One of the hottest Y Combinator startups just raised a big seed round to clean up the mess created by Uber, Postmates and the gig economy. Catch sells health insurance, retirement savings plans and tax withholding directly to freelancers, contractors, or anyone uncovered. By building and curating simplified benefits services, Catch can offer a safety net for the future of work.
“In order to stay competitive as a society, we need to address inequality and volatility. We think Catch is the first step to offering alternatives to the mandate that benefits can only come from an employer or the government,” writes Catch co-founder and COO Kristen Tyrrell. Her co-founder and CEO Andrew Ambrosino, a former Kleiner Perkins design fellow, stumbled onto the problem as he struggled to juggle all the paperwork and programs companies typically hire an HR manager to handle. “Setting up a benefits plan was a pain. You had to become an expert in the space, and even once you were, executing and getting the stuff you needed was pretty difficult.” Catch does all this annoying but essential work for you.
Now Catch is getting its first press after piloting its product with tens of thousands of users. TechCrunch caught wind of its highly competitive seed round closing, and Catch confirms it has raised $5.1 million at a $20.5 million post-money valuation co-led by Khosla Ventures, Kindred Ventures, and NYCA Partners. This follow-up to its $1 million pre-seed will fuel its expansion into full heath insurance enrollment, life insurance and more. Catch is part of a growing trend that sees the best Y Combinator startup fully funded before Demo Day even arrives.
“Benefits, as a system built and provided by employers, created the mid-century middle class. In the post-war economic boom, companies offering benefits in the form of health insurance and pensions enabled familial stability that led to expansive growth and prosperity,” recalls Tyrrell, who was formerly the director of product at student debt repayment benefits startup FutureFuel.io. “Emboldened by private-sector growth (and apparent self-sufficiency), the 1970s and 80s saw a massive shift in financial risk management from the government to employers. The public safety net contracted in favor of privatized solutions. As technological advances progressed, employers and employees continued to redefine what work looked like. The bureaucratic and inflexible benefits system was unable to keep up. The private safety net crumbled.”
That problem has ballooned in recent years with the advent of the on-demand economy, where millions become Uber drivers, Instacart shoppers, DoorDash deliverers and TaskRabbits. Meanwhile, the destigmatization of remote work and digital nomadism has turned more people into permanent freelancers and contractors, or full-time employees without benefits. “A new class of worker emerged: one with volatile, complex income streams and limited access to second-order financial products like automated savings, individual retirement plans, and independent health insurance. We entered the new millennium with rot under the surface of new opportunity from the proliferation of the internet,” Tyrrell declares. “The last 15 years are borrowed time for the unconventional proletariat. It is time to come to terms and design a safety net that is personal, portable, modern and flexible. That’s why we built Catch.”
Currently Catch offers the following services, each with their own way of earning the startup revenue:
- Health Explorer lets users compare plans from insurers and calculate subsidies, while Catch serves as a broker collecting a fee from insurance providers
- Retirement Savings gives users a Catch robo-advisor compatible with IRA and Roth IRA, while Catch earns the industry standard 1 basis point on saved assets
- Tax Withholding provides an FDIC-insured Catch account that automatically saves what you’ll need to pay taxes later, while Catch earns interest on the funds
- Time Off Savings similarly lets you automatically squirrel away money to finance “paid” time off, while Catch earns interest
These and the rest of Catch’s services are curated through its Guide. You answer a few questions about which benefits you have and need, connect your bank account, choose which programs you want and get push notifications whenever Catch needs your decisions or approvals. It’s designed to minimize busy work so if you have a child, you can add them to all your programs with a click instead of slogging through reconfiguring them all one at a time. That simplicity has ignited explosive growth for Catch, with the balances it holds for tax withholding, time off and retirement balances up 300 percent in each of the last three months.
In 2019 it plans to add Catch-branded student loan refinancing, vision and dental enrollment plus payments via existing providers, life insurance through a partner such as Ladder or Ethos and full health insurance enrollment plus subsidies and premium payments via existing insurance companies like Blue Shield and Oscar. And in 2020 it’s hoping to build out its own blended retirement savings solution and income-smoothing tools.
If any of this sounds boring, that’s kind of the point. Instead of sorting through this mind-numbing stuff unassisted, Catch holds your hand. Its benefits Guide is available on the web today and it’s beta testing iOS and Android apps that will launch soon. Catch is focused on direct-to-consumer sales because “We’ve seen too many startups waste time on channels/partnerships before they know people truly want their product and get lost along the way,” Tyrrell writes. Eventually it wants to set up integrations directly into where users get paid.
Catch’s biggest competition is people haphazardly managing benefits with Excel spreadsheets and a mishmash of healthcare.gov and solutions for specific programs. Twenty-one percent of Americans have saved $0 for retirement, which you could see as either a challenge to scaling Catch or a massive greenfield opportunity. Track.tax, one of its direct competitors, charges a subscription price that has driven users to Catch. And automated advisors like Betterment and Wealthfront accounts don’t work so well for gig workers with lots of income volatility.
So do the founders think the gig economy, with its suppression of benefits, helps or hinders our species? “We believe the story is complex, but overall, the existing state of the gig economy is hurting society. Without better systems to provide support for freelance/contract workers, we are making people more precarious and less likely to succeed financially.”
When I ask what keeps the founders up at night, Tyrrell admits “The safety net is not built for individuals. It’s built to be distributed through HR departments and employers. We are very worried that the products we offer aren’t on equal footing with group/company products.” For example, there’s a $6,000/year IRA limit for individuals while the corporate equivalent 401k limit is $19,000, and health insurance is much cheaper for groups than individuals.
To surmount those humps, Catch assembled a huge list of angel investors who’ve built a range of financial services, including NerdWallet founder Jake Gibson, Earnest founders Louis Beryl and Ben Hutchinson, ANDCO (acquired by Fiverr) founder Leif Abraham, Totem founder Neal Khosla, Commuter Club founder Petko Plachkov, Playable (acquired by Stripe) founder Tad Milbourn and Synapse founder Bruno Faviero. It also brought on a wide range of venture funds to open doors for it. Those include Urban Innovation Fund, Kleiner Perkins, Y Combinator, Tempo Ventures, Prehype, Loup Ventures, Indicator Ventures, Ground Up Ventures and Graduate Fund.
Hopefully the fact that there are three lead investors and so many more in the round won’t mean that none feel truly accountable to oversee the company. With 80 million Americans lacking employer-sponsored benefits and 27 million without health insurance and median job tenure down to 2.8 years for people ages 25 to 34 leading to more gaps between jobs, our workforce is vulnerable. Catch can’t operate like a traditional software startup with leniency for screw-ups. If it can move cautiously and fix things, it could earn labor’s trust and become a fundamental piece of the welfare stack.
Spotify’s Clubhouse rival, Greenroom, tops 140K installs on iOS, 100K on Android – TechCrunch
Spotify’s recently launched live audio app and Clubhouse rival, Spotify Greenroom, has a long road ahead of it if it wants to take on top social audio platforms like Clubhouse, Airtime, Spoon and others, not to mention those from top social networks, like Twitter and Facebook. To date, the new Greenroom app has only been downloaded a total of 141,000 times on iOS, according to data from app intelligence firm Sensor Tower. This includes downloads from its earlier iteration, Locker Room — an app Spotify acquired to make its move into live audio.
On Android, Google Play data indicates the app has been installed over 100,000 times, but Sensor Tower cannot yet confirm this figure.
For comparison, Clubhouse today has 30.2 million total installs, 18.7 million of which are on iOS, Sensor Tower says.
Other top audio apps include Airtime, with 11.4 million iOS installs, out of a total of 14.3 million (including Android); and Spoon, with 7.6 million iOS installs, out of a total of 27.3 million.
International apps like UAE’s Yalla and China’s Lizhi are massive, as well, with the former sporting 48.1 total installs, 3.8 million of which are on iOS. The latter has 29.5+ million total installs, but only a handful on iOS.
There are other newcomers that have managed to stake smaller claims in the social audio space, too, including Fishbowl (759,000 total installs), Cappuccino (497,000 installs), Riff (339,000 installs) and Sonar (154,000 installs.)
Spotify Greenroom’s launch last month, meanwhile, seems to have attracted only a small fraction of Spotify’s larger user base, which has now grown to 365 million monthly active users.
The majority of Greenroom’s installs — around 106,000 — took place after Greenroom’s official launch on July 16, 2021 through July 25, 2021, Sensor Tower says. Counting only its Greenroom installs, the app is ranked at No. 12 among social audio apps. It follows Tin Can, which gained 127,000 installs since launching in early March.
Because Greenroom took over Locker Room’s install base, some portion of Greenroom’s total iOS installs (141K) included downloads that occurred when the app was still Locker Room. But that number is fairly small. Sensor Tower estimates Locker Room saw only around 35,000 total iOS installs to date. That includes the time frame of October 26, 2020 — the month when the sports chat app launched to the public — up until the day before Greenroom’s debut (July 15, 2021).
We should also point out that downloads are not the same thing as registered users, and are far short of active users. Many people download a new app to try it, but then abandon it shortly after downloading it, or never remember to open it at all.
That means the number of people actively using Greenroom at this time, is likely much smaller that these figures indicate.
Spotify declined to comment on third-party estimates.
While Sensor Tower looked at competition across social audio apps on the app stores, Spotify’s competition in the live audio market won’t be limited to standalone apps, of course.
Other large tech platforms have more recently integrated social audio into their apps, too, including Facebook (Live Audio Rooms), Twitter (Spaces), Discord (Stage Channels) and trading app Public. A comparison with Greenroom here is not possible, as these companies would have to disclose how many of their active users are engaging with live audio, and they have not yet done so.
Despite what may be a slower uptake, Greenroom shouldn’t be counted out yet. The app is brand-new, and has time to catch up if all goes well. (And if the market for live audio, in general, continues to grow — even though the height of Covid lockdowns, which prompted all this live audio socializing in the first place, seems to have passed.)
Spotify’s success or failure with live audio will be particularly interesting to watch given the potential for the company to cross-promote live audio shows, events, and artist-produced content through its flagship streaming music application. What sort of programming Greenroom may later include is still unknown, however.
Following Spotify’s acquisition of Locker Room maker Betty Labs, the company said it would roll out programmed content related to music, culture, and entertainment, in addition to sports. It also launched a Creator Fund to help fuel the app with new content.
But so far, Spotify hasn’t given its users a huge incentive to visit Greenroom.
The company, during its Q2 2021 earnings, explained why. It said it first needed to get Greenroom stabilized for a “Spotify-sized audience,” which it why it only soft-launched the app in June. Going forward, Spotify says there will be “more tie-ins” with the main Spotify app, but didn’t offer any specifics.
“Obviously we’ll leverage our existing distribution on Spotify,” noted Spotify CEO Daniel Ek. “But this feels like a great way to learn, experiment and iterate, much faster than if we had to wait for a full on integration into the main app,” he added.
Google unveils its proposed ‘Safety Section’ for apps on Google Play – TechCrunch
In the wake of Apple’s advances into consumer privacy with initiatives like App Tracking Transparency and App Store privacy labels, Google recently announced its own plans to introduce a new “safety section” on Google Play that offers more information about the data apps collect and share, and other security and privacy details. Today, the company is sharing for the first time what the new section’ user interface will look like, along with other requirements for developers.
In May, Google explained the safety section would be designed to easily communicate to users how apps are handling their data, so they could make informed choices. It said app developers would need to disclose to users whether their app uses security practices like data encryption, whether it follows Google Play’s Families policy for apps aimed at kids, whether users have a choice in data sharing, whether the app’s safety section had been verified by a third party, and if the app allowed users to request data deletion at the time of uninstall, among other things.
In the user interface concept Google debuted today, developers are now able to see how this feature will look to the end user.
In the safety section, users will be able to see the developer’s explanation of what data the app collects followed by those other details, each with their own icon to serve as a visual indicator.
When users tap into the summary, they’ll be able to then see other details like what data is collected or shared — like location, contacts, personal information (e.g., name, email address), financial information and more.
They’ll also be able to see how the data is used — for app functionality, personalization, etc. — and whether data collection is optional.
Google says it wants to give developers plenty of time to prepare for these Play Store changes which is why it’s now sharing more information about the data type definitions, user journey and policy requirements of the new feature.
In October 2021, developers will be able to submit their information in the Google Play Console for review, ahead of the planned launch of the safety section in Google Play, which is scheduled for the first quarter of 2022.
The company also notes it’s offering some buffer time after the section’s launch before apps must have their safety section approved by Google. However, the company says apps will have to be approved by Q2 2022 or risk having their app submissions or app updates rejected. And if an app doesn’t provide an approved safety section, the app will say “No information available.”
The change will help to highlight how many active developers are present on Google Play, as those will be the ones who will adopt the new policy and showcase how their apps collect and use data.
The question that remains is how stringent Google will be about enforcing its new guidelines and how carefully apps will be reviewed. One interesting note here is that conscientious developers will be able to submit their safety section for a third-party review and then be able to promote that to users concerned app data privacy and security.
This could help to address some potential criticism that these safety sections aren’t factual. That’s been a problem for Apple since the launch of its App Store privacy labels, in fact. The Washington Post discovered that a number of apps were displaying false information, making them less helpful to the users whose data they aimed to protect.
When reached for comment, however, Google declined to share more details about how the third-party verification process will work.
Twitter ‘acqui-hires’ the team from subscription news app, Brief – TechCrunch
Twitter’s recent acquisition spree continues today as the company announces it has acqui-hired the team from news aggregator and summary app Brief. The startup from former Google engineers launched last year to offer a subscription-based news summary app that aimed to tackle many of the problems with today’s news cycle, including information overload, burnout, media bias, and algorithms that promoted engagement over news accuracy.
Twitter declined to share deal terms.
Before starting Brief, co-founder and CEO Nick Hobbs was a Google product manager who had worked on AR, Google Assistant, Google’s mobile app, and self-driving cars, among other things. Co-founder and CTO Andrea Huey, meanwhile, was a Google senior software engineer, who worked on the Google iOS app and had a prior stint at Microsoft.
While Brief’s ambitious project to fix news consumption showed a lot of promise, its growth may have been hampered by the subscription model it had adopted. The app required a $4.99 per month commitment, despite not having the brand-name draw of a more traditional news outlet. For comparison, The New York Times’ basic digital subscription is currently just $4 per week for the first year of service, thanks to a promotion.
Twitter says the startup’s team, which also includes two other Brief employees, will join Twitter’s Experience.org group where they’ll work on areas that support the public conversation on Twitter, including Twitter Spaces and Explore.
While Twitter wouldn’t get into specifics as to what those tasks may involve, the company did tell TechCrunch it hopes to leverage the founders’ expertise with Brief to build out and accelerate projects in both those areas.
Explore, of course, is Twitter’s “news” section, where top stories across categories are aggregated alongside trending topics. But what it currently lacks is a comprehensive approach to distilling the news down to the basic facts and presenting balance, as Brief’s app had offered. Instead, Twitter’s news items include a headline and a short description of the story, followed by notable tweets. There’s certainly room for improvement there.
It’s also possible to imagine some sort of news-focused product built into Twitter’s own subscription service, Twitter Blue — but that’s just speculation at this point.
Twitter says it proactively reached out to Brief with its offer. As part of its current M&A strategy, the company is on the hunt for acquiring talent that will complement its existing teams and help to accelerate its product developments.
Over the past year, Twitter has made similar acqui-hires, including those for distraction-free reading service Scroll, social podcasting app Breaker, social screen-sharing app Squad, and API integration platform Reshuffle. It also bought products, like newsletter platform Revue, which it directly integrated. The company even held acquisition talks with Clubhouse and India’s ShareChat, which would have been much larger M&A deals.
“We’re really glad we ended up at Twitter,” Hobbs told TechCrunch.
“Andrea and I founded Brief to build news that fostered a healthy discourse, and Twitter’s genuine commitment to improve the public conversation is deeply inspiring,” he said. “While we can’t discuss specifics on future plans, we’re confident our experience at Brief will help accelerate the many exciting things happening at Twitter today,” he added.
Hobbs said the team remains optimistic about the future of paid journalism, too, as Brief demonstrated that some customers would pay for a new and improved news experience.
“Brief pioneered a fresh vision for journalism, focused on getting you just the news you need rather than as much as you could withstand,” remarked Ilya Kirnos, founding partner and CTO at SignalFire, who backed Brief at the seed stage. “That respect for its readers made SignalFire proud to support founders Nick Hobbs and Andrea Huey, who are now bringing that philosophy to the top source of breaking news — Twitter.”
To date, Brief had raised a million in seed funding from SignalFire and handful of angel investors, including Sequoia Scouts like David Lieb, Maia Bittner, and Matt Macinnis.
As a result of today’s deal, Brief will wind down its subscription app on July 31. The company says it will alert its current user base today via a notification about its forthcoming shutdown but the app will remain on the App Store offering new features that allow users to explore its archives.
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