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Daily Crunch: Facebook acquires Kustomer for $1B

Facebook makes a billion-dollar acquisition, we learn more about Twitter’s Clubhouse-style feature and Moderna applies for emergency authorization for its COVID-19 vaccine. This is your Daily Crunch for November 30, 2020.
The big story: Facebook acquires Kustomer for $1B
Kustomer says it can give customer service teams better data and a more unified view of the people they’re interacting with. So with this acquisition, Facebook can improve its offerings for businesses that have a presence (in some cases, their primary digital presence) on the social network.
The terms of the deal were not disclosed, but TechCrunch has confirmed that the …

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Facebook’s latest ad tool fail puts another dent in its reputation

Reset yer counters: Facebook has had to ‘fess up to yet another major ad reporting fail.
This one looks like it could be costly for the tech giant to put right — not least because it’s another dent in its reputation for self reporting. (For past Facebook ad metric errors check out our reports from 2016 here, here, here and here.)
AdExchanger reported on the code error last week with Facebook’s free ‘conversion lift’ tool which it said affected several thousand advertisers.
The discovery of the flaw has since led the tech giant to offer some advertisers millions of dollars …

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Google, Facebook and Twitter threaten to leave Pakistan over censorship law

Global internet companies Facebook, Google and Twitter and others have banded together and threatened to leave Pakistan after the South Asian nation granted blanket powers to local regulators to censor digital content.

Earlier this week, Pakistan Prime Minister Imran Khan granted the Pakistan Telecommunication Authority the power to remove and block digital content that pose “harms, intimidates or excites disaffection” toward the government or in other ways hurt the “integrity, security, and defence of Pakistan.”

Through a group called the Asia Internet Coalition Asia (AIC), the tech firms said that they were “alarmed” by the scope of Pakistan’s new law targeting internet firms.” In addition to Facebook, Google, and Twitter, AIC represents Apple, Amazon, LinkedIn, SAP, Expedia Group, Yahoo, Airbnb, Grab, Rakuten, Booking.com, Line, and Cloudflare.

If the message sounds familiar, it’s because this is not the first time these tech giants have publicly expressed their concerns over the new law, which was proposed by Khan’s ministry in February this year.

After the Pakistani government made the proposal earlier this year, the group had threatened to leave, a move that made the nation retreat and promise an extensive and broad-based consultation process with civil society and tech companies.

That consultation never happened, AIC said in a statement on Thursday, reiterating that its members will be unable to operate in the country with this law in place.

“The draconian data localization requirements will damage the ability of people to access a free and open internet and shut Pakistan’s digital economy off from the rest of the world. It’s chilling to see the PTA’s powers expanded, allowing them to force social media companies to violate established human rights norms on privacy and freedom of expression,” the group said in a statement.

“The Rules would make it extremely difficult for AIC Members to make their services available to Pakistani users and businesses. If Pakistan wants to be an attractive destination for technology investment and realise its goal of digital transformation, we urge the Government to work with industry on practical, clear rules that protect the benefits of the internet and keep people safe from harm.”

Under the new law, tech companies that fail to remove or block the unlawful content from their platforms within 24 hours of notice from Pakistan authorities also face a fine of up to $3.14 million. And like its neighboring nation, India, — which has also proposed a similar regulation with little to no backlash — Pakistan now also requires these companies to have local offices in the country.

The new rules comes as Pakistan has cracked down on what it deems to be inappropriate content on the internet in recent months. Earlier this year, it banned popular mobile game PUBG Mobile and last month it temporarily blocked TikTok.

Countries like Pakistan and India contribute little to the bottomline for tech companies. But India, which has proposed several protectionist laws in recent years, has largely escaped any major protest from global tech companies because of its size. Pakistan has about 75 million internet users.

By contrast, India is the biggest market for Google and Facebook by users. “Silicon Valley companies love to come to India because it’s an MAU (monthly active users) farm,” Kunal Shah, a veteran entrepreneur, said in a conference in 2018.

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African fintech startup Chipper Cash raises $30M backed by Jeff Bezos

African cross-border fintech startup Chipper Cash has raised a $30 million Series B funding round led by Ribbit Capital with participation of Bezos Expeditions — the personal VC fund of Amazon CEO Jeff Bezos.

Chipper Cash was founded in San Francisco in 2018 by Ugandan Ham Serunjogi and Ghanaian Maijid Moujaled. The company offers mobile-based, no fee, P2P payment services in seven countries: Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa and Kenya.

Parallel to its P2P app, the startup also runs Chipper Checkout — a merchant-focused, fee-based payment product that generates the revenue to support Chipper Cash’s free mobile-money business. The company has scaled to 3 million users on its platform and processes an average of 80,000 transactions daily. In June 2020, Chipper Cash reached a monthly payments value of $100 million, according to CEO Ham Serunjogi .

As part of the Series B raise, the startup plans to expand its products and geographic scope. On the product side, that entails offering more business payment solutions, crypto-currency trading options, and investment services.

“We’ll always be a P2P financial transfer platform at our core. But we’ve had demand from our users to offer other value services…like purchasing cryptocurrency assets and making investments in stocks,” Serunjogi told TechCrunch on a call.

Image Credits: Chipper Cash

Chipper Cash has added beta dropdowns on its website and app to buy and sell Bitcoin and invest in U.S. stocks from Africa — the latter through a partnership with U.S. financial services company DriveWealth.

“We’ll launch [the stock product] in Nigeria first so Nigerians have the option to buy fractional stocks — Tesla shares, Apple shares or Amazon shares and others — through our app. We’ll expand into other countries thereafter,” said Serunjogi.

On the business financial services side, the startup plans to offer more API payments solutions. “We’ve been getting a lot of requests from people on our P2P platform, who also have business enterprises, to be able to collect payments for sale of goods,” explained Serunjogi.

Chipper Cash also plans to use its Series B financing for additional country expansion, which the company will announce by the end of 2021.

Jeff Bezos’s backing of Chipper Cash follows a recent string of events that has elevated the visibility of Africa’s startup scene. Over the past decade, the continent’s tech ecosystem has been one of the fastest growing in the world by year year-over-year expansion in venture capital and startup formation, concentrated in countries such as Nigeria, Kenya, and South Africa.

Image Credits: TechCrunch/Bryce Durbin

Bringing Africa’s large unbanked population and underbanked consumers and SMEs online has factored prominently. Roughly 66% of Sub-Saharan Africa’s 1 billion people don’t have a bank account, according to World Bank data.

As such, fintech has become Africa’s highest-funded tech sector, receiving the bulk of an estimated $2 billion in VC that went to startups in 2019. Even with the rapid venture funding growth over the last decade, Africa’s tech scene had been performance light, with only one known unicorn (e-commerce venture Jumia) a handful of exits, and no major public share offerings. That changed last year.

In April 2019, Jumia — backed by investors including Goldman Sachs and Mastercard — went public in an NYSE IPO. Later in the year, Nigerian fintech company Interswitch achieved unicorn status after a $200 million investment by Visa.

This year, Network International purchased East African payments startup DPO for $288 million and in August WorldRemit acquired Africa focused remittance company Sendwave for $500 million.

One of the more significant liquidity events in African tech occurred last month, when Stripe acquired Nigerian payment gateway startup Paystack for a reported $200 million.

In an email to TechCrunch, a spokesperson for Bezos Expeditions confirmed the fund’s investment in Chipper Cash, but declined to comment on further plans to back African startups. Per Crunchbase data, the investment would be the first in Africa for the fund. It’s worth noting Bezos Expeditions is not connected to Jeff Bezo’s hallmark business venture, Amazon.

For Chipper Cash, the $30 million Series B raise caps an event-filled two years for the San Francisco-based payments company and founders Ham Serunjogi and Maijid Moujaled. The two came to America for academics, met in Iowa while studying at Grinnell College and ventured out to Silicon Valley for stints in big tech: Facebook for Serunjogi and Flickr and Yahoo! for Moujaled.

Chipper Cash founders Ham Serunjogi (R) and Maijid Moujaled; Image Credits: Chipper Cash

The startup call beckoned and after launching Chipper Cash in 2018, the duo convinced 500 Startups and Liquid 2 Ventures — co-founded by American football legend Joe Montana — to back their company with seed funds. The startup expanded into Nigeria and Southern Africa in 2019, entered a payments partnership with Visa in April and raised a $13.8 million Series A in June.

Chipper Cash founder Ham Serunjogi believes the backing of his company by a notable tech figure, such as Jeff Bezos (the world’s richest person), has benefits beyond his venture.

“It’s a big deal when a world class investor like Bezos or Ribbit goes out of their sweet spot to a new area where they previously haven’t done investments,” he said. “Ultimately, the winner of those things happening is the African tech ecosystem overall, as it will bring more investment from firms of that caliber to African startups.”

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Facebook content moderators demand safer working conditions

A group of more than 200 Facebook content moderators are demanding the tech company “stop needlessly risking moderators’ lives,” they wrote in an open letter to Facebook and the company’s contractors that manage content moderators, Accenture and Covalen. This comes after The Intercept reported how Facebook content moderators were required to come back into the office during the pandemic. Shortly after they returned to the office, a Facebook content moderator reportedly tested positive for COVID-19.

“After months of allowing content moderators to work from home, faced with intense pressure to keep Facebook free of hate and disinformation, you have forced us back to the office,” the group wrote. “Moderators who secure a doctors’ note about a personal COVID risk have been excused from attending in person.[1] Moderators with vulnerable relatives, who might die were they to contract COVID from us, have not.”

Moderators are now demanding Facebook allow those who are high-risk or live with someone who is high-risk for having a severe case of COVID-19 to be able to work from home indefinitely. Additionally, moderators generally want Facebook to maximize the amount of work people can do from home, offer hazard pay, offer healthcare and psychiatric care and employ moderators rather than outsource them.

In the letter, moderators argue that Facebook’s algorithms are nowhere near where they need to be in order to successfully moderate content. They argue they’re “the heart” of Facebook.

“Without our work, Facebook is unusable,” the moderators wrote. “Its empire collapses. Your algorithms cannot spot satire. They cannot sift journalism from disinformation. They cannot respond quickly enough to self-harm or child abuse. We can.”

The group represents content moderators in throughout the U.S. and Europe and has support from legal advocacy firm Foxglove. Foxglove said in a tweet that it’s the “biggest joint international effort of Facebook content moderators yet.”

TechCrunch has reached out to Facebook and will update this story if we hear back.

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Facebook extends its temporary ban on political ads for another month

The election is settled, but the nation is far from it.

Before Election Day in the U.S., Facebook hit pause on all political and social issue ads. At the time, the company made it clear that the precautionary measure designed to turn off one potential faucet of misinformation would be temporary, but it couldn’t say how long the policy would remain in effect.

Now, Facebook says the temporary ban will continue for at least another month. The decision to extend the special policy was implemented Wednesday, four days after Joe Biden’s election victory — and four days after it became clear that Trump had no intention of conceding a lost election.

“The temporary pause for ads about politics and social issues in the US continues to be in place as part of our ongoing efforts to protect the election,” the company wrote in an update to its previous announcement. “Advertisers can expect this to last another month, though there may be an opportunity to resume these ads sooner.”

Facebook’s ongoing political ad pause throws a wrench into things in Georgia, where two January runoff elections will decide which party will control the Senate heading into President-Elect Biden’s administration. A friendly Senate is essential for many of Biden’s biggest proposals, including a $2 trillion climate package that could reshape the American economy and push the country toward an electrified future that doesn’t rely on fossil fuels.

Over the last few days, a shocking number of Republicans have “humored” the president’s refusal to transfer power in spite of an unambiguous election call and Biden’s decisive win in Pennsylvania, which cut off any potential paths to victory for his opponent. The Trump campaign’s last-ditch flurry of legal challenges have presented little of substance so far, and they might ultimately be more about dividing a nation and sowing doubt than prevailing in court.

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Twitter hides Trump tweet attacking Supreme Court’s decision on Pennsylvania ballots

In an election eve preview of what to expect in the coming days, President Trump pushed the limits on Twitter’s election-specific policies Monday night.

In a tweet, Trump railed against the Supreme Court’s decision to allow Pennsylvania officials to count ballots postmarked by Election Day. The Republican party has waged a brazen legal onslaught against voting rights throughout key states in recent weeks, a cynical effort designed to better the sitting president’s reelection chances.

Twitter pushed back on the president’s false claim about Pennsylvania mail-in ballots, hiding it behind a misinformation warning that calls the tweet “disputed.” Twitter also disabled non-quote retweets, likes and replies for the hidden tweet, which remains viewable but restricted.

Image Credits: Twitter

“The Supreme Court decision on voting in Pennsylvania is a VERY dangerous one,” Trump tweeted. “It will allow rampant and unchecked cheating and will undermine our entire systems of laws. It will also induce violence in the streets. Something must be done!”

Facebook did not remove the reposted message, but did add a label emphasizing the trustworthiness of voting systems. Three hours after it was published, Trump’s Facebook post had collected 63,000 likes and 13,000 comments.

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Bridgefy launches end-to-end encrypted messaging for the app used during protests and disasters

Offline-messaging app Bridgefy — which innovatively uses Bluetooth and Wi-fi — became known as the go-to app by thousands of protesters around the world to keep communications going even when oppressive regimes blocked or shut down the Internet. Recently, activists in Nigeria and Thailand have urged supporters to download the app, as last year, when protesters in Hong Kong downloaded Bridgefy to face the government’s censorship of phone services or data connections. In the last 12 months, the startup says it’s reached 2 million downloads. And since the events of the weekend, when Turkey and Greece were hit by an earthquake, the app is now trending on app stores for those regions.

Bridgefy is now publishing a major new update, with a new, crucial feature for activists: end-to-end encrypted messages. This will allow people to securely send and receive messages when they don’t have access to data and will use the same encryption protocol used by Signal, Whatsapp and Facebook Messenger .

Bridgefy launched in 2014 (and appeared on the TechCrunch Disrupt stage in 2017) when the founders identified the problem of not being able to communicate during the earthquakes in Mexico City. It started as a mobile app, and an SDK was added a few years later so other apps could also work without the Internet. The Bridgefy SDK is now licensed to companies on an annual subscription model, based on user volume and is integrated by more than 40 companies across payments, messaging, gaming, social media, dating, and natural disaster apps. Technically-speaking, its competitors include GoTenna and the moth-ball gathering Firechat, although Bridgefy has become better known in the activist space.

The startup is now raising a Seed round and has already raised $800,000 USD, with investors including Twitter cofounder Biz Stone, Alchemist Accelerator and GAN Ventures.

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WhatsApp is now delivering roughly 100 billion messages a day

WhatsApp, the popular instant messaging app owned by Facebook, is now delivering roughly 100 billion messages a day, the company’s chief executive Mark Zuckerberg said at the quarterly earnings call Thursday.

For some perspective, users exchanged 100 billion messages on WhatsApp last New Year’s Eve. That is the day when WhatsApp tops its engagement figures, and as many of you may remember, also the time when the service customarily suffered glitches in the past years. (No outage on last New Year’s Eve!)

At this point, WhatsApp is just competing with itself. Facebook Messenger and WhatsApp together were used to exchange 60 billion messages a day as of early 2016. Apple chief executive Tim Cook said in May that iMessage and FaceTime were seeing record usage, but did not share specific figures. The last time Apple did share the figure, it was far behind WhatsApp’s then usage (podcast). WeChat, which has also amassed over 1 billion users, is behind in daily volume of messages, too.

In early 2014, WhatsApp was being used to exchange about 50 billion texts a day, its then chief executive Jan Koum revealed at an event.

At the time, WhatsApp had fewer than 500 million users. WhatsApp now has more than 2 billion users and at least in India, its largest market by users, its popularity surpasses those of every other smartphone app including the big blue app.

“This year we’ve all relied on messaging more than ever to keep up with our loved ones and get business done,” tweeted Will Cathcart, head of WhatsApp.

Sadly, that’s all the update the company shared on WhatsApp today. Mystery continues for when WhatsApp expects to resume its payments service in Brazil, and when it plans to launch its payments in India, where it began testing the service in 2018. (It has already shared big plans around financial services in India, though.)

“We are proud that WhatsApp is able to deliver roughly 100B messages every day and we’re excited about the road ahead,” said Cathcart.

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Watch Facebook, Google, and Twitter’s CEOs defend the law that created social media to Congress

The CEOs of Twitter, Facebook and Google will appear before the Senate Commerce Committee on Wednesday in big tech’s latest showdown with Congress.

The Senate hearing will have a narrower, more policy-centric scope than other recent high profile tech hearings, focusing specifically on Section 230 of the Communications Decency Act. That short law might sound obscure, but it’s the key legal shield that protects internet companies from liability for the user-generated content they host, from Facebook posts and tweets to Yelp reviews and comments sections.

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Recent big tech hearings have meandered, seldom forcing the leaders of some of the world’s most powerful companies into revealing much. But the cumulative pressure of federal antitrust action, a high-stakes election less than a week away and a number of legislative proposals that could dismantle the law that made their businesses possible will likely set a different tone — and hopefully offer more substance.

You can follow a livestream of the hearing here (above) starting at 10:00 AM ET on Wednesday, October 28. We’ll be following the testimony and all things Section 230, so check back for our coverage of the day’s key takeaways.

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