Index Ventures, Stripe back bookkeeping service Pilot with $40M

Five years after Dropbox acquired their startup Zulip, Waseem Daher, Jeff Arnold and Jessica McKellar have gained traction for their third business together: Pilot.

Pilot helps startups and small businesses manage their back office. Chief executive officer Daher admits it may seem a little boring, but the market opportunity is undeniably huge. To tackle the market, Pilot is today announcing a $40 million Series B led by Index Ventures with participation from Stripe, the online payment processing system.

The round values Pilot, which has raised about $60 million to date, at $355 million.

“It’s a massive industry that has sucked in the past,” Daher told TechCrunch. “People want a really high-quality solution to the bookkeeping problem. The market really wants this to exist and we’ve assembled a world-class team that’s capable of knocking this out of the park.”

San Francisco-based Pilot launched in 2017, more than a decade after the three founders met in MIT’s student computing group. It’s not surprising they’ve garnered attention from venture capitalists, given that their first two companies resulted in notable acquisitions.

Pilot has taken on a massively overlooked but strategic segment — bookkeeping,” Index’s Mark Goldberg told TechCrunch via email. “While dry on the surface, the opportunity is enormous given that an estimated $60 billion is spent on bookkeeping and accounting in the U.S. alone. It’s a service industry that can finally be automated with technology and this is the perfect team to take this on — third-time founders with a perfect combo of financial acumen and engineering.”

The trio of founders’ first project, Linux upgrade software called Ksplice, sold to Oracle in 2011. Their next business, Zulip, exited to Dropbox before it even had the chance to publicly launch.

It was actually upon building Ksplice that Daher and team realized their dire need for tech-enabled bookkeeping solutions.

“We built something internally like this as a byproduct of just running [Ksplice],” Daher explained. “When Oracle was acquiring our company, we met with their finance people and we described this system to them and they were blown away.”

It took a few years for the team to refocus their efforts on streamlining back-office processes for startups, opting to build business chat software in Zulip first.

Pilot’s software integrates with other financial services products to bring the bookkeeping process into the 21st century. Its platform, for example, works seamlessly on top of QuickBooks so customers aren’t wasting precious time updating and managing the accounting application.

“It’s better than the slow, painful process of doing it yourself and it’s better than hiring a third-party bookkeeper,” Daher said. “If you care at all about having the work be high-quality, you have to have software do it. People aren’t good at these mechanical, repetitive, formula-driven tasks.”

Currently, Pilot handles bookkeeping for more than $100 million per month in financial transactions but hopes to use the infusion of venture funding to accelerate customer adoption. The company also plans to launch a tax prep offering that they say will make the tax prep experience “easy and seamless.”

“It’s our first foray into Pilot’s larger mission, which is taking care of running your companies entire back office so you can focus on your business,” Daher said.

As for whether the team will sell to another big acquirer, it’s unlikely.

“The opportunity for Pilot is so large and so substantive, I think it would be a mistake for this to be anything other than a large and enduring public company,” Daher said. “This is the company that we’re going to do this with.”

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Facebook now says its password leak affected ‘millions’ of Instagram users

Facebook has confirmed its password-related security incident last month now affects “millions” of Instagram users, not “tens of thousands” as first thought.

The social media giant confirmed the new information in its updated blog post, first published on March 21.

“We discovered additional logs of Instagram passwords being stored in a readable format,” the company said. “We now estimate that this issue impacted millions of Instagram users. We will be notifying these users as we did the others.”

“Our investigation has determined that these stored passwords were not internally abused or improperly accessed,” the updated post said, but the company still has not said how it made that determination.

The social media giant did not say how many millions were affected, however.

Last month, Facebook admitted it had inadvertently stored “hundreds of millions” of user account passwords in plaintext for years, said to have dated as far back as 2012. The company said the unencrypted passwords were stored in logs accessible to some 2,000 engineers and developers. The data was not leaked outside of the company, however. Facebook still explained how the bug occurred

Facebook posted the update at 10am ET — an hour before the Special Counsel’s report into Russian election interference was set to be published.

When reached, spokesperson Liz Bourgeois said Facebook does not have “a precise number” yet to share, and declined to say exactly when the additional discovery was made.

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The chat feature may soon return to Facebook’s mobile app

Facebook upset millions upon millions of users five years ago when it removed chat from its core mobile app and forced them to download Messenger to communicate privately with friends. Now it looks like it might be able to restore the option inside the Facebook app.

That’s according to a discovery from researcher Jane Manchun Wong who discovered an unreleased feature that brings limited chat features back into the core social networking app. Wong’s finding suggests that, at this point, calling, photo sharing and reactions won’t be supported inside the Facebook app chat feature, but it remains to be seen if that is simply because it is currently in development.

It is unclear whether the feature will ship to users at all since this is a test. Messenger, which has over 1.3 billion monthly users, will likely stick but this change would give users other options for chatting to friends.

We’ve contacted Facebook for comment, although we’re yet to hear back from the company. We’ll update this story with any comment that the company does share.

As you’d expect, the discovery has been greeted with cheers from many users who were disgruntled when Facebook yanked chat from the app all those years ago. I can’t help but wonder, however, if there are more people today who are content with using Messenger to chat without the entire Facebook service bolted on. Given all of Facebook’s missteps over the past year or two, consumer opinion of the social network has never been lower, which raises the appeal of using it to connect with friends but without engaging its advertising or newsfeed.

Wong’s finding comes barely a month after Facebook CEO Mark Zuckerberg sketched out a plan to pivot the company’s main focus to groups and private conversation rather than its previously public forum approach. That means messaging is about to become its crucial social graph, so why not bring it back to the core Facebook app? We’ll have to wait and see, but the evidence certainly shows Facebook is weighing the merits of such a move.

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Here’s the first official preview of Microsoft’s Chromium-based Edge browser

Microsoft today launched the first official version of its Edge browser with the Chromium engine for Windows 10. You can now download the first developer and canary builds here. The canary builds will get daily updates and the developer builds will see weekly updates. Over time, you’ll also be able to opt in to the beta channel and, eventually, the stable channel.

The company first announced this project last December and the news obviously created quite a stir, given that Microsoft was abandoning its own browser engine development in favor of using an open-source engine — and one that is still very much under the control of Google. With that, we’re now down to two major browser engines: Google’s Chromium and Mozilla’s Gecko.

I used the most recent builds for the last week or so. Maybe the most remarkable thing about using Microsoft’s new Chromium-based Edge browser is how unremarkable it feels. It’s a browser and it (with the exceptions of a few bugs you’d expect to see in a first release) works just like you’d expect it to. That’s a good thing, in that if you’re a Windows user, you could easily use the new Edge as your default browser and would be just fine. On the other hand — at least at this stage of the project — there’s also very little that differentiates Edge with Chromium from Google’s own Chrome browser.

That will change over time, though, with more integrations into the Windows ecosystem. For now, this is very much a first preview and meant to give web and extensions developers a platform for testing their sites and tools.

There are a few points of integration with Microsoft’s other services available already, though. Right now, when you install the Edge preview builds, you get the option to choose your new tab layout. The choices are a very simple new tab layout that only presents a search bar and a few bookmarks and a variation with a pretty picture in the background, similar to what you’d see on Bing. There is, however, also another option that highlights recent news from Microsoft News, with the option to personalize what you see on that page.

Microsoft also says that it plans to improve tab management and other UI features as it looks at how it can differentiate its browser from the rest.

In this first preview, some of the syncing features are also already in place, but there are a few holes here. So while bookmarks sync, extensions, your browsing history, settings, open tabs, addresses and passwords do not. That’ll come in some of the next builds, though.

Right now, the only search engine that’s available is Bing. That, too, will obviously change in upcoming builds.

Microsoft tells me that it prioritized getting a full end-to-end browser code base to users and setting up the engineering systems that will allow it to both push regular updates outside of the Windows update cycle and to pull in telemetry data from its users.

Most of the bugs I encountered where minor. Netflix, though, regularly gave me trouble. While all other video services I tried worked just fine, the Netflix homepage often stuttered and became unresponsive for a few seconds.

That was the exception, though. In using the new Edge as my default browser for almost a week, I rarely ran into similar issues and a lot of things ‘just work’ already. You can read PDFs in the browser, just like you’d expect. Two-factor authentication with a Yubikey to get into Gmail works without an issue. Even complex web apps run quickly and without any issues. The extensions I regularly use, including LastPass, worked seamlessly, no matter whether I installed them from the Google store or Microsoft’s library.

I also ran a few benchmarks and unsurprisingly, Edge and the latest version of Chrome tend to score virtually the same results. It’s a bit too early in the development process to really focus on benchmarks, but the results are encouraging.

With this release, we’re also getting our first official look at using extensions in the new Edge. Unsurprisingly, Microsoft will offer its own extension store, but with the flip of a switch in the settings, you’ll also be able to install and use extensions from third-party marketplaces, meaning the Chrome Web Store. Extension developers who want to add their tools to the Microsoft marketplace can basically take their existing Chrome extensions and use those

Microsoft’s promise, of course, is that it will also bring the new Edge to Windows 7 and Windows 8, as well as the Mac. For now, though, this first version is only available on 64-bit versions of Windows 10. Those are in the works, but Microsoft says they simply aren’t quite as far along as the Windows 10 edition. This first release is also English-only, with localized versions coming soon, though.

While anybody can obviously download this release and give it a try, Microsoft stressed that if you’re not a tech enthusiast, it really isn’t for you. This first release is very much meant for a technical audience. In a few months, though, Microsoft will surely start launching more fully-featured beta versions and by that time, the browser will likely be ready for a wider audience. Still, though, if you want to give it a try, nobody is stopping you today, no matter your technical expertise.

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Snap is channeling Asia’s messaging giants with its move into gaming

Snap is taking a leaf out of the Asian messaging app playbook as its social messaging service enters a new era.

The company unveiled a series of new strategies that are aimed at breathing fresh life into the service which has been ruthlessly cloned by Facebook across Instagram, WhatsApp, and even its primary social network. The result? Snap has consistently lost users since going public in 2017. It managed to stop the rot with a flat Q4, but resting on its laurels isn’t going to bring the good times back.

Snap has taken a three-pronged approach: extending its stories feature (and ads) into third-party apps and building out its camera play with an AR platform, but it is the launch of social games that is the most intriguing. The other moves are logical and they fall in line with existing Snap strategies, but games is an entirely new category for the company.

It isn’t hard to see where Snap found inspiration for social games — Asian messaging companies have long twinned games and chat — but the U.S. company is applying its own twist to the genre.

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