Wij willen met u aan tafel zitten en in een openhartig gesprek uitvinden welke uitdagingen en vragen er bij u spelen om zo, gezamelijk, tot een beste oplossing te komen. Oftewel, hoe kan de techniek u ondersteunen in plaats van dat u de techniek moet ondersteunen.

The head of what is arguably private equity’s most successful technology investment firm — Vista Equity Partners — made a rare appearance on Meet The Press to discuss the steps that the country needs to take to help minority-owned businesses recover from the economic collapse caused by the COVID-19 epidemic.

Robert F. Smith is one of the worlds wealthiest private equity investors, a noted philanthropist, and the richest African American in the U.S.  Days after announcing a $ 1.5 billion investment into the Indian telecommunications technology developer Jio Platforms, Smith turned his attention to the U.S. and the growing economic crisis that’s devastating minority businesses and financial institutions even as the COVID-19 epidemic ravages the health of minority communities.

Calling the COVID-19 “a pandemic on top of a series of epidemics”, Smith said that the next round of stimulus needs to support the small businesses that still remain underserved by traditional financial institutions — and that new financial technology software and services can help.

“We need to continue to rally as Americans to come with real, lasting, scalable solutions to enable the communities that are getting hit first, hardest, and probably will take the longest to recover with solutions that will help these communities thrive again,” Smith told NBC’s Chuck Todd.

Smith called for an infusion of cash into community development financial institutions and for a new wave of technology tools to support transparency and facilitate operations among these urban rural communities that aren’t served by large banking institutions. 

In all, the first round of the Congressional stimulus package poured $ 6 trillion into the U.S. economy through authorizations for the Treasury to issue $ 4 trillion in credit and $ 2 billion in cash payouts to various industries. The average size of those initial loans was just under $ 240,000, according to a post-mortem assessment of the Payroll Protection Program written by Lendio chief executive Brock Blake for Forbes

Blake’s assessment of the shortcomings of the PPP echoes Smith’s own criticism of the program. “Many of these small communities — urban, rural — aren’t being banked by the large institutions,” Smith said. Instead they’re working with community development financial institutions that in many instances weren’t approved lenders under the Small Business Administration and so were not able to distribute PPP money and make loans to their customers.

“We have to take this opportunity to reinvest in our business infrastructure in these small to medium businesses. In our banking infrastructure so that we can actually emerge out of this even stronger,” Smith said. “We have to invest in technology and software so that these ‘capillary banking systems’ are more efficient and they have more access to capital so they can engage with these businesses that are underbanked.”

In many instances this would amount to the construction of an entirely new financial infrastructure to support the small businesses that were only just beginning to emerge in minority communities after the 2008 recession.

“We need to get this average loan size to $ 25,000 and $ 15,000,” said Smith. To do that, community banks and development finance institutions are going to need to be able to access new fintech solutions that accelerate their ability to assess the creditworthiness of their customers and think differently about how to allocate capital and make loans. 

In some ways, Smith is echoing the call that fintech executives have been making since the PPP stimulus first started making its way through the financial system and banks began issuing loans.

“We would be remiss if we didn’t take a significant portion of capital to reinvest in the infrastructure of delivering capital back into those businesses and frankly reinvest in those businesses and give them technology and capability so there’s more transparency and visibility so there’s an opportunity to grow [and] scale,” said Smith. “I don’t want to see us go back to the same position where we were so we have these banking deserts.”

The head of Vista Equity Partners has even tasked his own portfolio companies to come up with solutions. As Barron’s reported last week, Smith told the Vista Equity portfolio company Finastra to develop technology that could help small lenders process Paycheck Protection Program loans for small businesses in underserved communities.

“In the process, it became apparent how unbanked these most vulnerable communities are, and we felt it was imperative to help build out permanent infrastructure in those banks so that they can build long-term relationships with the U.S. Small Business Administration beyond PPP,” Smith told Barrons.

As of last week, 800 lenders had processed 75,000 loans using the software that London-based Finastra developed for U.S. small lenders. Those loans generated $ 2.2 million in processing fees for the fintech company, proving that there’s money to be made in the small ticket lending market. And even as Finastra is reaping the rewards of its push into small business lending services, Vista Equity and Smith are donating the same amount to local food banks, according to a spokeswoman for the private equity firm, Barron’s reported.


TechCrunch

Since moving to the United States, I’ve come to appreciate and admire the United States Postal Service as a symbol of American ingenuity and resilience.

Like electricity, telephones and the freeway system, it’s part of our greater story and what binds the United States together. But it’s also something that’s easy to take for granted. USPS delivers 181.9 million pieces of First Class mail each day without charging an arm and a leg to do so. If you have an address, you are being served by the USPS — and no one’s asking you for cash up front.

As CEO of Shippo, an e-commerce technology platform that helps businesses optimize their shipping, I have a unique vantage point into the USPS and its impact on e-commerce. The USPS has been a key partner since the early days of Shippo in making shipping more accessible for growing businesses. As a result of our work with the USPS, along with several other emerging technologies (like site builders, e-commerce platforms and payment processing), e-commerce is more accessible than ever for small businesses.

And while my opinion on the importance of the USPS is not based on my company’s business relationship with the Postal Service, I want to be upfront about the fact that Shippo generates part of its revenue from the purchase of shipping labels through our platform from the USPS along with several other carriers. If the USPS were to stop operations, it would have an impact on Shippo’s revenue. That said, the negative impact would be far greater for many thousands of small businesses.

I know this because at Shippo, we see firsthand how over 35,000 online businesses operate and how they reach their customers. We see and support everything from what options merchants show their customers at checkout through how they handle returns — and everything in between. And while each and every business is unique with different products, customers operations and strategies, they all need to ship.

In the United States, the majority of this shipping is facilitated by the USPS, especially for small and medium businesses. For context, the USPS handles almost half of the world’s total mail and delivers more than the top private carriers do in aggregate, annually, in just 16 days. And, it does all of this without tax dollars, while offering healthcare and pension benefits to its employees.

As has been the case for many organizations, COVID-19 has significantly impacted the USPS. While e-commerce package shipments continue to rise (+30% since early March based on Shippo data), it has not been enough to overcome the drastic drop in letter mail. With this, I’ve heard opinions of supposed “inefficiency,” calls for privatization, pushes for significant pricing and structural changes, and even indifference to the possibility of the USPS shutting down.

Amid this crisis, we all need the USPS and its vital services now more than ever. In a world with a diminished or dismantled USPS, it won’t be Amazon, other major enterprises, or even Shippo that suffer. If we let the USPS die, we’ll be killing small businesses along with it.

Quite often, opinions on the efficiency (or lack thereof) of the USPS are very narrow in scope. Yes, the USPS could pivot to improve its balance sheet and turn operating losses into profits by axing cumbersome routes, increasing prices and being more selective in who they serve.

However, this omits the bigger picture and the true value of the USPS. What some have dubbed inefficient operations are actually key catalysts to small business growth in the United States. The USPS gives businesses across the country, regardless of size, location or financial resources, the ability to reach their customers.

We shouldn’t evaluate the USPS strictly on balance sheet efficiency, or even as a “public good” in the abstract. We should look at how many thousands of small businesses have been able to get started thanks to the USPS, how hundreds of billions of dollars of commerce is made possible by the USPS annually and how many millions of customers, who otherwise may not have access to goods, have been served by the USPS.

In the U.S., e-commerce accounts for over half a trillion dollars in sales annually, and is growing at double-digit rates each year. When I hear people talk about the growth of e-commerce, Amazon is often the first thing that comes up. What doesn’t shine through as often is the massive growth of small business — which is essential to the health of commerce in general (no one needs a monopoly!). In fact, the SMB segment has been growing steadily alongside Amazon. And with the challenges that traditional businesses face with COVID-19, more small businesses than ever are moving online.

USPS Priority Mail gets packages almost anywhere in the U.S. in two to three days (average transit time is 2.5 days based on Shippo data) and starts at around $ 7 per shipment, with full service: tracking, insurance, free pickups and even free packaging that they will bring to you.

In a time when we as consumers have become accustomed to free and fast shipping on all of our online purchases, the USPS is essential for small businesses to keep up. As consumers we rarely see behind the curtain, so to speak, when we interact with e-commerce businesses. We don’t see the small business owner fulfilling orders out of their home or out of a small storefront, we just see an e-commerce website. Without the USPS’ support, it would be even harder, in some cases near impossible, for small business owners to live up to these sky-high expectations. For context, 89% of U.S.-based SMBs (under $ 10,000 in monthly volume) on the Shippo platform rely on the USPS.

I’ve seen a lot of talk about the USPS’s partnership with Amazon, how it is to blame for the current situation, and how under a private model, things would improve. While we have our own strong opinions on Amazon and its impact on the e-commerce market, Amazon is not the driver of USPS’s challenges. In fact, Amazon is a major contributor in the continued growth of the USPS’s most profitable revenue stream: package delivery.

While I don’t know the exact economics of the deal between the USPS and Amazon, significant discounting for volume and efficiency is common in e-commerce shipping. Part of Amazon’s pricing is a result of it actually being cheaper and easier for the USPS to fulfill Amazon orders, compared to the average shipper. For this process, Amazon delivers shipments to USPS distribution centers in bulk, which significantly cuts costs and logistical challenges for the USPS.

Without the USPS, Amazon would be able to negotiate similar processes and efficiencies with private carriers — small businesses would not. Given the drastic differences in daily operations and infrastructure between the USPS and private carriers, small businesses would see shipping costs increase significantly, in some cases by more than double. On top of this, small businesses would see a new operational burden when it comes to getting their packages into the carriers’ systems in the absence of daily routes by the USPS.

Overall, I would expect to see the level of entrepreneurship in e-commerce slow in the United States without the USPS or with a private version of the USPS that operates with a profit-first mindset. The barriers to entry would be higher, with greater costs and larger infrastructure investments required up-front for new businesses. For Shippo, I’d expect to see a much greater diversity of carriers used by our customers. Our technology that allows businesses to optimize across several carriers would become even more critical for businesses. Though, even with optimization, small businesses would still be the group that suffers the most.

Today, most SMB e-commerce brands, based on Shippo data, spend between 10-15% of their revenue on shipping, which is already a large expense. This could rise well north of 20%, especially when you take into account surcharges and pick-up fees, creating an additional burden for businesses in an already challenging space.

I urge our lawmakers and leaders to see the full picture: that the USPS is a critical service that enables small businesses to survive and thrive in tough times, and gives citizens access to essential services, no matter where they reside.

This also means providing government support — both financially and in spirit — as we all navigate the COVID-19 crisis. This will allow the USPS to continue to serve both small businesses and citizens while protecting and keeping their employees safe — which includes ensuring that they are equipped to handle their front-line duties with proper safety and protective gear.

In the end, if we continue to view the USPS as simply a balance sheet and optimize for profitability in a vacuum, we ultimately stand to lose far more than we gain.


TechCrunch

Adriel is a South Korean startup bringing automated ad tools to small businesses — and in recent months, it’s been expanding into the United States and the United Kingdom.

This might seem like exactly the wrong time to be growing an ad-buying platform, since we’re at the beginning of what’s likely to be a tremendous pullback in ad spend due to the COVID-19 pandemic. However, co-founder and CEO Sophie Eom told me via email that ad spend on Adriel increased by 7% in February, then by 6% in March, and she estimated that spend will be up by 8% in April.

“We all know that businesses are struggling from the uncertainty of the economic situations with COVID-19,” Eom said. “And most are hesitant about hiring agencies for their marketing and advertising efforts due to the high costs — in addition to the fact that many corporates don’t have enough knowledge about the right marketing processes.”

So why is Adriel still seeing growth? She argued, “We see that even in the midst of tough times, many startups and entrepreneurs are not giving up their businesses. In fact, they are shifting their focus and investments into more digital to reach their customers.”

As part of its response to COVID-19, the company is also donating ads to support small business customers in the San Francisco area.

Adriel’s technology automatically generates creative materials and suggests keywords for ads, as well as managing the targeting. But there’s also a human team that reviews campaigns and suggests ways to improve. The company does not require retainers or contracts, but charges a 19% fee on ad spend.

I first spoke to Eom at the end of 2019, when she was first expanding Adriel into the U.S. In some ways, it felt like a familiar pitch — I’ve written about companies like AdEspresso (acquired by HootSuite) and Smartly.io (which sold a majority stake to Providence Equity Partners last year), which also said they were optimizing or automating small business advertising. Plus, Facebook itself has launched an automated ad builder.

Eom suggested that while there are tools that sound superficially similar, there’s nothing quite like Adriel (which was part of Facebook’s Namsam Lab Korea incubator), with its multi-platform support for managing Facebook, Google and Instagram ad campaigns in one place, and with its focus on the true “long tail” of advertisers — she said the average Adriel client spends a relatively modest $ 1,000 per month on digital advertising.

“We’re not merely a self-service tool either,” she said. “We support and assist our clients in getting their ad placed, making their campaign more successful. We use technology to make all these processes more affordable for more business owners.”

She added that Adriel has launched 7,200 campaigns for nearly 20,000 business accounts.


TechCrunch

Many expectant mothers are told that breastfeeding will come naturally, but it is often a fraught and confusing experience, especially during the first few weeks after birth. Parents often worry about if their babies are getting enough nutrition or if they are producing enough milk. MyMilk Labs wants to give nursing mothers more information with Mylee, a sensor that scans a few drops of breast milk to get information about its composition and connects to a mobile app. The Israel-based company presented today at Disrupt Battlefield as one of two wild card competitors picked from Startup Alley.

The Mylee launched at Disrupt with a pre-order price of $ 249 (its regular retail price is $ 349). Based in Israel, MyMilk Labs was founded in 2014 by Ravid Schecter and Sharon Haramati, who met while working on PhDs in neuroimmunology and neurobiology, respectively, at the Weizmann Institute of Science.

Mylee deviceDuring the company’s stage presentation, Schecter said the device is meant to give mothers and lactation consultants objective information about breast milk.

Breast milk changes in the first days and weeks after birth, progressing from colostrum to mature milk. Mylee scans the electrochemical properties of milk and then correlates that to data points based on MyMilk Labs’ research to calculate where the sample is on the continuum, then tells mothers if their milk is “delayed” or “advanced,” relative to the time that has passed since they gave birth.

The device’s first version is currently in a beta pilot with lactation consultants who have used them to scan milk samples from 500 mothers.

MyMilk Labs already has consumer breast milk testing kits that enable mothers to provide a small sample at home that is then sent to MyMilk Labs’ laboratories for analysis. One is a nutritional panel that gives information about the milk’s levels of vitamins B6, B12 and A, calories and fat percentage, along with dietary recommendations for the mother. Another panel focuses on what is causing breast pain, a frequent complaint for nursing mothers. It tests for bacterial or fungal infections and gives antibiotic suggestions depending on what strains are detected.

Though some doctors believe testing kits are unnecessary for the majority of nursing mothers, there is demand for more knowledge about breastfeeding, as demonstrated by the line-up of breast milk testing kits from MyMilk Labs and competitors like Lactation Labs, Everly Well and Happy Vitals. Haramati said on stage that MyMilk Labs plans to eventually transfer some of the tests’ capabilities to the Mylee.


TechCrunch

Tesla CEO Elon Musk says that the company is in the process of completing a “small acquisition” that will help it release its own insurance product, something it said in April that it was only around “a month” away from bringing to market. One month is at least two months when translated from Musk time to rest-of-us time, so that tracks.

Musk made the remark at Tesla’s Annual Shareholders Meeting, adding that the company is “pretty close to being able to release [its insurance product],” and that in addition to this acquisition in progress, Tesla also has “a bit of software to write” to make it ready for market.

Insurance for Tesla vehicles can be expensive when sourced from traditional insurance providers (it ranked 15th highest in the U.S. in a recent third-party survey) but Tesla says it has a key advantage when compared to third-parties that will help it price insurance for its customers correctly – ample and detailed information about their driving habits.

No word yet on who the acquisition target is, but it makes sense that Apple might seek to pick up a small insurer to supplement its own driving and user data, rather than trying to build an insurance business in-house from scratch.


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