Technology
A TikTok ban could hurt Amazon sellers looking for alternatives
In March The US House of Representatives overwhelmingly passed a bill that could force ByteDance to achieve this eliminate TikTok or face a ban from US app stores. Ma lot of the discussions and debates surrounding it centered around America data security and the fitting to speechhowever the potential move also highlights something else: TikTok is increasingly focused on e-commerce, however the interplay of tech giants and geopolitics is putting pressure on smaller sellers.
Over the past few months, buyers – many from China – have been looking out Amazon alternatives have began coming to TikTok to sell clothes, cosmetics, electronics and plenty of other products to US buyers via TikTok Shop. In interviews with TechCrunch, sellers in Shenzhen – a Chinese megacity that could be a major trading hub for Amazon sellers – said they felt a collective sense of frustration over rising geopolitical tensions and “helplessness” over a possible TikTok ban.
“The situation is not under our control,” a retailer specializing in maternity and kids’s products told TechCrunch. “It’s just hard to know how the situation will develop.” Because existing supply chains are difficult to shift, “we just have to play it by ear.” (The sellers asked to stay anonymous resulting from political sensitivity.)
The TikTok Store officially launched in September 2023 and already serves 200,000 sellers. However, since then, no updated data has been released on what number of sellers are currently on the platform, how much products are sold there, or how much is being sold elsewhere (and where else that could be).
Tests from Jungle Scout, an information analytics provider for Amazon, nonetheless, gives some idea of TikTok’s impact on e-commerce. It found that 20% of Amazon sellers, brands and corporations plan to expand to TikTok Shop this yr. Before the present political backlash, ByteDance supposedly projected that it had the potential to grow its U.S. e-commerce business tenfold this yr to $17.5 billion.
TikTok is not the only platform on the list of shops looking for more channels beyond Amazon to expand their customer base. Its growth is a component of a bigger shift we’re seeing in alternative marketplaces like Temu, attracting more attention not only from buyers but additionally from Chinese exporters and e-commerce sellers. And Amazon is there apparently I listen to itwhich is one other sign that alternative solutions are gaining popularity.
TikTok didn’t immediately reply to a request for comment.
A latest approach to sell and buy
TikTok has been attempting to grow its e-commerce business since its U.S. launch last September.
The app is thought — or infamous, depending on who you consult with — for how tightly it controls what content is shared with whom. The TikTok store also has a heavy dose of curation.
Unlike Temu, known for its seas of low-cost white-label products sourced from Chinese factories and sold on to U.S. consumers, TikTok’s strategy is to advertise and highlight more branded goods, making it a more direct competitor to Amazon.
TikTok can be attempting to attract sellers with more traditional grants. According to reports, with a view to encourage sellers to sell goods at a major discount through the recent Black Friday sale, TikTok gave grants to those sellers to cut back their prices by as much as 50%.
Incentives and algorithms aside, sellers were focused on selling through the app just because TikTok’s short-video platform generates massive engagement. According to a survey conducted by TabcutChinese performance monitoring company TikTok Shop, almost 70% of sellers reported year-over-year sales growth in the primary 11 months of 2023.
This can be borne out by consumer behavior, where influencer-recommended products proceed to grow in popularity, particularly amongst desirable younger consumers.
According to Jungle Scout, nearly 20% of consumers began searching for products on TikTok in the primary quarter of 2023, up 44% from the previous yr. While 56% of all consumers still preferred to start out their product search on Amazon, 40% of Gen Zers preferred TikTok search engine over Google.
The high concentration of young buyers will not be surprising considering that data shows that 52% of TikTok users within the U.S. are between the ages of 18-34 Pew research. TikTok has the potential to vary the best way younger generations of Americans shop online.
In addition to counting on its momentum, TikTok revolves across the media to convey its message.
Earlier this month, business research firm Oxford Economics published a report report on TikTok’s impact on the U.S. small and medium-sized business sector It was funded by TikTok and, perhaps unsurprisingly, provided clear support for TikTok’s economic impact: it was estimated that presence on the platform (either through promoting or just marketing through accounts ) generated $14.7 billion in revenue for the 7 million U.S. small and medium-sized businesses that used it.
Amazon competition?
TikTok appears to be serious about entering e-commerce, however the situation continues to be in flux. On the one hand, the corporate – even within the face of a possible U.S. sales ban or forced sale – continues to introduce latest e-commerce features resembling latest video shopping format it was presented at a conference this month. On the opposite hand, it modifies or enforces seller policies seemingly on the fly, trying to seek out a approach to thrive in a very glaring highlight.
“The internal management of TikTok (the shop) is a bit chaotic in the mean time. It’s a brand new platform, so it hasn’t began oppressing sellers, but the principles are still changing,” said a lamp seller who has been selling on Amazon since mid-2010.
One of those principles appears to be related to what algorithms reach to consumers. Sellers outside China say TikTok’s U.S. store has stepped up efforts in recent months to prioritize U.S. stores over foreign ones. Sellers tell TechCrunch this has led to the creation of black market “agents” — parties that intermediate transactions between foreign sellers and U.S. residents, who in turn arrange TikTok stores that appear U.S.-owned but are literally run by foreign merchants.
Retailers are wanting to hop over these hurdles to grow their user touchpoints and diversify their channels as one giant emerges after one other.
“Margins are shrinking on Amazon and competition is getting fiercer because of Temu, so TikTok gives us another option,” the lamp seller said.
To assess TikTok’s impact on Amazon, “we need to understand the entire U.S. retail market,” said Richard Xu, a partner at Starting Gate Fund, which invests in cross-border retail solutions between China and the U.S.
E-commerce covers approx 15% in line with the US Department of Commerce, subsequently “If we’re talking about just the small share of the e-commerce sector on the Internet, there’s not much to discuss,” Xu suggested.
However, in case your TikTok Shop strategy is primarily focused on bringing offline businesses online for the primary time, this could be a really big move. “(Using) live e-commerce to enable small shops and offline stores to participate, the potential is quite significant.”
In any case, while 15% seems small, the number continues to be significant – $285.2 billion – so the potential for TikTok Shop is big, even when it only captures a small slice of the present e-commerce pie.
Juozas Kaziukenas, founding father of Marketplace Pulse, an e-commerce analytics company, doubts that TikTok will ever replace Amazon. “It does not provide a wide range of choice and fulfillment, and buyers in the West are accustomed to search engine-driven e-commerce,” he said. “But many people use TikTok for hours every day, so they sometimes make purchases on it.”
“In the United States and other Western countries, shopping apps have developed in parallel with entertainment or connectivity apps such as social media. We are used to downloading different things from different applications rather than doing everything in one place,” he added.
“Today, social media apps like TikTok are trying to get a handle on shopping before retailers like Amazon embrace social media (e.g. through Amazon Inspire). However, the status quo of different apps serving different needs remains.”
Technology
The company is currently developing washing machines for humans
Forget about cold baths. Washing machines for people may soon be a brand new solution.
According to at least one Japanese the oldest newspapersOsaka-based shower head maker Science has developed a cockpit-shaped device that fills with water when a bather sits on a seat in the center and measures an individual’s heart rate and other biological data using sensors to make sure the temperature is good. “It also projects images onto the inside of the transparent cover to make the person feel refreshed,” the power says.
The device, dubbed “Mirai Ningen Sentakuki” (the human washing machine of the longer term), may never go on sale. Indeed, for now the company’s plans are limited to the Osaka trade fair in April, where as much as eight people will have the option to experience a 15-minute “wash and dry” every day after first booking.
Apparently a version for home use is within the works.
Technology
Zepto raises another $350 million amid retail upheaval in India
Zepto has secured $350 million in latest financing, its third round of financing in six months, because the Indian high-speed trading startup strengthens its position against competitors ahead of a planned public offering next yr.
Indian family offices, high-net-worth individuals and asset manager Motilal Oswal invested in the round, maintaining Zepto’s $5 billion valuation. Motilal co-founder Raamdeo Agrawal, family offices Mankind Pharma, RP-Sanjiv Goenka, Cello, Haldiram’s, Sekhsaria and Kalyan, in addition to stars Amitabh Bachchan and Sachin Tendulkar are amongst those backing the brand new enterprise, which is India’s largest fully national primary round.
The funding push comes as Zepto rushes so as to add Indian investors to its capitalization table, with foreign ownership now exceeding two-thirds. TechCrunch first reported on the brand new round’s deliberations last month. The Mumbai-based startup has raised over $1.35 billion since June.
Fast commerce sales – delivering groceries and other items to customers’ doors in 10 minutes – will exceed $6 billion this yr in India. Morgan Stanley predicts that this market shall be value $42 billion by 2030, accounting for 18.4% of total e-commerce and a pair of.5% of retail sales. These strong growth prospects have forced established players including Flipkart, Myntra and Nykaa to cut back delivery times as they lose touch with specialized delivery apps.
While high-speed commerce has not taken off in many of the world, the model seems to work particularly well in India, where unorganized retail stores are ever-present.
High-speed trading platforms are creating “parallel trading for consumers seeking convenience” in India, Morgan Stanley wrote in a note this month.
Zepto and its rivals – Zomato-owned Blinkit, Swiggy-owned Instamart and Tata-owned BigBasket – currently operate on lower margins than traditional retail, and Morgan Stanley expects market leaders to realize contribution margins of 7-8% and adjusted EBITDA margins to greater than 5% by 2030. (Zepto currently spends about 35 million dollars monthly).
An investor presentation reviewed by TechCrunch shows that Zepto, which handles greater than 7 million total orders every day in greater than 17 cities, is heading in the right direction to realize annual sales of $2 billion. It anticipates 150% growth over the following 12 months, CEO Aadit Palicha told investors in August. The startup plans to go public in India next yr.
However, the rapid growth of high-speed trading has had a devastating impact on the mom-and-pop stores that dot hundreds of Indian cities, towns and villages.
According to the All India Federation of Consumer Products Distributors, about 200,000 local stores closed last yr, with 90,000 in major cities where high-speed trading is more prevalent.
The federation has warned that without regulatory intervention, more local shops shall be vulnerable to closure as fast trading platforms prioritize growth over sustainable practices.
Zepto said it has created job opportunities for tons of of hundreds of gig employees. “From day one, our vision has been to play a small role in nation building, create millions of jobs and offer better services to Indian consumers,” Palicha said in an announcement.
Regulatory challenges arise. Unless an e-commerce company is a majority shareholder of an Indian company or person, current regulations prevent it from operating on a listing model. Fast trading corporations don’t currently follow these rules.
Technology
Wiz acquires Dazz for $450 million to expand cybersecurity platform
Wizardone of the talked about names within the cybersecurity world, is making a major acquisition to expand its reach of cloud security products, especially amongst developers. This is buying Dazzlespecialist in solving security problems and risk management. Sources say the deal is valued at $450 million, which incorporates money and stock.
This is a leap within the startup’s latest round of funding. In July, we reported that Dazz had raised $50 million at a post-money valuation of just below $400 million.
Remediation and posture management – two areas of focus for Dazz – are key services within the cybersecurity market that Wiz hasn’t sorted in addition to it wanted.
“Dazz is a leader in this market, with the best talent and the best customers, which fits perfectly into the company culture,” Assaf Rappaport, CEO of Wiz, said in an interview.
Remediation, which refers to helping you understand and resolve vulnerabilities, shapes how an enterprise actually handles the various vulnerability alerts it could receive from the network. Posture management is a more preventive product: it allows a company to higher understand the scale, shape and performance of its network from a perspective, allowing it to construct higher security services around it.
Dazz will proceed to operate as a separate entity while it’s integrated into the larger Wiz stack. Wiz has made a reputation for itself as a “one-stop shop,” and Rappaport said the integrated offering will proceed to be a core a part of it.
He believes this contrasts with what number of other SaaS corporations are built. In the safety industry, there are, Rappaport said, “a lot of Frankenstein mashups where companies prioritize revenue over building a single technology stack that actually works as a platform.” It could be assumed that integration is much more necessary in cybersecurity than in other areas of enterprise IT.
Wiz and Dazz already had an in depth relationship before this deal. Merat Bahat — the CEO who co-founded Dazz with Tomer Schwartz and Yuval Ofir (CTO and VP of R&D, respectively) — worked closely with Assaf Rappaport at Microsoft, which acquired his previous startup Adallom.
After Rappaport left to found Wiz together with his former Adallom co-founders, CTO Ami Luttwak, VP of Product Yinon Costica and VP of R&D Roy Reznik, Bahat was one in all the primary investors. Similarly, when Bahat founded Dazz, Assaf was a small investor in it.
The connection goes deeper than work colleagues. Bahat and Rappaport are also close friends, and she or he was the second family of Mickey, Rappaport’s beloved dog, referred to as Chief Dog Officer Wiz (together with LinkedIn profile). Once the deal was done, the 2 faced two very sad events: each Bahat and Mika’s mother died.
“We hope for a new chapter of positivity,” Bahat said. The cycle of life does indeed proceed.
Rumors of this takeover began to appear earlier this month; Rappaport confirmed that they then began talking seriously.
But that is not the one M&A conversation Wiz has gotten involved in. Earlier this 12 months, Google tried to buy Wiz itself for $23 billion to construct a major cybersecurity business. Wiz walked away from the deal, which might have been the biggest in Google’s history, partly because Rappaport believed Wiz could turn into a fair larger company by itself terms. And that is what this agreement goals to do.
This acquisition is a test for Wiz, which earlier this 12 months filled its coffers with $1 billion solely for M&A purposes (it has raised almost $2 billion in total, and we hear the subsequent round will close in just a few weeks). . Other offers included purchasing Gem security for $350 million, but Dazz is its largest acquisition ever.
More mergers and acquisitions could also be coming. “We believe next year will be an acquisition year for us,” Rappaport said.
In an interview with TC, Luttwak said that one in all Wiz’s priorities now’s to create more tools for developers that have in mind what they need to do their jobs.
Enterprises have made significant investments in cloud services to speed up operations and make their IT more agile, but this shift has include a significantly modified security profile for these organizations: network and data architectures are more complex and attack surfaces are larger, creating opportunities for malicious hackers to find ways to to hack into these systems. Artificial intelligence makes all of this far more difficult when it comes to malicious attackers. (It’s also a chance: the brand new generation of tools for our defense relies on artificial intelligence.)
Wiz’s unique selling point is its all-in-one approach. Drawing data from AWS, Azure, Google Cloud and other cloud environments, Wiz scans applications, data and network processes for security risk aspects and provides its users with a series of detailed views to understand where these threats occur, offering over a dozen products covering the areas, corresponding to code security, container environment security, and provide chain security, in addition to quite a few partner integrations for those working with other vendors (or to enable features that Wiz doesn’t offer directly).
Indeed, Wiz offered some extent of repair to help prioritize and fix problems, but as Luttwak said, the Dazz product is solely higher.
“We now have a platform that actually provides a 360-degree view of risk across infrastructure and applications,” he said. “Dazz is a leader in attack surface management, the ability to collect vulnerability signals from the application layer across the entire stack and build the most incredible context that allows you to trace the situation back to engineers to help with remediation.”
For Dazz’s part, once I interviewed Bahat in July 2024, when Dazz raised $50 million at a $350 million valuation, she extolled the virtues of constructing strong solutions and this week said the third quarter was “amazing.”
“But market dynamics are what trigger these types of transactions,” she said. She confirmed that Dazz had also received takeover offers from other corporations. “If you think about the customers and joint customers that we have with Wiz, it makes sense for them to have it on one platform.”
And a few of Dazz’s competitors are still going it alone: Cyera, like Dazz, an authority in attack surface management, just yesterday announced a rise of $300 million at a valuation of $5 billion (which confirms our information). But what’s going to he do with this money? Make acquisitions, after all.
Wiz says it currently has annual recurring revenue of $500 million (it has a goal of $1 billion ARR next 12 months) and has greater than 45% of its Fortune 100 customers. Dazz said ARR is within the tens of hundreds of thousands of dollars and currently growing 500% on a customer base of roughly 100 organizations.
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