Singapore says Uber-Grab deal may violate competition laws

Uber’s exit from Southeast Asia is under scrutiny from regulators in Singapore who believe that Grab’s purchase of the U.S. firm’s business in the region may violate competition laws.

Singapore-based Grab, Uber’s chief rival in the region, announced the acquisition of Uber’s Southeast Asian business on Monday. In return, Uber is taking 27.5 percent of the Grab business, which is valued at over $6 billion, in a move that appears to be a win for both parties.

Grab plans to shutter the Uber app in less than two weeks and migrate passengers and drivers to its services. It will also integrate Uber Eats into its nascent food delivery service.

The coming together has already concerned consumers, who believe that prices may rise without two companies competeting head-to-head, and now the Competition Commission of Singapore (CCS) has announced that it is looking into the deal.

The organization said it has “reasonable grounds” to suspect that the deal may fall foul of section 54 of Singapore’s Competition Act.

It added:

CCS is generally of the view that competition concerns are unlikely to arise in a merger situation unless:

The merged entity has/will have a market share of 40 percent or more; or
The merged entity has/will have a market share of between 20 percent to 40 percent and the post-merger combined market share of the three largest firms is 70 percent or more.

That might make the deal a little tricky to explain for Grab, which claims over 90 million downloads and more than five million drivers and agents for its transportation and fintech services.

In a first for Singapore, the CCS said it has proposed an Interim Measures Directions (IMD) that requires both Grab and Uber to “maintain pre-transaction independent pricing, pricing policies and product options.” The commission also directed Grab to not take confidential information from Uber nor lock Uber drivers into driving for Grab.

The commision defines the space not as ride-hailing — where Grab would appear to hold a significantly dominant position by acquiring Uber’s business — but instead as “chauffeured personal point-to-point transport passenger and booking services.”

In that respect, taxi companies in Singapore — which allow booking by SMS and phone call, and also offer ride-hailing apps in some cases — may be considered competition which might water down Grab’s marketshare. Likewise, Grab’s case may be helped by Singapore carpooling service Ryde’s plan to add private car services in an effort to fill some of the gap post-Uber.

Lim Kell Jay, head of Grab Singapore, argued in a statement that the deal with Uber allows consumers a choice against “the dominant taxi industry” and that Grab has already committed to freezing its prices. He added that Grab would work with the CCS and other authorities over the deal as required.

Five years ago, consumers were not able to flag or book taxis easily as supply was a problem. Grab innovated to improve the point-to-point transport within the overall transportation industry, particularly the availability and quality of both taxi and car services. Improving services for commuters and drivers will always be our priority, and we urge the government to allow us to freely compete and complement the dominant taxi business. To address consumer concerns, we have voluntarily committed to maintaining our fare structure and will not increase base fares. This is a commitment we are prepared to give the CCS, and to the public. We have and will continue to work with the CCS, LTA and other relevant authorities, and will propose measures to reassure the CCS, our driver-partners and consumers.

Grab has conducted its comprehensive due diligence and legal analysis with its advisers before entering into and concluding the transaction. We had engaged with the CCS prior to signing and continue to do so. Even though not required by the law, we have informed the CCS that we are making a voluntary notification no later than 16 April 2018 to continue to cooperate and engage with the CCS.

The CCS said it has the power to unwind or modify a deal if it sees that its completion will substantially weaken competition, but it is unclear what that might mean for a regional business like Grab.

Grab and Uber operate in eight markets in Southeast Asia, but Singapore — which is where Grab is headquartered and registered as a business — is the first country where a competitive agency is pouring over the deal.

The US IPO market just had the best quarter in three years

The U.S. IPO market had its best quarter by proceeds in three years, according to the IPO research company Renaissance Capital.

That kind of momentum has seemingly set the stage for some big names in tech to march onto the public market in the second quarter.

Forty-three companies raised a collective $15.6 billion through their IPOs, says Renaissance, though not all were tech deals. One was the IPO of security company ADT, which had been taken private in early 2016 in a $6.9 billion leveraged buyout by the private equity group Apollo Global Management. As MarketWatch noted at the time of ADT’s January IPO, Apollo continues to own a majority of the company’s shares, meaning it’s a “controlled company” where Apollo is still basically in charge.

Another big, non-tech IPO was that of Hudson, operator of the Hudson “travel essentials” and bookstores found at airports across the U.S. and Canada. Hudson is also a controlled company that remains majority owned by a parent company, Dufry AG of Switzerland. In fact, Dufry earmarked all the proceeds from Hudson’s IPO ($750 million) to pay down its own debt.

Neither of their IPOs performed terribly well. Hudson priced at the low end of its proposed range and its shares started to sink almost immediately. ADT’s shares are also trading below their offering price.

As Renaissance notes, three companies that went public and performed much better are the biotechs Menlo Therapeutics and ARMO BioSciences, and the cybersecurity company Zcaler.

Menlo is a seven-year-old, Redwood City, Calif.-based drug developer focused on severe skin itching and chronic cough, and demand for its shares was such that it increased its proposed IPO terms from offering 5.7 million shares at $14 to $16, to offering 6.5 million shares at $16 to $17. Those shares are now trading at roughly $37.

ARMO BioSciences is a four-year-old, Redwood City-based late-stage immuno-oncology company. And it similarly priced its shares above their initial range, owing to demand. The original idea was to sell 6.7 million shares at between $14 and $16; it wound up selling 7.5 million shares at $17. Today, those shares are also trading at around $37.

Both companies went public in January. Meanwhile, Zcaler, a nearly 11-year-old, San Jose, Calif.-based security startup that confidentially filed for an IPO last year, started trading less than two weeks ago at $27.50 per share. Its shares are trading at around the same point as of this writing.

Indeed, biotechs and other tech companies led deal flow, says Renaissance, with 13 and 10 IPOs being staged, respectively.

Some of them were China-based companies, like the video streaming platform iQIYI, which raised a whopping $2.3 billion in a sale of American depositary shares.

The market also had a taste of its first, long-awaited tech company, when the cloud-storage firm Dropbox finally IPO’d last week. It was everything its private investors could have hoped for, too. After selling 36 million shares at $21 apiece last Thursday night, its shares soared 36 percent in their first day of trading last Friday.

Dropbox may have been helped along by its investment bankers (they have a way of making these things pop). Either way, if its performance holds up, we can probably expect more splashy debuts in very short order.

Already on deck, of course, is the music streaming service Spotify. The company has filed to sell shares on the public markets this coming Tuesday, April 3.

LetsGetChecked raises $12M for its personal health tests

LetsGetChecked, an Irish startup that offers a health test kit service so that you can take various common laboratory tests from the comfort of your home, has picked up $12 million in Series A funding.

Leading the round is Optum Ventures, the independent venture fund of health services provider Optum, and Qiming Venture Partners, the Chinese VC firm.

The funding will be used to scale the company, including growing the LetsGetChecked full clinical support team. In addition, the health tech startup plans to further invest in its technology platform that links customers to laboratories, and to continue expanding to the U.S. where it has an office in New York.

Founded in 2014 by Peter Foley, LetsGetChecked has set out to build a technology and logistics platform to bridge the gap between traditional lab testing and consumers. The startup’s home testing kits span a number of categories including “lifestyle testing,” cancer screening, sexual health testing, fertility, and hormone testing.

“Our aim is to make lab testing better, more convenient and patient led,” Foley tells me. “Traditionally, you need to attend a doctor’s office to obtain a lab test. The physician will determine what test is right for you, complete a paper requisition form, collect your sample and send it off to the lab for analysis. You will wait for a period of time to hear back from your physician and may never see the results. This is a slow process and far from convenient”.

Instead, LetsGetChecked mirrors the process that happens in a doctor’s office but in a way that Foley claims puts the patient at the center and makes it more convenient. “We eliminate the middleman and link customers directly to labs enabling them to better manage and control their personal health,” Foley says.

First you decide which tests or groups of tests you wish to access based on hereditary risk, curiosity or simply for health monitoring purposes. You then order the test via LetsGetChecked, which will be authorised by a medical board certified LetsGetChecked physician. A test kit is then dispatched from a LetsGetChecked accredited facility direct to your home. It is also worth noting that the kits are anonymised, containing just a barcode.

Once the test kit arrives, you’re responsible for collecting your own sample, whether that be finger prick, stool (for colorectal cancer), or a swab. You then send the sample to LetsGetChecked and can track progress via the app ‘dashboard’ at any stage during the process or request a call from the clinical team. When the lab processes the sample, the corresponding result will be reviewed by a LetsGetChecked physician and the company’s nursing support team.

“For positive or out of range results, patients will get a call from the team to discuss treatment options,” says Foley. “Only after a consultation will the results be released to the patient’s dashboard where the customer can track and monitor their health over time”.

The tests themselves range hugely in cost, from £39 for a cortisol test, £69 for a prostate cancer test, all the way up to £500 for a BRCA check (why is it that breast cancer tests are 7 times more expensive than testing for prostate cancer). Despite the extra convenience that a service like LetsGetChecked affords, the price of each test soon adds up and begs the question as to why you wouldn’t just visit your GP and request the same tests for free through the NHS.

Meanwhile, the LetsGetChecked founder wouldn’t be drawn on who the startup’s direct competitors are — although in the U.K., Thriva is an obvious example — except to say it was focused internally on innovating and building on its technology platform.

“The aim is to make the patient experience more enriched over time and through API integrations provide for a more consolidated and cohesive healthcare engagement,” he says, hinting at future partners as another way to market. No doubt the strategic investment from Optum Ventures will be able to help on that front, too.

Rackspace may reportedly go public again after a $4.3B deal took it private in 2016

Rackspace, which was taken private in a $4.3 billion deal in August 2016 by private equity firm Apollo Global Management, is reportedly in consideration for an IPO by the firm, according to a report by Bloomberg.

The company could have an enterprise value of up to $10 billion, according to the report. Rackspace opted to go private in an increasingly challenging climate that faced competition on all sides from much more well capitalized companies like Amazon, Microsoft, and Google. Despite getting an early start in the cloud hosting space, Rackspace found itself quickly focusing on services in order to continue to gain traction. But under scrutiny from Wall Street as a public company, it’s harder to make that kind of a pivot.

Bloomberg reports that the firm has held early talks with advisers and may seek to begin the process by the end of the year, and these processes can always change over time. Rackspace offers managed services, including data migration, architecture to support on-boarding, and ongoing operational support for companies looking to work with cloud providers like AWS, Google Cloud and Azure. Since going private, Rackspace acquired Datapipe, and in July said it would begin working with Pivotal to continue to expand its managed services business.

Rackspace isn’t alone in companies that have found themselves opting to go private, such as Dell going private in 2013 in a $24.4 billion deal, in order to resolve issues with its business model without the quarter-to-quarter fiduciary obligations to public investors. Former Qualcomm executive chairman Paul Jacobs, too, expressed some interest in buying out Qualcomm in a process that would take the company private. There are different motivations for all these operations, but each has the same underlying principle: make some agile moves under the purview of a public owner rather than release financial statements every three months or so and watch the stock continue to tumble.

Should Rackspace actually end up going public, it would both catch a wave of successful IPOs like Zscalar and Dropbox — though things could definitely change by the end of the year — as well as an increased need by companies to manage their services in cloud environments. So, it makes sense that the private equity firm would consider taking it public to capitalize on Wall Street’s interest at this time in the latter half.

A spokesperson for Rackspace said the company does not comment on rumors or speculation. We also reached out to Apollo Global Management and will update the post when we hear back.

Southeast Asia exit deal is a win, not a defeat, for Uber

They say in sport that the best teams win even when they don’t perform. On those terms, Uber seems unstoppable.

The day’s big news is that the U.S. ride-hailing firm is leaving Southeast Asia after it agreed to sell its business to local rival Grab. That much is true, but claims that Grab beat Uber out may be overstating the situation.

Ordinarily, you’d call the exit a loss for Uber and a win for Grab, but the devil is in the detail. The deal that has been agreed is a very solid win for both sides which reads more than an alliance than a settlement between winner and loser.

Let’s consider the facts:

Uber takes a 27.5 percent stake in a growing business that was most recently valued at $6 billion.

That stake — worth north of $1.6 billion — is a strong return considering that Uber said today it has invested $700 million in Southeast Asia over the past five years.

Grab takes over and shuts down its largest rival’s business, all while importing any drivers and passengers that aren’t already on its platform and adding Uber Eats to its nascent food delivery play.

That’s a notable outcome for Grab, which started out offering licensed taxis only and required passengers to pay their bill in cash until three years ago. When Uber first arrived the two were hugely differentiated and market share was fairly even, but now Grab is the dominant player in the region by some margin.


Despite humble beginnings, Grab — which started out in Malaysia but relocated to Singapore — has made strides over the past two years. Today, it offers more than 10 transportation services — including taxis, private cars, car-pooling, bicycle sharing, and bike taxis — across eight countries.

You might read about its localization strategy and how important it is, and for sure it is impressive.

Beyond food delivery — which is now a fairly standard expansion for ride-sharing companies — it has made a push into financial services through its GrabPay service, which allows users to pay for goods and services offline, and a new venture that provides micro-loans and insurance products.

Grab’s focus on fanning out beyond ride-sharing is designed to capture and engage users beyond just offering transportation. The theory is that this not only makes it more useful to users, but it introduces entirely different (and potentially more lucrative) business opportunities that set the company up to become a profitable entity further down the line.

But — and this is the important caveat — this product expansion is in its early stages so the effect didn’t play out on Grab’s rivalry with Uber.

In fact, it looks like a lot of the rivalry came down to the usual factor: Money.

Put simply, Grab has consistently secured the financial backing of its investors.

As one senior Uber employee in Southeast Asia aptly explained to TechCrunch recently: “They just kept giving them money!”

Over the past two years the money factor appeared to swing in Grab’s favor. It raised $750 million in late 2016, and then followed that up with more than $2.5 billion last year to take it to more than $4 billion from investors at a valuation of over $6 billion.

Compare that to the $700 million Uber had invested in Southeast Asia and you can already see an advantage which is particularly key in ride-hailing when two firms are locked in an ongoing subsidy war.

So, for all those comparisons and fancy charts that show the total amount Uber raised as a global business, it was financially outmuscled in Southeast Asia presumably because it chose to limit its investment.

Grab’s money was strategic, too.

SoftBank and Didi, the ‘Uber slayer’ of China, fronted $2 billion of the newest round, while the likes of Toyota, Hyundai, Tiger Global, Coatue Management and influential Indonesian firms Emtek and Lippo are among others to have come aboard in recent years.

That network allowed Grab to hire experienced executives to fill out its team, including most notably Ming Maa, a “deal-maker” who joined as company President from SoftBank 18 months ago.

Uber was often quick to point out that it gave country offices the freedom to suggest and implement localized policies and ideas, but in Southeast Asia it seemed to lack overall coherence. For example, it only appointed a regional head for Southeast Asia last August, some four years after its initial arrival.

That symbolizes its struggle to develop a strategy until it was too late. And that’s without even mentioning the wave of controversies that hit Uber as a company in 2017, which no doubt impacted decision-making outside of the U.S..

Win-win deal

Uber struck decent deals to exit China and Russia, and it appears to be the same again here.

As a private company, it isn’t possible to analyze Grab’s shareholders and their ownership percentages, but Uber is likely now one of the largest investors in the business. That’s the ideal scenario for Uber and its shareholders because Southeast Asia is forecast to be a major growth market for ride-hailing, and Uber is now in the front seat with the market leader.

Currently a loss-making region for Grab and Uber, revenue from taxi apps in Southeast Asia is said to have more than doubled over the past two years to cross $5 billion in 2017, according to a recent report co-authored by Google. The industry is expected to grow more than four-fold to hit $20 billion by 2025, according to the same research.

Uber could have continued on, increased its investment and still seen success, but the deal it has landed allows it to maintain a presence via proxy while diverting resources to other markets worldwide. That stake in Grab, which is worth north of $1.6 billion as of Grab’s most recent funding round, is likely to appreciate significantly over time as the market grows and Grab’s fintech play yields fruit.

Sources close to the deal indicate that Grab gave Uber less than $100 million as part of this deal, and it will take on Uber’s roughly 500 staff across the region in addition to its ride-hailing business and Uber Eats, which is present in three countries.

More than the operational gains, Grab can now count on both Uber and China’s Didi as investors, with Uber CEO Khosrowshahi joining the board. That’s the kind of influence and experience that money can’t buy, and it may be essential for what comes next.

The next stage of ride-sharing in Southeast Asia will pit Grab against Indonesia’s Go-Jek, a $5 billion startup backed by big names including Google and Tencent. Go-Jek is leading in its home market — where it pioneered the kind of financial products and on-demand services that Grab is just launching now — and it houses ambitions to export its empire to new markets starting this year.

One source close to Go-Jek told TechCrunch that the company is preparing to launch in the Philippines potentially before the end of March. Go-Jek has been very deliberate about taking its time, but now that Uber is out of the equation in Southeast Asia, it’s time to walk to walk and amp up the battle.

Uber has agreed to sell its Southeast Asia business to rival Grab

After weeks of speculation, Uber has concluded a deal that will see it sell its business in Southeast Asia to local rival Grab . The company plans to announce the agreement this coming week and potentially as soon as Monday, two sources have confirmed to TechCrunch.

Full details of the arrangement aren’t fully clear at this point, but TechCrunch understands that Singapore-based Grab will take over Uber’s ride-sharing in the eight markets in Southeast Asia where it is operational. It will also take ownership of Uber Eats, which is available in Thailand, Malaysia and Singapore. Bloomberg reported today that Uber will take 25-30 percent equity in Grab in exchange.

Both Uber and Grab declined to comment when contacted separately for comment.

The successful conclusion of negotiations comes less than two months after SoftBank, an early investor in Grab, secured a long-drawn-out deal to become an Uber shareholder.

SoftBank is thought to have favored consolidating Uber’s businesses in emerging markets, with Southeast Asia — a loss-making geography for all — one of its apparent targets. That’s despite significant growth potential as more of the regions 600 million consumers come online for the first time.

Revenue from taxi apps is said to have more than doubled over the past two years to cross $5 billion in 2017, according to a recent report co-authored by Google. The industry is expected to reach $20 billion by 2025, the same report found.

Uber previously exited China in 2016 after striking an equity exchange deal with Chinese market leader Didi. The U.S. firm also quit Russia last year after it sold its business in the country to local rival Yandex.

Unlike those two deals, however, Uber had held a decent position in Southeast Asia in recent times although it appeared to lose considerable market share last year. Issues inside Uber, including the resignation of founding CEO Travis Kalanick and investor squabbles, seemed to divert its attention away from Southeast Asia. All the while, Grab marched on and it notably refueled its tanks with over $2.5 billion in additional funding from investors.

Grab isn’t the only rival in Southeast Asia, however. Go-Jek leads the Indonesian market and it recently gained the backing of Google, and Tencent at a valuation of some $5 billion. Despite winning in Indonesia, Southeast Asia’s largest economy and the world’s fourth most populous country, Go-Jek is yet to venture overseas. This Uber-Grab consolidate certains gives it a good reason to expedite those plans.

IPOs are back, but for how long?

The first quarter is almost over, and despite Dropbox’s splashy debut on the public market earlier today, it was preceded by just two other U.S. tech companies to IPO in 2018: Cardlytics and Zscaler. 

Will Dropbox turn things around? Will the fact that Spotify is readying its debut get the momentum going at long last?

It all depends on how Dropbox and Spotify perform and how they impact what’s known as the IPO window. When new issuers perform well, it typically swings wide open. When they don’t, well, it gets slammed shut.

At this point, it’s been four years since we had an IPO window big enough for a stream of companies to pass through. In 2013, 50 tech companies went public. In 2014, the number was 62. Things grew chillier after that, with just 31, 26 and 27 companies getting out the window in 2015, 2016 and 2017, respectively.

Why haven’t things warmed up again, particularly with a stunning 171 venture-backed “unicorns” waiting in the wings?

Some high-profile flops are one large factor. Last year, venture-backed darlings like Blue Apron and Snapchat braved the public markets, but it was public shareholders who had to keep a stiff upper lip as their shares abruptly sputtered. These kinds of scenarios can seriously spook pipeline companies and their advisors, particularly in the world of consumer tech.

The availability of late-stage capital is also making it far easier to stay private longer. With SoftBank’s $100 billion Vision Fund writing enormous checks to growth startups — and traditional venture funds reacting by raising their own gigantic venture funds — this trend is only expected to continue.

There are also plenty of sky-high valuations to consider. Startups were able to command numbers that weren’t necessarily tied to reality in 2014 to 2015. That makes the prospect of a public offering, at a potentially much smaller valuation, something to be put off as long as possible.

Still, IPO insiders think things shifted once again — that a growing number of companies will have the wind at their backs in 2018. They point to strong signals like Zscaler doubling on its first day of trading and Dropbox pricing above its IPO range as favorable signs of what’s to come. Indeed, they say that behind the scenes, a lot of prep work has already set the stage.

“The number of tech companies, across the spectrum, now meeting with (if not engaging) bankers and working with the auditors to be ‘IPO ready’ is very definitely on the upswing,” says Lise Buyer, an IPO consultant and partner at Class V Group. The “window is already wide open, and there is enormous pent-up demand at institutions for new companies that are priced reasonably.”

John Tuttle, global head of listings at the New York Stock Exchange, similarly says he expects “a strong year if market conditions hold constant.” He characterizes the pipeline for technology offerings as “strong,” particularly enterprise technology companies.

Tuttle also notes the growing number of far-flung tech companies looking to list their share in the U.S. Among these are three China-based companies with plans to raise hundreds of millions of dollars by selling American depositary shares in the not-too-distant future, including Bilibili, a nine-year-old, Shanghai, China-based anime video sharing platform; iQiyi, an eight-year-old Beijing-based video streaming service; and OneSmart, a 10-year-old, Shanghai, China-based K-12 after-school education provider.

Hardware-maker Xiaomi is expecting to stage a public offering both in the U.S. and in Hong Kong this year, too.

That’s saying nothing of the Canadian and Latin American companies that are offering shares to U.S. investors. Among them: Brazil’s payments business PagSeguro Digital; it went pubic in January on the NYSE.

So who’s next? Following Dropbox and Spotify, Zuora, the 11-year-old, cloud subscription management platform, has finally filed to go public. Another company to just file is Pivotal Software, a spinoff of EMC and VMware. DocuSign is on file confidentially. We’re also hearing that quite a few other enterprise technology companies are gearing up to go public.

Just don’t expect to see big consumer tech companies like Airbnb, Uber and Pinterest listing in 2018. A lot of these “decacorns” are planning to debut next year at the earliest, partly because they’ve raised enough money that they can’t afford to make mistakes at this point.

They’ve raised enough money that they can wait, too. That means the rest of us will have to wait alongside them.


Dropbox prices above its original range at $21 as it heads toward an IPO

Dropbox today said it is pricing above the range it originally set ahead of its public listing tomorrow, handing the company a valuation inching ever-closer to its original $10 billion valuation.

Dropbox earlier this week said it would price its initial public offering in a range between $18 and $20 per share, settling on a valuation near $8 billion at the high end of the range (or closer to $8.75 billion, based on its fully-diluted share count). With the new pricing, Dropbox will be valuing itself at around $8.4 billion — or a hair above $9 billion based on its fully-diluted share count. That $18 to $20 range, too, was a step up from its original proposed range, which fell between $16 and $18. Dropbox will be raising more than $700 million in the IPO, in addition to existing shareholders selling more than 9 million shares as part of the process.

What all this means is that Dropbox initially tested the waters to gauge interest, and clearly there was a lot. Companies sometimes set conservative price ranges (though this isn’t always the case) and then revise upwards as they see how much interest there is in potential investors buying shares at that price. Dropbox will make its public debut tomorrow, and the usual process here aims to get as much value for the company as possible while still ensuring the so-called IPO “pop” — usually a jump of around 20%. We’ll probably get the formal price in the form of an SEC filing this evening as it gets ready to list tomorrow.

Should that be successful, Dropbox would fall above the valuation of its last financing round, which gave the company a $10 billion valuation amid a hype wave of consumer startups. Dropbox, one of the original pioneers of online storage, in recent years has found itself looking to slowly scoop up more and more enterprise customers as it tries to create a second lucrative line of business. The company deploys a classic playbook of attracting initial customers within teams and then growing up to the point it reaches the C-Suite of companies, though the reverse is certainly possible as Dropbox matures over time.

CNBC first reported the news.

Skyline AI raises $3M from Sequoia Capital to help real estate investors make better decisions

Skyline AI, an Israeli startup that uses machine learning to help real estate investors identify promising properties, announced today that it has raised $3 million in seed funding from Sequoia Capital. The round will be used to build its tech platform and hire experts in data science and machine learning.

Founded in 2017 and headquartered in Tel Aviv, Skyline AI predicts future property values and also analyzes the real estate market to help investors make important decisions such as when to raise rents, renovate or sell. Co-founder and chief executive officer Guy Zipori told TechCrunch that Skyline AI’s founding team (who also includes chief technology officer Or Hiltch, chief revenue officer Iri Amirav and executive chairman Amir Leitersdorf) worked together for years at various artificial intelligence-based startups in sectors including security, healthcare and online video. After several of their companies exited, the four were in a position to find investment opportunities. They wanted to explore commercial real estate, but Zipori “were surprised by how limited the technology is in this space.”

Though more industries are turning to data science and artificial intelligence to save time while making complex decisions, many veteran investors still depend on Excel spreadsheets, outdated market data and their “gut feelings,” added Zipori.

Skyline AI wants to take the guesswork out of investment decisions by training its technology on what it claims is the most comprehensive dataset in the industry, drawing on more than 130 sources and analyzing over 10,000 attributes on each data asset for the last 50 years. Skyline AI’s tech then compiles all information into a data lake and cross-references everything to find discrepancies and figure out what information is the most accurate.

“As a side note, we were surprised to learn that asset data sampled from different sources is often dissimilar, meaning that in some cases decisions regarding large deals were made based on bad data,” Zipori said.

One benefit of Skyline AI’s system is that it is able to consider variables that would be difficult to include in Excel spreadsheets and other traditional methods for aggregating data, which is important in real estate because there are so many factors that can impact a property’s value and impact its rents, occupancy levels, maintenance costs and future worth.

In a statement, Sequoia Capital partner Haim Sadger said “The promise of AI to transform commercial real estate investments cannot be understated. Over the last few years, we’ve seen AI disrupt a number of traditional industries and the real estate market should be no different. The power of Skyline AI technology to understand vast amounts of data that affect real estate transactions, will unlock billions of dollars in untapped value.”

Pandora doubles down on ad tech with acquisition of AdsWizz for $145 million

Pandora announced this morning it’s acquiring digital audio ad technology firm AdsWizz for $145 million, as a combination of at least 50 percent cash, with the remaining paid in either cash or stock at Pandora’s discretion. The company, whose technology will be used to upgrade Pandora’s own ad tech capabilities, will continue as a subsidiary headed by CEO Alexis van de Wyer.

AdsWizz offers an end-to-end technology platform that powers music platforms, podcasts and broadcasting groups. Customers include Cox Media Group, iHeartRadio, TuneIn, Entercom, Omnicom Media Group, Spotify, Deezer, PodcastOne, GroupM, and others.

Its software suite includes a variety of ad technology capabilities, including dynamic ad insertion, advanced programmatic platforms, ad campaign monitoring tools, and more.

Above: AdsWizz’ AudioMatic platform for programmatic buying 

It has also developed a number of new audio formats, like ShakeMe which has users shake their phones to trigger an action while listening to an ad; ads that can target users based on an activity like jogging or a situation like cold weather; ads that can be customized based personalized data; and others.

Pandora says it will leverage the acquisition to capitalize on the growth in digital audio advertising, which is up 42 percent year-over-year, according to the IAB.

We understand that Pandora was interested in where AdsWizz’ roadmap aligned with Pandora’s specifically in the areas of audio monetization and ad-buying capabilities. It believes that by joining forces, it will be able to ship and launch new products faster.

Once integrated with Pandora, advertisers will be able to transact through AdsWizz’s global marketplace across Pandora and other audio publishers, the company says. Pandora says that it will continue to invest in AdsWizz technology that supports its core business and the wider industry – or, in order words, Pandora isn’t ripping away AdsWizz from its competitors in streaming at this time.

“Since I joined Pandora six months ago, I have highlighted ad tech as a key area of investment for us. Today we took an important step to advance that priority and accelerate our product roadmap,“ said Roger Lynch, CEO of Pandora, in a statement. “With our scale in audio advertising and AdsWizz’s tech expertise, we will create the largest digital audio advertising ecosystem, better serving global publishers and advertisers — while improving Pandora’s own monetization capabilities.”

The deal comes at a time when Pandora continues to generate the majority of its revenues from advertising, despite its entry into the subscription business with its own rival to Apple Music and Spotify. In its Q4 2017 earnings, the company reported $97.7 million in subscription revenue that offset a 5 percent year-over-year decline in advertising revenues. Meanwhile, ad revenues clocked in at $297.7 million, down from $313.3 million in the same quarter the year before.

It also follows a rough year for Pandora which saw its original founder and CEO Tim Westergren exit, along with Chief Marketing Officer Nick Bartle and President Mike Herring, as part of a larger exec shakeup.

In addition to AdsWizz CEO van de Wyer, Pandora’s acquisition will add 140 people to the company from across all AdsWizz locations, including its San Mateo headquarters.

Pandora has not been as acquisitive as rival Spotify, having generally purchased businesses that are of strategic importance at the time, instead of smaller teams with interesting technology. It’s best known for its acquisitions of Rdio and Ticketfly in 2015, though the latter was handed off to Eventbrite last year.

“We know that the value we have created for all our stakeholders – brands, publishers and listeners – comes from our ability to create engaging and well-targeted advertising experiences. That will not change,” said van de Wyer, in a post on AdsWizz’ website. “Our focus has always been digital audio, with a unique expertise in innovative monetization solutions. That will not change. What will change is our ability to grow even faster, to develop technology more rapidly, to accelerate our ability to provide solutions that meet the increasingly sophisticated needs of advertisers and digital audiences. And to have an even bigger impact on people’s lives,” he added.

The new acquisition does not impact the first quarter 2018 guidance or the full year 2018 commentary provided at Pandora’s last earnings, the company notes. The transaction is expected to close in the second quarter of 2018, and is subject to regulatory approval.