Technology

Esports, video games and the innovations that enable them now occupy a central space in the cultural and commercial fabric of the tech world.

For the investment firm Bitkraft Esports Ventures, the surge in interest means a vast opportunity to invest in the businesses that continue to reshape entertainment and develop technologies which have implications far beyond consoles and controllers.

Increasingly, investors are willing to come along for the ride. The firm, which launched its first fund in 2017 with a $40 million target, is close to wrapping up fundraising on a roughly $140 million new investment vehicle, according to a person with knowledge of the firmplans.

Through a spokesperson, Bitkraft confirmed that over the course of 2019 it had invested $50 million into 25 investments across esports and digital entertainment, 21 of which were led by the firm.

The new, much larger, fund for Bitkraft is coming as the firmthesis begins to encompass technologies and services that extend far beyond gaming and esports — although they&re coming from a similar place.

Along with its new pool of capital, the firm has also picked up a new partner in Moritz Baier-Lentz, a former Vice President in the investment banking division of Goldman Sachs and the number one ranked esports player of BlizzardDiablo II PC game in 2003.

While at Goldman, Baier-Lentz worked on the $67 billion Dell acquisition of EMC and the $34 billion acquisition of RedHat by IBM.

The numbers in venture capital — and especially in gaming — aren&t quite at that scale, but there are increasingly big bets being made in and around the games industry as investors recognize its potential. There were roughly $2 billion worth of investments made into the esports industry in 2019, less than half of the whopping $4.5 billion which was invested the prior year, according to the Esports Observer.

As Ethan Kurzweil of Bessemer Venture Partners told TechCrunch last year:

&Gaming is now one of the largest forms of entertainment in the United States, with more than $100B+ spent yearly, surpassing other major mediums like television. Gaming is a new form of social network where you can spend time just hanging with friends/family even outside of the constructs of ‘winning the game.&&

Over $100 billion is nothing to sneer at in a growing category — especially as the definition of what qualifies as an esports investment expands to include ancillary industries and a broader thesis.

For Bitkraft, that means investments which are &born in Internet and gaming, but they have applications beyond that,& says Baier-Lentz. &What we really see on the broader level and what we think bout as a team is this emergence of synthetic reality. [That&s] where we see the future and the growth and the return for our investors.&

Bitkraftnewest partner, Moritz Baier-Lentz

Baier-Lentz calls this synthetic reality an almost seamless merger of the physical and digital world. It encompasses technologies enabling virtual reality and augmented reality and the games and immersive or interactive stories that will be built around them.

&Moritz shares our culture, our passion, and our ambition—and comes with massive investment experience from one of the worldfinest investment firms,& said Jens Hilgers, the founding general partner of BITKRAFT Esports Ventures, in a statement. &Furthermore, he is a true core gamer with a strong competitive nature, making him the perfect fit in our diverse global BITKRAFT team. With his presence in New York, we also expand our geographical coverage in one of todaymost exciting and upcoming cities for gaming and esports.&

It helps that, while at Goldman, Baier-Lentz helped develop the firmglobal esports and gaming practice. Every other day he was fielding calls around how to invest in the esports phenomenon from private clients and big corporations, he said.

Interestingly for an esports-focused investment firm, the one area where Bitkraft won&t invest is in Esports teams. instead the focus is on everything that can enable gaming. &We take a broader approach and we make investments in things that thrive on the backbone of a healthy esports industry,& said Baier-Lentz.

In addition to a slew of investments made into various game development studios, the company has also backed Spatial, which creates interactive audio environments; Network Next, a developer of private optimized high speed networks for gaming; and Lofelt, a haptic technology developers.

&Games are the driver of technological innovation and games have prepared us for human machine interaction,& says Baier-Lentz. &We see games and gaming content as the driver of a broader wave of synthetic reality. That would span gaming, sports, and interactive media. [But] we don&t only see it as entertainment… There are economic and social benefits here that are opened up once we transcend between the physical and the digital. I almost see it as the evolution of the internet.&

Got your sights set on attending TC Sessions: Mobility 2020 on May 14 in San Jose? Spend the day with 1,000 or more like-minded founders, makers and leaders across the startup ecosystem. Ita day-long deep dive dedicated to current and evolving mobility and transportation tech. Think autonomous vehicles, micromobility, AI-based mobility applications, battery tech and so much more.

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One of the questions I frequently ask startup founders is how much they&re spending on security. Unsurprisingly, everyone has a different answer.

Startups and small companies are invariably faced with the prospect that they&re either not spending enough or are spending too much on something thathard to quantify in terms of value. Ita tough sell to sink money into an effort to stop something that might one day happen, particularly for bootstrapped startups that must make every cent count — yet we&re told security is a crucial investment for a companyfuture.

Sorry to break it to you, but there is no easy answer.

The reality is that each company is different and there is no single recommended dollar amount to spend. But itabsolutely certain that some investment is required. We know because we see a lot of security incidents here at TechCrunch — hacks, breaches and especially data exposures, often a result of human error.

We spoke to three security experts — a head of security, a security entrepreneur and a cybersecurity fellow — to understand the questions facing startups.

Know and understand your threat model

Every company has a different threat model — by that, we mean identifying risks and possible ways of attack before they happen. Companies that store tons of user data may be a greater target than companies that don&t. Each firm needs to evaluate which kind of risks they face and identify weaknesses.

Yesterday, Samsung announced that the Galaxy Flip Z sold out online. What, precisely, that means, is hard to say, of course, without specific numbers from the company. But itprobably enough to make the company bullish about its latest wade into the foldable waters, in the wake of last yearFold — letjust say &troubles.&

Response to the device has been positive. I wrote mostly nice things about the Flip, with the caveat that the company only loaned out the product for 24 hours (I won&t complain here about heading into the city on a Saturday in 20-degree weather to return the device. I&m mostly not that petty).

Heck, the product even scored a (slightly) better score on iFixitrepairability meter than the Razr. Keep in mind, it got a 2/10 to Motorola1/10 (the lowest score), but in 2020, we&re all taking victories where we can get them.

Therebeen some negative coverage mixed in, as well, of course; iFixit noted that the Flip could have some potential long-term dusty problems due to its hinge, writing, &it seems like dust might be this phoneKryptonite.& Also, the $1,400 phonenew, improved folding glass has proven to be vulnerable to fingernails, of all things — a definite downside if you have, you know, fingers.

Reports of cracked screens have also begun to surface, owing, perhaps, to cold weather. Itstill hard to say how widespread these concerns are. Samsungsaving grace, however, could well be the Razr. First the device made it through a fraction of the folds of Samsungfirst-gen product. Then reviewers and users alike complained of a noisy fold mechanism and build quality that might be…lacking.

A review at Input had some major issues with a screen that appeared to fall apart at the seams (again, perhaps due to cold weather). Motorola went on the defensive, issuing the following statement:

We have full confidence in razrdisplay, and do not expect consumers to experience display peeling as a result of normal use. As part of its development process, razr underwent extreme temperature testing. As with any mobile phone, Motorola recommends not storing (e.g., in a car) your phone in temperatures below -4 degrees Fahrenheit and above 140 degrees Fahrenheit. If consumers experience device failure related to weather during normal use, and not as a result of abuse or misuse, it will be covered under our standard warranty.

Consensus among reviews is to wait. The Flip is certainly a strong indication that the category is heading in the right direction. And Samsung is licensing its folding glass technology, which should help competitors get a bit of a jump start and hopefully avoid some of the pitfalls of the first-gen Fold and Razr.

A new survey from PCMag shows that 82% of consumers don&t plan to purchase such a device, with things like snapping hinges, fragile screens and creases populating the list of concerns. Which, honestly, fair enough on all accounts.

The rush to get to market has surely done the category a disservice. Those who consider themselves early adopters are exactly the people who regularly read tech reviews, and widespread issues are likely enough to make many reconsider pulling the trigger on a $1,500-$2,000 device. Even early adopters are thrilled about the idea of beta testing for that much money.

Two steps forward, one step back, perhaps? Letcheck back in a generation or two from now and talk.

Several companies rolled out electric pickups in 2019. Tesla Cybertruck got most of the attention, but don&t sleep on General Motors and Ford — bringing electric pickups to market is critical for the viability of electric vehicles.

Automakers build vehicles around shared components. These platforms, the underpinnings of the vehicles, often live for 10 or more years, and are critical to each automakereconomic stability. The exterior sheet metal might change, but dozens of models often share the frame, powertrain and electrical components.

Electric pickup platforms offer vehicle makers a new revenue source. Instead of building electric vehicles designed to move people, these platforms can move goods. Thatkey to building a long-term strategy around electric vehicles.

Look at Ford, whose best-selling F-150 is just a portion of its success. From the F-150, the automaker has dozens of commercial vehicles built off platforms that share components. If Ford can produce an electric pickup — which it says itdoing alongside startup Rivian — Ford will be able to electrify its commercial offering more quickly.

Specific vehicle platforms are perfect for electrification. Vehicles with a predictable driving route like municipal vehicles, delivery vans and even hearses could benefit from electric powertrains.

Electric powertrains have long offered advantages over internal combustion; electric counterparts feature fewer moving parts and are now often smaller, allowing for more interior space. And then therethe torque that gives electric vehicles near-superhero strength.

March 2 is the planned launch date for SpaceX 20th ISS resupply mission, which is bringing the usual supplies and goodies, plus a payload of interesting experiments from partners and paying customers. And a big expansion to EuropeColumbus Module.

The most ridiculous has to be Adidas&BOOST in Space& effort. The company creates its midsoles by fusing together thousands of tiny foam spheres. But sadly, this is generally done on Earth, where theregravity. So of course they want to try it in space to see what they can learn.

&Microgravity enables a closer look at the factors behind pellet motion and location, which could enhance manufacturing processes as well as product performance and comfort,& the project description reads. It also makes for a great stunt. The revelations from this toaster-sized device will surely lead to better shoes.

Itfunny, but as always with these commercial operations, itpretty cool that itpossible to just decide to do some experimenting in the ISS.

Microgravity is a sought-after condition, and several of the other research projects going up rely on it as well. Another commercial operation is from Delta, the faucet maker, which thinks it might be able to learn something about droplet formation and create more efficient showers and such.

Gut tissue isn&t normally this blue, but thatnot an effect of microgravity.

Emulate is sending up an organ-on-a-chip, intestinal tissue to be precise, which it hopes will help teach us &how microgravity and other potential space travel stressors affect intestine immune cells and susceptibility to infection.& They&re also testing the growth of heart tissue from stem cells up there, which could come in handy on long voyages.

The biggest payload, though, has to be Bartolomeo, a new exterior platform that will attach to the European Columbus Module:

With payloads attached, left, and without, right. Therea boom that sticks out for other purposes.

It has 12 sites onto which can be attached payloads from commercial and institutional partners — anyone from universities to companies that need access to the exterior of the space station for one reason or another. Earth imagery, vacuum exposure, radiation testing, whatever you like. You can read about the specifications here.

The launch is set for March 2 if all goes well — we&ll post the live stream and any other updates closer to T-0.