Garena is quietly developing new India-themed games even though Free Fire, its biggest title, has still not made a comeback to the country.
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Spotify has apparently found a new way to push its free users to a paid subscription: It’s putting lyrics behind a paywall. Following various reports citing frustrated posts from users on Reddit, the company is quietly confirming the change — but without a direct statement. Instead, the company told TechCrunch simply that Spotify’s features can vary over time, between markets and across devices. The response indicates the change to lyrics may be more than just a test but that Spotify isn’t yet prepared to make an official announcement about affected markets.
There were some indications that Spotify was heading in this direction, however. Last fall, the company was spotted locking down lyrics for nonpaying users. Free users who tried to access the feature would see a message that read, “Enjoy lyrics on Spotify Premium.”
However, at that time, a Spotify spokesperson clarified that the changes were “only a test” that was taking place with a limited number of users in a “pair of markets.” Spotify is no longer referring to the changes as a test, though it’s unclear why it wouldn’t document access to lyrics as being a premium feature somewhere on its website — like on the page where users can upgrade plans or within its help documentation. That could be because the company is still testing the monthly limit on lyrics for free accounts; free users report seeing messages that tell them that every time they tap “Show lyrics,” it counts toward the new limit.
Spotify didn’t offer any more detail about why it’s now paywalling lyrics, but clearly it’s a bid to push more people to its paid tier. In its most recent quarter, the company reached more than 600 million monthly active users, ahead of estimates, and paid subscribers were up to 236 million+, representing 15% year-over-year growth. However, quarterly revenue had missed analyst expectations of 3.72 billion euros, coming in at 3.67 billion ($3.94 billion) instead.
Whether blocking lyrics will push more people to subscribe remains to be seen. Lyrics are easily available and free via the web and in other apps that work alongside Spotify, like Genius, Apple’s Shazam or Musixmatch, for example.
The OpenAI Startup Fund, a venture fund related to — but technically separate from — OpenAI that invests in early-stage, typically AI-related companies across education, law and the sciences, has quietly closed a $15 million tranche.
According to a filing with the U.S. Securities and Exchange Commission, two unnamed investors contributed the $15 million in new cash on or around April 19. The paperwork was submitted on April 25, and mentions Ian Hathaway, the OpenAI Startup Fund’s manager and sole partner.
The capital was transferred to a legal entity called a special purpose vehicle, or SPV, associated with the OpenAI Startup Fund: OpenAI Startup Fund SPV II, L.P.
SPVs allow multiple investors to pool their resources and make an investment in a single company or fund. In the VC sector, they’re sometimes used to invest in startups that don’t fit a fund’s strategy or that fall outside a fund’s terms. SPVs can also be marketed to a wider range of non-institutional investors.
It’s the second such time the OpenAI Startup Fund has raised capital through an SPV — the first time being in February for a $10 million tranche.
The OpenAI Startup Fund, whose portfolio companies include legal tech startup Harvey, Ambiance Healthcare and humanoid robotics firm Figure AI, came under scrutiny last year after it was revealed that OpenAI CEO Sam Altman had long legally controlled the fund. While marketed like a standard corporate venture arm, Altman raised capital for the OpenAI Startup Fund from outside limited partners, including Microsoft (a close OpenAI partner and investor), and had the final say in the fund’s investments.
Neither OpenAI nor Altman had — or have — a financial interest in the OpenAI Startup Fund. But critics nonetheless argued that Altman’s ownership amounted to a conflict of interest; OpenAI claimed that the general partner structure was intended to be “temporary.”
In April, Altman transferred formal control of the OpenAI Startup Fund to Hathaway, previously an investor with the VC firm Haystack, who’d played a key role in managing the Startup Fund since 2021.
As of last year, the OpenAI Startup Fund — whose ventures also include an incubator program called Converge — had $175 million in commitments and held $325 million in gross net asset value. It’s backed well over a dozen startups including Descript, a collaborative multimedia editing platform valued at $553 million last year; language learning app Speak; AI-powered note-taking app Mem; and IDE platform Anysphere.
OpenAI hadn’t responded to TechCrunch’s request for comment as of publication time. We’ll update this post if we hear back.
Nearly 20 years after finding success in helping startups build products, Canadian interface design firm Metalab has launched Metalab Ventures to invest in many of those product-led startups.
Serial entrepreneur and investor Andrew Wilkinson started Metalab in 2006, a company that went on to support product innovations by companies including Slack, Coinbase, Uber and Tumblr.
Metalab often works with startups, acting a bit like co-founders, to help them get a product off the ground. Then Metalab “lets them loose” to grow, CEO Luke Des Cotes told TechCrunch. Metalab had a record year in 2023 and was involved in the development of 40 products that went into the market last year.
Corporate venture capital has found its stride over the last decade as a stable source of capital or when startups have something Big Tech wants.
With Metalab Ventures, the venture arm will play the role of a long-term value investor, essentially “putting our money where our mouth is,” Des Cotes said.
“We want to go on a journey with them for the next 10 to 12 years,” he said. “We’ve been asked over and over again by founders when we will invest, and sometimes we have, but it’s been very ad hoc in the past. Today, we make that a formal process.”
Metalab Ventures has raised $15 million in capital commitments for its first fund to invest in product-led startups where strategy, design and technology are the key differentiators.
“Product-led” is how a product will be the differentiator for the business, Des Cotes said. Most businesses have some major component of success riding on how well a product is created and how well it’s connecting to the user. Metalab Ventures seeks out founders who “believe in the power of design as a tool to be able to connect with users in a way that’s different and special,” he said.
Des Cotes and David Tapp, head of partnerships at Metalab, are the general partners at Metalab Ventures and will invest in 25 to 35 startups at the pre-seed, seed and Series A stages. So far, the firm made a handful of unannounced investments, Des Cotes said.
The limited partnership makeup of the new fund includes institutional, funds to fund, angel investors and founders of companies with whom Metalab has previously worked. Metalab is also an LP in the fund.
The company performs diligence on thousands of founders each year to determine who it will help, and that same process was shifted to Metalab Ventures in the way it evaluates investments, Des Cotes said.
When determining who to invest in, the process includes getting to know the founders and if the firm can add value. Metalab often taps into its 160-person workforce for design, technology, product and research leadership.
“We’ve already operated very much like a venture fund,” Des Cotes said. “Now we are working through that process to understand what’s the product, what’s the opportunity, what’s the value that can be created here. When we believe in this business, we think of human capital as being our scarce resource that we can then deploy into those businesses.”
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