Test.ai nabs $11M Series A led by Google to put bots to work testing apps

For developers, the process of determining whether every new update is going to botch some core functionality can take up a lot of time and resources, and things get far more complicated when you’re managing a multitude apps.

Test.ai is building a comprehensive system for app testing that relies on bots, not human labor to see whether an app is ready to start raking in the downloads.

The startup has just closed an $11 million Series A round led by Gradient Ventures, Google’s AI-focused venture fund. Also participating in the round were e.ventures, Uncork Capital, and Zetta Venture Partners. Test.ai, which was founded in 2015, has raised $17.6 million to date.

“Every advancement in training AI systems enables an advancement in user testing, and test.ai is the leader in AI-powered testing technology. We’re excited to help them supercharge their growth as they test every app in the world,” Gradient Ventures founder Anna Patterson said in a statement. “In a couple years, AI testing will be ingrained into every company’s product flow.”

The company’s technology doesn’t just leverage AI to cut down on how long it takes for an app to be tested; there are much lengthier processes it helps eliminate when it comes to developers readying a list of scenarios to be tested. Test.ai has trained their bots on tens of thousands of apps to help it understand what an app looks like and what interface patterns they’re typically comprised of.

That can mean, in the case of an app like our own, tracking down a bookmark button and then deducing that there are certain process that users would go through to use its functionality.

Right now, the utility is in the fact that bots scales so broadly and so quickly. While a startup working on a single app may have the flexibility to choose amongst a few options, larger enterprises with several aging products having to grapple with updated systems are in a bit more of a bind. Some of Test.ai’s larger unnamed partners that “make app stores” or devices are working at the stratospheric level having to verify tens of thousands of apps to ensure that everything is in working order.

“That’s an easy sell for us, almost too easy, because they don’t have the resources to individually test ten thousand apps every time something like Android gets updated,” CEO Jason Arbon tells TechCrunch.

The startup’s capabilities operate on a much more quantitative scale than human-powered competitors like UserTesting which tend to emphasize testing for feedback that’s a bit more qualitative in nature. Test.ai’s founders believe that their system will be able to grapple with more nebulous concepts in the future as it analyzes more apps, and that it’s already gaining insights into concepts like whether a product appears “trustworthy,” though there are certainly other areas where bots are trailing the insights that can be delivered by human testers.

The founders say they hope to use this latest funding to scale operations for their growing list of enterprise clients and hire some new people.

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Gusto raises $140 million to go after small business payroll and benefits with more gusto

Gusto, which sells payroll, benefits and human resources management and monitoring services to small businesses, has raised $140 million in its latest round of funding.

The company said it will use the money to add new services to increase payment flexibility for employees. The company launched a new service called Flexible Pay, which gives employees a way to get paid no matter when a company’s pay schedule dictates. It seems sort of like a payday loan where a percentage of the salary is taken by Gusto for providing money upfront.

The late-stage round was led by T.Rowe Price Associates portfolio, MSD Capital (the family investment fund for Michael Dell), Dragoneer Investment Group, and Y Combinator’s Continuity Fund.

Previous investors including General Catalyst, CapitalG, Kleiner Perkins, 137 Ventures, Emergence Capital also participated in the round.

The company claims that it processes tens of billions of dollars in payroll and offers a range of benefits including health insurance, 401(k) plans, and college savings plans.

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Facebook really doesn’t want users to go to a fake Unite the Right counter-protest next week

According to COO Sheryl Sandberg, getting ahead of an event called “No Unite the Right 2, DC” is the reason behind Facebook’s decision to disclose new platform behavior that closely resembles previous Russian state-sponsored activity meant to sow political discord in the US.

“We’re sharing this today because the connection between these actors and the event planned in Washington next week,” Sandberg said, calling the disclosure “early” and noting that the company still does not have all the facts.

A Facebook Page called “Resisters” created the event, set to take place on August 10, as a protest against Unite the Right 2 — a follow-up event to last year’s deadly rally in Charlottesville, Virginia that left peaceful counter-protester Heather Heyer dead.

The Page, which Facebook identified as displaying “coordinated inauthentic behavior,” also worked with the admins from five authentic Facebook Pages to co-host the event and arrange transportation and logistics. Facebook has notified those users of its findings and taken down the event page.

This isn’t the first event coordinated by fake Facebook accounts with the likely intention of further polarizing US voters. In a call today, Facebook noted that the new inauthentic accounts it found had created around 30 events. While the dates for two have yet to pass, “the others have taken place over the past year or so.”

Facebook will not yet formally attribute its new findings to the Russian state-linked Internet Research Agency (IRA). Still, the Resisters Page hosting “No Unite the Right 2, DC” listed a previously identified IRA account as a co-admin for “only seven minutes.”

That link, and whatever else the public doesn’t know at this time, is enough for the Senate Intel committee Vice Chairman Mark Warner to credit the Russian government with what appears to be an ongoing campaign of political influence.

“Today’s disclosure is further evidence that the Kremlin continues to exploit platforms like Facebook to sow division and spread disinformation, and I am glad that Facebook is taking some steps to pinpoint and address this activity,” Warner said in a statement provided to TechCrunch. “I also expect Facebook, along with other platform companies, will continue to identify Russian troll activity and to work with Congress on updating our laws to better protect our democracy in the future.”

Facebook’s Chief Security Officer Alex Stamos maintained that the company “doesn’t think it’s appropriate for Facebook to give public commentary on political motivations of nation states” and calls the IRA link “interesting but not determinant.”

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Google partners with news orgs to show more data in its search results

Google today announced that it is working with a number of news organizations to surface more data from their data journalism projects in its search results. The idea here is to make it easier to discover the data that a lot of these organizations produce and then surface it in an easy to read format on the company’s search results pages.

The company is currently working with a few news organizations, including ProPublica, to produce the structured data in the format it needs for its search index. As long as that data is in a table, adding it to the index should be pretty straightforward.

“As a news organization that is focused on having real-world impact, it’s very much in our mission to give people information at the point of need,” said Scott Klein, the deputy managing editor of ProPublica. “If we can make the data we’ve worked hard to collect and prepare available to people at the very moment when they’re researching a big life decision, and thereby help them make the best decision they can, it’s an absolute no-brainer for us. And the code is trivial to add.”

Any news organizations that produce this kind of data can follow Google’s guidelines and have their data indexed. For the right queries, the result of that is going to be prime placement on Google’s search results pages, so it’s probably worth the effort. That first results, after all, is all that counts.

It’s worth noting that Google already indexes and highlights lots of other data it finds online, but this is the first time it’s making a concerted effort to include journalism projects, too.

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Waymo partners with Phoenix to connect people to public transit

Waymo, the former Google self-driving project that spun out to become a business under Alphabet, is launching program in Phoenix next month that will focus on delivering people to bus stops, train and light rail stations.

The pilot program announced Tuesday is in partnership with Valley Metro, the Phoenix area’s regional public transportation authority.

The announcement gives clarity to the fourth leg in Waymo’s business strategy. The company’s has publicly shared plans to focus on four areas: create a ride-hailing service, develop self-driving trucks for logistics, and license its technology to automakers for personally-owned vehicles

But it was the fourth piece—connecting people to public transportation—that was nebulous until now.

The program will be initially offered to employees of Valley Metro. These riders will be able to use the Waymo app to hail a ride in one of the company’s autonomous Chrysler Pacifica Hybrid minivans to take them to the nearest public transportation option.

Waymo will expand the program and provide first-and-last mile travel to Valley Metro RideChoice travelers, which cover groups traditionally underserved by public transit.

Waymo and Valley Metro hope to learn more about how people use public transit and what role self-driving cars can have in connecting people to the buses, trains, and light systems found in cities.

The company said it hopes to open the service to the public in the future.

Phoenix has become a major testing hub for Waymo. The company has been testing its self-driving vehicles there for months and launched an early rider program. In March, Waymo began shuttling a group of early riders in self-driving vehicles without a human test driver behind the wheel.

Last week, the company, announced a series of partnerships with Walmart, AutoNation, Avis and others to give customers access to autonomous vehicles. Under the partnerships, Waymo will pick up customers and drive them to businesses in the Phoenix area.

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Just 24 hours until prices go up for Disrupt SF 2018 passes

A lot can happen in 24 hours. Just ask Jack Bauer, the hard-charging protagonist from the TV drama series 24. Seriously, he had to save the world every dang episode. All you have to do is buy your pass to Disrupt San Francisco 2018 before the prices go up in — you guessed it — 24 hours.

We want you to join us on September 5-7 at Moscone Center West, and we want you to get the best deal possible. You have until midnight PST on August 1 before the price hike hits. Depending on the pass you buy, you could save up to $1,200. Jack Bauer would take action, and so should you. Buy your ticket right now.

What can you expect at Disrupt SF 2018? Plenty, and we’ll get to that in a minute. But sometimes it helps to hear what your peers found most beneficial. For example, Vlad Larin, one of the founders of Zeroqode, shared his Disrupt experience with us.

“TechCrunch Disrupt was a massively positive experience,” said Larin. “It gave us the chance to show our technology to the world and have meaningful conversations with investors, accelerators, incubators, solo founders and developers.”

If you’re more interested in a VC’s point of view, here’s what early-stage investor Michael Kocan of New York-based Trend Discovery had to say.

“Attending Disrupt San Francisco helped me plug into that community and take the pulse of what’s going on,” he said. “It’s probably the best place for us to meet the most early-stage founders quickly, so that’s the biggest benefit for us.”

There’s plenty of programming to keep you happy as you search for opportunity. Don’t miss an incredible roster of speakers talking about the most pressing tech and investment issues of the day. And take a peek at the conference agenda while you’re at it.

Check out our first Virtual Hackathon — from thousands of submitted hacks, we’ll have the top 30 contenders showing their stuff at Disrupt SF.

You’ll find more than 1,200 startups and exhibitors in Startup Alley — along with the startups that earned a TechCrunch Top Pick designation. We have Top Picks in each of these categories: AI, AR/VR, Blockchain, Biotech, Fintech, Gaming, Healthtech, Privacy/Security, Space, Mobility, Retail or Robotics.

And, of course, you don’t want to miss Startup Battlefield, the crown jewel of TechCrunch Disrupt. This year, we doubled the prize money to $100,000. The competition’s going to be intense!

Disrupt San Francisco 2018 takes place on September 5-7. You have only 24 hours left before the prices increase. If you leap into action now, you won’t save the world, but you will save some money. Buy your pass today.

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Facebook has found evidence of influence campaigns targeting U.S. midterms

In a newsroom post Tuesday, Facebook revealed that it has detected evidence of “coordinated inauthentic behavior” designed to influence U.S. politics on its platform.

According to Facebook’s Head of Cybersecurity Policy Nathaniel Gleicher, the company first identified the activity two weeks ago. So far, the activity encompasses eight Facebook Pages, 17 profiles and seven accounts on Instagram. Facebook stated that the activity “violate[s] our ban on coordinated inauthentic behavior” though so far is unable to attribute the activity to Russia or any other entity with an interest in influencing U.S. politics.

Facebook has been in contact with Congress and law enforcement about the discovery, which suggests that social platforms should expect to again detect the kind of coordinated disinformation campaigns targeted the 2016 election around U.S. midterm elections this November. The company stated that more than 290,000 accounts followed one of the Pages it identified. The Pages in question were created starting in March 2017 and most recently in May of 2018.

The most popular Pages displaying this kind of behavior were “Aztlan Warriors,” “Black Elevation,” “Mindful Being,” and “Resisters.” The other Pages had less than 10 followers each and the Instagram account did not have any followers. That does not necessarily discount other kinds of potential activity like commenting and messaging.

According to Facebook, “They ran about 150 ads for approximately $11,000 on Facebook and Instagram, paid for in US and Canadian dollars” between April 2017 and June of this year. The Pages also made around 30 Facebook events.

As Gleicher writes in the post, these accounts are operating more cautiously than the infamous Russian disinformation accounts around the 2016 election.

“For example they used VPNs and internet phone services, and paid third parties to run ads on their behalf. As we’ve told law enforcement and Congress, we still don’t have firm evidence to say with certainty who’s behind this effort. Some of the activity is consistent with what we saw from the IRA before and after the 2016 elections. And we’ve found evidence of some connections between these accounts and IRA accounts we disabled last year, which is covered below. But there are differences, too. For example, while IP addresses are easy to spoof, the IRA accounts we disabled last year sometimes used Russian IP addresses. We haven’t seen those here.”

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The Istio service mesh hits version 1.0

Istio, the service mesh for microservices from Google, IBM, Lyft, Red Hat and many other players in the open source community, launched version 1.0 of its tools today.

If you’re not into service meshes, that’s understandable. Few people are. But Istio is probably one of the most important new open source projects out there right now. It sits at the intersection of a number of industry trends like containers, microservices and serverless computing and makes it easier for enterprises to embrace them. Istio now has over 200 contributors and the code has seen over 4,000 check-ins since the launch of  version 0.1.

Istio, at its core, handles the routing, load balancing, flow control and security needs of microservices. It sits on top of existing distributed applications and basically helps them talk to each other securely, while also providing logging, telemetry and the necessary policies that keep things under control (and secure). It also features support for canary releases, which allow developers to test updates with a few users before launching them to a wider audience, something that Google and other webscale companies have long done internally.

“In the area of microservices, things are moving so quickly,” Google product manager Jennifer Lin told me. “And with the success of Kubernetes and the abstraction around container orchestration, Istio was formed as an open source project to really take the next step in terms of a substrate for microservice development as well as a path for VM-based workloads to move into more of a service management layer. So it’s really focused around the right level of abstractions for services and creating a consistent environment for managing that.”

Even before the 1.0 release, a number of companies already adopted Istio in production, including the likes of eBay and Auto Trader UK. Lin argues that this is a sign that Istio solves a problem that a lot of businesses are facing today as they adopt microservices. “A number of more sophisticated customers tried to build their own service management layer and while we hadn’t yet declared 1.0, we hard a number of customers — including a surprising number of large enterprise customer–  say, ‘you know, even though you’re not 1.0, I’m very comfortable putting this in production because what I’m comparing it to is much more raw.’”

IBM Fellow and VP of Cloud Jason McGee agrees with this and notes that “our mission since Istio’s launch has been to enable everyone to succeed with microservices, especially in the enterprise. This is why we’ve focused the community around improving security and scale, and heavily leaned our contributions on what we’ve learned from building agile cloud architectures for companies of all sizes.”

A lot of the large cloud players now support Istio directly, too. IBM supports it on top of its Kubernetes Service, for example, and Google even announced a managed Istio service for its Google Cloud users, as well as some additional open source tooling for serverless applications built on top of Kubernetes and Istio.

Two names missing from today’s party are Microsoft and Amazon. I think that’ll change over time, though, assuming the project keeps its momentum.

Istio also isn’t part of any major open source foundation yet. The Cloud Native Computing Foundation (CNCF), the home of Kubernetes, is backing linkerd, a project that isn’t all that dissimilar from Istio. Once a 1.0 release of these kinds of projects rolls around, the maintainers often start looking for a foundation that can shepherd the development of the project over time. I’m guessing its only a matter of time before we hear more about where Istio will land.

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What every startup founder should know about exits

The dream of a startup founder can often be summarized by the following, well-intentioned, and mostly delusional quote, “We’ll raise a few rounds and in a few years we’ll IPO on Nasdaq.”

But a more likely scenario looks something like this.:

You invest a few years of hard work to build something of value. One day you receive an acquisition offer out of the blue. You’re elated. And you’re not prepared. You drop everything to focus on this opportunity. Exclusive due diligence starts. Your company is a mess (IP, contracts, burn). Days become weeks; weeks become months. You’ve neglected business and fundraising. You’re running out of money. M&A is now your one and only option. The buyer says they found a bunch of cockroaches in the walls and drops the price. Now what?

Sounds unlikely?

This is still a favorable situation: you had an offer! Think about how much time you invested in your various funding rounds. The hundreds of names and Google spreadsheet or Streak-powered quasi-CRM process.

Have you spent even a fraction of that on understanding exit paths? If you’d rather not live the situation described above, read along.

The E-word: A Strange Taboo

Investors live by exits, but many founders keep dreaming of unicornization and avoid the “E-word” until it’s too late. Yet, in 2016, 97% of exits were M&As. And most happened before series B.

Exits matter because that’s when you, your team and your investors get paid. Oddly enough, and to use a chess metaphor, we hear a lot about the “opening game” (lean startup), the “mid-game” (growth) but very little about this “end game”.

As a result, founders miss opportunities or leave money on the table. This is a shame. Our fund, SOSV, has over 700 companies in portfolio. We want the best possible exit for each of them. And fortune favors the prepared! Now, how to get 700 exits (and counting)?

To explore the topic, organized a series of Masterclasses tapping corporate buyers, bankers, investors, lawyers, and startup CEOs with M&A or IPO experience in San Francisco. It was a group that included the founders of Guitar Hero — bought by Activision; JUMP Bikes — a SOSV portfolio company bought by Uber, Ubiquisys  — bought by Cisco, and Withings — bought by Nokia. Each one for hundreds of millions).

Their observations can be summarized below.

Maximize Optionality

“Founders must be aware of what contributes to an exit. This means understanding partnerships and how they are formed in the business space the entrepreneur is working in,” said one MasterClass participant.  

As founders, you build your product, your company and… optionality. You need to understand the options open to your company, and take steps to enable them.

The most likely one is an acquisition but there are others like IPO (including small cap), RTO, SBO, LBO, Equity Crowdfunding and even ICO.

“Exit is not a goal ​per se, but as a CEO it is something you should think about as early in your cycle as possible, while being business-focused,” said the London-based investor Frederic Rombaut, of Seraphim Capital.

Indeed, most participants said that exits should always be on the chief executive’s agenda, no matter how early in the process. “Exits should be on the CEO agenda. Not front and center, but on the agenda. M&A is a by-product of a great business and targeted BD. IPOs are always an option once you’ve built significant cashflow forecasting.”

It’s important to ask questions like: How many “strategic engagements” with potential buyers have you had this month? Is your message and value clear in their eyes? Have you considered an acquisition track in parallel to a fundraise?

It doesn’t stop there:

  • Equity crowdfunding might help close some gaps at seed stage.
  • Early IPOs on smaller exchanges can be an option to raise over $10M — the robotics startup Balyo went public and raised 40MEUR on Euronext to get rid of a critical ‘right of first refusal’ option held by one of its corporate investors.
  • Reverse mergers can work too: the medical exoskeleton company EKSO Bionics went public this way.

One thing is sure: the time to exit is not when you’re running out of money.

Companies are bought, not sold

Unicorn or not, the most likely exit is an acquisition.

As George Patterson, Managing Director at HSBC in New York said, “Good tech companies are bought, not sold. The question is thus: how to get bought?”

Patterson says it’s important to understand how mergers and acquisitions actually work; how to prepare a startup for an exit; and how to develop a “feel” for the market you’re exiting through and into. ;

How M&A works

Hearing from corp dev veterans from Cisco, Logitech, Dassault and IBM, a few key ideas emerged:

  • Motivations vary

It could be (from least to most expensive, or as a mix), as listed by Mark Suster, Managing Partner at Upfront Ventures:

  1. Talent hire ($1M/dev as a rule of thumb — location matters)
  2. Product gap
  3. Revenue driver
  4. Strategic threat (avoid or delay disruption)
  5. Defensive move (can’t afford a competitor to own it)
  • How corporates find you

Corporates find deals via the development of partnerships, investment (CVC), their business units, corp dev research, media, and investor connections.

Asked about the best approach, Todd Neville, Manager of Corporate Business Development and Strategy at IBM (who gave the most detailed description of the corp dev process), said, “Do something cool to one of the IBM customers. If they rave about even a POC, we’re interested.”

In other words, business development is corporate development. 

Get the house in order

Buyers typically want to know three things:

  1. Is your IP really yours?
  2. Is your team capable?
  3. Will your customers stick around?

For IP, they will check your contracts (staff and contractors), run some automated code analysis for proprietary code and open source use. They will evaluate potential IP infringement. No point buying you if you end up costing more in lawsuits!

For your team skills: sitting down with your engineers will tell them plenty enough without understanding the details of this or that algorithm. Be sure the last thing a corporate wants is to be accused of stealing!

Lawyers engaged early can help. The later the clean-up, the more costly and painful.

Develop a feel for your “market”

Develop relationships and create champions within corporates. It will help promote your deal when the time comes, and will let you keep your finger on the pulse of corporate strategy to time your moves.

Do you read the earning calls of Cisco or IBM (or others relevant to you)? This is where strategies are presented. Are your keywords coming up there or in their press releases?

Chris Gilbert, former CEO of Ubiquisys (sold to Cisco for over $300M) was very deliberate in planning his exit.

Selling start on day one and is a leadership-only function — work out who will be your buyer. Only the CEO can do this. Constantly articulate why a company should buy you,” Gilbert said. Bring clear messages into the acquiring company so it can be presented upwards: give them the presentation you would like them to show their boss! When the time is right, force decisions through competition. If you know they have to buy you, your starting position is strong.”

The Dark Art of Price Discovery

There are dozens of formulas (from DCF to comparables) to evaluate a deal — which also means none is ‘correct’. What matters is: how much would you sell for, and how much is the buyer ready to pay?

Gilbert, at Ubiquisys, described how close interactions with his banker helped drive the price up among the bidders assembled.

Just like buyers, we meet bankers and lawyers too rarely at startup events, but there is much to learn with them. They make deals happen, avoid value erosion and optimize price. They often also make introductions before you engage them, to build goodwill and earn your business.

And if you worry about fees, the right banker handsomely pays for itself by finding more bidders, and playing “bad cop” for you, avoiding direct confrontation with your future employer. Do you want a slice of the watermelon or the whole grape?

Final Twist: Exits Are Not Exits

When asked about what happens after an M&A or IPO, buyers said that they generally hoped the founders would stay with them for many years. Often using re-vesting, earn-outs or shares of the acquiring company to incentivize them. Neville, from IBM, mentioned a security company they acquired whose founder is now the head of one of the largest IBM divisions.

In the case of IPOs, supposedly the ultimate “exit”, any block of shares sold by founders would face extreme scrutiny and might cause a price drop.

So who’s exiting during those deals? Investors (and not always).

Eventually, if the average age of a startup at exit is 8–10 years, the active duty period of founders (if not replaced in the meantime) extends even more. Better love the problem you’re solving, and your customers!

Thanks to speakers, participants and supporters of this Masterclass series:

London: Frederic Rombaut (Seraphim Capital), Joe Tabberer (FirstBank), Chris Gilbert (Ubiquisys), Jonathan Keeling (Crowdcube), Fred Destin, Tony Fish (AMF Ventures, James Clark (London Stock Exchange), Denise Law (SGCIB).

Paris: Frederic Rombaut (Seraphim Capital), Manuel Gruson (Dassault Systemes), Pierre-Henri Chappaz (Rothschild Global Advisory), Christine Lambert-Goue (All Invest), Olivier Younes (EXPEN), Eric Carreel (Withings), Fabien Bardinet (Balyo), Xavier Lazarus (Elaia Partners), Pierre-Eric Leibovici(Daphni). Jean de La Rochebrochard (Kima Ventures), Jeremy Sartre (SmartAngels), Gwen Regina Tan (Entrepreneur First).

San Francisco: Natasha Ligai (Logitech), Matt Cutler (Cisco),Will Hawthorne, (CODE Advisors), Ryan Rzepecki (JUMP Bikes), Charles Huang (Guitar Hero), Jeff Thomas (Nasdaq), Shahin Farshchi (Lux Capital), Ammar Hanafi (Moment Ventures), Adam J. Epstein (Third Creek Advisors), Nathan Harding (EKSO Bionics), Kate Whitcomb, Anthony Marino and Ethan Haigh (SOSV).

New York: Todd Neville (IBM), George Patterson (HSBC), Ryan Rzepecki (JUMP Bikes), Aaron Kellner (SeedInvest), Jeremy Levine (Bessemer Venture Partners), Taylor Greene (Collaborative Fund), Adam Rothenberg (BoxGroup), Eli Curi(Fenwick & West), Ian Engstrand and Salil Gandhi (Goodwin), Warren Spar(Sparring Partners Capital), Duncan Turner, Vivian Law and Sheng Ge (SOSV).

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Autonomous-aviation startup Xwing takes flight with $4 million in funding

Marc Piette had a revelation as he buzzed in and out of the Palo Alto Airport in pursuit of his pilot’s license. Instead of freedom, he saw restraint. He also saw potential.

“It became pretty apparent that there were major issues with the general aviation industry with smaller aircraft,” Piette said in a recent interview with TechCrunch. “And yet it had enormous potential to change the way people moved around.”

Now, Piette’s two-year-old autonomous-aviation startup Xwing is ramping up to unlock that potential. The company isn’t building autonomous helicopters and planes. Instead, it’s focused on the software stack that will enable pilotless flight of small passenger aircraft.

The company announced Tuesday that it has raised $4 million in a seed round led by Eniac Ventures. Array Ventures, along with Stripe founders John and Patrick Collison and Nat Friedman of Xamarin, Microsoft and GitHub, also participated in the round.

The funding will be used by the San Francisco-based company to scale operations and continue to hire aerospace and software talent.

The startup has about a dozen employees, including some uniquely talented folks who have experience with optionally piloted vehicles, unmanned systems and certified avionics. For example, the company’s CTO, Maxime Gariel, worked on autonomous-aviation projects such as DARPA Gremlins and the AgustaWestland SW4 Solo autonomous helicopter. Other members of the small team previously worked at Rockwill Collins, with the Naval Research Lab, Google, and McKinsey.

Piette, whose last company Locu was acquired by GoDaddy, sees several restraints to small passenger aircraft: the skill level required to fly a plane and the cost of earning a pilot’s license and accessing a plane. The relatively puny sales volume of small aircraft — just 3,293 general aviation aircraft, including helicopters, were delivered last year worldwide, in contrast to more than 80 million cars — has depressed innovation and kept prices high.

And even when people have both a license and an aircraft, they still must travel from a small airport to their final destination.

The company is focusing on the key functions of autonomous flight, such as sensing, reasoning and control.

Xwing isn’t pinned to one kind of aircraft. Piette said the system is designed to work across different kinds of aircraft. For instance, the company spent 18 months testing on a subscale fixed-wing aircraft. It tested on a helicopter more recently.

Xwing is developing and integrating those technologies for rotorcraft, general aviation fixed-wing and the emerging electric vertical takeoff and landing (known as eVTOL) aircraft.

The company’s sensor integration software enables aircraft to perceive the world around it and reliably detect ground-based and airborne hazards and precisely determine the vehicle’s position.

This perception technology is the building block for autonomous aircraft, and also can be used to increase the operational envelope of current-day piloted aircraft, according to Xwing.

From here, the company’s Autonomy Flight Management System (AFMS) allows the aircraft to act upon the information from its surroundings. The system will integrate with air traffic control, generate flight paths to navigate the airspace, monitor system health and address all contingencies to ensure passenger safety, the company says.

Now, Xwing is in discussion with various, and still unnamed, large companies about integrating the system into their aircraft.

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