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Worried about a slowdown It already happened in 2016 says one new venture study

In today’s market, it’s hard to make sense of what’s what. Deals have grown incestuous for the first time, with outfits like GV investing alongside Uber last week — just months after its parent company, Alphabet, was at Uber’s throat. A $10 million-plus round of seed funding is no longer a joke. Venture firms continue to raise record-breaking amounts of money, despite what feels like creeping uncertainty about how much longer this go-go market can continue.

Unsurprisingly, there’s been some talk lately about deal flow and the possibility that some of the most well-regarded early-stage investors in the industry have quietly applied the brakes. But new analysis out of Wing, the 7.5-year-old, Silicon Valley venture firm co-founded by veteran VCs Peter Wagner and Gaurav Garg, draws a conclusion that might surprise nervous industry watchers: After tracking the investment activity of what Wing considers to be the 21 leading venture firms, it discovered that a pullback already happened . . . in 2016. In fact, Wagner, who oversaw the analysis, tells us there’s been so sign of a slowdown since then.

We caught up with Wagner last week to learn more about Wing’s analysis — and what might be causing some confusion in the industry right now.

TC: First, why do this kind of study right now?

PW: There’s been a lot of analysts and reporters and LPs and VCs asking us about our investment pace really, and I think it owes to talk of Benchmark and Union Square Ventures slowing down, so we thought we’d look at some parameters and see what’s going on.

TC: Why not just refer to industry-wide statistics? It seems like there are plenty of these.

PW: They’re kind of swamped with the data of less discriminating investors, though. You really want to focus on the signal, which is why we track what the 21 leading venture firms are doing, and in that analysis, we found no signs of a slowdown. We found instead that there was a peak of activity in 2013 and 2014, a pullback in 2016, and an uptick since.

And we cut it different ways. We removed international deals in China and India, because they have th

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Midwest rising

Emerging venture capital firms in smaller American cities from Indianapolis to Princeton, NJ are attracting increasingly larger funding as investors see opportunities for returns beyond the coastal confines of the nation’s largest cities and the innovation epicenter of Silicon Valley.

For the last four years, AOL co-founder Steve Case has been criss-crossing the country preaching a gospel of economic renewal for American cities driven by startup investment and technology-based entrepreneurialism. With Case those journeys culminated in the creation of a fund called Rise of the Rest — a $150 million vehicle raised by some of tech’s highest-profile names.

Investors like Amazon founder Jeff Bezos, Eric Schmidt, the chairman of Google’s parent company, Alphabet; Jim Bryer, the former head of the National Venture Capital Association and an early investor in Facebook; Kleiner Perkins Caufield & Byers partner John Doerr; and Facebook’s former President Sean Parker; came together with the family offices of some of America’s wealthiest people to back the fund.

As Schmidt told The Times, “There is a large selection of relatively undervalued businesses in the heartland between the coasts, some of which can scale quickly.”

Steve Case (Revolution LLC) at TechCrunch Disrupt NY 2017

Case and his partner JD Vance (the author of Hillbilly Elegy) are only two of the would-be pioneers that are bringing the venture investment model to the Midwest. In fact, it has been about four years since Mark Kvamme and Chris Olsen left the West Coast and Silicon Valley to launch Drive Capital — the venture capital firm they founded in Columbus, Ohio.

In that time the firm has managed to raise over half a billion dollars to invest in startups based primarily in the Midwest, and has spurred an investment revolution in areas of the country that are more synonymous with tractors than with technological innovation. 

But the Midwestern investment scene isn’t just defined by Valley transplants coming in. Some of the entrepreneurs behind the region’s home-grown success stories, like Indianapolis’ ExactTarget, have launched funds of their own to plant an entirely new crop of tech companies in the Midwest.

Homegrown Heroes

These are fun

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‘Underwater Pokéball’ snatches up soft-bodied deep dwellers

Creatures that live in the depths of the oceans are often extremely fragile, making their collection a difficult affair. A new polyhedral sample-collection mechanism acts like an “underwater Pokéball,” allowing scientists to catch ’em all without destroying their soft, squishy bodies in the process.

The ball is technically a dodecahedron that closes softly around the creature in front of it. It’s not exactly revolutionary, except in that it is extremely simple mechanically — at depths of thousands of feet, the importance of this can’t be overstated — and non-destructive.

Sampling is often done via a tube with moving caps on both ends into which the creature must be guided and trapped, or a vacuum tube that sucks it in, which as you can imagine is at best unpleasant for the target and at worst, lethal.

The rotary actuated dodecahedron, or RAD, has five 3D-printed “petals” with a complex-looking but mechanically simple framework that allows them to close up simultaneously from force applied at a single point near the rear panel.

“I was building microrobots by hand in graduate school, which was very painstaking and tedious work,” explained creator Zhi Ern Teoh, of Harvard’s Wyss Institute, “and I wondered if there was a way to fold a flat surface into a three-dimensional shape using a motor instead.”

The answer is yes, obviously, since he made it; the details are published in Science Robotics. Inspired by origami and papercraft, Teoh and his colleagues applied their design knowledge to creating not just a fold-up polyhedron (you can cut one out of any sheet of paper) but a mechanism that would perform that folding process in one smooth movement. The result is the network of hinged arms around the polyhedron tuned to push lightly and evenly and seal it up.

In testing, the RAD successfully captured some moon jellies in a pool, then at around 2,000 feet below the ocean surface was able to snag squid, octopus and wild jellies and release them again with no harm done. They didn’t capture the octopus on camera, but apparently it was curious about the device.

Because of the RAD’s design, it would wor

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Senate wants emergency alerts to go out through Netflix Spotify etc

An emergency alert goes out, trying to let you know about incoming bad news — a missile, a tsunami or something else terrifying. Your phone starts shouting… but it’s downstairs. A warning ticker pops on TVs, if you’re watching cable… but you’ve got your eyes glued to Netflix, or Hulu, or some other online streaming service.

Should these services, with their ever-increasing ownership of our screen time, be prepped to broadcast these warnings?

Senators in Hawaii and South Dakota think so, having just introduced a bill (the “Reliable Emergency Alert Distribution Improvement,” or READI, act) that would “explore” broadcasting alerts to “online streaming services, such as Netflix and Spotify,” amongst other changes to the Emergency Alert System.

“Hawaii? Wasn’t that the state that had a very public false alarm with its emergency alert system?”

Yep! But it seems that in investigating what went wrong, the state found plenty of long-lived shortcomings in the existing, aging alert system.

Some of the other things the bill touches on:

Users on many phones can currently disable federal alerts; they want to get rid of that option Building a better system for reporting false alarms and figuring out what happened Updating the system to better prevent false alarms, and to better retract them when they do happen

The idea of sending emergency alerts to Netflix etc. seems a bit obvious at this point — hell, I was mulling over it right here on TechCrunch back in 2011, and it seemed a bit obvious even back then.

With that said, I still have the same hesitations I had at the time. After the recent false alarms and ensuing panic, it’s clear that any such system needs to be rock solid from a security standpoint — one missed bug or exploit and half the country is freaking out about non-existent incoming missiles when all they wanted to do was watch Orange Is the New Black. If it can be done right, though, it seems like a reasonable idea.

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Hyundai teams up with Amazon to offer virtual showroom

Next time you’re grabbing a new charging cord on Amazon, you might be tempted to grab a new Hyundai as well. Hyundai announced today a partnership with Amazon to create a digital showroom to allow customers to compare pricing and reviews, book a test drive and find a dealer in their area to purchase the car (no, you can’t order them directly from Amazon — yet.)

“The car industry is changing, and customer demands and expectations around a frictionless, efficient and transparent experience are key drivers,” Dean Evans, Hyundai Motor America CMO, said in a statement.

The digital showroom will be incorporated into Amazon’s Vehicle section, which Amazon launched in 2016 for customers to browse automobile makes and models, from Tesla cars to vehicles from Toyota. But, while some of these vehicle profiles are lacking in detailed pictures or model information, Hyundai has created a more robust experience.

On its own unique landing page, Hyundai highlights the brand’s features, such as its compatibility with Alexa and its Shopper Assurance program, and creates a selection of Hyundai vehicles for you based on your preferences and buying habits. From there, you can select a model you’d like to look at and explore it in typical Amazon style — flipping between different product pictures, colors and customer reviews.

After you’re happy with your selection, you can either schedule a test-drive — where you have the option for the car to pick you up in your driveway — or go directly to a dealer near you to sign the paperwork.

With the average industry price of $36,270 for a new car in 2018, according to Kelly Blue Book, maybe it’s a good thing there’s no Dash button for these vehicles just yet.

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