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1. APIs, antitrust & entrants – The latest in the collaboration race
  • As COVID-19 continues to reinforce the need for remote work, the leading collaboration players are in a heated race to build platform capabilities and fend off rivals. The past couple weeks have seen notable moves in the space, with Microsoft, Zoom, Slack and Google all investing in capabilities to entrench their position with customers and developers.
  • Meanwhile, the CEO of Zoom – which in Q2 2020 broke the Apple App Store record for the most worldwide downloads in a quarter ever (with nearly 94M downloads) – said it was doubling down on API and SDK capabilities to help 3rd-party developers build applications, "collapse communication" into their platforms, and “embed into other use cases at the API level.” (Zoom already has 600+ app integrations on its marketplace.) Zoom is also extending its platform with two new hardware offerings – a Zoom for Home all-in-one device ($599) with a 27-inch touchscreen that works out of the box; and a Zoom Hardware as a Service subscription offering businesses equipment at a monthly rate.
  • Slack, which was designed with 3rd-party developers in mind, already has an industry-leading 2,200+ app integrations (including one with Microsoft Teams). It has lately been focused on Shared Channels (two-sided collaboration with external partners and clients) and Slack Connect (an extension of Shared Channels with up to 20 organizations within a channel). It also lately added features to bolster its enterprise position – analytics dashboards, APIs to integrate Slack data into business reporting, administrator tools (e.g. to manage channels and track engagement), and a Slack Certified program for admins. Slack also plans to integrate capabilities from its new employee-directory acquisition Rimeto, which can turn disparate data into a searchable staff directory (including who they work with, key projects, skills and experience). Perhaps most notably, Slack this week filed an antitrust complaint against Microsoft in the EU (which has lately been tough on big tech), saying that it is unfairly bundling Teams with Office 365.
  • Google, in turn, has redesigned Gmail for G Suite to be a unified workplace app on mobile and desktop. The app brings together Gmail (email), Chat (messaging), Rooms (team channels), Meet (videoconferencing) and document collaboration into one place. It’s currently in early access preview and will be rolled out to all customers in late 2020.
  • New meaningful entrants are still coming into the game. JioMeet – the videoconferencing app from rising Indian tech player Jio Platforms (which recently saw massive investments from Facebook, Google, Intel Capital, and Qualcomm Ventures, among others) – saw 5M downloads in India within 14 days of its launch. The app, called a “completely free 1:1 copy of Zoomby one industry watcher, offers unlimited free HD calls, support for 100 participants, scheduling, screen-sharing, and other Zoom-like features.
  • The rising tide is lifting all boats to a certain extent and enterprises will have more than one or even two products under their roofs. According to Slack, 70%+ of its top 50 customers also have access to Teams. Similarly, an Okta report found almost 1/3 of its customers with Office 365 also had G Suite. In some cases, products will coexist and integrate with each other through APIs. In other cases, they will fill different needs and serve different customer segments.
  • That said, network effects are powerful in the world of collaboration – and enterprises like category leaders. When the tide goes out, there will be a few clear leaders in each category. Right now, it’s looking like Microsoft Teams will lead among large enterprises and G Suite will lead among small businesses. Zoom and Slack are the utility players that are doing very well now but are vulnerable for different reasons – Zoom for its security issues and China connection, and Slack for its separate-ness as collaboration moves into existing workflows (though Shared Channels and Slack Connect do increase the stickiness factor).
  • The larger players have the war chests to expand integrations and make acquisitions, and also have the resources and talent to build copycat features of any 3rd-party product that gains meaningful traction. From this perspective, many of the investments in so-called differentiators – such as APIs and SDK, low-code automation and custom workflows, and adjacent hardware – are starting to look like just table stakes.
  • Related Briefs:
    • Apr 7 2020: A follow-up on the race in digital collaboration
    • Feb 16 2020: Microsoft Teams & Slack's rivalry and what’s ahead for collaboration
2. The expanding reach of mental wellness and teletherapy
  • With the stress of the pandemic and protests, the issue of mental health has risen to the fore – with the demographics in need of support ranging from isolated seniors to teens to university students to the Black American community. Mental wellness and teletherapy services are getting greater traction among investors, while leading players such as Calm and Headspace are partnering to extend their brand reach.
  • Mental-health startups saw a record $576M in funding in Q1 2020 (CB Insights), with the total number of startups now surpassing 1,000. Notable recent funding rounds include Mindstrong ($100M in Jun 2020 for its therapy platform for patients with severe mental illnesses); Headspace ($48M in a Jun 2020 follow-on round for its meditation app); Meditopia ($15M in Jul 2020 for its meditation app for non-English speaking markets); Ahead ($9M in Jul 2020 for a platform that connects people to psychiatrists); and Real ($3.5M in Jul 2020 for its group therapy app).
  • Calm’s main rival Headspace this week announced it was partnering with Snap to bring a mini version of its meditation app to Snapchat. Headspace Mini will offer 6 meditation exercises to help with anxiety, depression and stress, and will let friends check on each other’s mental state through emojis and a “Vibe Check” feature. Headspace reported 65M+ downloads and 2M+ paid subscribers ($70/year) in Jun 2020, with a 10x increase in new meditation users, 70% increase in live group meditations, and 33% increase in sleep music usage from mid-March to mid-June. With the recent $48M fundraise, it plans to expand internationally and build out its Headspace for Work offering targeting business customers (Headspace claims 900+ corporate clients such as Starbucks and Adobe).
  • Apps such as Calm, Headspace and Meditopia are helping meditation go mainstream. These startups, however, represent just the tip of the “digital mental health” spear. As seeking help becomes destigmatized and app-based solutions prove their effectiveness, we can expect to see greater acceptance of digital treatment options that address more complicated and sensitive mental-health issues (e.g. teletherapy, digital biomarkers, treatments for eating disorders). While hurdles still need to be overcome (e.g. privacy, clinical research, insurance approvals), this is good news for us all. Mental health is not only an issue that reportedly costs the US healthcare system $20B per month, it lies at the root of many of our societal problems from homelessness to domestic violence.
  • Related Briefs:
    • Mar 18 2020: Looking beyond – 11 ways in which COVID-19 might be an inflection point
    • Mar 16 2020: The new HHS rules & shifting regulatory landscape around health data/AI
3. The push towards Mars by the UAE, China and US
  • This month, 3 nations – the United Arab Emirates (UAE), China, and the United States – are taking advantage of a window that happens every 26 months, in which Mars and Earth’s respective orbits bring them 34M miles closer to each other, to deploy missions to Mars. Mars has long infatuated scientists as a potentially hospitable environment for life, a place where water once flowed (and may still flow underneath the surface).
  • A relative newcomer to space, the UAE was the first of the 3 nations to launch its Amal (Hope) mission earlier this week on Monday, just a year after the first UAE astronaut was launched into space. It built capabilities by partnering with US universities and Japanese launch services on the $200M mission, which involved just an orbiter. If successful, Amal will reach Mars by Feb 2021 and orbit for 2+ years to study the upper atmosphere and monitor climate change. It plans to produce the first global map of the atmosphere and release the data to the scientist community without embargo. While the UAE’s long-term goal is to build a human colony on Mars by 2117, the near-term driver is economic – the acceleration of the nation’s transformation into a knowledge economy. In the words of its Space Agency chief, “The UAE is now a member of the club.”
  • China – which has never before had a successful mission to Mars – followed with the launch of its Tianwen-1 mission on Thursday, carried by the Chinese-built Long March 5 rocket. The ambitious mission will carry a combined payload that includes an orbiter, lander and rover (rather than taking a staged approach). Upon arrival after 7 months, China will study the geology and atmosphere with instrumentation (including looking for water). If successful, China will be only the second nation to operate a rover on Mars, solidifying its position as a “full-spectrum space power.” For China, the mission is an element in a long-term plan to stake out a strategic position in space for resources, trade routes, and military advantage.
  • The US is rounding out this summer’s Mars missions with the expected launch next week of the Perseverance rover, using an Atlas V rocket (operated by a Lockheed-Boeing joint venture). The 5th US Mars rover so far, the Perseverance will join the InSight lander and Curiosity rover already on the ground on Mars. The Perseverance will look for habitable conditions and search for past existence of microbial life on Mars, collecting samples for eventual return to Earth (which is much harder than it sounds). The US will also conduct a first in attempting to deploy the 4-pound Ingenuity Mars helicopter, which will be part of an experimental flight test in Mars’ atmosphere.
  • A 4th planned mission to Mars, a joint venture between the European Space Agency and Russia, was to also launch this summer. However, technical challenges aggravated by COVID-19 caused the rover mission to miss the July window. The joint venture is now targeting 2022 for launch.
  • The race to Mars will be a great accelerator of new technologies and markets. SpaceX’s Starship rocket, for instance, will be a gamechanger for satellite launches from Earth and their cost structure, in addition to being usable for Mars missions. R&D born out of space programs have historically been the source of many consumer innovations – from CAT scans to wireless headsets. New industries will also emerge adjacent to space exploration – such as global satellite-based internet, satellite ground infrastructure, space data management and cloud solutions, and space tourism. Last month, for instance, Amazon announced a new AWS Aerospace and Satellite Solutions division “to re-imagine space system architectures; transform space enterprises; launch new services that process space data on Earth and in orbit; and provide cloud solutions to support government and commercial space missions.”
  • Related Briefs:
    • Jul 10 2020 (3 Shifts): Investors snap up physical infrastructure underlying digital business models
    • Dec 23 2019: SpaceX’s Starlink and the push towards global satellite-based internet
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