Technology

Alibaba is investing big bucks intooffline distribution.The Chinese e-commerce giant has forked out $2.23 billion in exchange for a sizeable piece of Focus Media, a Shanghai-based company that operates outdoor digital advertising screens across China, Singapore and Hong Kong, according to a U.S. filing.

Thedeal itself is broken up into a few pieces. Alibaba itself is paying $1.43 billion for a 6.62 percent share ofFocus Media, which is listed in Shanghai, It is also spending $504.7 million to buy 10 percent of an entity (managed by Focus Media founder and chairman Jason Nanchun Jiang) which controls 23.34 percent of Focus Media.

In addition, an Alibaba-aligned fund called ‘New Retail Strategic Opportunities& is buying 1.37 percent of Focus Media, while Alibaba itself is planning to exercise an option to buy five percent more of the business over the next twelve months. That additional transaction will add another $1 billion or so to the total investment, dependent, of course, on Focus Mediastock price.

Thatquite a mouthful but the objective of the deal issimpler to grok:Alibaba already has a formidable online channel to interact with consumers and now it is expanding what it can do offline.

Focus Media currently claims to reach 200 million middle-class consumers across 300 Chinese cities via its outdoor advertising platform, which includes digital screens instreets, in subways and in elevators. The company plans togrow that to 500 million people across 500 cities, and that ties into Alibabaonline-to-offline strategy, which it also calls ‘New Retail.&

That has seen the company buy up expensive stakes in offline retail businesses with the goal of marrying the benefits of online shopping — such as quick delivery, easy to find products and easy payment — with the customer experience of brick and mortar stores, like in-person customer service and try-before-you-buy.

It isn&t hard to imagine a scenario in which a consumer sees a product advertised viaFocus Media with the option to buy it, or arrange to see it in a store, simply by scanning a QR code. (Lest you forgot, QR codes are huge in China and a very key component in online/offline shopping.)

Beyond the New Retail push, the distribution provided by Focus Media offerssellers on Alibabae-commerce platform an alternative avenue through which to reach potential customers, particularly within Chinagrowing middle class.

Will people reject being bombarded with ads on their commute or downtime, especially when they could just open an app on their phone Alibaba likely isn&t keen to take the risk, and given the vast amount of cash it is sitting on this deal isn&t going to be a huge risk.

Every time Accel invests in a startup, itan instant positive sign in the startup community. The venture capital firm has a rich history with decades of investments in successful startups. Thatwhy we&re excited to have four partners at Accel on stage at Disrupt Berlin.

Philippe Botteri, Sonali De Rycker, Luciana Lixandru and Harry Nelis will all relocate their partner meeting to our stage.

Accel is a different VC firm for many reasons. First, while the firm started in Silicon Valley, the team bet early on the European startup scene, back in 2001. With an office in London, the team keeps an eye on the entire continent for investment opportunities.

The firm has invested in Deliveroo, BlaBlaCar, Supercell, Spotify and so many others. With such a good track record, itclear that some recent investments are also going to become massive companies — nobody has realized it just yet.

In November, we will have four Accel partners on stage to discuss the firminvestment thesis, each partnercurrent obsessions and their collective thoughts on the startup scene in Europe.

Itgoing to be a great way to hear the granularity of a team with strong beliefs. I&m sure they don&t always agree on everything, but somehow they manage to invest together as a firm.

TechCrunch is coming back to Berlin to talk with the best and brightest people in tech from Europe and the rest of the world. In addition to fireside chats and panels, new startups will participate in the Startup Battlefield Europe to win the coveted cup.

Grab your ticket to Disrupt Berlin before August 1st as prices will increase after that. The conference will take place on November 29-30.

Philippe Botteri, Partner, Accel

Philippe Botteri focuses on SaaS, enterprise and marketplace businesses.

Philippe led Accelinvestments in DocuSign (IPO), PeopleDoc, Qubit, Algolia, BlaBlaCar, Doctolib and Zenaton. He also works closely with the team at Fiverr and CrowdStrike. Prior to joining Accel, Philippe was with Bessemer, where he worked with the firmSaaS and Ad Tech investments including Cornerstone OnDemand (public), Eloqua (public) and Criteo (public).

Philippe is from Paris and graduated from Ecole Polytechnique, where he is a member of the Entrepreneurship Advisory Board, and Ecole des Mines.

Sonali De Rycker, Partner, Accel

Sonali De Rycker focuses on consumer, software and financial services businesses.

She led Accelinvestments in Avito (acquired by Naspers), Lyst, Spotify (IPO), Wallapop, KupiVIP, Calastone, Catawiki, JobToday, Shift Technology, SilverRail (acquired by Expedia)​, Kry and Soldo. Prior to Accel, Sonali was with Atlas Ventures.

Sonali grew up in Mumbai and graduated from Bryn Mawr College and Harvard Business School.

Luciana Lixandru, Partner, Accel

Luciana Lixandru focuses on consumer internet, software and marketplace businesses.

She helped lead Accelinvestments and ongoing work in UiPath, Deliveroo, Framer, Avito, Catawiki, Vinted and others. She is also an independent director of Showroomprive (public). Prior to Accel, Luciana was with Summit Partners.

Luciana is from Romania and graduated from Georgetown University.

Harry Nelis, Partner, Accel

Harry Nelis focuses on consumer internet, financial services and software companies.

He led Accelinvestments in CHECK24, Funding Circle, KAYAK (IPO; acquired by Priceline), Showroomprive (IPO), WorldRemit, Celonis, Callsign, Instana and others.

Harry started his career as an engineer at Hewlett-Packard before founding the venture-backed software company E-motion.

Harry is from the Netherlands and graduated from Delft University of Technology and Harvard Business School.

TrueLayer, the London startup thatbuilt a developer platform to make it easy for fintech and other adjacent companies, such as retailers, to access bank APIs — and ride the Open Banking and PSD2 gravy train — has picked up further $7.5 million in funding.

Leading the round is venture capital fund Northzone. It follows a $3 million Series A in June last year, and will be used for European expansion, starting with Germany and France.

The new capital will also be invested in growing the TrueLayer team and to develop new products to help companies and consumers make the most of Open Banking and PSD2, where co-founder Francesco Simoneschi tells me the opportunities are huge, even if they remain largely untapped, thus far.

&I think the first quarters of 2018 have been about working and educating companies on Open Banking and how to build propositions on top of it,& he says. &This has seen a silent yet massive stream of inbound demand for us. To put things in context, we grew 500 percent in terms of the developer community averaging hundreds of companies a month asking how to start using TrueLayer and the services that we enable — from two people in a garage to the largest enterprise&.

Since Open Banking was tentatively launched in the U.K. January, TrueLayer has secured partnerships and integrations with a number of fintech companies including challenger banks Monzo and Starling Bank, along with the likes of Zopa, ClearScore, Canopy, Plum, BitBond, Emma, Anorak, and CreditLadder.

This has happened in despite of a press narrative around a &failed Big Bang kind of uptake& and incumbent banks not cooperating or meeting their minimum statutory requirements in time (which is undeniably true, in some instances). The reality on the ground, however, is quite different, argues Simoneschi.

&Remember that exponential growth often looks sub-linear at the very beginnings,& he says. &Based on the view of the market that we have, contracts signed, POCs and advanced conversations, I can assure you that you will see a wealth of high street banks and retailers, financial institutions, global platforms, marketplaces, loyalty and rewards propositions, crypto exchanges, wallets and fintech applications experimenting and launching Open Banking-based propositions in the next 12 months&.

To that end, TrueLayer offers a single platform/API to connect to 16 major and not so major banks and credit cards in the U.K., using a mixture of official Open Banking APIs, access to private APIs, and, at a push, screen scraping — depending on a developerdata needs and stomach for the different kinds of official and unofficial access available. As well as account verification, the platform supports KYC processes, and transactional data for things like account aggregation, credit scoring, and risk assessment.

In addition to its developer-friendly ‘universal& API, TrueLayer is also developing a number of other value-add services that do even more heavy-lifting and negate the need for other fintechs to keep re-inventing the wheel. These include features such as data cleansing, enhanced security and transaction categorisation.

However, Simoneschi says there is a lot more Open Banking goodness to come yet, especially in the payments space.

&We got FCA authorization for both access to data (AISP) and access to payments (PISP). The demand for the latter has been going through the roof in the last few months and we are taking steps to release a Payment API to the general public later this fall,& he tells me.

This means that companies, such as online retailers, will be able to use TrueLayer to connect directly to customers& bank accounts as a means of taking payment, therefore bypassing traditional debit and credit card charges, which legislators hope will help to break the duopoly of Visa and MasterCard.

On that note, Jeppe Zink, Partner at Northzone, says that the &walled gardens& of financial institutions, such as banks, are being knocked down, and that banking transactions will increasingly take place away from a bankmain interface. &To enable this to function, you need thousands of banks to deliver transaction data in a single, secure and compliant way,& he says. &This is a massive undertaking which TrueLayer intends to be the centrepiece of&.