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Instagram redesign puts Reels and Shop tabs on the home screen

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Instagram is putting its TikTok competitor Reels front-and-center in a redesigned version of its app by giving it the center position on its new navigation bar. The update, arriving today, also replaces the Activity tab (heart icon) with the Shop tab, following a test that had changed this aspect of the app’s home screen earlier this summer.

In the redesigned app, both the Compose button and the Activity tab have been relocated to the top-right of the home screen, while the center middle button now belongs to Reels.

Before, Reels videos were mixed in with other photo and video content on the Instagram Explore page, though Instagram this fall began to experiment with different layouts (see below).

This led to some early complaints from users looking for Reels in the app, who had said it was harder to find, the company says.

The redesign, which makes Reels the main button in the app, is an aggressive attempt on Instagram’s part to direct users to its short-form video feed, which has so far seen only a lukewarm reception from reviewers. Critics have said Reels lacks competitive features, contributes to Instagram’s bloat, feels stale and features a lot of recycled TikTok content. At best, it’s been deemed a shameless clone.

Instagram, on the other hand, would argue that it’s still early days for its Reels short-form video in its app. And the change could encourage more creators to share their Reels, given the now high-profile position given to the product.

That said, it cannot be understated how significant it is to relocate a Compose button in an app that relies on user-generated content. That Instagram would minimize the button’s importance in this way is a testament to how much of its future relies on making Reels work.

“The way we think about this update is that we’re trying to make it really easy to use an expanded suite of products now available on Instagram, while maintaining a simplicity,” explains Instagram’s director of Product Management, Robby Stein.

Simplicity, given the wide range of products Instagram now offers, could become a challenge.

When tapped, the relocated Compose button will now take users to a redesigned Camera experience, too. Here, you can either pick photos or videos to post to your Feed, or scroll over to choose to post to your Story, Reels, or go Live. While this doesn’t replace the swipe gesture to get to the Camera, it does give all the different post formats a more equal footing.

Image Credits: Instagram

Next to the new Compose button is the relocated Activity button (the heart icon) and a redesigned messaging button that takes you to your Instagram DMs — which are now connected to Facebook Messenger’s universe. The messages button itself has been changed to look like the Facebook Messenger icon (for those who opted in to the new experience), and not the paper airplane icon that was previously associated with the Instagram inbox.

Another major change sees the Instagram Shop winning a home screen placement.

The company began testing the Shop tab in place of the Activity tab in July, where it would send users to an updated version of the Instagram Shop. Here, users could filter by brands they followed on Instagram or by product category. And, in many cases, users could pay for their purchase using Instagram’s own Checkout feature, which involves a selling fee.

Instagram’s push to make its app more of an online shopping destination through this and other changes comes at a critical time for the e-commerce market. The coronavirus pandemic accelerated the shift to e-commerce by at least five years, according to some analysts. That means any plans Instagram had to become a major player in online commerce were also just expedited.

Image Credits: Instagram

Combined, both moves signal a company that’s worried about the impact TikTok may have on the long-term future of its business.

The Chinese-owned rival video app has been surging in popularity around the world, and particularly with the Gen Z demographic. TikTok is now projected to top 1.2 billion monthly active users in 2021, according to a recent forecast. However, the app’s U.S. fate is still unknown due to a lack of attention from the Trump administration over the TikTok ban, as well as uncertainty as to how the incoming Biden administration will proceed to enforce it.

Today’s TikTok captures users’ attention with its short-form content, personalized “For You” feed, sizable music catalog and special effects.

Image Credits: Instagram

But there’s also potential for the app to expand beyond being just an entertainment platform, as its recent partnership with Shopify on social commerce indicates. TikTok’s video format makes for an ideal medium to showcase a brand’s products — which is why Walmart angled in on the would-be TikTok acquisition for its U.S. operations, driven by Trump’s TikTok ban.

If and when TikTok scales this side of its business in the U.S., it could win social commerce market share from both Facebook and Instagram. And its appeal on the entertainment front could make it more difficult for Reels, or anyone else, to compete.

But Instagram has one big advantage in this battle: user data. It can inform its own personalization algorithms for Reels based on what users are doing elsewhere in its app, and even on Facebook if the user connected their account.

However, Stein says the main signals Reels personalization algorithms use are based on data coming from engagement within Reels, like whether you liked a video, for example.

Though Instagram users may not appreciate the buttons being relocated, Stein says, in tests, people came to adapt the changes. And in the end, it was necessary.

“We try to maintain simplicity by making sure that it’s clear why everything is where it is. But also, each tab has a really clear purpose to you,” says Stein. “So there’s now one clear place to go to start watching video and be entertained and, hopefully, have some fun,” he says. “There’s one really clear place to go now, when you want to post. And there’s one really clear place now you want to shop, which is really important to us.”

The changes will roll out to all markets where Reels and Shop are live, including the U.S., over the next few days.

Correction, 11/12/20 9:20 am et: We initially misspelled Robby Stein’s name. It’s spelled Robby Stein, not Robbie Stein. This has been corrected. Apologies for the error. 

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What about $30 billion under 30

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Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast (now on Twitter!), where we unpack the numbers behind the headlines.

We’re back with not an Equity Shot or Dive of Monday, this is just the regular show! So, we got back to our roots by looking at a huge number of early stage rounds. And a few other things that we were just too excited about to not mention.

So from Chris and Danny and Natasha and I, here’s the rundown:

That was a lot, but how could we leave any of it out? We’re back Monday with more!

Equity drops every Monday at 7:00 a.m. PDT and Thursday afternoon as fast as we can get it out, so subscribe to us on Apple PodcastsOvercastSpotify and all the casts.

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Henry picks up cash to be a Lambda School for Latin America

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Latin America’s startup scene has attracted troves of venture investment, lifting highly-valued companies such as Rappi and NuBank into behemoth businesses. Now that the spotlight has arrived, those same startups need more talent than ever before to meet demand.

That’s where one seed-stage Buenos Aires startup wants to help. Henry has created an online computer science school that trains software developers from low-income backgrounds to understand technical skills and get employed. The company was founded by brother-sister duo Luz and Martin Borchardt, as well as Manuel Barna Ferrés, Antonio Tralice and Leonardo Maglia.

The Henry team.

The company claims that there’s an estimated 1 million software engineering job openings in Latin America, but fewer than 100,000 professionals that have training suitable for those roles.

“Higher education is only for 13% of the population in Latin America,” says Martin Borchardt, CEO and co-founder of Henry . “It’s very exclusive, very expensive, and has very low impact skills. So we’re giving these people an opportunity.”

With 90% of graduates coming from no formal higher education background, Henry seeks to help bring more back-end junior developers and full-stack developers into startups. Henry offers a five-month course that goes from Monday to Friday, 9 a.m. to 6 p.m., which focuses on software developer skills. Beyond technical training, Henry gives participants job coaching, resume workshops and up-skilling opportunities post-graduation.

To make the school more affordable, Henry looks to take on the same strategy used by Lambda School, a YC-graduate that has raised over $122 million in known funding: income-share agreements. The set-up would allow for boot camp participants to join the program at zero upfront costs, and then only pay once they get hired at a job.

Lambda School’s ISA terms ask students to pay 17% of their monthly salary for 24 months once they earn $4,167 monthly. The students pay a maximum of $30,000. Henry takes a much smaller slice of the pie, partly because salaries are lower in Latin American than in the United States. Henry asks students to pay 15% of their monthly salary for 24 months once students earn $500 a month.

If a Henry student doesn’t get employed in a job that allows them to make $500 a month within five years after the program completes, they are off the hook for paying back the boot camp.

Henry is also focused on helping more women get into the field of software development. Internally, Henry’s remote team is 20% women, 64% men. The current students reflect the same breakdown.

One issue with coding boot camps is that while it might help a student go from unemployed to employed, the lack of credential and degree might limit career mobility past that first job. For that reason, Henry has created a database of alumni resources, including up-skilling and reskilling opportunities in the latest skill, which will be free of charge for graduates.

Henry needs to execute on job placement to be successful in its field. Currently, more than 80% of students in Henry’s first cohort have found jobs, but it’s too soon in the startups’ trajectory to get a stronger metric on that front. About four Henry graduates have been employed by the startup.

The need for more talent in emerging countries has not gone unnoticed. Microverse, also funded by Y Combinator, is similarly using income-sharing agreements to bring education to the masses in developing countries, including spaces in Latin America. Henry thinks the competitor is approaching the dynamic too broadly.

“They’re focusing on all emerging markets and don’t teach to Spanish speakers,” Borchardt said. Henry, alternatively, focuses on Spanish speakers, over 60% of its market in Latin America.

What if Lambda School, the source of Henry’s inspiration, was to break into Latin America? The founder added that the richly funded company has tried, and failed, to expand into international geographies, including China and Europe, due to fragmentation.

Currently, Henry has graduated 200 students and is working with 600 students across Colombia, Chile, Uruguay and Argentina. It plans to expand into Mexico and to bring on Portuguese instruction.

Now, VCs are giving Henry some cash to do so. After going through Y Combinator’s Summer batch, Henry announced today that it has raised $1.5 million in seed funding in a round led by Accion Venture Lab, Emles Venture Partners and Noveus VC. There were also a number of edtech angel investors from Latin American that participated in the round.

“I love the human interaction within instructors and our staff and students,” Borchardt said. “That is something very powerful of Henry compared to a MOOC. The biggest challenge is how do you scale maintaining those assets that bring you that?”

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Fantasy startup Esports One raises $4M more

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Esports One, a startup bringing the fantasy approach to esports, is announcing that it has raised an additional $4 million in funding.

When I first wrote about Esports One in April, co-founder and COO Sharon Winter described it as the first “all-in-one fantasy platform” in the esports world, allowing you to research players, create fantasy teams and watch games, with an initial focus on the North American and European divisions of League of Legends.

According to the Esports One team, creating this platform required building out a set of data and analytics products, as well as using computer vision technology that can track game activity (and update player stats) without relying on a publisher’s API.

The startup says its user base has been growing by more than 25% month-over-month. It may also have benefited from the pause in professional sports earlier this year, while CEO and co-founder Matt Gunnin told me recently that he also sees fantasy as a way to make video games accessible to a broader audience — he recalled one Esports One user who introduce his sister to League of Legends using the fantasy platform.

“I use the example of growing up and sitting there with my dad, watching a baseball game, he’s telling me everything that’s happening,” Gunnin said. “Now it’s the opposite — parents are sitting and watching their kids.”

Many parents, he suggested, are “never going to pick up a mouse and keyboard and play League of Legends,” but they might play the fantasy version: “That’s an entry point … if we can make it easily accessible to individuals both that are hardcore gamers playing video games and watching League of Legends their entire life, as well as someone who has no idea what’s going on.”

The new funding was led led by XSeed Capital, Eniac Ventures, and Chestnut Street Ventures, bringing Esports One to a total of $7.3 million raised. The company also recently signed a partnership deal with lifestyle company ESL Gaming.

Gunin said the money will allow the company to grow its Bytes virtual currency, which players use to enter contests and buy customizations — starting next year, players will be able to spend real money to purchase Bytes. In addition, it’s working on native iOS and Android apps (Esports One is currently accessible via desktop and mobile web).

Gunnin and his team also plan to develop fantasy competitions for Rainbow Six: Siege, Rocket League, Valorant and Fortnite.

“As a fairly new player in the esports world, we’ve seen immense determination and grit from Matt, Sharon, and the whole Esports One team to grow into a household name, ” said XSeed’s Damon Cronkey in a statement. “I’m excited to be partnering with a company that will deliver new perspectives and features to an evolving industry. We’re eager to see how Esports One grows in 2021.”

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