Startups in America are booming


October 13, 2020

PLUS: The business of private coroners.
October 13, 2020
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Roblox, the insanely popular sandbox video game, plans to go public and could be worth as much as $8B. By buying this stock, parents can finally offset all the Robux their kids covertly put on their credit cards.

P.S. Did you hear about the golden tickets?

The Big Idea

America is experiencing a startup boom

In what is pretty much the Super Bowl for economists, the US Census is releasing its Q3 2020 business formation data tomorrow.

Based on the most recent data, people have been getting their startup on. Through the 40th week of 2020 (ending Oct. 3), business applications were up a record 40% YoY.

This builds on the 883k+ biz applications submitted in Q2…

… and is an all-time high, including for “high propensity” businesses, which are linked to firm creation and staff employment, The Economist reports.

This result is contrary to 2 previous trends:

  • “High propensity” applications fell off the cliff after the last recession
  • New-business creation has been on a downward slide for decades

Why was startup creation slowing?

Researchers proffer 2 reasons:

  1. Stagnant population growth
  2. Established corporate powers scaring off new entrants (e.g., our yearslong reluctance to launch HustleBook, a college-to-college social network)

The recent surge in entrepreneurial-dom can draw a straight line to the government pandemic relief efforts, which prioritized income protection ($1.2k stimulus checks + high unemployment insurance) over job protection.

Per The Economist, these factors “gave people both the need (losing their job) and the means (greater financial security) to take on the risk of founding a business.”

The startup boost may be less than meets the eye

The census stats could be juiced by people spinning up businesses to qualify for stimulus money — and a backlog of paused applications from the start of quarantine.

Even if that’s the case, the Shopify-cation of the economy makes it easier than ever to start a new (digitally focused) business.

It wouldn’t be the first time a crisis led to some banger startups: Airbnb and Groupon were founded in 2008 — while WhatsApp, Uber, Slack, Venmo, and Square all launched in 2009.

HustleBook may yet have its day in the sun.

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Snippets
  • The EU is potentially drafting up a “hit list” of tech firms it plans to more closely scrutinize.
  • Here are YC’s biggest “failures” ranked by how much money was raised (Atrium, uBiome, Meta, Call9, Boosted).
  • Luxury cooler maker Yeti is having a great year — and it might be one of the pandemic’s oddest success stories.
  • Instacart is beating even Kroger and Target at online grocery delivery.
  • The guerilla retailer Spirit Halloween is back this season, and its pop-up approach might be its saving grace during an extremely bad year for both retail and Halloween.
  • Bonus: MSCHF’s newest drop will pay you… to put some brands on blast on TikTok.
Upcycled

Can tech companies make bike commutes safer?

In some cities, commuting on a bicycle can feel like turning over your life to the fates.

LINKS Foundation — a research group in Turin, Italy — wants to change that with a 5G transmitter that lets bikes and cars talk to each other.

If a bike and a car are hurtling toward a collision, LINKS will preemptively warn each person to slow or turn.

5G can keep this big bike moment cruising 

During the pandemic, many city slickers looking to cut down on public transit have taken up cycling. Back in May, bike sales were up ~2x YoY.

But when everyone starts commuting to work again, bike-to-vehicle tech might determine whether US cities — which typically aren’t designed for mass bike commuting — can handle the influx.

LINKS, which has collaborated with Chrysler, isn’t the only one in the bike-to-vehicle game: Ford and Trek are among the brands working on their own system.

Some bike-safety tech already does exist

  • GPS maker Garmin has a radar for bikes that flashes at you when cars are heading your way.
  • Volvo’s anti-crash system includes a feature that brakes when a cyclist approaches.

Together, features like this have cut accidents by up to 35%.

But they can only react to what’s in front of them

Because the bikes and cars aren’t communicating, they depend on cameras.

Bike-to-vehicle tech goes further. It pings other vehicles about speed, direction, and location even when one vehicle is out of sight — so you’re warned if, say, you and a car are both about to turn the same corner.

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SPONSORED

What’s with the 18 zeros? 

1,000,000,000,000,000,000: That’s eighteen zeros. A quintillion. A billion billion.

More to the point, that’s the number of calculations exascale supercomputers will make per second. Put simply, exascale supercomputers will be the biggest, baddest computers in the world.

How big a deal is exascale? Coupled with advancements in artificial intelligence, exascale computing promises to accelerate virtually every field of scientific research—from climate change to alternative fuels to vaccine research. In short, it can help tackle the world’s biggest problems, potentially affecting every person on the planet. 

HPE spoke with Rick Stevens, leader of Argonne’s Exascale Computing Initiative, about how these new supercomputers will change the world.

Read the Q&A →
AP-I Do

Twilio’s $3.2B acquisition of Segment makes a lot of sense

The communications API firm Twilio has been en fuego, with its stock up nearly 3x over the past 12 months.

On Monday, the firm used $3.2B of that sweet sweet $TWLO stock to buy Segment, a customer data firm.

Building from a strong base

Founded in 2008, Twilio created a suite of application programming interfaces (APIs) that allowed any company to easily add text and voice services with a few lines of code.

As noted by Techcrunch, Twilio has not been shy to use acquisitions to expand its offering: It acquired email delivery provider SendGrid in 2018 for $2B and almost acquired chatbot startup Intercom in 2015.

Twilio has 200k+ active user accounts

With Segment in the mix — it can cross-sell data management and analytics services to these customers.

The acquisition itself is likely to be a smooth process, per Techcrunch:

  • Both firms are API-oriented with strong existing integrations
  • A number of ex-Twilio folk (which are unfortunately called “Xwillions”) are on the Segment team, including the CFO and CSO

The market was happy with the deal: $TWLO was up a sweet sweet 7%+ yesterday.

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Seeking Solace

Private coroners are suddenly in the spotlight

Many Americans are facing a terrible dilemma: Their loved one(s) died mysteriously, and they want to know if COVID-19 might be the cause.

But unless they have a positive test, a lot of hospitals aren’t willing to perform an autopsy.

So grieving families with money are turning to a tiny industry of private coroners for a final diagnosis.

The US barely does autopsies anymore

Back in the late 1960s, US hospitals autopsied ~60% of patients. Today, that figure has fallen to just 4.3%, largely due to budgeting.

The sliding autopsy rate means that death certificates are more unreliable than you’d think. As much as 85% have some error in the listed cause of death.

According to the science publication Elemental, phrases like “cardiac arrest” are often just empty placeholders.

If you want peace of mind, you have to go private

That’s especially true during the pandemic. The National Association of Medical Examiners told National Geographic that private autopsies are on the up and up this year.

Companies like the Los Angeles-based 1-800-AUTOPSY say that they are busier in 2020 than ever before.

But at $10k+, a private autopsy isn’t cheap. Good luck getting your insurance to pay for that.

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