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Is Washington prepared for a geopolitical ‘tech race’?

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When Secretary of State Antony Blinken and National Security Advisor Jake Sullivan sat down with Chinese officials in Anchorage, Alaska for the first high-level bilateral summit of the new administration, it was not a typical diplomatic meeting. Instead of a polite but restrained diplomatic exchange, the two sides traded pointed barbs for almost two hours. “There is growing consensus that the era of engagement with China has come to an unceremonious close,” wrote Sullivan and Kurt Campbell, the Administration’s Asia czar also in attendance, back in 2019. How apt that they were present for that moment’s arrival.

A little more than one hundred days into the Biden Administration, there is no shortage of views on how it should handle this new era of Sino-American relations. From a blue-ribbon panel assembled by former Google Chairman Eric Schmidt to a Politico essay from an anonymous former Trump Administration official that consciously echoes (in both its name and its author’s anonymity) George Kennan’s famous “Long Telegram” laying out the theory of Cold War containment, to countless think tank reports, it seems everyone is having their say.

What is largely uncontroversial though is that technology is at the center of U.S.-China relations, and any competition with China will be won or lost in the digital and cyber spheres. “Part of the goal of the Alaska meeting was to convince the Chinese that the Biden administration is determined to compete with Beijing across the board to offer competitive technology,” wrote David Sanger in the New York Times shortly afterward.

But what, exactly, does a tech-centered China strategy look like? And what would it take for one to succeed?

Tech has brought Republicans and Democrats uneasily together

One encouraging sign is that China has emerged as one of the few issues on which even Democrats agree that President Trump had some valid points. “Trump really was the spark that reframed the entire debate around U.S.-China relations in DC,” says Jordan Schneider, a China analyst at the Rhodium Group and the host of the ChinaTalk podcast and newsletter.

While many in the foreign policy community favored some degree of cooperation with China before the Trump presidency, now competition – if not outright rivalry – is widely assumed. “Democrats, even those who served in the Obama Administration, have become much more hawkish,” says Erik Brattberg of the Carnegie Endowment for International Peace. Trump has caused “the Overton Window on China [to become] a lot narrower than it was before,” adds Schneider.

The US delegation led by Secretary of State Antony Blinken face their Chinese counterparts at the opening session of US-China talks at the Captain Cook Hotel in Anchorage, Alaska on March 18, 2021. Image Credits: FREDERIC J. BROWN/POOL/AFP via Getty Images

As the U.S.-China rivalry has evolved, it has become more and more centered around competing philosophies on the use of technology. “At their core, democracies are open systems that believe in the free flow of information, whereas for autocrats, information is something to be weaponized and stifled in the service of the regime,” says Lindsay Gorman, Fellow for Emerging Technologies at the German Marshall Fund. “So it’s not too surprising that technology, so much of which is about how we store and process and leverage information, has become such a focus of the U.S.-China relationship and of the [broader] democratic-autocratic competition around the world.”

Tech touches everything now – and the stakes could not be higher. “Tech and the business models around tech are really ‘embedded ideology,’’ says Tyson Barker of the German Council on Foreign Relations. “So what tech is and how it is used is a form of governance.”

What does that mean in practice? When Chinese firms expand around the world, Barker tells me, they bring their norms with them. So when Huawei builds a 5G network in Latin America, or Alipay is adopted for digital payments in Central Europe, or Xiaomi takes more market share in Southeast Asia, they are helping digitize those economies on Chinese terms using Chinese norms (as opposed to American ones). The implication is clear: whoever defines the future of technology will determine the rest of the twenty-first century.

That shifting balance has focused minds in Washington. “I think there is a strong bipartisan consensus that technology is at the core of U.S.-China competition,” says Brattberg. But, adds Gorman, “there’s less agreement on what the prescription should be.” While the Democratic experts now ascendant in Washington agree with Trump’s diagnosis of the China challenge, they believe in a vastly different approach from their Trump Administration predecessors.

Out, for instance, are restrictions on Chinese firms just for being Chinese. “That was one of the problems with Trump,” says Walter Kerr, a former U.S. diplomat who publishes the China Journal Review. “Trump cast broad strokes, targeting firms whether it was merited or not. Sticking it to the Chinese is not a good policy.”

Instead the focus is on inward investment – and outward cooperation.

Foreign policy is domestic policy

Democrats are first shoring up America domestically – in short, be strong at home to be strong abroad. “There’s no longer a bright line between foreign and domestic policy,” President Biden said in his first major foreign policy speech. “Every action we take in our conduct abroad, we must take with American working families in mind. Advancing a foreign policy for the middle class demands urgent focus on our domestic economic renewal.”

This is a particular passion of Jake Sullivan, Biden’s national security advisor, who immersed himself in domestic policy while he was Hillary Clinton’s chief policy aide during her 2016 presidential campaign. “We’ve reached a point where foreign policy is domestic policy, and domestic policy is foreign policy,” he told NPR during the transition.

Jake Sullivan, White House national security adviser, speaks during a news conference Image Credits: Jim Lo Scalzo/EPA/Bloomberg via Getty Images

This is increasingly important for technology, as concern grows that America is lagging behind on research and development. “We’re realizing that we’ve underinvested in the government grants and research and development projects that American companies [need] to become highly innovative in fields like quantum computing, AI, biotechnology, etc,” says Kerr.

“Rebuilding” or “sustaining” America’s “technological leadership” is a major theme of the Longer Telegram and is the very operating premise of the report of the China Strategy Group assembled by Eric Schmidt, former executive chairman of Alphabet, Google’s parent company, and the first chair of the Department of Defense’s Innovation Advisory Board. Those priorities have only become more important during the pandemic. It’s a question of “how do we orient the research system to fill in the industrial gaps that have been made very clear by the COVID crisis?” says Schneider of Rhodium.

While it hasn’t gone so far as to adopt a national industrial strategy, the Administration’s most ambitious officials are looking to prod along tech research in critical sectors. To that end, the National Security Council, which Sullivan runs, is reshaping itself around technology issues; Biden appointed the first deputy national security advisor focusing on technology issues as well as a high-profile senior director for technology. Their goal: to harness the same energy that drove the development of Silicon Valley during the Cold War into out-competing China.

That said, the ingredients to American (and Western) innovation aren’t exactly a secret: investment in education, research, and talent. “The West still has [most of] the universities, R&D and leading companies,” says Brattberg. “There’s still a lot of competitiveness and leverage.” Unsurprisingly, investing to retain that edge is a key theme of Biden’s $2 trillion infrastructure plan, which includes funds for basic research, supply chain support, broadband connectivity, and support for the semiconductor industry.

As almost anyone in Silicon Valley will tell you, a functioning and welcoming immigration system is a crucial ingredient, too. “The U.S. is at its best when it welcomes talent from around the world and gives people the tools to succeed and thrive here,” says Gorman. Whether the Biden Administration can strike a deal with Senate Republicans on comprehensive immigration reform – or even funding basic research – remains an open question, though. And even if it can succeed, American ingenuity is no longer sufficient on its own.

Team America

Whether it’s for talent or partnerships, the U.S.-China tech competition will be won overseas. Allies are “the most salient and straightforward way Biden can bring leverage to the table compared to Trump,” says Schneider.

Biden, Blinken, and other senior administration officials have loudly and repeatedly pronounced their preferences to work with democratic partners on international challenges, particularly in the Indo-Pacific region. It is no accident that Blinken and Sullivan’s meeting in Anchorage was preceded by a trip to Japan and South Korea, two of America’s closest allies in the region, and that Japanese Prime Minister Yoshihide Suga was the first foreign leader to visit Biden at the White House. “If you add the U.S. to the EU, Australia, Taiwan, and South Korea, you tilt the balance of economic heft and technological prowess back toward us,” he adds.

U.S. President Joe Biden and Prime Minister Yoshihide Suga of Japan hold a news conference in the Rose Garden of the White House on April 16, 2021. Image Credits: Doug Mills-Pool/Getty Images)

The ground for Blinken and company is increasingly fertile. Chinese diplomats have been aggressive, if not downright condescending, to countries they perceive have slighted China. In one recent example, the Chinese embassy in Dublin sent a series of tweets targeting an Irish-British journalist couple who had been forced to relocate to Taiwan as a result of a harassment campaign over their critical coverage of China’s Uyghur policy in Xinjiang. This so-called ‘wolf warrior’ diplomacy (a reference to a jingoist action film) is prompting a backlash, and helping convince many policy elites in countries who had hoped to sit out a U.S.-China conflict that perhaps Washignton’s China skeptics have a point.

This perhaps explains the proliferating alpha-numeric soup of coalitions and alliances being floated to secure a free and democratic internet for the future. There’s the D10, a secure supply chain network floated by British Prime Minister Boris Johnson, which adds Australia, India, and South Korea to the existing G7 countries (U.S., U.K., Canada, France, Italy, Germany, and Japan). Schmidt’s report calls for a T-12 (the D10 minus Italy plus Finland, Sweden, and Israel). Others look to expand existing technology-related groupings like the Five Eyes signals intelligence alliance of the U.S., U.K., Australia, Canada, and New Zealand, or harness burgeoning non-technical ones like the Quad. Gorman points to the significance of the news that the Quad itself – Australia, India, Japan, and the US – announced the creation of a working group on emerging technology at its first-ever (virtual) leaders summit in March.

Meanwhile, Senator Mark Warner, a Democrat from Virginia, has proposed a technology partnership to be run out of the State Department to coordinate with allies – including a $5 billion fund for research – with the explicit purpose of countering China.

International tech standards are increasingly not set by the West

Even if it can shephard its allies, the U.S. still faces stiff international headwinds. The Trump Administration’s decision to withdraw from the Trans-Pacific Partnership, a trade deal negotiated by the Obama Administration with ten other Pacific Rim countries with the intent of setting trade standards in the Asia-Pacific, was taken as a sign that perhaps the U.S. pivot to Asia was less ambitious than advertised. The pact, rebranded as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), has continued without the U.S.  – and now even China has expressed interest in joining.

Trump’s disdain for working within multilateral forums has also meant that Washington has essentially ceded the field of global technical standard-setting. Beijing has taken advantage, aggressively working the UN system so that Chinese officials now lead four of the 15 specialized UN agencies, including the two most focused on regulating technology: the International Telecommunication Union (ITU), which helps set global technical standards, and the World Intellectual Property Organization (WIPO), which is responsible for protecting intellectual property rights around the world.

China is also backing Russian efforts to rewrite internet governance. With Chinese support, Russia won a UN General Assembly vote in 2019 to start drafting a new cybercrime treaty. Their goal is to replace the U.S-backed 2001 Budapest Convention on Cybercrime, which was  created by democracies through the Council of Europe, with a treaty that one critic said would include provisions “likely to provide cover to authoritarian governments to persecute their political opponents.” Russia and China also unsuccessfully tried to use the (now Chinese-led) ITU to replace the Internet Corporation for Assigned Names and Numbers (ICANN), a private body of experts that governs internet domain names.

These efforts are all part of China Standards 2035, an explicit plan to internationalize standards to Chinese preferences in areas like 5G and the Internet of Things (IoT). As Emily de La Bruyère and Nathan Picarsic wrote on TechCrunch last year, “Beijing has spent the past two decades establishing influential footholds in multilateral bodies and targeted industrial areas. Now, it is using those footholds to set their rules – with them, to define the infrastructure of the future world.”

Hawks, doves, and U.S. divisions

Even within the new consensus on China, there are fissures on how to handle China itself.

On the hawkish side, the Schmidt Report concedes that “some degree of technological bifurcation is in U.S. interests.” But calibrating just how much is a difficult question. “It’s already a reality,” says Barker of the German Council on Foreign Relations. “The question is: how deep does the split have to be?”

Few argue for complete decoupling, Brattberg, the Carnegie scholar who has written extensively on tech diplomacy, says. After all, many are loath to concede completely separate ‘free’ and ‘authoritarian’ internets. There are other implications as well: a “bipolar, bifurcated internet … would have some very serious adverse implications in terms of cost [and] a slowdown in innovation,” one former UK intelligence official told me last year.

The key is to pinpoint which specific technologies are essential to produce domestically. “To the extent we [decouple from China], we have to do it in a smart way,” says Gorman. “There’s a risk of going too far and hurting potential innovation in the U.S. So the debate going forward is going to be: How do you address true national security vulnerabilities without emulating an authoritarian approach that might say ‘just ban everything from a certain country.’”

And even if we can form a consensus at home, America’s allies are no less divided as I wrote last year with regards to Huawei. While the debate over the Chinese company’s role in 5G has evolved, with both France and the U.K. (in a reversal) moving to phase out its kit, the debate over what role China should play economically and technologically in Europe is still very much alive.

The U.K. government is clear-eyed; in its Integrated Review of foreign and defense policy published in March, it acknowledged that China’s “growing international assertiveness … will pose an increasing risk to UK interests” and set an explicit goal for itself to be a third “science and tech superpower.” France, meanwhile, laid out an Indo-Pacific strategy backing the principle of a free and open Pacific, an explicit challenge to Chinese preferences.

But many are still equivocal. As Singapore’s Prime Minister Lee Hsien Loong wrote last year in Foreign Affairs, “Asian countries do not want to be forced to choose between the two.” Berlin made clear in its Indo-Pacific strategy last year that it was also reticent to make an outright choice. New Zealand, conscious of its important trade with China, is reluctant to expand the use of Five Eyes beyond intelligence sharing. Meanwhile, Italy endorsed China’s infrastructure-focused Belt and Road Initiative in 2019 and called the country a “strategic partner” last year. And the European Union moved forward on a trade deal with China late last year despite very public lobbying against it from the United States.

A world of tradeoffs

The challenge for the Biden Administration will be to assemble practical coalitions without asking allies and partners to make impossible choices. They will succeed if they can reframe the question. “In Europe, they don’t like ‘decoupling’ but they do like ‘diversification’,” says Brattberg. They also don’t like the idea of joining a U.S.-led alliance. Instead, he says, Washington should frame cooperation as “coalitions among like-minded democrtaic partners.”

For that to work, the U.S. will have to work out the bilateral issues it has with its allies first. “We need to be much more savvy on engaging directly with the EU on resolving issues like data transfers, digital taxation, and data privacy,” he said. “Digital sovereignty shouldn’t come at the expense of partnership with like-minded partners.”

Chancellor of Germany Angela Merkel gives a speech during the press conference at the end of the meeting with Chinese Premier Li Keqiang (not pictured) of at The Great Hall Of The People on September 06, 2019 in Beijing, China. Image Credits: Andrea Verdelli-Pool/Getty Images

Nimbleness will be key – multiple experts told me it will be far better to create ad hoc coalitions on particular issues than to create a single fixed democratic tech alliance. This would have the benefit of keeping groupings tight without excluding countries with key expertise in particular areas (think Sweden and 5G or Taiwan and semiconductors). Washington should also take a collegiate approach, recognizing and respecting that its allies will not always be in lock-step on every aspect of the relations with China. In other words, the U.S. shouldn’t let the perfect be the enemy of the good, as agreement most of the time on most issues is probably sufficient to create the momentum Washington needs.

The U.S. can still compete globally and widen the circle of like-minded countries, Gorman, the scholar at GMF, tells me, but it has to invest in them if they are going to build out their tech sectors in a way that is aligned with democratic values and standards. “It’s really about providing an attractive counteroffer,” she said.

Even if the United States retains its technological edge for the near future, Americans should start adjusting to a future where Silicon Valley’s dominance is no longer inevitable. Chinese technologists are pulling ahead in areas like 5G while Chinese firms are competing on price (mobile phones) and increasingly on quality (e-commerce) and innovation (see: TikTok). China also exerts enormous clout through its control of supply chains and rare earth metals as well as its vast customer base.

Perhaps China’s greatest leverage point is its looming presence over Taiwan. As long as Taiwan remains one of the leading manufacturers of semiconductors (chip giant TSMC manufactures 90% of the world’s most advanced chips), the world’s technology industry will be vulnerable to the precarity of cross-Strait relations.

Will technology become just another chip in the geopolitical game the U.S. and China are playing, then? The Biden Administration is more prepared than its predecessor to weigh the tradeoffs, Barker of the German Council on Foreign Relation retells me. But it’s unclear how Washington, so early in this administration, will prioritize technology issues if faced with the prospects of Chinese cooperation on other priorities.

After all, at any given moment, the U.S. (and its allies) must weigh a host of priorities vis-à-vis China. And for all of the downsides to its bellicosity, the Trump Administration’s fixation on a handful of issues gave it leverage: it was willing to ignore Uyghurs and other human rights abuses in order to get a trade deal (even if it was deeply flawed).

The Biden Administration, on the other hand, has not yet articulated any priorities at all. If the rhetoric from Washington can be believed, the White House thinks it can make progress on climate, Taiwan, trade, human rights, and any number of other areas, all at once. This on its own creates a vulnerability. As historian Niall Ferguson reminded us in a recent Bloomberg column, then National Security Advisor Henry Kissinger was outmaneuvered when he went to China in 1971 with a multi-issue agenda and China singularly focused on Taiwan.

Beijing’s diplomats, despite their wolf-warrior missteps, are still savvy negotiators. If they are allowed to do so, they will once again try to play different parts of the Administration against each other, conditioning progress on climate, for example, on a softening over geopolitics, as the Brookings scholar Thomas Wright has warned. In that light, it simply strains credulity that an ‘all of the above’ approach will work, especially when Biden’s wish list keeps the issues Trump cared about, like trade, 5G, and Taiwan, and adds those he ignored, like human rights, democracy, and climate change.

This is where America’s alliances may prove to be Biden’s hidden ace. If Biden can forge a common-enough front with a wide-enough spectrum of allies, the U.S. will be better able to withstand Chinese pressure to trade progress on one issue against another. Instead, forcing China to negotiate with the U.S. and its allies on an issue-by-issue basis may put Washington in a better position to succeed.

Of all the issues in America’s China portfolio, though, the tech race provides one extra advantage: for all the talk of industrial strategy, alliances, and diplomatic maneuvers, Washington is not the only or even primary actor involved. The Biden Administration can help set the rules, invest in basic research, and defend American interests abroad, but American innovation depends on its innovators – and there are still bountiful numbers of them tinkering away.

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

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Brazil’s Divibank raises millions to become the Clearbanc of LatAm

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Divibank, a financing platform offering LatAm businesses access to growth capital, has closed on a $3.6 million round of seed funding led by San Francisco-based Better Tomorrow Ventures (BTV).

São Paulo-based Divibank was founded in March 2020, right as the COVID-pandemic was starting. The company has built a data-driven financing platform aimed at giving businesses access to non-dilutive capital to finance their growth via revenue-share financing.

“We are changing the way entrepreneurs scale their online businesses by providing quick and affordable capital to startups and SMEs in Latin America,” said co-founder and CEO Jaime Taboada. In particular, Divibank is targeting e-commerce and SaaS companies although it also counts edtechs, fintechs and marketplaces among its clients.

The company is now also offering marketing analytics software for its clients so they can “get more value out of the capital they receive.”

A slew of other investors participated in the round, including existing backer MAYA Capital and new investors such as Village Global, Clocktower Ventures, Magma Partners, Gilgamesh Ventures, Rally Cap Ventures and Alumni Ventures Group. A group of high-profile angel investors also put money in the round, including Rappi founder and president Sebastian Mejia, Tayo Oviosu (founder/CEO of Paga, who participated via Kairos Angels), Ramp founder and CTO Karim Atiyeh and Bread founders Josh Abramowitz and Daniel Simon.

In just over a year’s time, Divibank has seen some impressive growth (albeit from a small base). In the past six months alone, the company said it has signed on over 50 new clients; seen its total loan issuance volume increase by 7x; revenues climb by 5x; customer base increase by 11x and employee base by 4x. Customers include Dr. Jones, CapaCard and Foodz, among others.

“Traditional banks and financial institutions do not know how to evaluate internet businesses, so they generally do not offer loans to these companies. If they do, it is generally a long and tedious process at a very high cost,” Taboada said. “With our revenue-share offering, the entrepreneur does not have to pledge his home, drown in credit card debts or even give up his equity to invest in marketing and growth.”

For now, Divibank is focused on Brazil, considering the country is huge and has more than 11 million SMEs “with many growth opportunities to explore,” according to Taboada. It’s looking to expand to the rest of LatAm and other emerging markets in the future, but no timeline has yet been set.

As in many other sectors, the COVID-19 pandemic served as a tailwind to Divibank’s business, considering it accelerated the digitalization of everything globally.

“We founded Divibank the same week as the lockdown started in Brazil, and we saw many industries that didn’t traditionally advertise online migrate to Google and Facebook Ads rapidly,” Taboada told TechCrunch. “This obviously helped our thesis a lot, as many of our clients had actually recently went from only selling offline to selling mostly online. And there’s no better way to attract new clients online than with digital ads.”

Divibank will use its new capital to accelerate its product roadmap, scale its go-to-market strategy and ramp up hiring. Specifically, it will invest more aggressively in engineering/tech, sales, marketing, credit risk and operations. Today the team consists of eight employees in Brazil, and that number will likely grow to more than 25 or 30 in the coming 12 months, according to Taboada.

The startup is also developing what it describes as “value additive” software, aimed at helping clients better manage their digital ads campaigns and “optimize their investment returns.”

Looking ahead, Divibank is working on a few additional financial products for its clients, targeting the more than $205 billion e-commerce and SaaS markets in Latin America with offerings such as inventory financing and recurring revenue securitizations. Specifically, it plans to continue developing its banking tech platform by “automating the whole credit process,” developing its analytics platform and building its data science/ML capabilities to improve its credit model.

Jake Gibson, general partner at Better Tomorrow Ventures, noted that his firm is also an investor in Clearbanc, which also provided non-dilutive financing for founders. The company’s “20-minute term sheet” product, perhaps its most well-known in tech, allowed e-commerce companies to raise non-dilutive marketing growth capital between $10,000 to $10 million based on its revenue and ad spend.

“We are very bullish on the idea that not every company should be funded with venture dollars, and that lack of funding options can keep too many would-be entrepreneurs out of the market,” he said. “Combine that with the growth of e-commerce in Brazil and LatAm, and expected acceleration fueled by COVID, and the opportunity to build something meaningful seemed obvious.”

Also, since there aren’t a lot of similar offerings in the region, Better Tomorrow views the space that Divibank is addressing as a “massive untapped market.”

Besides Clearbanc, Divibank is also similar to another U.S.-based fintech, Pipe, in that both companies aim to help clients with SaaS, subscription and other recurring revenue models with new types of financings that can help them grow without dilution.

“Like the e-commerce market, we see the SaaS, and the recurring revenues markets in general, growing rapidly,” Taboada said.

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Orbite offers a five-star ‘space camp’ for would-be space travelers

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As private companies like Axiom Space, Blue Origin, Virgin Galactic and SpaceX prepare to ferry private customers to the stars, a whole new market is opening up to train affluent would-be travelers for their future missions. Case in point: space training company Orbite, whose goal is to combine aeronautics and five-star hospitality in its inaugural astronaut training program.

“We’re going to have hundreds, if not thousands of people this decade of the 2020s, who will go to space, but you just don’t get off the couch and strap into a rocket […] you actually have to get mentally prepared, physically prepared, and also spiritually prepared for this out of out of this world journey,” co-founder Jason Andrews told TechCrunch. “And that’s really our role.”

Orbite (the French word for ‘orbit,’ pronounced or-beet) was founded by space and hospitality industry veterans Andrews and Nicolas Gaume. Andrews is an aerospace entrepreneur that founded Spaceflight and BlackSky, while Gaume, a software and game development entrepreneur, sits on the board of his family’s resort and hotel business Groupe Gaume. Last year, Gaume’s business Space Cargo Unlimited shipped a dozen bottles of wine to the International Space Station. They were later retrieved. (When asked how the wine tasted, Gaume told TechCrunch, “It’s a unique product.”)

The program will be led by Brienna Rommes, who previously worked as the director of space training and research at the National Aerospace Training and Research Center. Rommes has trained over 600 people to prepare for spaceflight, including Sir Richard Branson, Orbite said.

Led by Rommes, the program aim to prepare travelers that are determined to reach space, but Andrews also said Orbite can help customers “try before they buy” – give people a taste of spaceflight for those who are unsure whether they’d actually want to board a launch vehicle. This seems to be their main value proposition, by providing a general overview to space travel across different companies, because they’ll also be competing to a degree with the native (and mandatory) training programs of individual private launch companies that are purpose-built to prepare customers for their flight.

Costs remain prohibitively high for the average spacefarer: it’s been reported that a ticket on Axiom’s inaugural commercial launch to the International Space Station costs upwards of $55 million. Orbite’s premium training program comes in at $29,500 per person for the three-day, four-night stay.

In acknowledgement on the premium price tag, the four training program sessions scheduled through the remainder of 2021 will be held at luxury resorts: the Four Seasons Resort in Orlando, Florida, and Hôtel La Co(o)rniche in Pyla-sur-Mer, France. The latter hotel is owned by Groupe Gaume.

Would-be space travelers will be able to experience up to 5 Gs by taking a ride on a high-performance aircraft as well as simulated zero-gravity. To prepare customers mentally and even spiritually, the training program itinerary includes meditation training, a workshop on stress and anxiety management, and individual coaching with staff “to explore personal goals for space, thoughts and asses possible flight options,” the company said. The itinerary also includes virtual reality mission experiences and a ‘Michelin star’ space food tasting.

“We really want to make sure we bridge the gap with more of a sensorial, psychological, even spiritual preparation for the trip,” Gaume said.

The company’s long-term vision is building and operating many training facilities around the world. The first facility will open in 2023 or 2024, though Andrews and Gaume are not yet sharing where it will be located. They did say that the dedicated training facility will offer a range of packages, with some as short as single-day experiences. They will also offer accommodation and hospitality, potentially for the long term – weeks or even months, depending on if we reach a stage in human space travel where we’re sending private citizens to the Moon or even Mars.

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Treasury Prime raises $20M to scale its banking-as-a-service biz

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This morning Treasury Prime, a banking-as-a-service startup that delivers its product via APIs, announced that it has closed a $20 million Series B. The capital comes around a year since the startup announced its Series A, and around 1.5 years since it raised its preceding round.

For Treasury Prime, the new capital was an internal affair, with prior investors stepping up to lead its new round of funding. Deciens Capital and QED Investors co-led the round, with Susa Ventures and SaaStr Fund also putting cash into the transaction.

As is increasingly common among insider-led fundraises in recent years, the startup in question was not in dire need of new funding before the new investment came together. In fact, Treasury Prime CEO Chris Dean told TechCrunch that his firm is “super capital efficient” in an interview, adding that it had not tucked into its Series A capital until January of this year.

So, why raise more funds now? To invest aggressively in its business. That plan is cliche for a startup raising new funding, but in the case of Treasury Prime the move isn’t in anticipation of future demand. Dean told TechCrunch that his startups had run into a bottleneck in which it could only take on so much new customer volume. That’s no good for a startup in a competitive sector, so picking up its spend in early 2021 and raising new capital in mid-2021 makes sense as it could help it hire, and absorb more demand, more quickly.

And for Treasury Prime’s preceding backers, the chance to put more capital into a startup that was dealing with more demand than capacity likely wasn’t too hard a choice.  Dean added that to make sure the round’s price was market-reasonable, he pitched around 10 venture capital firms, got three term sheets, and then went with his preceding investor group; if any VC reading this is irked by the move, this is the founder equivalent of private-market investors asking founders to come back to them after they find a lead.

But with the banking-as-a-service market growing, thanks to entrants like Stripe showing up in recent quarters, how does Treasury Prime expect to stay towards the front of its fintech niche? Per Dean, by bringing together banks that want fintech deal volume, and fintechs who need both technology and eventual banking partners. By courting both sides of its market, Treasury Prime hopes to be well-situated for long-term growth.

And its CEO is bullish on the scale of his market.

If you imagine the banking-as-a-service market as merely neobanks, he explained, it’s not that big. But his startup expects the number of companies that want to offer their customers the sort banking capabilities that Treasury Prime and some competitors can offer will be broad. How broad? The best way I can summarize the company’s argument is that, a bit like how vertical SaaS has proven that building software for particular industries can be big business, Treasury Prime expects that banking tools will also be built for similar business categories. Vertical banking, perhaps, integrated into other services.

And it wants to be there, offering the back-end tech, and access to banks that the companies building those services will need.

Fintech is a big and expensive market, and Treasury Prime isn’t busy raising nine-figure rounds — yet, at least. According to PitchBook data, Treasury Prime was valued at just over $40 million at the time of its Series A; the company’s new valuation was presumably higher, though how much is not yet clear.

Let’s see how far it can get with $20 million more as it sheds some of its frugal DNA and looks to burn a little faster.

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