great for helping you run your business efficiently or interface with your customers directly. We see many, many enterprises now writing apps. Well, what do they use to write the apps? They use the Mac. The Mac is the development platform for iOS,” Cook told Bloomberg.

Photo: Justin Sullivan/Getty Images

Another way to look at the market is to look at Jamf, an Apple enterprise tool partner that helps companies manage Apple devices in large organizations. The company, which launched in 2002 long before the iPad or the iPhone, has been growing in leaps and bounds. It reports it has 13,000 customers today. To put that into perspective, it took 13 years to reach 6,000 customers and just 2.5 years to more than double to 13,000.

“A lot of people say Apple is getting more focused on enterprise, but I believe Apple helped enterprise focus more on users and they’ve had more success,” Jamf CEO Dean Hager told TechCrunch. “It started with Apple creating great products people wanted to bring to work and then they just demanded it,” he said.

Forcing their way into the enterprise

That organic momentum can’t be underestimated, but once it got in, Apple had to give IT something to work with. IT has always seen its role as hardware and software gatekeeper, keeping the enterprise safe from external security threats.

Ultimately the company never set out to build out enterprise-grade devices with the iPhone and iPad. They simply wanted devices that worked better than what was out there at the time. That people liked to use them so much that they brought them to work was an extension of that goal.

In fact, Susan Prescott, vice president of markets, apps and services at Apple was at the company when the first iPhone was released, and she was aware of the company’s goals. “With iPhone, we set out to completely rethink mobile, to enable the things we knew that people wanted to do, including at work,” she said.

Susan Prescott of Apple. Photo: Justin Sullivan/Getty Images

The notion of apps and the App Store and bringing in developers of all ilks to build them was also attractive to enterprises. When IBM and SAP got involved, they began building apps specifically geared towards enterprise customers. Customers could access these apps from a vetted App Store, which also was appealing to IT. The Cisco deal gave IT faster on-boarding of Apple devices on networks running Cisco equipment (which most enterprises use).

At the 2010 iPhone 4 keynote, Jobs was already touting the kinds of features that would appeal to enterprise IT, including mobile device management, wireless app distribution through the App Store and even support for Microsoft Exchange Server, the popular corporate email solution of choice at the time.

He may have spoken derisively about the enterprise in a general sense, but he clearly saw the potential of his company’s devices to transform the way people worked by giving them access to tools and technologies that previously were not in reach of the average worker.

Apple also was quietly talking to enterprises behind the scenes and figuring out what they needed from the earliest days of the iPhone. “Early on we engaged with businesses and IT to understand their needs, and have added enterprise features with every major software release,” Prescott told TechCrunch.

Driving transformation

One of the factors driving the change inside organizations was that mobile and cloud were coming together in that 2011 time frame, driving business transformation and empowering workers. If IT wouldn’t give employees the tools they wanted, the App Store and similar constructs gave them the power to do it themselves. That fueled the BYOD and Consumerization of IT movements, but at some point IT still required some semblance of control, even if that didn’t involve the same level they once had.

The iPhone and other mobile devices began to create the mobile worker, who worked outside the protection of the firewall. People could suddenly look at their documents while waiting for the train. They could update the CRM tool in-between clients. They could call a car to get to the airport. All of this was made possible by the mobile-cloud connection.

It was also causing a profound change inside every business. You simply couldn’t do business the same way anymore. You had to produce quality mobile apps and you had to get them in front of your customers. It was changing the way companies do business.

It was certainly something that Capital One saw. They realized they couldn’t remain a “stodgy bank” anymore, and control every aspect of the computing stack. If they wanted to draw talent, they had to open up, and that meant allowing developers to work on the tools they wanted to. According to Scott Totman, head of Mobile, Web, eCommerce, and personal assistants at Capital One, that meant enabling users to use Apple devices for work, whether their own or those issued by the company.

Workers at Capital One. Photo: Capital One/Apple.

“When I came in [five years ago], the Apple support group was a guy named Travis. We weren’t using Apple [extensively] in the enterprise, [back then],” he says. Today, they have dozens of people supporting more than 40,000 devices.

It wasn’t just people inside the company whose needs were changing. Consumer expectations were changing, too, and the customer-facing mobile tools the company created had to meet those expectations. That meant attracting those app developers to the enterprise and giving them an environment where they felt comfortable working. Clearly, Capital One has succeeded in that regard, and they have found ways to accommodate and support that level of Apple product usage throughout the organization.

Continue Reading

Apps

Foursquare is finally proving its (dollar) value

Published

on


In 2009, Facebook was just getting popular with moms and grandmas. People were playing Farmville. Twitter was just becoming mainstream. And Foursquare launched on to the scene.

Back then, Foursquare was just another social network, letting users check in to locations they visit and potentially receive badges for those check-ins.

A lot has changed since 2009, but Foursquare still remains, though not without some adversity. Today, in a review of 2017, Foursquare has announced that last year is the third year in a row in which Foursquare has seen at least 50 percent revenue growth.

Foursquare’s data, with over 3 billion visits/month around the globe, 105 million global venues, and 25 million users who have opted in to always-on location sharing, is incredibly valuable to advertisers, businesses and developers. But transitioning from a consumer app to an enterprise platform — going from an Instagram to a comScore — has not been without its trials.

In 2014, Foursquare decided to ditch its original legacy app. Instead, the company announced, it would offer check-ins and ambient location-sharing via a new app called Swarm and the new and improved Foursquare would focus solely on place recommendations, essentially turning Foursquare into a direct competitor to Yelp.

The only way to viably sell data to advertisers, businesses and developers is to have your own army of hungry, active users to provide that data to begin with. And the old Foursquare was bloated and directionless, with a variety of potential uses. In short, it felt stale during a time when new apps were springing up left and right.

But Foursquare knew that the data it was collecting on users would prove its value eventually. And it was able to continue convincing investors that that would be the case.

While the unbundling effort was a risky bet, it seems to have paid off for the company. Both apps have over 50 million monthly active users as of 2016, which has allowed Foursquare to put their foot on the gas with enterprise products.

For example, Pinpoint by Foursquare (an advertising product) now boasts more than half of the Ad Age 100 as advertisers. Attribution by Foursquare lets those brands measure how effective that advertising is. Attribution more than doubled revenue in 2017.

Developer tools are also an integral part of Foursquare’s business. The Pilgrim SDK and Places API “grew substantially,” according to a post by CEO Jeff Glueck, and now provides location tech to 125K+ developers.

Foursquare added 50+ new roles over 2017, including positions in engineering, sales, creative, business development, marketing, and ops. In 2018, the company is opening a new engineering office in Chicago, and plans to grow the team by 30 percent over the course of the year.

It’s taken nearly a decade, but Foursquare is finally proving that it can turn years of consumer data into a viable revenue stream.
Readmore

Continue Reading

Apps

Okta teams up with ServiceNow to bring identity layer to breach containment

Published

on


Okta and fellow cloud company ServiceNow got together to build an app that helps ServiceNow customers using their security operations tools find security issues related to identity and take action immediately.

The company launched the Okta Identity Cloud for Security Operations app today. It’s available in the ServiceNow app store and has been designed for customers who are using both toolsets. When a customer downloads and installs the app, it adds a layer of identity information inside the ServiceNow security operations interface, giving the operations team access to information about who specifically is involved with a security problem without having to exit their tool to find the information.

Okta is a cloud identity management company, while ServiceNow is a cloud service management company. ServiceNow approached Okta about this integration because research has shown that that vast majority of breaches are related to compromised user credentials. The sooner the security operations team can track down the source of those credentials, the sooner they can begin resolving situation.

The way it works is a company detects a breach through the ServiceNow security tool. Instead of searching logs and and taking days or weeks to find the source of the breach, security operations can see the problem user directly in the ServiceNow interface.

With that information, they can decide immediately how to mitigate the issue. That could involve forcing the person to log out of all their applications and logging back in with new credentials and two-factor identification, suspending the user for 24 hours or a number of other actions at the discretion of the security personnel.

Okta identity tools in the ServiceNow interface. Screenshot: ServiceNow

The combination of the two products results in a better solution for customers who are using both tools anyway, says Okta COO and co-founder Frederic Kerrest. “It reduces incident triage, improves risk scoring and accelerates containment,” he explained.

The integration takes advantage of the Okta Advanced Integration Network and involves a set of APIs for for inserting Okta functionality inside of other applications. Among the other companies Okta is working with on this kind of integration is Palo Alto Networks.

This is not the first time the two companies have worked together, says Kerrest. There have been a couple of other cases where ServiceNow has used Okta as the default identity management solution in their products.
Featured Image: nicescene/Getty Images Readmore

Continue Reading

Subscribe to our Newsletter

Trending