Nov
13
2019
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Messaging app Wire confirms $8.2M raise, responds to privacy concerns after moving holding company to the US

Big changes are afoot for Wire, an enterprise-focused end-to-end encrypted messaging app and service that advertises itself as “the most secure collaboration platform”. In February, Wire quietly raised $8.2 million from Morpheus Ventures and others, we’ve confirmed — the first funding amount it has ever disclosed — and alongside that external financing, it moved its holding company in the same month to the US from Luxembourg, a switch that Wire’s CEO Morten Brogger described in an interview as “simple and pragmatic.”

He also said that Wire is planning to introduce a freemium tier to its existing consumer service — which itself has half a million users — while working on a larger round of funding to fuel more growth of its enterprise business — a key reason for moving to the US, he added: There is more money to be raised there.

“We knew we needed this funding and additional to support continued growth. We made the decision that at some point in time it will be easier to get funding in North America, where there’s six times the amount of venture capital,” he said.

While Wire has moved its holding company to the US, it is keeping the rest of its operations as is. Customers are licensed and serviced from Wire Switzerland; the software development team is in Berlin, Germany; and hosting remains in Europe.

The news of Wire’s US move and the basics of its February funding — sans value, date or backers — came out this week via a blog post that raises questions about whether a company that trades on the idea of data privacy should itself be more transparent about its activities.

Specifically, the changes to Wire’s financing and legal structure were only communicated to users when news started to leak out, which brings up questions not just about transparency, but about the state of Wire’s privacy policy, given the company’s holding company now being on US soil.

It was an issue picked up and amplified by NSA whistleblower Edward Snowden . Via Twitter, he described the move to the US as “not appropriate for a company claiming to provide a secure messenger — claims a large number of human rights defenders relied on.”

“There was no change in control and [the move was] very tactical [because of fundraising],” Brogger said about the company’s decision not to communicate the move, adding that the company had never talked about funding in the past, either. “Our evaluation was that this was not necessary. Was it right or wrong? I don’t know.”

The other key question is whether Wire’s shift to the US puts users’ data at risk — a question that Brogger claims is straightforward to answer: “We are in Switzerland, which has the best privacy laws in the world” — it’s subject to Europe’s General Data Protection Regulation framework (GDPR) on top of its own local laws — “and Wire now belongs to a new group holding, but there no change in control.”

In its blog post published in the wake of blowback from privacy advocates, Wire also claims it “stands by its mission to best protect communication data with state-of-the-art technology and practice” — listing several items in its defence:

  • All source code has been and will be available for inspection on GitHub (github.com/wireapp).
  • All communication through Wire is secured with end-to-end encryption — messages, conference calls, files. The decryption keys are only stored on user devices, not on our servers. It also gives companies the option to deploy their own instances of Wire in their own data centers.
  • Wire has started working on a federated protocol to connect on-premise installations and make messaging and collaboration more ubiquitous.
  • Wire believes that data protection is best achieved through state-of-the-art encryption and continues to innovate in that space with Messaging Layer Security (MLS).

But where data privacy and US law are concerned, it’s complicated. Snowden famously leaked scores of classified documents disclosing the extent of US government mass surveillance programs in 2013, including how data-harvesting was embedded in US-based messaging and technology platforms.

Six years on, the political and legal ramifications of that disclosure are still playing out — with a key judgement pending from Europe’s top court which could yet unseat the current data transfer arrangement between the EU and the US.

Privacy versus security

Wire launched at a time when interest in messaging apps was at a high watermark. The company made its debut in the middle of February 2014, and it was only one week later that Facebook acquired WhatsApp for the princely sum of $19 billion.

We described Wire’s primary selling point at the time as a “reimagining of how a communications tool like Skype should operate had it been built today” rather than in in 2003. That meant encryption and privacy protection, but also better audio tools and file compression and more.

It was a pitch that seemed especially compelling considering the background of the company. Skype co-founder Janus Friis and funds connected to him were the startup’s first backers (and they remain the largest shareholders);Wire was co-founded in by Skype alums Jonathan Christensen and Alan Duric (former no longer with the company, latter is its CTO); and even new investor Morpheus has Skype roots.

Yet even with that Skype pedigree, the strategy faced a big challenge.

“The consumer messaging market is lost to the Facebooks of the world, which dominate it,” Brogger said today. “However, we made a clear insight, which is the core strength of Wire: security and privacy.”

That, combined with trend around the consumerization of IT that’s brought new tools to business users, is what led Wire to the enterprise market in 2017 — a shift that’s seen it pick up a number of big names among its 700 enterprise customers, including Fortum, Aon, EY and SoftBank Robotics.

But fast forward to today, and it seems that even as security and privacy are two sides of the same coin, it may not be so simple when deciding what to optimise in terms of features and future development, which is part of the question now and what critics are concerned with.

“Wire was always for profit and planned to follow the typical venture backed route of raising rounds to accelerate growth,” one source familiar with the company told us. “However, it took time to find its niche (B2B, enterprise secure comms).

“It needed money to keep the operations going and growing. [But] the new CEO, who joined late 2017, didn’t really care about the free users, and the way I read it now, the transformation is complete: ‘If Wire works for you, fine, but we don’t really care about what you think about our ownership or funding structure as our corporate clients care about security, not about privacy.’”

And that is the message you get from Brogger, too, who describes individual consumers as “not part of our strategy”, but also not entirely removed from it, either, as the focus shifts to enterprises and their security needs.

Brogger said there are still half a million individuals on the platform, and they will come up with ways to continue to serve them under the same privacy policies and with the same kind of service as the enterprise users. “We want to give them all the same features with no limits,” he added. “We are looking to switch it into a freemium model.”

On the other side, “We are having a lot of inbound requests on how Wire can replace Skype for Business,” he said. “We are the only one who can do that with our level of security. It’s become a very interesting journey and we are super excited.”

Part of the company’s push into enterprise has also seen it make a number of hires. This has included bringing in two former Huddle C-suite execs, Brogger as CEO and Rasmus Holst as chief revenue officer — a bench that Wire expanded this week with three new hires from three other B2B businesses: a VP of EMEA sales from New Relic, a VP of finance from Contentful; and a VP of Americas sales from Xeebi.

Such growth comes with a price-tag attached to it, clearly. Which is why Wire is opening itself to more funding and more exposure in the US, but also more scrutiny and questions from those who counted on its services before the change.

Brogger said inbound interest has been strong and he expects the startup’s next round to close in the next two to three months.

Feb
14
2019
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Peltarion raises $20M for its AI platform

Peltarion, a Swedish startup founded by former execs from companies like Spotify, Skype, King, TrueCaller and Google, today announced that it has raised a $20 million Series A funding round led by Euclidean Capital, the family office for hedge fund billionaire James Simons. Previous investors FAM and EQT Ventures also participated, and this round brings the company’s total funding to $35 million.

There is obviously no dearth of AI platforms these days. Peltarion focus on what it calls “operational AI.” The service offers an end-to-end platform that lets you do everything from pre-processing your data to building models and putting them into production. All of this runs in the cloud and developers get access to a graphical user interface for building and testing their models. All of this, the company stresses, ensures that Peltarion’s users don’t have to deal with any of the low-level hardware or software and can instead focus on building their models.

“The speed at which AI systems can be built and deployed on the operational platform is orders of magnitude faster compared to the industry standard tools such as TensorFlow and require far fewer people and decreases the level of technical expertise needed,” Luka Crnkovic-Friis, of Peltarion’s CEO and co-founder, tells me. “All this results in more organizations being able to operationalize AI and focusing on solving problems and creating change.”

In a world where businesses have a plethora of choices, though, why use Peltarion over more established players? “Almost all of our clients are worried about lock-in to any single cloud provider,” Crnkovic-Friis said. “They tend to be fine using storage and compute as they are relatively similar across all the providers and moving to another cloud provider is possible. Equally, they are very wary of the higher-level services that AWS, GCP, Azure, and others provide as it means a complete lock-in.”

Peltarion, of course, argues that its platform doesn’t lock in its users and that other platforms take far more AI expertise to produce commercially viable AI services. The company rightly notes that, outside of the tech giants, most companies still struggle with how to use AI at scale. “They are stuck on the starting blocks, held back by two primary barriers to progress: immature patchwork technology and skills shortage,” said Crnkovic-Friis.

The company will use the new funding to expand its development team and its teams working with its community and partners. It’ll also use the new funding for growth initiatives in the U.S. and other markets.

Mar
28
2018
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Microsoft can ban you for using offensive language

A report by CSOOnline presented the possibility that Microsoft would be able to ban “offensive language” from Skype, Xbox, and, inexplicably, Office. The post, which cites Microsoft’s new terms of use, said that the company would not allow users to “publicly display or use the Services to share inappropriate content or material (involving, for example, nudity, bestiality, pornography, offensive language, graphic violence, or criminal activity)” and that you could lose your Xbox Live Membership if you curse out a kid Overwatch.

“We are committed to providing our customers with safe and secure experiences while using our services. The recent changes to the Microsoft Service Agreement’s Code of Conduct provide transparency on how we respond to customer reports of inappropriate public content,” said a Microsoft spokesperson. The company notes that “Microsoft Agents” do not watch Skype calls and that they can only respond to complaints with clear evidence of abuse. The changes, which go into effect May 1, allows Microsoft to ban you from it services if you’re found passing “inappropriate content” or using “offensive language.”

These new rules give Microsoft more power over abusive users and it seems like Microsoft is cracking down on bad behavior on its platforms. This is good news for victims of abuse in private communications channels on Microsoft products and may give trolls pause before they yell something about your mother on Xbox. We can only dare to dream.

Jul
13
2017
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BMW to include Skype for Business in-car via iDrive

 BMW is doing more with partner Microsoft to bring productivity to its vehicles. After adding Office 365 communications features to its BMW 5 series late last year, it’s now also bringing Skype for Business to its infotainment features, making it possible for users to connect to Skype meetings in the car. The Skype integration is going to be integrated into BMW’s iDrive system, and… Read More

Mar
04
2016
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Source: Microsoft mulled an $8 billion bid for Slack, will focus on Skype instead

slack rope When Slack announced new voice and video services earlier this week, the enterprise messaging startup signalled a move into territory dominated by the likes of Microsoft’s Skype. But it looks like this is not the only moment when the two company’s paths have crossed in recent times. Microsoft eyed Slack as a potential acquisition target for as much as $8 billion, TechCrunch… Read More

Mar
02
2016
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Slack voice calling arrives on desktop

Slack Voice Chat Reaction GIF Slack was being cheeky when yesterday it said voice chat would start testing “very, very soon”. Today the new “Calls” feature starting rolling out on Slack for desktop and on the Chrome browser.
It lets you start a private Slack Call or launch a conference call in a channel that anyone can join with a click. And in keeping with Slack’s lighthearted style, once… Read More

Oct
29
2015
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Microsoft Integrates Skype With Office Online, Rolls Out An Office Chrome Extension

office-online-skype Microsoft today announced its plans to extend the social features of Office by integrating Skype into Office Online, allowing users to communicate by voice and video chat within Word, Excel, PowerPoint and OneNote Online documents, as well as in Outlook.com. With the integration, users will be able to see and chat with Skype contacts right from within their file, which Microsoft says will… Read More

Oct
15
2015
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Skype Now Lets Anyone Join A Chat Even If They Don’t Have An Account

skype-3-way-image Skype is working to make is service more broadly accessible, Microsoft announced today, detailing a new feature that will allow users to invite anyone – even those who don’t have a Skype account – to use the service via the Skype for Web interface. Invitees won’t have to create an account or download an app, but can instead join a chat as a guest simply by clicking a link. Read More

Jul
08
2015
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Creating A Universal Remote Control For Business Communications

connectedschools In the ultimate paradox, we have spent the last several years untethering our workforces while technically intertwining our personal and professional lives. Yet, for many, the notion of BYOD often results in a feeling of being AWOL. With 25 percent of knowledge workers out of the office on any given day, the ability to remotely connect back into corporate communications and collaboration tools… Read More

May
07
2015
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Ex-Skypers Launch Virtual Whiteboard Deekit

woman planning release1024x694 Deekit, which exits private beta today, is a virtual and collaborative whiteboard to help remote teams work smarter. Read More

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