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How Ryan Reynolds and Mint Mobile worked without becoming the joke

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In the past decade, celebrity interest and investment in tech companies has significantly increased. But not all celebrity investments are created equally. Some investors, like Ashton Kutcher, have prioritized the VC pursuits. Some have invested casually without getting overly involved. Others have used their considerable platforms to market their portfolio to varying degrees of success.

It’s been a little over a year since Ryan Reynolds bought a majority stake in Mint Mobile, a deal that has already had a dramatic impact on the the MVNO (mobile virtual network operator).

The four-year-old company has seen a tremendous amount of growth, boosting revenue nearly 50,000% in the past three years. However, the D2C wireless carrier has seen its highest traffic days on the backs of Reynolds’ marketing initiatives and announcements.

There is a long history of celebrities getting involved with brands, either as brand ambassadors or ‘Creative Directors’ without much value other than the initial press wave.

Lenovo famously hired Ashton Kutcher as a product engineer to help develop the Yoga 2 tablet, on which I assume you are all reading this post. Alicia Keys was brought on as BlackBerry’s Global Creative Director, which felt even more convoluted a partnership than Lady Gaga’s stint as Polaroid’s Creative Director. That’s not to say that these publicity stunts necessarily hurt the brands or the products (most of the time), but they probably didn’t help much, and likely cost a fortune.

And then there are the actual financial investments, in areas where celebrities fundamentally understand the industry, that still didn’t get to ‘alpha.’

Even Jay-Z has struggled to make a music streaming service successful. Justin Bieber never really got a selfie app off the ground. Heck, not even Justin Timberlake could breathe life back into MySpace. Reynolds seemingly has an even heavier lift here. It’s hard to imagine a string of words in the English language less sexy than, “mobile virtual network operator.”

Reynolds tells TechCrunch that he viewed celebrity investments as a kind of “handicapping,” prior to the Mint acquisition.

“I’ve just sort of seen how most celebrities are doing very, very well,” he explains. “We’re generally hocking or getting behind or investing in luxury and aspirational items and projects. Then George and I had a conversation about a year-and-a-half ago, maybe longer, about what if we swerved the other way? What if he kind of got into something that was hyper practical and just forget about the sexy aspirational stuff.”

Mint isn’t Reynolds’ first entrepreneurial venture. He bought a majority stake in Portland-based Aviation Gin in 2018, which recently sold for $610 million. He also cofounded marketing agency Maximum Effort alongside George Dewey, which has made its own impact over the past several years.

Maximum Effort was founded to help promote the actor’s first Deadpool film. Reynolds and Dewey had come up with several low-budget spots to get people excited about an R-rated comic book movie. The bid appears to have worked. The film raked in $783.1 million at the box office — a record for an R-rated film that held until the 2019 release of Joker.

Maximum Effort (and Reynolds) was also behind the viral Aviation Gin spot, which poked fun at the manipulative Peloton ad that aired last year around the holidays. The same actress who portrayed a woman seemingly tortured by her holiday gift of a Peloton sits at a bar with her friends, shell-shocked, sipping a Martini.

The original ad on YouTube, not counting recirculation by the media, has more than 7 million hits. Reynolds calls it ‘fast-vertising’.

“We get to react,” he told TechCrunch. “We get to acknowledge and play with the cultural landscape in real time and react to it in real time. There isn’t any red tape to come through, because it’s just a matter of signing off on the approval. So in a way, it’s unfair, in that sense, because most big corporations, they take weeks and weeks or months to get something approved. Our budgets are down and dirty, fast and cheap.”

He explained that this type of real-time marketing is only possible because he’s the owner of Maximum Effort (and in some cases of the client businesses, as well), but because there is no red tape to cut through when a great idea presents itself.

Reynolds has brought this marketing acumen to Mint Mobile in a big way. Last year during the Super Bowl, Reynolds took out a full page ad in The New York Times, explaining that the decision to spend $125,000 on a print ad instead of $5 million+ on a Super Bowl commercial would enable the prepaid carrier to pass the savings on to consumers.

In October, Reynolds spun Mint’s 5G launch into another light-hearted spot. He brought on the head of mobile technology to explain what 5G actually is, and after hearing the technical explanation, happily said “We may never know, so we’ll just give it away for free.”

Mint also released a holiday ad just a couple of weeks ago warning of wireless promo season, wherein large wireless carriers may try to lure customers into expensive contracts using new devices. Standing over a bear trap, Reynolds dryly states: “At Mint Mobile, we don’t hate you.”

Reynolds enjoys nearly 17 million Twitter followers and more than 36 million Instagram followers. He uses both platforms to promote his various brands without alienating his followers. Moreover, he doesn’t exclusively promote his brands on social media, but weaves in his own funny personal commentary or gives followers a peek into his marriage with Blake Lively, which we can all agree is #relationshipgoals.

Mint Mobile partners exclusively with T-Mobile to provide service, and unlike some other MVNOs, it uses a direct-to-consumer model, foregoing any physical footprint. Plans start at $15/month and top out at $30/month. CMO Aron North says that Reynolds’ ownership and involvement with Mint Mobile is “absolutely critical.”

“Ryan is an A plus plus celebrity, and he’s very funny and entertaining and engaging,” said North. “His reach has given us a much bigger platform to speak on. I would say he is absolutely critical in our success and our growth.”

We asked Reynolds if he has any specific plans for further tech investment, or if there are any trends he’s keeping an eye on. He explained that his motivations are not purely capitalistic.

“I’m really focused on community and bringing people together,” said Reynolds. “We think it’s super cool to bring people together, particularly in a world that is very divisive. Even in our marketing, we try to find ways to have huge cultural moments without polarizing people without dividing people without saying one thing is wrong.”

In one of the company’s more notable recent spots, Reynolds enlisted the help of iconic comedian, Rick Moranis. It was an impressive coup, given the actor’s seeming retreat from the public eye, turning down two separate Ghostbusters film reboots.

“It’s funny what happens when you just ask,” says Reynolds. “I explained that people genuinely miss him and his performances and his energy. And he, for whatever reason, said yes, and the next thing I know, six days later, we were out of there in 15, 20 minutes and we shot our spot.”

Of course, it didn’t escape the internet’s notice that two well-known Canadian actors were standing in a field, selling a U.S.-only wireless service.

“I would love to see [Mint] in Canada,” Reynolds says. “There’s a Big Three here that’s challenging to crack. I don’t pretend to know the telecom business well enough to say why, how or what the path forward would be there. I see basically a tsunami of feedback from Canada, asking ‘why can’t we have this here?’ I think it’s sexy. It’s pragmatic and sexy. That’s why I got involved with it.”

Lyron Foster is a Hawaii based African American Musician, Author, Actor, Blogger, Filmmaker, Philanthropist and Multinational Serial Tech Entrepreneur.

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Scalapay raises $48M to scale its buy now, pay later service in Europe

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Buy now, pay later services — which let consumers finance the purchase of goods online by paying back the total in installments over time — have been growing in ubiquity this past year. Today, Scalapay, one of the companies that’s building a platform to enable buy now, pay later (BNPL) and related features, has raised a round to boost its position in the race for customers against competitors like Klarna, Afterpay and Affirm.

The Milan, Italy-based startup has picked up $48 million in funding, money that it will use to continue building the tech in its platform, scaling its service in Europe, and to begin working on efforts to break into the U.S.

The round was led by Fasanara Capital and also included Baleen Capital and Italian family office Ithaca Investments. This is the startup’s first significant funding since launching in 2019.

Scalapay’s service is based around a basic model involving a quick sign-up, and then an agreement to repay the full amount in three equal installments, debited from your bank account or a credit card.

Like others such as Affirm, Scalapay does not charge consumers interest or other fees: its business model is based around taking a commission from the merchants on each transaction, the argument being that offering an easy and quick BNPL service will increase conversions and shopping cart size.

The startup currently has around 1,000 merchants in Europe using its service in France, Italy and Germany, including well-known, mulitnational European retailers like Decathlon, Calzedonia, Bata, Aosom and Bricobravo. It claims to be the biggest provider of BNPL services in its home country.

It also inked a recent partnership with banking “marketplace” Raisin Bank, and through that, Scalapay will soon be able to offer its merchant customers the ability to offer BNPL services in any European country.

The plan will be to add on more originating countries, said CEO and co-founder Simone Mancini, as well as related payment features in areas like customer acquisition, conversion, retention and the back office tasks associated with taking and fulfilling and order.

For a start, on its own site, Scalapay lists merchants that offer its BNPL service, and the startup has found that these links are on average generating 1 million referrals each month. Mancini said the company is working on a way of building a product around this concept as part of its expansion.

There was a time when it was not that common to find installment-based payment options on sites, with BNPL a carryover from the world of brick and mortar where people might have in the past paid for items using layaway or other in-store finance options, in particular for more expensive items like televisions.

But the traction of older online services like privately-held Klarna (valued now at over $10 billion), as well as Affirm in the U.S. and Afterpay in Australia (both of which are publicly traded), have paved the way for more recent entrants like Scalapay (which was founded in 2019) and other newer players like Alma.

All of them have in part been lifted by the conditions that we are living under at the moment.

E-commerce usage has seen a huge surge of activity due to people staying away from physical stores (when those stores are even open) to help with social distancing. But at the same time, many consumers are in less financial stable situations as a result of the pandemic, so options to help them stretch out payments and remain more flexible with their money have grown in appeal.

This has also meant that the average price of the kinds of items that people are buying on installments is also changing. Mancini said the average sum people are paying on Scalapay currently is around €100. That underscores the value that people are not willing to pay up front, so from a microeconomics perspective it will be interesting to see how that figure rises or falls in the future.

The fact that the sums are not particularly high right now, meanwhile, might be one reason why Scalapay has seen some strong numbers in terms of defaults and approvals. Mancini said that “first purchase approval rates” are about 93% right now, higher or lower depending on the category. And its default rate is below 1.5%.

These are not bad, but also not markedly different from its competitors.

Going forward, the big challenges for a company like Scalapay, therefore, will not just the usual ones of building solid algorithms to ensure that they are not financing people who are likely to default on payments, making sure its system stays fraud-free, and so on. They will also include finding a way to distinguish itself from the rest of the pack of companies providing the same kinds of basic services.

Perhaps a small detail, but it’s notable to me that Scalapay’s site doesn’t look unlike Klarna’s. Both even lean heavily on pink as a color theme.

It’s also worth mentioning that Mancini moved to Italy from Australia (where his co-founder Johnny Mitrevski still lives and runs R&D) to start Scalapay because Australia, he said, was going to be too hard to break into because of the dominance of Afterpay.

“Australia is one of the most competitive markets, versus Italy being one of the most underdeveloped markets,” he said. “It was an easy pick, with heaps of opportunity here for BNPL.” The company’s focus on building more beyond basic BNPL should also help with building a profile and diversifying the business.

“I was impressed with the fast growth of the company and the underlying model,” said Francesco Filia, CEO of Fasanara Capital, in a statement. “They have shown resilience during a difficult period and I’m excited by where the company is headed.”

“Scalapay’s platform delights customers while driving dramatic results for merchants,” added Fang Li, Managing Partner of Baleen Capital, in a statement. “As a long-time investor in the BNPL industry, I have been beyond impressed by Scalapay’s team, execution, and product vision. I believe the company is on the way to building a valued and leading partner for European retailers.”

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UCLA is building a digital archive of mass incarceration with a new $3.6M grant

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UCLA researchers have been awarded a $3.65 million grant to collect, contextualize, and digitally preserve a huge archive of materials relating to policing and mass incarceration. It should help historians and anthropologists, but more fundamentally it will thoroughly document a period that many would rather forget.

The “Archiving the Age of Mass incarceration” effort is being led by Kelly Lytle Hernandez, director of the university’s Bunche Center for African American Studies and creator of Million Dollar Hoods, another project documenting the human cost of incarceration in Los Angeles. The grant is provided by the Andrew W. Mellon Foundation.

“We may be at a turning point in American history — may be building something new,” Lytle Hernandez told me, citing a tumultuous but potentially transformative 2020. “If that’s the case we want to make sure we are preserving the record of what happened. What we want to do is retain the records, the memory, the experiences of people affected by mass incarceration, and where possible the records of the state, which would otherwise be destroyed.”

The core of this collection will be a cache of documents released to Lytle Hernandez by the LAPD as part of this 2019 settlement (shortly after she won a MacArthur fellowship) regarding public disclosures and communication. She described it as around 177 boxes of paper records from the 1980s to the early 2000s detailing the “war on drugs,” policing immigrants, and many other topics, with more to be provided later under an agreement with the department.

The idea would be to “counterbalance” these official documents, as she put it, with documentation and testimony from the other side of the equation.

“People who are disproportionately incarcerated or arrested — we often lose our records because we get evicted; because where we stored our records, we can’t make the payments and they’re seized; they’re seized when we’re arrested, etc.,” she explained. “If we need to undo generations of harm, we need to know, where did that harm happen? Who did it happen to? I see this archival project as part of that dismantlement effort.”

Over the next few years Lytle Hernandez will lead the effort to assemble the archive, which will involve such traditional work as scanning and indexing paper documents, but also visiting communities and collecting “carceral ephemera” such as receipts for bail bonds (which may be the only surviving record of a person’s brush with the justice system) and personal stories and media.

Getting records from police and state agencies is a difficult and sometimes legally or politically fraught process. It’s important to get as much information as possible, from as many sources as possible, as quickly as possible, she said. Other major turning points in the history of racial justice have been inadequately documented, for reasons both negligent and deliberate.

“What if the nation had sent out squads of oral historians and students to capture and preserve the record? Imagine what we could know about enslavement and its toll on all of us, what it meant to the making of this country, if we had talked to the people who had experienced it — what kind of archive that would have left us, to grapple with and to help us move away from its legacies,” said Lytle Hernandez. “But we’ve been able to forget the power and legacy of slavery because we didn’t do a good enough job. Same with native removal, internment, immigration.”

Now there is an opportunity — around the country, she was careful to point out, not just in LA — to do just that with the era of mass incarceration. Not only that but they can bring modern techniques to bear in ways that weren’t possible during, say, the Civil Rights movement.

Her experience with Million Dollar Hood has shown her that there is serious interest in turning the tables among communities that have historically been disenfranchised or targeted by racist and classist policies propped up by bogus data.

“When we have a meeting we have black and brown students crammed into the room and out into the hall to learn data analysis and data science,” she said. “Part of the project is opening up that door. When you bring the people into the room who are the most impacted, they see that data differently — they see different stories.”

The archive will be completely public, though the exact scope of what documents will be included and how they will be sorted, described, and so on is still being worked out. Regardless of the exact details, the archive should prove invaluable to students, researchers, and a curious public over the coming decades as the changes Lytle Hernandez hopes for begin to get underway.

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Qualtrics prices IPO at $30 per share, above its upgraded target range

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Last night, Qualtrics priced its IPO at $30 per share, selling 50.4 million shares in the process.

Notably, the company’s IPO price was harder to chase down than usual, with a formal press release in scarce supply. SEC filings indicate that the company “anticipate[s]” a price of $30 per share, and reports from media and IPO-watching entities cite the $30 figure as well.

TechCrunch has an email into the Qualtrics team asking to confirm the reports, which are sufficiently widespread and confident that we’re similarly comfortable with its final price.

At $30 per share, Qualtrics priced its IPO at $1 per share above its raised IPO range of $27 to $29 a share. TechCrunch anticipated that the company’s first IPO price interval was low; and this publication noted that we would not “fall over in shock if Qualtrics priced a dollar or two above [its] raised range.”

Quelle surprise.

At $30 per share, and with 511,138,997 shares outstanding after its debut per its most recent S-1/A, inclusive of its underwriters’ option, Qualtrics would be worth $15.3 billion. That’s just under double the $8 billion that the company was worth when it sold to SAP a few years ago. Of course, let’s wait until we get a formal, final share count before we lock in the company’s pre-trading value.

For SAP, then, the deal is a win. But it’s not alone in enjoying quick returns on Qualtrics. Silver Lake agreed to buy “15,018,484 shares at $21.64 per share” and “225 million of shares at the initial public offering price” back in December. So that means that the company has a paper gain of more than $125 million on the shares it bought for just under $22 apiece.

Not a bad trade. If Qualtrics’ gains in early trading, Silver Lake will do even better.

TechCrunch is talking to the company later today, and will have more notes on its performance and valuation when it begins to trade.

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