Top tech startup news for Wednesday, January 25, 2023: DailyPay, IBM, Microsoft, RapidDeploy, Tesla, ZenGo
Good evening! Below are some of the top tech startup news stories for Wednesday, January 25, 2023.
Tesla reports record revenue, beats analysts’ expectations
Elon Musk’s electric vehicle maker Tesla beat Wall Street targets in its fourth-quarter revenue and profit on Wednesday despite a sharp decline in its profit margins. According to financial market data firm Refinitiv, Tesla had revenue of $24.32 billion vs the $24.16 billion expected. Its adjusted earnings during the quarter were $1.19 vs the $1.13 per share expected. The total revenue during the quarter includes $21.3 billion in automotive, $1.78 in services, and $1.311 billion from energy generation and storage.
The positive news comes just a few months after Tesla cut the prices of its cars in China and the United States in late 2022. The earnings also come as Tesla sought to reassure investors that it can cut costs and still continue to generate cash as competition intensifies from other electric car maker rivals. Tesla’s shares ticked higher in the after-hours market.
In an earnings call with shareholders and analysts on Wednesday, Tesla CEO Elon Musk said, “Thus far in January we’ve seen the strongest orders year-to-date than ever in our history. We’re currently seeing orders of almost twice the rate of production.”
In recent years, Tesla has outperformed the industry and has also seen increased sales and record profits. The company was also able to weather the pandemic of the last three years and global supply-chain issues better than its rivals. However, its automotive gross margins came in at 25.9%, the lowest figure in the last five quarters.
The reported automotive revenue of $21.3 billion in the fourth quarter, represents 33% growth year-over-year for the world’s largest electric car maker.
Fintech startup DailyPay raises $260M in growth funding to revolutionize the $1 trillion on-demand pay market
DailyPay, a New York-based fintech startup that works with employers to provide greater financial wellness support for employees in need, leading to happier and more productive employees, announced Tuesday it has secured $260 million in new capital. The funding is divided between revolving credit facility capacity provided by Barclays and Angelo Gordon and new term loan funding from SVB Capital and a fund managed by Neuberger Berman. DailyPay will also use the new cash infusion to further invest in product innovation.
The fresh funding comes almost a year after DailyPay first announced a $300 million revolving credit facility from Barclays in March 2022. The additional revolving credit facility capacity ($100 million provided by Barclays and $60 million from Angelo Gordon) provides DailyPay with more capital to service its ever-growing roster of clients. The $100 million in term loan funding will be invested to fuel DailyPay’s continued product innovation and accelerate growth.
The fundraising announcement comes five months after Kevin Coop joined DailyPay as Chief Executive Officer. In his first five months as CEO, DailyPay has significantly grown its roster of clients and has seen meaningful revenue growth.
Founded in 2015 by Jason Lee and Rob Law, DailyPay enables organizations and payroll providers to offer early access wages to employees. Its service is often used by companies and employers with low-wage employees, who work paycheck-to-paycheck. DailyPay’s on-demand pay solution also helps employers to activate their workforce and build stronger relationships with their employees, so they feel more engaged, work harder, and stay longer. DailyPay is headquartered in New York City, with operations based in Minneapolis and Belfast.
IBM to cut 3,900 jobs; tops revenue estimates
Mainframe pioneer IBM managed to avoid posting a revenue decline as the century-old tech giant reported its quarterly revenue on Wednesday. According to data analytics company Refinitiv, IBM reported revenue of $16.69 billion during the quarter, vs. $16.4 billion expected by analysts. The revenue was driven by higher-than-expected growth in the company’s software and infrastructure segments.
The company plans to cut about 3,900 jobs or 1.5% of its workforce. While other big tech companies like Microsoft showed a slowdown in new business, IBM CEO Arvind Krishna said he has not seen the same pattern. “I see that our clients do want to do new development,” Krishna said.
During the quarter, its software unit posted $7.29 billion in revenue, which translates to nearly 3% growth and above the $7.12 billion consensus among analysts polled by StreetAccount.
Today, ZenGo becomes the first non-custodial wallet with no seed phrase vulnerability to integrate with the Polygon network. As a result, Polygon users can enjoy self-custody of Polygon (MATIC), ETH, BTC, and more with secure asset recovery built-in. ZenGo is the first MPC wallet for retail users with no seed-phrase vulnerability, and Polygon is the preferred choice for non-web3 companies trying to enter Web3, such as Nike and Starbucks (and recently the Smurfs NFTs).
By leveraging advanced biometrics and cutting-edge MPC cryptography, ZenGo eliminates onboarding complexities, allowing anyone to safely set up and secure their wallet in seconds from any iOS or Android device. ZenGo’s security model removes the single point of failure that besets traditional non-custodial wallets: Not a single ZenGo wallet has been taken over since the company was founded in 2018.
“Today, digital asset security is still one of the biggest concerns, especially when it comes to those just starting their web3 journey,” said Hamzah Khan, Head of DeFi at Polygon Labs. “This is why the integration of ZenGo is so beneficial to Polygon users, allowing them to reliably and securely self-custody their cryptocurrencies. It also aligns perfectly with Polygon’s mission to onboard the next billion users to web3, making the space as accessible, safe, and inclusive as possible.
More than 800,000 users rely on MPC technology to secure their digital assets, with ZenGo the most popular wallet of its kind. ZenGo replaces the traditional private key with two independently created mathematical “shares.” One is stored on the user’s mobile device and the other on ZenGo’s server, ensuring no single point of failure while facilitating recovery in the event of device loss.
RapidDeploy raises $34M in growth funding to enable public safety officials to reduce emergency response times
Every year, about 240 million people call 911 in the United States. That’s a lot of calls if you think about it. According to reports, in 2017, the average wait time for law enforcement to arrive was 11 minutes while the average ambulance response time for an EMS unit to arrive on the scene from the time of a 911 call – was 7 minutes.
Eleven and seven minutes may not sound like a lot of time. But when you’re in the middle of an emergency, it’s a matter of life and death and time is of the essence. It’s for this reason that Austin-based startup RapidDeploy is on a mission to save lives by reducing response times for all and improving first responder safety by increasing situational awareness.
That’s not all. RapidDeploy also protects public safety and prevents ransomware attacks, Microsoft CEO Satya Nadella described the company during the Microsoft Ignite conference in Orlando, Florida. It’s not just Microsoft CEO, RapidDeploy has also partnered with some of the Fortune 500 companies since its inception a decade ago. Today, RapidDeployis the leading provider of cloud-native 911 mapping and analytics solutions for Public Safety.
To further fuel its growth and international expansion, RapidDeploy announced today it has raised $34 million in new growth capital led by Edison Partners, a leading growth equity investment firm, with participation from existing financial and strategic investors GreatPoint Ventures, Morpheus Ventures, GM Ventures, Ericsson Ventures, Tao Capital Partners, Clearvision Ventures, Tau Ventures, NedBank CIB, and others. This latest round brings RapidDeploy’s total raised to $87 million.
Founded in 2013 by Brett Meyerowitz and Steven Raucher, RapidDeploy is currently the industry’s only truly open and integrated response platform, transforming 9-1-1 communications centers of any size into data-centric organizations. The startup has grown to 10 statewide contracts and more than 1,500 contracted 911 centers using its platform.
Millions of Microsoft users around the world were hit with an outage on Wednesday after a networking outage took down its cloud platform Azure along with services such as Teams and Outlook.
The tech giant said it had since recovered all of its cloud services after a networking outage. Azure’s status page showed services were impacted in the Americas, Europe, Asia Pacific, Middle East, and Africa. Only services in China and its platform for governments were not hit.
Microsoft said it has now rolled back a network change that it believes is responsible for a disruption that left users globally unable to access multiple Microsoft 365 services earlier Wednesday.
Earlier this morning, Microsoft said it found a network connectivity issue was occurring with devices across the Microsoft WAN. This impacts connectivity between clients on the internet to Azure, as well as connectivity between services in data centers, the company said.
In a tweet, Microsoft said it had rolled back a network change that it believed was causing the issue and was using “additional infrastructure to expedite the recovery process.”
It all started around 2:05 EST when Microsoft said that customers may “experience issues with networking connectivity, manifesting as network latency and/or timeouts when attempting to connect to Azure resources in multiple regions, as well as other Microsoft services.”