The Amazon boogie-man has every retailer scrambling for ways to fight back. But the cost and effort to install cameras all over the ceiling or into every shelf could block stores from entering the autonomous shopping era. Caper Labs wants to make eliminating checkout lines as easy as replacing their shopping carts while offering a more familiar experience for customers.
The startup makes a shopping cart with a built-in barcode scanner and credit card swiper, but it’s finalizing the technology to automatically scan items you drop in thanks to three image recognition cameras and a weight sensor. The company claims people already buy 18 percent more per visit after stores are equipped with its carts.
Today, Caper is revealing that it’s raised a total of $ 3 million including a $ 2.15 million seed round led by prestigious First Round Capital and joined by food-focused angels like Instacart co-founder Max Mullen, Plated co-founder Nick Taranto, Jet’s Jetblack shopping concierge co-founder Jenny Fleiss, plus Y Combinator. Caper is now in two retailers in the NYC area, though it plans to use the cash to expand to more and develop a smart shopping basket for smaller stores.
“If you walked in to a grocery store 100 years ago versus today, nothing has really changed” says Caper co-founder and CEO Lindon Gao. “It doesn’t make sense that you can order a cab with your phone or go book a hotel with your phone, but you can’t use your phone to make a payment and leave the store. You still have to stand in line.”
Autonomous retail is going to be a race. $ 50 million-funded Standard Cognition, ex-Pandora CTO Will Glaser’s Grabango, and scrappier startups like Zippin and Inokyo are all building ceiling and shelf-based camera systems to help merchants keep up with Amazon Go’s expanding empire of cashierless stores. But Caper’s plug-and-play cart-based system might be able to leapfrog its competitors if it’s easier for shops to set up.
Inventing The Smart Cart
“I don’t have an altruistic reason to care about retail, but I really want to put a dent in the universe and I think retail is severely under-innovated” Gao candidly remarked. Most founders try to spin a “super hero origin story” about why they’re the right person for the job. For Gao, chasing autonomous retail is just good business. He built his first startup in gaming commerce at age 14. The jewelry company he launched at 19 still operates. He went on to become an investment banker at Goldman Sachs and JP Morgan but “I always felt like I was more of a startup guy.”
Caper was actually a pivot from his previous entry to the space called QueueHop that made cashierless apparel security tags that unlocked when you paid. But during Y Combinator, he discovered how tough it’d be to scale a product that requires a complete rethinking of a merchant’s operations flow. So Gao hoofed it around NYC to talk to 150 merchants and discover what they really wanted. The cart was the answer.
V1 of Caper’s cart lets people scan their items’ barcodes and pay on the cart with a credit card swipe or Apple/Android Pay tap and their receipt is emailed to them. But each time they scan, the cart is actually taking 120 photos and precisely weighing the items to train Caper’s machine vision algorithms in what Gao likens to how Tesla is inching towards self-driving.
Soon, Caper wants to go entirely scanless, and sections of its two pilot stores already use the technology. The cameras on the cart employ image recognition matched with a weight sensor to identify what you toss in your cart. You shop just like normal but then pay and leave with no line. Caper pulls in a store’s existing security feed to help detect shoplifting, which could be a bigger risk than with ceiling and shelf camera systems, but Gao says it hasn’t been a problem yet. He woudn’t reveal the price of the carts but said “they’re not that much more expensive than a standard shopping cart. To outfit a store it should be comparable to the price of implementing traditional self-checkout.” Shops buy the carts outright and pay a technology subscriptions but get free hardware upgrades. They’ll have to hope Caper stays alive.
“Do you want guacamole with those chips?”
Caper hopes to deliver three big benefits to merchants. First, they’ll be able to repurpose cashier labor to assist customers so they buy more and to keep shelves stocked, though eventually this technology is likely to eliminate a lot of jobs. Second, the ease and affordable cost of transitioning means businesses will be able to recoup their investment and grow revenues as shoppers buy more. And third, Caper wants to share data that its carts collect on routes through the store, shelves customers hover in front of, and more with its retail partners so they can optimize their layouts.
One big advantage over its ceiling and shelf camera competitors is that Caper’s cart can promote deals on nearby or related items. In the future, it plans to add recommendations based on what’s on your cart to help you fill out recipes. ‘Threw some chips in the cart? Here’s where to find the guacamole that’s on sale.’ A smaller hand-held smart basket could broaden Caper’s appeal beyond grocers amongst littler shops, though making it light enough to carry will be a challenge.
Gao says that with merchants already seeing sales growth from the carts, what keeps him up at night is handling Caper’s supply chain since the product requires a ton of different component manufacturers. The startup has to move fast if it wants to be what introduces Main Street to autonomous retail. But no matter what gadgets it builds in, Caper must keep sight of the real-world stress their tech will undergo. Gao concludes “We’re basically building a robot here. The carts need to be durable. They need to resist heat, vibration, rain, people slamming them around. We’re building our shopping cart like a tank.”
Former Facebook VP of News Feed and recently appointed Instagram VP of Product Adam Mosseri has been named the new head of Instagram following the resignation of Instagram’s founders Kevin Systrom and Mike Krieger last week.. “We are thrilled to hand over the reins to a product leader with a strong design background and a focus on craft and simplicity — as well as a deep understanding of the importance of community” the founders wrote. “These are the values and principles that have been essential to us at Instagram since the day we started, and we’re excited for Adam to carry them forward.”
Systrom will recruit a new executive team including heads of product, operations, and engineering to replace himself, Instagram COO Marne Levine who went back to lead Facebook partnerships last month, and engineering leader James Everingham who moved to Facebook’s blockchain team in May before finishing at Instagram in July. Instagram’s product director Robby Stein is a strong candidate for the product head decision, as he’s been overseeing Stories, feed, Live, direct messaging, camera and profile.
Instagram’s founders announced last week that they were leaving the Facebook corporation after sources told TechCrunch the pair had dealt with dwindling autonomy from Facebook and rising tensions with its CEO Mark Zuckerberg. The smiling photo above seems meant to show peace has been restored to Instaland, and counter the increasing perception that Facebook breaks its promises to acquired founders. TechCrunch has previously reported Mosseri was first in line for the role according to sources, and The Information later wrote that some inside the company saw him as a lock.
Mosseri’s experience dealing with the unintended consequences of the News Feed such as fake news in the wake of the 2016 election could help him predict how Instagram’s growth will affect culture, politics, and user well-being. Over the years of interviewing him, Mosseri has always come across as sharp, serious, and empathetic. He comes across as a true believer that Facebook and its family of apps can make a positive impact in the world, but congniscent of the hard work and complex choices required to keep them from being misused.
Born and raised in New York, Mosseri started his own design consultancy while attending NYU’s Gallatin School Of Interdisciplinary Study to learn about media and information design. Mosseri joined Facebook in 2008 after briefly working at a startup called TokBox. Tasked with helping Facebook embrace mobile as design director, he’s since become part of Zuckerberg’s inner circle of friends and lieutenants. Mosseri later moved into product management and oversaw Facebook’s News Feed, turn it into the world’s most popular social technology and the driver of billions in profit from advertising. However, amidst his successes, Mosseri also oversaw Facebook Home, the flopped mobile operating system, and the was the officer on duty when fake news and Russian election attackers proliferated.
After going on parental leave this year, Mosseri returned to take over the role of Instagram VP of Product Kevin Weil as he move to Facebook’s blockchain team. A source tells TechCrunch he was well-received and productive since joining Instagram, and has gotten along well with Systrom. Mosseri now lives in San Francisco, close enough to work from both Instagram’s city office and South Bay headquarters. He’ll report to Facebook’s chief product officer Chris Cox as he did at Facebook. Cox wrote “Kevin and Mike, we will never fill your shoes. But we will work hard to uphold the craft, simplicity, elegance, and the incredible community of Instagram: both the team and the product you’ve built.”
“The impact of their work over the past eight years has been incredible. They built a product people love that brings joy and connection to so many lives” Mosseri wrote about Instagram’s founders in an…Instagram post. I’m humbled and excited about the opportunity to now lead the Instagram team. I want to thank them for trusting me to carry forward the values that they have established. I will do my best to make them, the team, and the Instagram community proud.”
Mosseri will be tasked with balancing the needs of Instagram such as headcount, engineering resources, and growth with the priorities of its parent company Facebook, such as cross-promotion to Instagram’s younger audience and revenue to contribute to the corporation’s earnings reports. Some see Mosseri as more sympathetic to Facebook’s desire than Instagram’s founders, given his long-stint at the parent company and his close relationship with Zuckerberg. Interestingly, Zuckerberg wasn’t mentioned or pictured in the transition announcement and hasn’t posted anything congratulating Mosseri as is common in Facebook’s employee culture. Zuckerberg may be seeking to reduce the appearance that he’s playing puppet master and instead does actually let Instagram run independently.
The question now is whether users will end up seeing more notifications and shortcuts linking back to Facebook, or more ads in the Stories and feed. Instagram hasn’t highlighted the ability to syndicate your Stories to Facebook, which could be boon for that parallel product. Instagram Stories now has 400 million daily users compared to Facebook Stories and Messenger Stories’ combined 150 million users. Tying them more closely could seem more content flow into Facebook, but it might also make users second guess whether what they’re sharing is appropriate for all of their Facebook friends, which might include family or professional colleagues.
Mosseri’s most pressing responsibility will be reassurring users that the culture of Instagram and its app won’t be assimilated into Facebook now that he’s running things instead of the founders. He’ll also need to snap into action to protect Instagram from being used as a pawn for election interference in the run-up to the 2018 US mid-terms. While he’ll never have the same mandate and faith from employees that the founders did, Mosseri is the experienced leader Instagram needs to grapple with its scaled-up influence.
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Last week, @kevin and @mikeyk announced that they're leaving Instagram. The impact of their work over the past eight years has been incredible. They built a product people love that brings joy and connection to so many lives. I'm humbled and excited about the opportunity to now lead the Instagram team. I want to thank them for trusting me to carry forward the values that they have established. I will do my best to make them, the team, and the Instagram community proud.
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