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Two Sigma Ventures raises $288M, complementing its $60B hedge fund parent



Eight years ago, Two Sigma Investments began an experiment in early-stage investing.

The hedge fund, focused on data-driven quantitative investing, was well on its way to amassing the $60 billion in assets under management that it currently holds, but wanted more exposure to early-stage technology companies, so it created a venture capital arm, Two Sigma Ventures.

At the time of the firm’s launch it made a series of investments, totaling about $70 million, exclusively with internal capital. The second fund was a $150 million vehicle that was backed primarily by the hedge fund, but included a few external limited partners.

Now, eight years and several investments later, the firm has raised $288 million in new funding from outside investors and is pushing to prove out its model, which leverages its parent company’s network of 1,700 data scientists, engineers and industry experts to support development inside its portfolio.

The world is becoming awash in data and there’s continuing advances in the science of computing,” says Two Sigma Ventures co-founder Colin Beirne. “We thought eight years ago when when started, that more and more companies of the future would be tapping into those trends.”

Beirne describes the firm’s investment thesis as being centered on backing data-driven companies across any sector — from consumer technology companies like the social networking monitoring application, Bark, or the high-performance, high-end sports wearable company, Whoop.

Alongside Beirne, Two Sigma Ventures is led by three other partners: Dan Abelon, who co-founded SpeedDate and sold it to IAC; Lindsey Gray, who launched and led NYU’s Entrepreneurial Institute; and Villi Iltchev, a former general partner at August Capital.

Recent investments in the firm’s portfolio include Firedome, an endpoint security company; NewtonX, which provides a database of experts; Radar, a location-based data analysis company; and Terray Therapeutics, which uses machine learning for drug discovery.

Other companies in the firm’s portfolio are farther afield. These include the New York-based Amper Music, which uses machine learning to make new music; and Zymergen, which uses machine learning and big data to identify genetic variations useful in pharmaceutical and industrial manufacturing.

Currently, the firm’s portfolio is divided between enterprise investments, consumer-facing deals and healthcare-focused technologies. The biggest bucket is enterprise software companies, which Beirne estimates represents about 65% of the portfolio. He expects the firm to become more active in healthcare investments going forward.

“We really think that the intersection of data and biology is going to change how healthcare is delivered,” Beirne says. “That looks dramatically different a decade from now.”

To seed the market for investments, the firm’s partners have also backed the Allen Institute’s investment fund for artificial intelligence startups.

Together with Sequoia, KPCB and Madrona, Two Sigma recently invested in a $10 million financing to seed companies that are working with AI. “This is a strategic investment from partner capital,” says Beirne.

Typically startups can expect Two Sigma to invest between $5 million and $10 million with its initial commitment. The firm will commit up to roughly $15 million in its portfolio companies over time.

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Google gets woke on gender in Vision API, Amazon happy to sell its facial recognition code to foreigners, and more



Elon Musk roasts OpenAI, says should be more open

Roundup Hello readers. If you’re struggling to keep up with all the AI-related news spewed out and have already read what we’ve covered this week, then here’s more.

Me, sexist? No! What’s gender anyway?: Google’s Vision API, a service that offers pre-trained computer vision models for image recognition, will no longer identify gender in photos.

If an image of a person is fed into the API, Google will now label them as a ‘person’ rather than ‘male’ or ‘man,’ or ‘female’ or ‘woman’. The move to scrap “gendered labels” was to reduce the chances of unfair biases, apparently.

“Given that a person’s gender cannot be inferred by appearance, we have decided to remove these labels in order to align with the Artificial Intelligence Principles at Google, specifically Principle #2: Avoid creating or reinforcing unfair bias,” a spokesperson told Business Insider.

The classification of male and female doesn’t apply to everyone. Training machine learning models on these two labels means that they can fail when given a picture of transgender or non-binary people. To avoid such mistakes, Google’s Vision API will now just label someone as a person.

The change only affects Google’s Vision API, and doesn’t apply to its AutoML Vision service. AutoML Vision is more flexible, and users can train models on their own custom labels, so they can include gendered labels if they want.

Deepfakes in India’s politics: Fake videos of politician Manoj Tiwari, who is running for the current State Legislative Assemblies in India, began surfacing this week.

In one of the clips, Tiwari criticises his opponent, Arvind Kejriwal, from the Aam Aadmi Party for not sticking to his promises of opening more schools and installing more CCTV cameras in English.

Youtube Video

In another clip, he’s positioned against the same background, wearing the same clothes, and making another speech. But this time, he’s speaking in Haryanvi, a dialect of Hindi.

Youtube Video

If that’s not suspicious enough, here’s a third video that’s very similar to the first two – except now Tiwari is speaking in a completely different language.

Youtube Video

When viewed together, it definitely looks like the clips may have been altered using machine learning algorithms. The fake content described as deepfakes allows people to paste over someone’s face onto another person’s body. It’s possible that Tiwari’s appearance from the shoulders up was mapped onto other people’s bodies, and presumably these people were the ones that spread his message in English and Haryvani.

These deepfake videos were then spread across 5,800 WhatsApp groups, reaching up to 15 million people, as first reported by Vice.

The majority of deepfakes – about 96 per cent – are for pornographic content. Internet perverts have a penchant for swapping the faces of adult actresses for their favorite female celebrities.

But the creation of deepfakes for political reasons seems to be rising. Suspected fake videos of politicians from other countries, like Malaysia and Gabon, have cropped up too.

Hell yeah, we sell our facial recognition to police departments. And we’d probably sell it foreign governments too: The head of Amazon’s AWS cloud service, Andy Jassy, said he was happy to offer its facial recognition technology to law enforcement and would sell it to foreign governments too.

Facial recognition is the most controversial application of modern AI. It’s a well-known fact that the vast majority of models struggle to identify women and people of darker skin as accurately as white men. The technology, therefore, is likely to carry racial and gender biases, possibly leading to things like false arrests from incorrect matches.

Despite these issues, however, Amazon continues to sell to law enforcement departments across the US. In a documentary, Amazon Empire: The Rise and Reign of Jeff Bezos, produced by Frontline, the investigative journalism arm of America’s Public Broadcasting Service, Jassy states that he would sell Amazon’s Rekognition technology to foriegn governments.

“There’s a number of governments that are against the law for U.S. companies to do business with,” he said. “We would not sell it to those people or those governments.”

When pressed with the fact that some countries that the US can trade freely with are known for enforcing oppressive regimes and human rights abuses, Jassy said: “Yeah, again, if we have documented cases where customers of any sort are using the technology in a way that’s against the law or that we think is impinging people’s civil liberties, then we won’t allow them to use the platform” — meaning all of AWS, not just Rekognition.”

So, erm, that’s all okay then.

Algorithms inspecting visa applications: An architect’s visa to travel to the US was revoked after a computer algorithm flagged him up for being involved in a security threat.

Eyal Weizman, director of Forensic Architecture, a research group based in London that analyses and investigates videos of violent conflicts and human rights abuses around the world, was told he could no longer enter the US for a trip planned this month. Weizman has had no previous problems passing in and out of the border, and was flew to American in December.

But this time, this visa was revoked. When he went to the US embassy in London to apply for it again, he was told that his name had been flagged up by an algorithm. The computers had “identified a security threat that was related to him,” according to The New York Times. The embassy told him that the algorithm may have singled him out for interacting with certain people or staying in certain hotels.

He was asked to provide travel details over the last 15 years, including whether he had visited Syria, Iran, Iraq, Yemen, or Somalia. Weizman has passports from the United Kingdom and Israel.

Not much is known about how the algorithm works. A spokesperson from the US Customs and Border Protection refused to discuss the issue further and said that visa records were confidential under US law.

OpenAI not so open, after all: Here’s this week’s long read: OpenAI, the research lab based in San Francisco, known for its very public quest to develop artificial general intelligence has changed over the years.

Its reputation as a friendlier and more transparent company, compared to other bigger Silicon Valley tech corps, has slowly eroded over time. OpenAI appears to operate just like any other upstart now. There is a strong incentive for developing technology for profit, installing corporate secrecy, and an aggressive PR strategy.

All of it seems to stem from the OpenAI transforming from a nonprofit to a startup accepting cash from investors.

MIT Tech Review’s Karen Hao discovered this when she was given limited access to interview some of the company’s most prominent employees. On the surface they appeared open, talking about their grandeur visions of AGI, but behind closed doors other employees were told to notify the internal communications team whenever Hao contacted them without explicit permission to talk. It’s a common tactic employed by companies to prevent employees leaking to the press.

Read her story to find out more about the internal politics of what goes on inside OpenAI.

After the article was published, Elon Musk, who left OpenAI’s board last year criticized the company for its lack of transparency and said he had little confidence in the company’s safety strategy. Ouch. ®

Sponsored: Detecting cyber attacks as a small to medium business


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Petnet’s smart pet feeder system is back after a week-long outage, but customers are still waiting for answers



Petnet, the smart pet feeder backed by investors including Petco, recently experienced a week-long system outage affecting its second-generation SmartFeeders. While the startup’s customer service recently tweeted that its SmartFeeders and app’s functionality have been restored, Petnet’s lack of responsiveness continues to leave many customers frustrated and confused.

Petnet first announced on Feb. 14 that it was investigating a system outage affecting its second-generation SmartFeeders that made the feeders appear to be offline. The company said in a tweet that the SmartFeeders were still able to dispense on schedule, but several customers replied that their devices had also stopped dispensing food or weren’t dispensing it on schedule.

On Feb. 19, the company said that it is “working closely with our third-party service provider in regards to the outage,” before announcing on Feb. 22 that the SmartFeeders are returning online.

During that time, customers voiced frustration at the company’s lack of responses to their questions on Twitter and Facebook. Messages to the company’s support email and CEO Carlos Herrera were undeliverable.

TechCrunch tried contacting their emails and got delivery failure notices. A message sent to their Twitter account was also not replied to. We have contacted the company again for comment.

Petnet also experienced a similar system outage last month.

According to Crunchbase, has raised $14.9 million since it was founded in 2012, including a Series A led by Petco.

In a statement sent to TechCrunch over the weekend before Petnet said the outage was resolved, a Petco representative said “Petco is a minor and passive investor in Petnet, but we do not have any involvement in the company’s operations nor insight into the system outage they are currently experiencing.


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Heres our pick of the top six startups from Pause Fest



We’ve been dropping into the Australian startup scene increasingly over the years as the ecosystem has been building at an increasingly faster pace, most notably at our own TechCrunch Battlefield Australia in 2017. Further evidence that the scene is growing has come recently in the shape of the Pause Fest conference in Melbourne. This event has gone from strength to strength in recent years, and it is fast becoming a must-attend for Aussie startups aiming for both national international attention.

I was able to drop in virtually to interview a number of those showcased in the Startup Pitch Competition, so here’s a run-down of some of the stand-out companies.

Medinet Australia

Medinet Australia is a health-tech startup aiming to make healthcare more convenient and accessible to Australians by allowing doctors to do consultations with patients via an app. Somewhat similar to apps like Babylon Health, Medinet’s telehealth app allows patients to obtain clinical advice from a GP remotely; access prescriptions and have medications delivered; access pathology results; directly email their medical certificate to their employer; and access specialist referrals along with upfront information about specialists such as their fees, waitlist, and patient experience. They’ve raised $3M in Angel financing and are looking for institutional funding in due course. Given Australia’s vast distances, Medinet is well-placed to capitalize on the shift of the population towards much more convenient telehealth apps. (1st Place Winner)


Everty allows companies to easily manage, monitor and monetize Electric Vehicle charging stations. But this isn’t about infrastructure. Instead, they link up workplaces and accounting systems to the EV charging network, thus making it more like a “Salesforce for EV charging.” It’s available for both commercial and home charging tracking. It’s also raised an Angel round and is poised to raise further funding. (2nd Place Winner)

AI On Spectrum

It’s a sad fact that people with Autism statistically tend to die younger, and unfortunately, the suicide rate is much higher for Autistic people. “AI on Spectrum” takes an accessible approach in helping autistic kids and their families find supportive environments and feel empowered. The game encourages Autism sufferers to explore their emotional side and arms them with coping strategies when times get tough, applying AI and machine learning in the process to assist the user. (3rd Place Winner.)


Professional bee-keepers need a fast, reliable, easy-to-use record keeper for their bees and this startup does just that. But it’s also developing a software and sensor technology to give beekeepers more accurate analytics, allowing them to get an early-warning about issues and problems. Their technology could even, in the future, be used to alert for coming bushfires by sensing the changed behavior of the bees. (Hacker Exchange Additional Winner.)


Rechargeable batteries for things like cars can be re-used again, but the key to employing them is being able to extend their lives. Relectrify says its battery control software can unlock the full performance from every cell, increasing battery cycle life. It will also reduce storage costs by providing AC output without needing a battery inverter for both new and 2nd-life batteries. Its advanced battery management system combines power and electric monitoring to rapidly the check which are stronger cells and which are weaker making it possible to get as much as 30% more battery life, as well as deploying “2nd life storage”. So far, they have a project with Nissan and American Electric Power and have raised a Series A of $4.5 million. (SingularityU Additional Winner.)


Sadly, seniors and patients can contract bedsores if left too long. People can even die from bedsores. Furthermore, hospitals can end up in litigation over the issue. What’s needed is a technology that can prevent this, as well as predicting where on a patient’s body might be worst affected. That’s what Gabriel has come up with: using multi-modal technology to prevent and detect both falls and bedsores. Its passive monitoring technology is for the home or use in hospitals and consists of a resistive sheet with sensors connecting to a system which can understand the pressure on a bed. It has FDA approval, is patent-pending and is already working in some Hawaiian hospitals. It’s so far raised $2 million in Angel and is now raising money.

Here’s a taste of Pause Fest:

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