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Tradeshift cuts headcount by three figures in effort to turn towards profitability

Last month Tradeshift, a platform for supply chain payments which has achieved unicorn startups in recent years, had some good news and some bad news. It announced a Series F funding round of $240 million in equity and debt, raised from a combination of existing and new investors. It’s now raised a total of $661M since it started in 2008 and investors include Goldman Sachs, Principal Strategic Investments and Wipro Ventures among others.

The new funding came, despite talk of a possible IPO last year. In effect, this new funding round was an admission by the company that it was delaying any IPO and setting the company “on a direct path to profitability in the near future,” which is exactly the kinds of noises many larger tech firms have made in the wake of the WeWork and Peleton issues with the public markets.

During that announcement CEO and co-founder Christian Lanng also admitted that the drive toward profitability would mean a cost-cutting exercise ahead of any possible IPO.

Lanng said this would likely mean reducing headcount in its expensive San Francisco offices, but reallocating resources and talent to locations where that is more affordable.

The company has many no formal announcement about the detail on that, but yesterday we got confirmation from the European tech press that the cuts were indeed starting to bite.

The Danish version of ComputerWorld reported that the staffing cuts have now run into 3 figures and were conducted in mid-January.

The cuts came from headcount at the company’s offices in Copenhagen, San Francisco and other offices.

Mikkel Hippe Brun, a co-founder of Tradeshift and head of the company’s Asian business, confirmed the information to Computerworld, but indicated that “there are still some consultations around the world, where we are subject to different rules about notifications and opportunities to raise objections.”

However, he said that the company still has more than 1,000 employees worldwide, which is “significantly more employees” than two years ago.

At the same time, the company has also brought in new executives from SAP, Oracle and Microsoft, among others, as the company tightens its belt, according to ComputerWorld.

Tradeshift has an impressive array of investors such as Goldman Sachs, although it’s notable that this doesn’t include any of the usual round of typical SaaS-oriented Valley VCs.

Tradeshift customers have included Air France KLM, Kuehne + Nagel International AG, DHL, Fujitsu, HSBC, Siemens, Société Générale, Unilever, and Volvo.

Former Google X ecec Mo Gawdat wants to reinvent consumerism

Mo Gawdat, the former Google and Google X executive, is probably best known for his book Solve for Happy: Engineer Your Path to Joy. He left Google X last year. Quite a bit has been written about the events that led to him leaving Google, including the tragic death of his son. While happiness is still very much at the forefront of what he’s doing, he’s also now thinking about his next startup: T0day.

To talk about T0day, I sat down with the Egypt-born Gawdat at the Digital Frontrunners event in Copenhagen, where he gave one of the keynote presentations. Gawdat is currently based in London. He has adopted a minimalist lifestyle, with no more than a suitcase and a carry-on full of things. Unlike many of the Silicon Valley elite that have recently adopted a kind of performative aestheticism, Gawdat’s commitment to minimalism feels genuine — and it also informs his new startup.

07 28 19 Frontrunner 38“In my current business, I’m building a startup that is all about reinventing consumerism,” he told me. “The problem with retail and consumerism is it’s never been disrupted. E-commerce, even though we think is a massive revolution, it’s just an evolution and it’s still tiny as a fraction of all we buy. It was built for the Silicon Valley mentality of disruption, if you want, while actually, what you need is cooperation. There are so many successful players out there, so many efficient supply chains. We want the traditional retailers to be successful and continue to make money — even make more money.”

What T0day wants to be is a platform that integrates all of the players in the retail ecosystem. That kind of platform, Gawdat argues, never existed before, “because there was never a platform player.”

That sounds like an efficient marketplace for moving goods, but in Gawdat’s imagination, it is also a way to do good for the planet. Most of the fuel burned today isn’t for moving people, he argues, but goods. A lot of the food we buy goes to waste (together with all of the resources it took to grow and ship it) and single-use plastic remains a scourge.

How does T0day fix that? Gawdat argues that today’s e-commerce is nothing but a digital rendering of the same window shopping people have done for ages. “You have to reimagine what it’s like to consume,” he said.

The reimagined way to consume is essentially just-in-time shipping for food and other consumer goods, based on efficient supply chains that outsmart today’s hub and spoke distribution centers and can deliver anything to you in half an hour. If everything you need to cook a meal arrives 15 minutes before you want to start cooking, you only need to order the items you need at that given time and instead of a plastic container, it could come a paper bag. “If I have the right robotics and the right autonomous movements — not just self-driving cars, because self-driving cars are a bit far away — but the right autonomous movements within the enterprise space of the warehouse, I could literally give it to you with the predictability of five minutes within half an hour,” he explained. “If you get everything you need within half an hour, why would you need to buy seven apples? You would buy three.”

Some companies, including the likes of Uber, are obviously building some of the logistics networks that will enable this kind of immediate drop shipping, but Gawdat doesn’t think Uber is the right company for this. “This is going to sound a little spiritual. There is what you do and there is the intention behind why you do it,” he said. “You can do the exact same thing with a different intention and get a very different result.”

That’s an ambitious project, but Gawdat argues that it can be done without using massive amounts of resources. Indeed, he argues that one of the problems with Google X, and especially big moonshot projects like Loon and self-driving cars, was that they weren’t really resource-constrained. “Some things took longer than they should have,” he said. “But I don’t criticize what they did at all. Take the example of Loon and Facebook. Loon took longer than it should have. In my view, it was basically because of an abundance of resources and sometimes innovation requires a shoestring. That’s my only criticism.”

T0day, which Gawdat hasn’t really talked about publicly in the past, is currently self-funded. A lot of people are advising him to raise money for it. “We’re getting a lot of advice that we shouldn’t self-fund,” he said, but he also believes that the company will need some strategic powerhouses on its side, maybe retailers or companies that have already invested in other components of the overall platform.

T0day’s ambitions are massive, but Gawdat thinks that his team can get the basic elements right, be that the fulfillment center design or the routing algorithms and the optimization engines that power it all. He isn’t ready to talk about those, though. What he does think is that T0day won’t be the interface for these services. It’ll be the back end and allow others to build on top. And because his previous jobs have allowed him to live a comfortable life, he isn’t all that worried about margins either, and would actually be happy if others adopted his idea, thereby reducing waste.

WeChat wants to own tourism

When people travel, they usually have a list of apps installed to navigate a new city, find restaurants, book transit tickets and more. China’s top chat app WeChat has designs on claiming that spot with a new strategy that lumps all these functions into a collection of destination-specific apps.

Operated by Tencent, Asia’s second most valuable tech giant, WeChat is a so-called “super app” defined by the myriad of services it hosts ranging from ride-hailing and food delivery to e-commerce and payments. Its efforts to dominate China received a huge boost back in 2017 when it launched “mini programs”, easily-downloadable apps that provide stripped-down but essential functionality. Millions of these lite apps are serving WeChat’s one billion users today, and WeChat is now adding travel to the list of needs it addresses.

One of WeChat’s first attempts at aiding tourism is a mini app called “MyHelsinki”, a collaboration between Tencent, mobility startup Whim, the city of Helsinki and other partners. In effect, the WeChat-powered app is a hybrid of Lonely Planet, Yelp, Google Translator, Uber and an e-wallet for Chinese tourists who visit the Finnish capital, and it has plans to replicate the system elsewhere in the world.