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Chat app Line’s games business raises $110M for growth opportunities

Chat app Line’s games business raises 0M for growth opportunities

Messaging app firm Line has given up majority control of its Line Games business after it raised outside financing to expand its collection of titles and go after global opportunities.

The Line Games business was formed earlier this year when Line merged its existing gaming division from NextFloor, the Korea-based game publisher that it acquired in 2017. Now the business has taken on capital from Anchor Equity Partners, which has provided 125 billion KRW ($110 million) in financing via its Lungo Entertainment entity, according to a disclosure from Line.

A Line spokesperson clarified that the deal will see Anchor acquire 144,743 newly-created shares to take a 27.55 percent stake in Line Games. That increase means Line Corp’s own shareholding is diluted from 57.6 percent to a minority 41.73 percent stake.

Korea-based Anchor is best known for a number of deals in its homeland including investments in e-commerce giant Ticket Monster, Korean chat giant Kakao’s Podotree content business and fashion retail group E-Land.

Line operates its eponymous chat app which is the most popular messaging platform in Japan, Thailand and Taiwan, and also significantly used in Indonesia, but gaming is a major source of income. This year to date, Line has made 28.5 billion JPY ($250 million) from its content division, which is primarily virtual goods and in-app purchases from its social games. That division accounts for 19 percent of Line’s total revenue, and it is a figure that is only better by its advertising unit, which has grossed 79.3 billion JPY, or $700 million, in 2018 to date.

The games business is currently focused on Japan, Korea, Thailand and Taiwan, but it said that the new capital will go towards finding new IP for future titles and identifying games with global potential. It is also open to more strategic deals to broaden its focus.

While Line has always been big on games, Line Games isn’t just building for its own service. The company said earlier this year that it plans to focus on non-mobile platforms, which will include the Nintendo Switch among others consoles.

That comes from the addition of NextFloor, which is best known for titles like Dragon Flight and Destiny Child. Dragon Flight has racked up 14 million users since its 2012 launch, at its peak it saw $1 million in daily revenue. Destiny Child, a newer release in 2016, topped the charts in Korea and has been popular in Japan, North America and beyond.

Line went public in 2016 via a dual U.S.-Japan IPO that raised over $1 billion.

Note: the original version of this article was updated to clarify that Lungo Entertainment is buying newly-issued shares.

Chat app Line’s games business raises 0M for growth opportunities
Source: TechCrunch

Four days left before Disrupt Berlin 2018 early-bird pricing goes extinct

Four days left before Disrupt Berlin 2018 early-bird pricing goes extinct

Listen up, Menschen. In German, it’s time to Himmel und Hölle in Bewegung setzen — put heaven and hell in motion. In English, it’s time to move heaven and earth. Say it anyway you like, you still have only four days left to save up to €500 on passes to Disrupt Berlin 2018.

The early-bird price disappears forever on Friday, 2 November. Do your bottom line a big favor and buy your ticket today.

No matter what role you play in the startup ecosystem, Disrupt Berlin offers plenty of opportunity to learn, network and collaborate. You don’t have to take our word for it. Take a look at what these previous attendees have to say about their Disrupt experience:

  • The exposure we received at TechCrunch Disrupt completely changed our trajectory and made it easier to raise funds and jump to the next stage. — David Hall, co-founder and president, Park & Diamond.
  • I get the most value at the intersection of CrunchMatch and Startup Battlefield. If I see an interesting company present on stage, I use CrunchMatch to quickly schedule a meeting with them for later that day. It makes vetting deals extremely efficient. — Michael Kocan, managing partner, Trend Discovery.
  • I spent time exploring Startup Alley just to get out of my own day-to-day, to learn new ways of thinking and to get inspired. The conversations I had with startups outside of content, media or social networking gave me fresh ideas that I can modify and apply in my own industry. — Carrie Friedrich, senior product marketing manager, LinkedIn.
  • TechCrunch Disrupt was a massively positive experience. It gave us the chance to show our technology to the world and have meaningful conversations with investors, accelerators, incubators, solo founders and developers. — Vlad Larin, co-founder, Zeroqode.

Disrupt Berlin 2018 takes place on 29-30 November. Whether you come to Disrupt looking for funding, founders, collaborators, customers or a hefty dose of inspiration, it’s time to Himmel und Hölle in Bewegung setzen. Buy your ticket before Friday, 2 November and save up to €500. We can’t wait to see you there!

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Four days left before Disrupt Berlin 2018 early-bird pricing goes extinct
Source: TechCrunch

Five days left to reap big early-bird savings for Disrupt Berlin 2018

Five days left to reap big early-bird savings for Disrupt Berlin 2018

This is it, startup fans. We’re in the homestretch for big savings on tickets to Disrupt Berlin 2018. That means you have just five days left to save up to €500 on two action- and opportunity-packed days with some of the best and brightest minds in the tech startup world. The early-bird price becomes extinct on Friday, 2 November. Haven’t you waited long enough? Buy your ticket today.

We’ve recruited a killer line-up of Main Stage speakers — tech luminaries, business legends and game-changing investors — to share their perspective, experience and insight. Here’s a quick peek at what we have in store for you — and be sure to take a gander at the Disrupt Berlin agenda:

  • Kaidi Ruusalepp, founder and CEO of Funderbeam, will discuss how her company’s shaking up the traditional startup funding model by using a marketplace approach, a modern syndication system and a blockchain-based platform.
  • Pieter van der Does, CEO of payments company Adyen, will share how the startup quietly built its empire and took a profitable company public.
  • Denys Zhadanov, VP at Readdle, will talk about the mobile app company’s bootstrapped success — 100 million downloads and counting.

Opportunity at Disrupt Berlin abounds at every turn, but it shifts into overdrive once you enter Startup Alley, our exhibition floor. You’ll find more than 400 early-stage startups showcasing the latest technology products, platforms and services. Collaborate, recruit, invest, connect — it all happens in Startup Alley.

While you’re in the Alley, be sure to check out this year’s TC Top Picks — our curated cohort of exceptional startups spanning these categories: AI/Machine Learning, Blockchain, CRM/Enterprise, E-commerce, Education, Fintech, Healthtech/Biotech, Hardware, Robotics, IoT, Mobility and Gaming. Here are just a few fine examples:

  • Nuzzera: Your Spotify for news — the first two-sided market for professional journalism.
  • MakerBrane: A digital and physical platform that lets anyone design, build and trade their own play worlds.
  • FinMarie: Germany’s first online financial platform for women.

And, of course, you don’t want to miss Startup Battlefield — the crown jewel of Disrupt. Watch up to 15 outstanding early-stage startups go head-to-head to win $50,000 cash, hoist the coveted Disrupt Cup, earn invaluable investor and media attention and launch their companies on a global stage.

Disrupt Berlin 2018 takes place on 29-30 November, and the finish line for saving up to €500 is Friday 2 November — just five days left. Buy your pass today, and join us in Berlin at the best possible price.

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Five days left to reap big early-bird savings for Disrupt Berlin 2018
Source: TechCrunch

Facial recognition startup Kairos founder continues to fight attempted takeover

Facial recognition startup Kairos founder continues to fight attempted takeover

Facial recognition startup Kairos founder continues to fight attempted takeover

There’s some turmoil brewing over at Miami-based facial recognition startup Kairos . Late last month, New World Angels President and Kairos board chairperson Steve O’Hara sent a letter to Kairos founder Brian Brackeen notifying him of his termination from the role of chief executive officer. The termination letter cited willful misconduct as the cause for Brackeen’s termination. Specifically, O’Hara said Brackeen misled shareholders and potential investors, misappropriated corporate funds, did not report to the board of directors and created a divisive atmosphere.

Kairos is trying to tackle the society-wide problem of discrimination in artificial intelligence. While that’s not the company’s explicit mission — it’s to provide authentication tools to businesses — algorithmic bias has long been a topic the company, especially Brackeen, has addressed.

Brackeen’s purported termination was followed by a lawsuit, on behalf of Kairos, against Brackeen, alleging theft, a breach of fiduciary duties — among other things. Brackeen, in an open letter sent a couple of days ago to shareholders — and one he shared with TechCrunch — about the “poorly constructed coup,” denies the allegations and details his side of the story. He hopes that the lawsuit will be dismissed and that he will officially be reinstated as CEO, he told TechCrunch. As it stands today, Melissa Doval who became CFO of Kairos in July, is acting as interim CEO.

“The Kairos team is amazing and resilient and has blown me away with their commitment to the brand,” Doval told TechCrunch. “I’m humbled by how everybody has just kind of stuck around in light of everything that has transpired.”

The lawsuit, filed on October 10 in Miami-Dade and spearheaded by Kairos COO Mary Wolff, alleges Brackeen “used his position as CEO and founder to further his own agenda of gaining personal notoriety, press, and a reputation in the global technology community” to the detriment of Kairos. The lawsuit describes how Brackeen spent less than 30 percent of his time in the company’s headquarters, “even though the Company was struggling financially.”

Other allegations detail how Brackeen used the company credit card to pay for personal expenses and had the company pay for a car he bought for his then-girlfriend. Kairos alleges Brackeen owes the company at least $60,000.

In his open letter, Brackeen says, “Steve, Melissa and Mary, as cause for my termination and their lawsuit against me, have accused me of stealing 60k from Kairos, comprised of non-work related travel, non-work related expenses, a laptop, and a beach club membership,” Brackeen wrote in a letter to shareholders. “Let’s talk about this. While I immediately found these accusations absurd, I had to consider that, to people on the outside of  ‘startup founder’ life— their claims could appear to be salacious, if not illegal.”

Brackeen goes on to say that none of the listed expenses — ranging from trips, meals, rides to iTunes purchases — were not “directly correlated to the business of selling Kairos to customers and investors, and growing Kairos to exit,” he wrote in the open letter. Though, he does note that there may be between $3,500 to $4,500 worth of charges that falls into a “grey area.”

“Conversely, I’ve personally invested, donated, or simply didn’t pay myself in order to make payroll for the rest of the team, to the tune of over $325,000 dollars,” he wrote. “That’s real money from my accounts.”

Regarding forcing Kairos to pay for his then-girlfriend’s car payments, Brackeen explains:

On my making Kairos ‘liable to make my girlfriend’s car payment’— in order to offset the cost of Uber rides to and from work, to meetings, the airport, etc, I determined it would be more cost effective to lease a car. Unfortunately, after having completely extended my personal credit to start and keep Kairos operating, it was necessary that the bank note on the car be obtained through her credit. The board approved the $700 per month per diem arrangement, which ended when I stopped driving the vehicle. Like their entire case— its not very sensational, when truthfully explained.

The company also claims Brackeen has interfered with the company and its affairs since his termination. Throughout his open letter, Brackeen refers to this as an “attempted termination” because, as advised by his lawyers, he has not been legally terminated. He also explains how, in the days leading up to his ouster, Brackeen was seeking to raise additional funding because in August, “we found ourselves in the position of running low on capital.” While he was presenting to potential investors in Singapore, Brackeen said that’s “when access to my email and documents was cut.”

He added, “I traveled to the other side of the world to work with my team on IP development and meet with the people who would commit to millions in investment— and was fired via voicemail the day after I returned.”

Despite the “termination” and lawsuit, O’Hara told TechCrunch via email that “in the interest of peaceful coexistence, we are open to reaching an agreement to allow Brian to remain part of the family as Founder, but not as CEO and with very limited responsibilities and no line authority.”

O’Hara also noted the company’s financials showed there was $44,000 in cash remaining at the end of September. He added, “Then reconcile it with the fact that Brian raised $6MM in 2018 and ask yourself, how does a company go through that kind of money in under 9 months.”

Within the next twelve days, there will be a shareholder vote to remove the board, as well as a vote to reinstate Brackeen as CEO, he told me. After that, Brackeen said he intends to countersue Doval, O’Hara and Wolff.

In addition to New World Angels, Kairos counts Kapor Capital, Backstage Capital and others as investors. At least one investor, Arlan Hamilton of Backstage Capital, has publicly come out in support of Brackeen.

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As previously mentioned, Brackeen has been pretty outspoken about the ethical concerns of facial recognition technologies. In the case of law enforcement, no matter how accurate and unbiased these algorithms are, facial recognition software has no business in law enforcement, Brackeen said at TechCrunch Disrupt in early September. That’s because of the potential for unlawful, excessive surveillance of citizens.

Given the government already has our passport photos and identification photos, “they could put a camera on Main Street and know every single person driving by,” Brackeen said.

And that’s a real possibility. In the last couple of months, Brackeen said Kairos turned down a government request from Homeland Security, seeking facial recognition software for people behind moving cars.

“For us, that’s completely unacceptable,” Brackeen said.

Whether that’s entirely unacceptable for Doval, the interim CEO of Kairos, is not clear. In an interview with TechCrunch, Doval said, “we’re committed to being a responsible and ethical vendor” and that “we’re going to continue to champion the elimination of algorithmic bias in artificial intelligence.” While that’s not a horrific thing to say, it’s much vaguer than saying, “No, we will not ever sell to law enforcement.”

Selling to law enforcement could be lucrative, but that comes with ethical risks and concerns. But if the company is struggling financially, maybe the pros could outweigh the cons.

Facial recognition startup Kairos founder continues to fight attempted takeover
Source: TechCrunch

Tesla is rolling out its Navigate on Autopilot feature

Tesla is rolling out its Navigate on Autopilot feature

Some Tesla owners in North America will wake up to a new driver assistance feature that had been delayed for testing, according to a tweet sent Friday evening by CEO Elon Musk.

“Tesla Autopilot Drive on Navigation going to wide release in North America tonight,” Musk tweeted. Tesla Autopilot Drive on Navigation is described by the company as its most advanced driver assistance feature to date. The feature, which is typically referred to as Navigate on Autopilot or just Navigate, was held back earlier this month when the automaker released the latest version of its in-car software, 9.0.

A blog posted by Tesla later in the evening said the feature would begin to roll out this week to U.S. customers who have purchased enhanced Autopilot or full self-driving capability. Tesla has offered enhanced Autopilot and FSD capability as upgrades that cost, $5,000 and $3,000, respectively.

Tesla’s vehicles are not self-driving. Autopilot is an advanced driver assistance system. But back in October 2016, when Tesla started producing Hardware 2 vehicles equipped with a more robust suite of sensors, it also started taking money from customers for FSD, which would become available if and when the technical challenges were conquered and regulatory approvals were met. Tesla removed the option to upgrade to FSD from its website, although Musk has said customers can still request it.

Autopilot on Navigate is considered a step towards that still on-met full self-driving promise; albeit it’s a small one.

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Tesla’s 9.0 software, which was released in early October, delivered a host of improvements, including a new dash cam feature (for cars built after August 2017), improved navigation and even Atari games that can be played when parked. But Navigate was held back. It was later introduced as a beta feature to some customers in the U.S.

Navigate is an active guidance feature of the company’s Enhanced Autopilot system that is supposed to guide a car from a highway on-ramp to off-ramp, including navigating interchanges and making lane changes. Once the driver enters a destination into the navigation, they can enable “Navigate on Autopilot” for that trip.

Tesla has placed some limitations on Navigate. For now, the feature makes a lane change suggestion that requires the driver to confirm by tapping the turn signal before it will proceed.

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Future versions of Navigate on Autopilot will allow customers to waive the confirmation requirement if they choose to, according to a blog posted by Tesla late Friday evening.

In Musk’s view, the feature will require confirmation until safety “looks good after 10M miles of driving, or so.”

Navigate on Autopilot will make suggestions for two different kinds of lane changes: route-based lane changes that allow the driver to stick with the navigation route, and speed-based lane changes, which are designed to keep the vehicle moving as close to the driver’s set speed as possible.

The speed-based lane changes have four settings, including disabled, mild, average, or Mad Max. This will suggest transitions into other lanes that are moving faster if, for example, the driver approaches a slow-moving car or truck ahead. The “mild” setting suggests lane changes when the driver is traveling significantly slower than the set speed. Mad Max will suggest lane changes when traveling just below the driver’s set speed.

Tesla is rolling out its Navigate on Autopilot feature
Source: TechCrunch