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Former YouTube star sentenced to ten years in prison for child porn

Former Youtube star Austin Jones has been sentenced to ten years in a US federal prison after pleading guilty to persuading underage girls to send him explicit videos of themselves.

Jones, who made a name for himself online singing covers of songs, was arrested and charged in 2017 with two counts of producing child pornography.

He later pled guilty to one charge of receiving child pornography — admitting in a plea agreement that in 2016 and 2017 he enticed six girls to to produce and send explicit videos to “prove” they were his “biggest fan”, per Buzzfeed.

“Production and receipt of child pornography are extraordinarily serious offenses that threaten the safety of our children and communities,” it quotes assistant U.S. Attorney Katherine Neff Welsh writing in a sentencing memo. “Jones’s actions took something from his victims and their families that they will never be able to get back.”

At the height of his YouTube fame Jones had around 540,000 subscribers to his channel and more than 20M video views.

In a 2015 apology vlog, after reports emerged of Jones asking young fans to send him twerking videos, he claimed it never went further than that. “There were never any nudes, never any physical contact, it never happened,” he said then.

But in his plea agreement Jones admitted to attempting to persuade more than thirty underage fans to send him explicit photos or videos.

YouTube removed Jones’ channel after he pled guilty in February — saying it had violated its community guidelines. But the Google -owned company initially refused to shutter it, telling the BBC a few days earlier that while it does have a policy of removing content when a person is convicted of a crime “in some cases” it does so only if the content is closely related to the crime committed.

Describing her experience in a vlog also posted to YouTube, one former fan she had received messages from Jones asking her for twerking videos prior to his 2015 apology video when she was 14-years-old.

“I just don’t understand how these people can let the fame get to their heads that much that they think it’s alright to do something to people like this,” she said. “It’s so messed up. But the fact that his fanbase was these vulnerable, insecure young girls makes it so much worse than it already is… He knew that that was his fanbase and he took advantage of that.”

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Startups Weekly: Will the Seattle tech scene ever reach its full potential?

Greetings from Seattle, the land of Amazon, Microsoft, two of the world’s richest men and some startups.

I’m always surprised the Seattle startup ecosystem hasn’t grown to compete with the likes of Silicon Valley — or at least Boston and New York City — since the dot-com boom. Today, it’s the strongest it’s has been due to the successes of companies like the newly minted unicorn Outreach, trucking business Convoy and, of course, the dog walking startup Rover. But the city still lags behind, failing to adopt the culture of entrepreneurship that defines San Francisco.

I spent a lot of time wondering why it hasn’t reached its full potential. Is it because Microsoft and Amazon pay their employees so well they don’t have the same urge to build something from the ground up? Is it a lack of access to capital? Is the city not attracting top talent? If you have thoughts, send them my way.

“We think part of the issue is a lack of capital and a lack of help,” Rover and Pioneer Square Labs co-founder Greg Gottesman told TechCrunch earlier this year. “If we can provide a little bit of both of those things, we can really put Seattle where it deserves to be, should be and will be.”

Despite its shortcomings, there is still some action in the city I want to highlight this week. A same-day delivery business, Dolly, is on the rise. The startup told me on Thursday it had raised a $7.5 million round from Unlock Venture Partners, Maveron and Jeff Wilke, the chief executive officer of Amazon Worldwide Consumer. Maveron, if you remember, is the VC fund co-founded by Starbucks founder Howard Schultz.

In other Seattle news, Madrona Venture Group, a well-regarded fund, raised an additional $100 million this week. Typically, Madrona focuses on companies based in the Pacific Northwest, but this fund will deploy capital throughout the entire U.S. Hmmm, that’s not necessarily a good sign for Seattle founders, but great progress for the ecosystem nonetheless.

If you’re interested in learning more about Seattle tech, I’ve covered it a bit because it’s my hometown! Start with this story, which dives deep into a Seattle accelerator that’s working hard to encourage entrepreneurship in the city. Alright, on to other news.

Want more TechCrunch newsletters? Sign up here.

IPO corner!

WeWork: The co-working giant now known as The We Company submitted confidential IPO documents to the SEC, the company confirmed in a press release Monday. Is this the next massive startup win or a house of cards waiting to be toppled by the glare of the public markets? TechCrunch’s Danny Crichton investigates.

Slack: The business is in its final steps toward a much-anticipated direct listing, with one source telling TechCrunch the listing will be complete within 45 days. The WSJ reported this week that Slack will make an online presentation to potential shareholders on May 13. This week, we dug deep into Slack’s S-1 and decided to evaluate just how well the tech press, us included, did in covering the company. For the most part, the tech press did decently well, except for one curious, $162 million gap.

Uber: Finally! That ride-hailing company is going public next week. That latest news? Uber co-founder Travis Kalanick won’t be ringing the opening bell. Uber would not be where it is today without Kalanick, but him being there would surely be a reminder of Uber’s rocky past.

Beyond Meat: Shares of the company surged up 135 percent in their market opener last week, valuing the company as high as $3.52 billion. Volatility was so high on the company’s stock that the Nasdaq had to pause trading of “BYND” shares.

Micro-mobility instability:

Ofo has run into its fair share of issues, laying off hundreds of workers, shutting down its international division and more. Now, you can buy a piece of the startup’s history.

Now you can buy a piece of startup history… Ofo bikes for ~$60 https://t.co/LLJbDOXm0C

— Jon Russell (@jonrussell) April 29, 2019

In other micro-mobility news, Lyft’s head of scooter & bikes Liam O’Connor, who was hired to help transportation company Lyft build its bike and scooter operations, has left after seven months with the newly-public company. TechCrunch’s Ingrid Lunden has the scoop. Plus, Bird, the electric scooter unicorn doing its best to overcome regulatory barriers, has made its way back to San Francisco. Bird is using its business license in San Francisco to introduce monthly personal rentals in the city. The program enables people to rent a scooter for $24.99 a month with no cap on the number of rides. We’ll how that goes.

WTF?

For some reason, people are giving Magic Leap more money. The company has secured another $280 million in a deal with Japan’s largest mobile operator, Docomo. Do you know what that means? The developer fo AR/VR headsets has raised a total of $2.6 billion. We’re just as confused as you.

Brand new venture capital funds:

Unshackled Ventures raised $20 million. 

Exclusive: @UnshackledVC has a new $20M pre-seed fund to invest only in immigrants. Why? Because immigrants are “inherently more entrepreneurial:” https://t.co/ZLiZ1UczJV

— Kate Clark (@KateClarkTweets) May 2, 2019

Jungle Ventures closed on $175 million.

And Toyota AI Ventures launched a $100 million fund.

Startup Capital

Uber investors exit

I have the inside story on Menlo Ventures early Uber stake and TechCrunch’s Connie Loizos goes deep with early Uber backer Bradley Tusk.

Extra Crunch!

This week, we offer TechCrunch Extra Crunch subscribers exclusive tips on building extraordinary teams. Plus, the final piece in TechCrunch’s Greg Kumparak’s series on Niantic, the fast-growing developer of Pokemon Go. If you recall, we’ve captured much of Niantic’s ongoing story in the first three parts of our EC-1, from its beginnings as an “entrepreneurial lab” within Google, to its spin-out as an independent company and the launch of Pokémon GO, to its ongoing focus on becoming a platform for others to build augmented reality products upon.

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase News editor-in-chief Alex Wilhelm and TechCrunch’s Danny Crichton chat about updates at the Vision Fund, Cheddar’s big exit and more of this week’s headlines.

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Struggling grocery startup Honestbee fires its CEO

The changes continue to roll at Honestbee. Fresh from pausing operations in four countries and announcing plans to lay off 10 percent of staff, the Singapore-based online grocery startup has let CEO Joel Sng go, two sources with knowledge of his exit told TechCrunch.

Sng, who co-founded Honestbee back in 2015 and previously served as an advisor with its investor Formation 8, cleared his desk and vacated his office yesterday, according to sources.

Honestbee declined to comment.

Isaac Tay, another co-founder, left the company last year while the last remaining co-founder is Jonathan Low, who leads Honestbee’s engineering team.

Sng’s apparent exit comes after we reported that Honestbee had told staff that it is in the process of securing funding that it claims will provide an additional year of runway for the business. Sources who spoke to TechCrunch said it has not been announced how much that funding is, or which investor is providing it.

Honestbee had held acquisition talks with Grab, Go-Jek and others in recent weeks.

Honestbee co-founder Joel Sng [Image via LinkedIn]

It isn’t immediately clear who will take over from Sng. Sources previously told TechCrunch that Sng’s right man is Roger Koh, whose LinkedIn lists his current job as a principal with Formation 8. Formation 8 led Honestbee’s $15 million Series A round in 2015. The fund has since shut down and its stake appears to have transferred to Formation Group, according to the firm’s website.

Filings show that Honestbee has raised at least $46 million since that Series A. Its high burn rate suggests it may have raised even more, but nothing has been announced or filed while former staff have told TechCrunch that only Sng and Koh have access to financial details.

The company is going through some turbulent times. We reported last week that a cash crash — not helped by a burn rate of $6.5 million per month — had left suppliers unpaid, payroll for April uncertain and morale low among Honestbee’s estimated 1,000 staff.

The company said yesterday announced a series of cost-cutting measures that will see it temporarily cease business in Hong Kong, Indonesia, Japan and the Philippines while it conducts a review. It has also stopped offering food delivery, an additional service it launched in recent years, in Thailand and Hong Kong.

Grocery delivery startup Honestbee is running out of money and trying to sell

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Samsung Ventures’ first investment in Southeast Asia is HR startup Swingvy

Samsung Ventures, the VC arm of the Korean electronics giant, has made its first investment in Southeast Asia after it backed HR startup Swingvy.

Singapore-based Swingy’s service provides HR services, payroll and insurance for SMEs on a freemium basis. The company announced this week that it raised $7 million that was led by the Samsung arm with participation from Aviva Ventures — from insurance firm Aviva — and Bass Investment. Existing investors Walden International and Big Basin Capital, which financed a previous $1.6 million round, also took part.

Founded in 2016, Swingvy claims to work with over 5,100 companies across Singapore, Malaysia and Taiwan. Those customers, some of which do not pay, have a cumulative user base of over 100,000 employees.

“Our target customer is SMEs not enterprise,” Jin Choeh, who is CEO and one of three Swingvy co-founders, told TechCrunch in an interview. “There are some local players, some legacy players and some startup competitors, but generally we saw that there’s no market leader for HR tech in Southeast Asia.”

The service itself covers areas such as an employee directory, processes for leave, performance management, company calendar, HR reporting, payroll and benefits. On the latter, Swingvy offers health insurance through partnerships with third-parties — Choeh said it is a licensed insurance agent. He said that new features coming soon include claims (for expenses and payments) while further down the line will be monthly insurance and corporate cards.

It is quite common for HR and other ‘base-level’ SME services to develop marketplaces that match their customers with third-party providers — we’ve seen that in Japan among very mature players, for example — but Swingvy isn’t going down that route. Choeh explained that it will consider offering its own services in areas where it believes it can give value to customers and control the quality and experience directly.

More broadly, the startup is aiming to triple its customer base to 15,000 this year thanks to this new injection of capital.

The initial focus is on hiring — Swingy plans to grow its headcount of 23 to over 60 this year — and more “aggressive” sales growth. That’ll mean bringing in a dedicated sales team, increasingly online advertising spend to reach new customers and being more visible around event marketing.

“Sales and marketing has been less than 10 percent of our spend,” said Choeh. “We’ve proved our model is quite cost efficient and we believe it is time to raise sales and marketing efforts.”

There’s no immediate plan to expand to new markets, but the Swingvy CEO said his company is eyeing potential expansions in 2020. Potential countries include Thailand, Vietnam and Japan, he said. Indonesia — Southeast Asia’s largest economy and the world’s fourth most populous country — is also under review, but Choeh said his team is aware that it is hyper-competitive while the market for paid SME products is particularly challenging.

What of the relationship with Samsung? For now, the relationship is financial rather than strategic, but Choeh admitted that there could be opportunities to work closely together in the future.

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Elon Musk, SEC agree to guidelines on Twitter use

Tesla,  Elon Musk and the U.S. Securities and Exchange Commission reached an agreement Friday that will give the CEO freedom to use Twitter —within certain limitations — without fear of being held in contempt for violating an earlier court order.

Musk can tweet as he wishes except when it’s about certain events or financial milestones. In those cases, Musk must seek pre-approval from a securities lawyer, according to the agreement filed with Manhattan federal court.

U.S. District Judge Alison Nathan, the presiding judge on this matter, must still approve the deal. Nathan had given the SEC and Musk two weeks to work out their differences and come to a resolution.

Musk must seek pre-approval if his tweets include:

  • any information about the company’s financial condition or guidance, potential or proposed mergers, acquisitions or joint ventures,
  • production numbers or sales or delivery number (actual, forecasted, or projected),
  • new or proposed business lines that are unrelated to then-existing business lines (presently includes vehicles, transportation, and sustainable energy products);
  • projection, forecast, or estimate numbers regarding Tesla’s business that have not been previously published in official company guidance
  • events regarding the company’s securities (including Musk’s acquisition or disposition of shares)
  • nonpublic legal or regulatory findings or decisions;
  • any event requiring the filing of a Form 8-K such as a change in control or a change in the company’s directors; any principal executive officer, president, principal financial officer, principal accounting officer, principal operating officer, or any person performing similar functions

The fight between the two parties began after Musk’s now infamous August 7, 2018 tweet that had “funding secured” for a private takeover of the company at $420 per share. The SEC filed a complaint in alleging that Musk had committed securities fraud.

Musk and Tesla settled with the SEC last year without admitting wrongdoing. Tesla agreed to pay a $20 million fine; Musk had to agree to step down as Tesla chairman for a period of at least three years; the company had to appoint two independent directors to the board; and Tesla was also told to put in place a way to monitor Musk’s statements to the public about the company, including via Twitter.

The fight was re-ignited after Musk sent a tweet on February 19 that Tesla would produce “around” 500,000 cars this year, correcting himself hours later to clarify that he meant the company would be producing at an annualized rate of 500,000 vehicles by year end.

The SEC argued that the tweet sent by Musk violated their agreement. Musk has said the tweet was “immaterial” and complied with the settlement.

The SEC had asked the court to hold Musk in contempt for violating a settlement agreement reached last October over Musk’s now infamous “funding secured” tweet. The SEC had argued that Musk was supposed to get approval from Tesla’s board before communicating potentially material information to investors, the agency has argued. The SEC claimed a February 19 tweet violated the agreement.

Musk has steadfastly maintained that he didn’t violate the agreement.

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Equity Shot: Uber’s IPO terms and Slack’s S-1

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

Kate and Alex are back (again), bringing you the latest on the IPO front. As Friday is coming to a close, we’ll keep this post short to leave plenty of room for you to dig into the audio. Welcome to the weekend.

Up first we dug into Uber’s latest S-1 filing. This time, the company set a price range for itself (TechCrunch’s coverage here), valuing itself at $84 billion and also detailing estimates of its first-quarter results (Crunchbase News’s notes here).

We suspect Uber will ultimately price a top that range. Time will tell.

And then we turned to Slack, who’s direct listing will help set the historical tone for the unicorn era; screw your money, Slack says, we have our own. Well maybe not, but the company has impressive growth, killer margins, and, to our surprise, larger GAAP deficits than we expected. The company’s filing was fascinating.

But worry not, we can figure out how to value Slack. It’s Uber that left us scratching our heads. Expect next week to be another blizzard of news and numbers.

Thanks as always for listening to the show. We’ve never had more downloads than these last few weeks. It means a lot that you want to hang out with us. Don’t forget that we have an email address (equitypod@techcrunch.com), and a hashtag that Alex needs to learn to use: #equitypod.

Equity drops every Friday at 6:00 am PT, so subscribe to us on Apple PodcastsOvercast, Pocket Casts, Downcast and all the casts.

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Led by LA-based March Capital, Astound raises $15.5 million for employee help desk automation services

Astound, a company selling automated employee help desk services, has raised a new round of $15.5 million from investors led by the Los Angeles investment firm March Capital Partners.

Previous investors Vertex Ventures, Pelion Venture Partners, Moment Ventures, and the Slack Fund also participated in the funding, which brings Astound’s total capital raised to $27 million.

The company’s software integrates with ServiceNow, BMC, Jira, Cherwell, and Workday, among others.

For co-founder and chief product officer Dan Turchin, the company is the culmination of decades of work spent developing tools for human resources and employee services. It’s the seventh company that Turchin has been involved in around applying technology to help employees, he says. Most recently Turchin worked at ServiceNow, which he left in 2014 to launch Astound.

Astound said it would use the financing to increase its product development and sales and marketing efforts, according to a statement.

Taking information from structured and unstructured data sources across different information silos within a business and offering it up to employees via automated messages (it’s a chatbot) frees human resources and helpdesk staff to engage at a higher level with employees, companies like Astound say.

Automation is certainly coming to businesses, whether employees like it or not. A study from McKinsey indicates that 70 percent of companies will bring in at least one automation technology by 2030. And those technologies could contribute up to $120 billion in increased economic value, according to the McKinsey study cited by Astound.

 


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The company behind Laundroid files for bankruptcy

At the end of the day, Laundroid amounted to little more than a fun show demo. The device was a bit silly and prohibitively large and expensive for most  to consider actually purchasing. All in all, it was a lot of work for the relatively simple task of folding laundry.

Seven Dreamers, which has been a staple at trade shows in recent years, has filed for bankruptcy in Japan. No official word yet on whether the dream is fully dead, but things certainly look bleak for the company, which has racked up in the roughly $22 million in debt as it’s struggled to actually ship its laundry folding machine.

And while Laundroid was reportedly still on track for a 2019 release, according to Seven Dreamers, the product had too many rough edges left to smooth out, struggling with even basic tasks according to hands-on reports.

With Laundroid’s future in doubt, California-based Foldimate seems reasonably well positioned to dominate whatever market might actually exist for such a product. The company got fairly good marks for its own robotic folding technology back at CES.

The automation of household tasks has been a holy grail for consumer robotics in recent years. Aside from the Roomba, however, it’s so far proven an impossible nut to crack.

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New hack challenge from Eramet for the TC Hackathon at VivaTech

There’s no question that springtime in Paris is the stuff of legend. TechCrunch is returning to the City of Lights to continue building another legendary experience. The TechCrunch Hackathon at VivaTech 2019 takes place at the Expo Porte de Versailles on 17-18 May. If you’re a developer, a UX/UI designer or an all-around tech creator, don’t miss this chance to collaborate, compete and create something great.

Thanks to stellar sponsored hack contests, you can win serious cash and other awesome prizes in the process. There’s no fee to enter, but get your free hackathon ticket now, because they won’t last long.

Thousands of startup founders, business leaders, investors, academics, students and media across Europe and beyond will descend on VivaTech, which makes it the perfect place to host a hackathon of epic proportion.

Here’s how it all works:

Form or join a team and take on a specific hack challenge put forth by the hack sponsors. Fuel up on whatever gets you through the night, because you have just 24 hours to work your tech magic, wield your mighty coding skills and produce a working solution.

It’s pencils down after 24 hours, and then your sleep-deprived team will have just 60 seconds to deliver a rapid-fire presentation to our hackathon judges. Each team receives a score between one and five, and the team with the highest score wins the prize associated with the sponsored hack. In addition, TechCrunch will award a €5,000 grand prize for the best overall hack.

All teams that receive a combined score of three or higher also win tickets to TechCrunch Disrupt Berlin 2019 and VivaTech 2020.

We’re stoked to announce the details of the latest hack contest from our sponsor, Eramet:

In the 21st century, metal alloys are everywhere, e.g. computers, electric cars, satellites. You can find up to 20 different alloys in a single computer. The quality requirements of customers are extremely tight nowadays. Eramet, a global mining and metallurgical group, challenges you to find a solution that can provide our customers with 100 percent transparency on our supply chains, from the extraction of ore from the mine to the final product, with a heavy focus on the quality, environmental, social and ethical aspects. The winner of this challenge will receive a €5,000 prize.

In case you missed it, we already announced a contest from EDHEC. The company’s offering a €5,000 prize to the team that creates the best product to help students make sure they choose the course of studies and career that’s right for them.

Be sure to keep checking back, because we’ll announce plenty more sponsored contests — with awesome prizes — in the coming weeks.

The TechCrunch Hackathon at VivaTech 2019 takes place on May 17-18. Are you ready to put your skills to the ultimate test and become a legend in your own right? Get your free ticket and join us in Paris. We can’t wait to see what you create!

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Le Wagon launches part-time coding bootcamps

Le Wagon has been steadily growing for the past few years. The bootstrapped French company now has 34 campuses across 22 countries. And now, Le Wagon is about to welcome a whole lot more students thanks to a new part-time program.

The startup has been testing a new part-time format in London and now wants to expand this program across all campuses. This way, students can keep working in their existing company and attend Le Wagon on Tuesday night, Thursday night and Saturday.

Le Wagon still focuses on its highly rated full-stack program. So far, nearly 5,000 students have attended this 9-week full-time bootcamp. You get to learn about front-end and back-end development, and you end up building your own project from start to finish.

After a couple of months, you should be ready to start a startup or join a startup as a software engineer. And Le Wagon is still scaling that program as the company expects to accept between 2,000 and 3,000 students in 2019 alone.

The part-time program has the exact same content and costs the same price — the full-time program in Paris currently costs €6,900. The part-time program is going live in Paris in August, and it should be live on most campuses by January 2020. And the company thinks a part-time program opens up many different possibilities.

If you have a family and kids, maybe you can’t afford to leave your job or take a sabbatical. Some high-ranked executives also want to be 100 percent sure they want to start a new career before leaving everything behind. According to Le Wagon co-founder and COO Romain Paillard, the new program should attract different profiles, which should improve the quality of the alumni community.

Many former students create their own startups. French startups founded by Le Wagon alumni have raised $48 million (€43 million) in total.

Of course, it’ll take a lot of motivation to go through the program. It’s like signing up for a part-time job in addition to your full-time job. Le Wagon will screen candidates as much as possible to see if they’re motivated enough to finish the program.

Many companies don’t want to let their employees attend Le Wagon right now because it means they’ll be gone for a couple of months. Le Wagon thinks companies will be more open-minded about a part-time program and support their employees.

This will be a nice addition to Le Wagon’s executive program. The company is just starting on this front and has attracted hundreds of employees working for big companies and looking for a short program to learn new skills.

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