Tinder’s head of product has left

Tinder’s chief product officer Brian Norgard wants to get back to his entrepreneurial roots, citing former PayPal executive-turned-venture capitalist Keith Rabois as inspiration.

Norgard, who joined Tinder as part of the acquisition of his Kleiner Perkins-backed ephemeral messaging startup Tappy in 2014, has confirmed to TechCrunch that he’s left the app-based dating company to focus on building products and investing in early-stage businesses. Tinder has not yet identified his successor, but Norgard says “it’s all positive vibes” between him and the company.

Norgard began as Tinder’s head of revenue before being promoted to the chief product role in late 2016. Prior to joining Tinder via Tappy, he co-founded two other successful startups: Chill, a Facebook application that garnered 30 million users, and adtech startup Newroo, which was acquired by FOX Interactive in 2006.

“It’s been a great ride but my strength has always been in the early-stage game,” Norgard told TechCrunch. “What I’m trying to do now is take all the learnings from that wonderful experience and bring them into my investing.”

Though he’s yet to sign on in any official capacity, Norgard said he is in talks with several different entities about investing roles.

Brian Norgard has invested in Coinmine, a developer of a sleek cryptocurrency mining device.

Norgard said he’s invested in one company so far, a cryptocurrency mining startup called Coinmine founded by Justin Lambert, who helped design the second iteration of the Pebble watch, and Farb Nivi, the former chief product officer at Learnist. Coinmine is selling a crypto mining device, similar in size and look to an Xbox, that’s controlled by a mobile app. The device is meant to help anyone, crypto enthusiasts and otherwise, mine crypto easily. Nivi told TechCrunch the internet-connected device uses less energy than a PlayStation.

The Los Angeles-based startup is officially launching today with Norgard signed on as an active advisor.

“There are a lot of parallels I draw from Coinmine and Tinder,” Norgard said. “Online dating was very complicated six years ago. It was an arduous process and so is mining. You have to be pretty sophisticated, but this takes it down to the studs. A normal consumer with no technical knowledge can get into the crypto game.”

Coinmine, which raised a total of $2 million, is also backed by Coinbase Ventures, Social Leverage, Arrington Capital, Wonder VC and angel investors like Coinbase’s chief technology officer Balaji Srinivasan.

Facebook reorganizes Oculus for AR/VR’s long-haul

Facebook is again looking to whip Oculus into shape for its 10-year journey towards making virtual reality mainstream. According to two sources, Facebook reorganized its AR and VR team this week from a divisional structure focused around products to a functional structure focused around technology areas of expertise. While no one was laid off, the change could eliminate redundancies by uniting specialists so they can iterate towards long-term progress rather than being separated into groups dedicated to particular gadgets.

Facebook confirmed the reorg to TechCrunch, with a spokesperson providing this statement: “We made some changes to the AR/VR organization earlier this week. These were internal changes and won’t impact consumers or our partners in the developer community.” Oculus CTO John Carmack and Oculus co-founder/newly-promoted Head of PC VR Nate Mitchell will remain in their leadership positions within VP of AR/VR Andrew ‘Boz’ Bosworth’s hardware wing of the company.

The shift obviously communicates that Facebook believes Oculus could be running more effectively. Organizing the company around areas of expertise rather than broader divisions is probably more appropriate for a moonshot effort that can’t afford redundancies, on the other hand, keeping expertise siloed could isolate new approaches and advancements from reaching other teams. As the company builds out its first full lineup of headsets, there seems to be significant overlap in the tech problems and products bring tackled by those working on mobile and PC products.

TechCrunch reported earlier this week that the company is planning to release a new Rift headset as early as 2019, possibly called the Rift S, which will featured upgraded displays and an inside-out tracking system. The company’s “Rift 2” project, codenamed Caspar, was left behind in the reorganization, a source tells us. We can’t confirm whether any other products or concepts have been shelved.

While an immersive virtual world that users can hang out and communicate in certainly seems to fit Facebook’s broader mission, the company has spent the better part of the past few years deciding how a costly, ambitious venture like Oculus fits into its corporate structure.

First, things went smoothly. The company and its empowered co-founders were building out a developer network and prepping for the launch of their Rift headset after creating a successful partnership with Samsung for the Gear VR. Then, the company’s good fortune turned as the Rift headset was racked by expensive delays and Oculus failed to ship the company’s Touch motion controllers at launch losing some initial ground to HTC. 

By the end of 2016, it was announced that co-founder Brendan Iribe was out as CEO and that the company would be reorganizing around divisions focused on things like PC VR, mobile and content with Xiaomi exec Hugo Barra coming aboard as VP of VR to lead the new effort working directly beneath CEO Mark Zuckerberg. An additional layer of oversight has been built in since then, with Bosworth was put in charge of the company’s consumer hardware ambitions with Oculus as a central pillar. His title is now VP of AR/VR.

The absorption of Oculus deeper into Facebook’s corporate structure was a trend that soon replicated itself as the company looked to rein in the independent teams under a more cohesive vision. The culmination of this was a major executive reshuffle earlier this year that changed the landscape for how divisions within the company were managed.

Now, they’re changing things up even more.

Oculus Go

The new structure sounds like it could coordinate efforts around more general lines like hardware and software allowing insights to flow more intuitively across Facebook’s planned devices.

Given the slow adoption of VR and engineering challenges of AR headsets, which at TechCrunch’s LA conference last month Facebook’s head of AR Ficus Kirkpatrick confirmed it was building, this structure could help Oculus iterate its way to long-term success rather than just getting the next product out the door.

If Facebook is going to beat companies solely focused on AR like Magic Leap, and potential incumbent invaders like Apple if it so chooses, it needs to maximize efficiency. And if it’s going to get both developers and users excited about these next-generation computing platforms, it will have to produce products that make cutting-edge technologies feel unified and accessible. That’s a lot easier when everyone’s not stepping on each other’s virtual shoes.

Drone startup Airware crashes, shut downs after burning $118M

Drone operating system startup Airware today suddenly informed employees it will cease operations immediately despite having raised $118 million from top investors like Andreessen Horowitz, Google’s GV, and Kleiner Perkins. The startup ran out of money after trying to manufacture its own hardware that couldn’t compete with drone giants like China’s DJI. The company at one point had as many as 140 employees, all of which are now out of a job.

A source sent TechCrunch screenshots from the Airware alumni Slack channel detailing how the staff was told this morning that Airware would shut down.

Airware makes a cloud sofware system that helps enterprise customers like construction companies, mining operations, and insurance companies reviewing equipment for damages to use drones to collect and analyze aerial data. That allowed companies to avoid using expensive helicopters or dangerous rigs with humans on harnesses to make inspections and gauge work progress.

One ex-employee asked “How do I get my options sent to me on paper so I can burn them all in a fire?😅

Founded in 2011 by Jonathan Downey, the son of two pilots, Airware first built an autopilot system for programming drones to follow certain routes to collect data. It could help businesses check rooftops for damage, see how much of a raw material was coming out of a mine, or build constantly-updated maps of construction sites. Later it tried to build its own drones before pivoting to consult clients on how to most efficiently apply unmanned aerial vehicles.

While flying high, Airware launched its own Commercial Drone Fund for investing in the market in 2015, and acquired 38-person drone analytics startup Redbird in 2016. In this pre-crypto, pre-AI boom, Airware scored a ton of hype from us and others as tried to prove drones could be more than war machines. But over time, the software that shipped with commercial drone hardware from other manufacturers was good enough to make Airware irrelevant, and a downward spiral of layoffs began over the past two years, culminating in today’s shutdown. Demonstating how sudden the shut down is, Airware opened a Tokyo headquarters alongside an investment and partnership from Mitsubishi just four days ago.

“Airware was ahead of the game trying to build their software. So far ahead that the drone hardware on the market wasn’t sophisticated enough to actually produce the granularity of data they needed to test out their software/train their algorithms” an ex-employee told TechCrunch (emphasis ours). “So they spent shitloads of money designing bespoke hardware, including two drones in-house, one multi-rotor called an AT-28, and one fixed-wing called Cygnet. Both projects were scuttled as hardware from DJI and Ebee caught up to needs, after sinking tons of engineering time and manufacturing into them.”

Following TechCrunch’s inquiry about the unnannounced news, Airware confirmed the shut down to us with this statement:

“History has taught us how hard it can be to call the timing of a market transition. We have seen this play out first hand in the commercial drone marketplace. We were the pioneers in this market and one of the first to see the power drones could have in the commercial sector. Unfortunately, the market took longer to mature than we expected. As we worked through the various required pivots to position ourselves for long term success, we ran out of financial runway. As a result, it is with a heavy heart that we notified our team, customers, and partners that we will wind down the business.

This is not the business outcome we had worked so hard for over the years and yet we are deeply proud of our company’s accomplishments and our leadership in driving the adoption of drone powered analytics to improve productivity, mitigate risks, and take workers out of harm’s way.

As we close the book of Airware; we want to thank the partners and customers who believed in us and helped us along the way. And, while it is difficult to say goodbye to our team, we want to thank them for all they have contributed to Airware and the industry. We look forward to seeing how they will take their learnings from Airware to fuel continued innovations in the world around us.”

[Update: Since we broke the news, Airware has put up a “thank you” note about the shutdown informing clients that “A representative from the Airware team will be in touch.”]

An Airware-hardware equipped drone

Employees will get one week’s severance, COBRA insurance until November, and payouts for unused paid time off. It appears the startup wasn’t able to raise necessary funding to save the company or secure an acquisition from one of its strategic partners like Catepillar.

Airware will serve as cautionary tale of startup overspending in hopes of finding product-market fit. Had it been more frugal, saved cash to extend its runway, and given corporate clients more time to figure out how to use drones, Airware might have stayed afloat. Sometimes, even having the most prestigious investors can’t save a startup from mismanagement.

Our ex-employee source concludes that “I think having $118M in the bank led Airware to charge ahead and sink tons of money into force-it-to-work methods rather than exercise a bit of patience and wait for the inevitable advance of hardware to catch up. They had a knack for hiring extremely talented and expensive people from places like Google, Autodesk, there was even SpaceX and NASA alumni there.

They spared no expense ever.”

The lobbying is fast and furious as gig companies seek relief from pro-labor Supreme Court ruling

For four years, Edhuar Arellano has left his house at 7 a.m. on weekdays to drive customers around the Bay Area for Lyft and Uber . Most days, he doesn’t get home to Santa Clara until 11 p.m. On weekends, he delivers pizzas to make ends meet.

Like a lot of drivers plugging in to ride-hailing apps for work, he likes the flexibility the gig economy has offered. But given the choice, Arellano says he wishes he could just become an employee. That would get him paid vacation, benefits, overtime, his own health insurance and perhaps more say over his working conditions.

“We need to accept whatever they want,” said the 55-year-old father of two grown children. “I can’t control anything.”

That quandary is behind a ferocious battle quietly playing out in the state Capitol in the final days of the legislative session, which ends August 31. Lobbyists for ridesharing companies and the California Chamber of Commerce are scrambling to delay until next year (and the next governor’s administration) a far-reaching California Supreme Court decision that could grant Arellano’s wish — and, businesses fear, undermine the entire gig economy.

The April ruling, involving the nationwide delivery company Dynamex Operations West Inc. and its contract drivers, established a new test for enforcement of California wage laws, and made it much harder for companies in California to claim that independent contractors are not actually employees.

Though the ruling only applies to California, the state’s labor force is so huge that it has already had national impact. Shortly after the decision, U.S. Senator Bernie Sanders of Vermont introduced a bill to make a version of California’s new rule the federal standard, a move that only added urgency to employers’ calls for state lawmakers to hit the pause button on implementing the ruling.

“Businesses are very concerned. The key is who’s going to be sued here in the near future,” said Allan Zaremberg, president of the California Chamber, which represents 50,000 businesses.

They should be, says labor leader Caitlin Vega, who has been similarly lobbying Capitol Democrats to refrain from meddling and let the Supreme Court decision move forward.

“Companies have made so much money already at the expense of workers,” Vega, the legislative director of the California Labor Federation, said Tuesday during a harried break between Capitol meetings. “We really see the Dynamex decision as core to rebuilding the middle class.”

State and federal labor laws give employees a wide range of worker protections, from overtime pay and minimum wages to the right to unionize. But those rights don’t extend to independent contractors, whose ranks have grown dramatically in the gig economy.

Apps such as Uber, TaskRabbit and DoorDash, which match customers and services online and in real time, have given workers an unprecedented ability to freelance but they also have blurred traditional employer-employee relationships and, labor advocates say, invited exploitation.

Some 2 million people, from Lyft drivers to construction workers, consider themselves independent contractors in California. In 2017, according to the Bureau of Labor Statistics, about one in 14 workers was an independent contractor nationally.

If state lawmakers don’t rewrite the law or stall its implementation for a few months, as businesses want — which the Legislature can legally do, though the clock is ticking — the Dynamex decision will subject businesses in California to a standard that is tougher than the federal government’s or most states’.

Known as the “ABC test,” the standard requires companies to prove that people working for them as independent contractors are:

  • A) Free from the company’s control when they’re on the job;
  • B) Doing work that falls outside the company’s normal business;
  • C) And operating an independent business or trade beyond the job for which they were hired.

That’s a high bar for the many companies whose bottom lines have depended on large numbers of contractors to deliver a particular service. According to the business lobby, in the months since the Dynamex decision, law firms have received 1,200 demands for arbitration and 17 class action lawsuits.

Last month, business leaders sent a letter to members of Gov. Jerry Brown’s administration, warning that the new test would “decimate businesses,” and urging the governor and Legislature to suspend and then limit the court’s ruling to only workers involved in the Dynamex case. The letter also asked that the decision not apply to other contractors for the next two years.

Not all those contractors are in tech, Chamber head Zaremberg points out. Emergency room doctors and accountants, for example, could also be impacted. Emergency hospitals and trauma centers contract their doctors through medical groups, and doctors generally work at a combination of hospitals and community clinics.

Photo: shapecharge / iStock / Getty Images Plus

Dr. Aimee Mullen, president of the California chapter of American College of Emergency Physicians, confirms that ER docs are among those uncertain about their contractor status.

“A lot of our members use that model. It’s choice. They like flexibility. They like working at multiple hospitals,” Mullen said.

The California Labor Federation’s Vega contends that, disruptive though it may be, the Dynamex ruling is the right one, particularly on worker exploitation. The core group affected tends to be low-income and immigrant workers, she said.

“The Dynamex decision was a victory for working people — truck drivers who are cheated out of wages, warehouse workers forced to risk their health and gig economy workers who want to be treated with dignity and respect,” Vega wrote in a Sacramento Bee op-ed.

Some workers see room for hybrid solutions. Edward Escobar, a San Francisco ride-hail driver of four years and founder of the Alliance for Independent Workers, a group formed by drivers three years ago, says he has seen a big decrease in how much these companies compensate drivers without a commensurate increase in control over working conditions.

Escobar believes gig companies are trying to have it both ways, and should give their workers either true independence or full employment. His proposal: Let workers choose their own classification, with wage and benefit protection for those who choose to be employees, and more control for contractors over which rides to take and what prices to set.

“These tech titans have been taking advantage of these gray areas,” Escobar said.

Assembly Speaker Anthony Rendon, a Paramount Democrat, said earlier this month that while the Legislature is eager to delve into workforce issues, leaders do not have adequate time to act on it before the session ends next week.

“The Dynamex​ decision strikes at the core of what the future of work looks like in our society,” Rendon said in a statement. “From the decline of union membership to court rulings like the Janus decision, we’ve seen the continual erosion of workers’ rights. If the Legislature is to take action, we must do so thoughtfully with that in mind. That will not happen in the last three weeks of the legislative session.”

Nor are the stakes likely to be lowered for workers like Arellano.

“If I don’t work, I have no money,” said the Lyft and Uber driver. “Everything is so expensive in Santa Clara and the Bay Area.”

CALmatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.