TechCrunch : Business banking startup Qonto raises $552 million at $5 billion va

Business banking startup Qonto raises $552 million at $5 billion valuation

French startup Qonto has raised a $552 million Series D funding round (€486 million). Following this investment, the startup has reached a valuation of $5 billion (€4.4 billion). This is one of the largest rounds in the French tech ecosystem.

Qonto is a challenger bank focused on business bank accounts. The startup focuses primarily on small and medium companies as well as freelancers. It currently operates in France, Germany, Italy and Spain.

Tiger Global and TCV are leading today’s funding round. With 220,000 clients, Qonto still plans to grow at a rapide pace in the coming years. “Our goal is to reach one million SMEs by 2025,” co-founder and CEO Alexandre Prot told me. “And we know that Tiger and TCV have supported quite a few companies to reach that scale.”

Some new investors are also participating in the round, such as Alkeon, Eurazeo, KKR, Insight Partners, Exor Seeds, Guillaume Pousaz, Gaingels and Ashley Flucas. Existing investors Valar, Alven, DST Global and Tencent are putting more money on the table as well.

That’s quite a long list of investors and Qonto proves once again that private equity firms are actively looking for late-stage growth rounds in Europe.

From everyday banking to an all-in-one finance solution
What’s interesting with Qonto is that it’s a truly European startup. In the U.S., spend management solutions, such as Brex and Ramp, have been massively successful. As The Information’s Kate Clark reported, they want to replace American Express and hand out corporate cards to millions of employees in the U.S.

Qonto started out with business bank accounts because that’s the key financial component of European companies. Many companies use their bank accounts directly to move money around. They initiate transfers, share their bank account number (IBAN) to receive a payment and set up direct debits to pay bills.

And Qonto does that really well. You can sign up from a computer and get a local IBAN a few minutes later. After that, you can also order debit cards to pay with your card.

At first, Qonto relied heavily on a third-party banking partner — Treezor. The startup then applied to get its own license to become a payment institution. In 2020, Qonto moved all its clients to its in-house core banking system. The company now owns this critical part of the technical stack.

Qonto has expanded beyond the simple bank account. The startup’s CEO Alexandre Prot defines Qonto as three different products rolled into a single service. In addition to the everyday banking part, it also simplifies bookkeeping and accounting. It can become your spend management solution as well.

On the bookkeeping front, Qonto lets you export or sync with your existing accounting solution. This is a fragmented market as each country uses different accounting tools. For instance, you can export your data to Cegid if you’re a French company, you can synchronize with Datev if you’re a German company, etc. Qonto users can also import receipts directly in their Qonto account.

As for spend management, Qonto lets you hand out physical, virtual or one-time cards to employees. Admins can set up different spending limits, an approval workflow and all the usual stuff that you get from a spend management solution. It might not be as feature complete as a dedicated product, such as Spendesk, but it could be enough for small companies.

For everything else, Qonto partners with other fintech startups. For instance, customers can open a credit line with October and borrow €15,000 to €30,000. Customers can also open a savings account with Cashbee and its banking partner My Money Bank.

A single bank account
There are 220,000 companies paying for Qonto every month. Pricing ranges from €9 per month for the most basic freelancer account to €249 per month for enterprise accounts. On top of that, some companies pay more to get more cards or when they go above certain limits.

What makes the business model even more lucrative is that a lot of customers just sign up on their own. When they create their company, they use Qonto for the initial capital deposit in order to register the company. Essentially, Qonto combines inbound marketing with the high margins of a SaaS product.

“Around a third of our customers created their companies with us. It’s their first account and the only one that they use,” Alexandre Prot said. “Two-thirds of our customers are companies that existed before they opened an account with us. Roughly half of them close their existing bank account, half of them use Qonto in parallel with one or several accounts.”

With today’s funding round, the company plans to grow its team from 500 employees to 2,000 people by 2025. Qonto will also invest heavily in its existing markets. “We will be able to invest more than €100 million on each of our markets,” Prot said. While there are still a lot of SMEs that are not using Qonto in France, Germany, Spain and Italy, Qonto also plans to enter new market in 2023.

Wired : The Best of CES 2022

The Best of CES 2022
These are the products, prototypes, and ideas that did the best job of signaling the future at this year’s consumer tech showcase.
ILLUSTRATION: WIRED; MOVANO
AFTER WATCHING COUNTLESS Zoom briefings, sitting through dozens of livestreamed press conferences, and even attending a handful of in-person demos, we're ready to declare these 14 products to be the most interesting things we saw at CES 2022. Of all the amazing and beautiful gadgets on display—both in Las Vegas and virtually—these are the products that exhibit the strongest sense of innovation and vision within their categories. They achieve this through groundbreaking industrial design, innovative engineering, and simply seeing the future and realizing it in a product you can touch, hold, ride, or wear.
Best PC
Asus's experimental computer is just a screen that folds.
PHOTOGRAPH: ASUS
Asus Zenbook 17 Fold. Foldables are still finding their place, but Asus' design for a folding laptop-tablet hybrid is one of the more promising efforts we've seen this year. The device unfolds to reveal a full 17-inch display, with a kickstand on the back so it can stand alone as a monitor, or it can fold like a clamshell to create one continuous screen running from the top of the laptop down to a virtual keyboard on the lower half. If you prefer physical keys for typing, it pairs with the ErgoSense Bluetooth keyboard, which you can place over the bottom section of the screen, making the whole thing almost indistinguishable from a regular laptop. It's a welcome shakeup to the field of laptops that hasn't changed much in recent years. The concept has us intrigued about how the future of foldable laptops might, well, unfold, but we're still waiting to see how it works in practice—and for a price. —Eric Ravenscraft
Best in Mobile
Oh so seamless.
COURTESY OF GOOGLE
Google Fast Pair and Audio Switching. The magic of Apple’s ecosystem is how seamlessly iPads, Macs, iPhones, and AirPods all work with each other. Google’s trying to bring some of that pizazz to Android, Windows, and Chromebooks. This interoperability comes partly through its Fast Pair technology, which was announced several years ago and primarily lets you instantly pair wireless headphones with an Android phone. The tech is now expanding to include the quick-pairing of headphones with Google TVs and Chromebooks, connecting an Android phone to a new Chromebook for faster setup, and Android phones with Windows laptops to sync texts and share files. All of that is immensely helpful, but I’m most excited about the other new ability for headphones to automatically switch between the various devices they are paired to, just like how Apple’s AirPods switch from iPad to iPhone when you receive a phone call while watching a movie on the tablet. Not all Fast Pair-enabled devices will support audio switching and it very much will depend on the manufacturer, but I’m looking forward to when I don’t need to manually reconnect my earbuds to another device. Truly magical. —Julian Chokkattu
Best in Home Entertainment
Powered by radio waves.
PHOTOGRAPH: SAMSUNG
Samsung 2022 Eco Remote. TVs are objectively getting prettier, but I wasn’t particularly blown away by any of the screens I e-saw at this year’s CES. I’m sure I’ll be more excited when I get to see the innovations—largely in processing and brightness—in person, but for now I have a new obsession in home entertainment: Samsung has made a remote that never, ever, needs new batteries. The Eco Remote, as the South Korean brand calls it, charges from both solar energy and the radio waves blasted out of your Wi-Fi router to stay juiced up indefinitely. It’s not only a blessing for those of us who are tired of the battery shuffle, it’s good for the planet; in April of last year, Samsung said that by eliminating AAA cells from the remotes it packages with its televisions and other gadgets, it could avoid 99 million discarded batteries over seven years. —Parker Hall
Best Headphones
How many games can you play in 300 hours?
PHOTOGRAPH: HYPERX
HyperX Cloud Alpha Wireless. The gaming accessories company HyperX announced a handful of new products this year, but the one that really caught our eye is a gaming headset that promises 300 hours of battery life. The Cloud Alpha Wireless has many of the same features we've come to love about HyperX headsets: the aluminum forks, plush leatherette earpads, a detachable boom microphone, and easy-to-navigate audio controls on the earcup. New additions include 50-mm drivers that are slimmer and lighter than the drivers used in previous headsets, leaving more room for that big battery. Of course, that 300-hour mark may only be attainable under ideal conditions, at lower volumes, or using a wireless dongle instead of Bluetooth. But if it can reach even 75 percent of that promised time, that's literally days better than most of the competition. The Cloud Alpha Wireless will cost $200 when it goes on sale in February. —Jess Grey
Best in Home Audio
Classic sound, classic looks.
PHOTOGRAPH: JBL
JBL 4305P Studio Monitors. I expect we’ll see a lot of photos of these new JBL speakers floating around on Reddit’s r/audiophile community in the coming years. They have a compelling blend of professional engineering, classic studio design, and modern-day connectivity options for a $2,200 price tag. JBL speakers have been used in prominent recording studios since the Led Zeppelin era. But not enough non-pros have used JBLs most impressive speakers, mostly because they required powerful audio interfaces or studio mixing boards to get a proper signal. Not so with these new speakers, which support many ways to connect: Apple AirPlay 2, Google Chromecast, Bluetooth, Ethernet, a 3.5-mm aux jack, and balanced audio inputs (via XLR or TRS). Add to that a near-flat response preferred by studio pros, and they’re the first modern speakers I’ve heard of that are designed to pull double duty on the mixing console and in your listening room. You can even get them with a walnut veneer and classic purple grill covers just like the JBLs of old. Gorgeous. —Parker Hall
Best in Parenting
Let's go outside.
PHOTOGRAPH: PICOO
Picoo. I have a 4-year-old and a 6-year-old, who were 2 and 4 when the Covid-19 pandemic started. In 2020, we were determined to make school closures, social distancing, and quarantines bearable for our children. But as we roll into 2022 … we’re getting really, really tired. This year at CES, the Picoo was the only educational toy that didn’t make me cringe. The “outdoor game console” is really a set of lighted, handheld controllers, aimed at children between the ages of 4 and 10. The set comes with game cards suggesting games like Whack-a-Mole, Zombierun, and Math Mania; the child uses their controller to scan a card to play each game. The Picoos pick teams and adjust the game depending on the child’s proficiency, their age, or if they have special needs. It’s social; it’s outside; it’s equitable; it’s safe. That’s all I want for my children right now. Picoo is available now starting at $249. —Adrienne So
Best in Smart Home
Samsung Bespoke Washer and Dryer
PHOTOGRAPH: SAMSUNG
New Alliances. With all of the connected gadgets in our homes—security cameras, thermostats, smart speakers, phones, televisions, light bulbs, refrigerators—it feels like a small miracle when we can get just two different devices to talk to each other. That hurdle of interoperability is what’s truly keeping the smart home from advancing, so the companies that make most of these devices are banding together to try to solve it. At CES, Samsung announced that it is joining the Home Connectivity Alliance, a group of companies including other big-name appliance makers like GE, Haier, and Electrolux Group. The union will work on a set of guidelines to enable secure communication between each other’s smart-home platforms. The other entity generating goodwill at CES is Matter, an open source interoperability standard which will fully launch later this year. It already has buy-in from the biggest names in smart-home tech—including Google, Apple, Amazon, and Samsung—and dozens of other companies are showing off Matter-compatible devices at this year’s expo. We expect to see even more products with built-in support in the coming months. Good; It’s about time the smart home tidied up its house. —Michael Calore
Best in Transportation

Who needs paint.
BMW iX Flow. One thing to remember about CES is that it’s mostly make-believe. Sure, many things unveiled in Las Vegas actually ship, but the expo is also rife with experimental concepts, flights of fancy, and pie-in-the-sky demos. We have no idea where on that spectrum this one falls, but we were delighted to see BMW's iX Flow bodywork tech, where the traditional exterior paint job on a car has been replaced with E Ink technology. BMW managed to deform and laser-cut E Ink panels to cover an iX luxury EV in its entirety. The E Ink on the prototype uses microcapsules with negatively charged white pigments and positively charged black ones, each the thickness of a human hair. At the push of a button, the driver can cycle through any shade between brilliant white and deep black, or run animated patterns continually across the exterior. Aside from the considerable aesthetic boon, BMW says the color changes can also help cut the amount of cooling and heating required from the vehicle's air conditioning, reducing battery drain. Although this iX Flow prototype is monochrome, a full-color E Ink “paintwork” is in development too. —Jeremy White
Best in Micromobility
Simple, safe, practical.
PHOTOGRAPH: PANASONIC
Panasonic and Totem Zen Rider. The concurrent Covid-19 and climate crises spurred an ebike boom, as a half-million Americans bought electric bicycles in 2020 to get off crowded, possibly contagious public transportation and reduce their carbon emissions. I loved this! What I didn’t love were new ebike riders leaning on their throttles, doing unsafe speeds against traffic in bike lanes, or setting themselves on fire by choosing sketchy bikes with sketchier batteries. This year at CES, Panasonic and Totem unveiled an ebike with UL certification, making it one of the first companies in the ebike sphere besides Bosch to seek the gold standard certificate for electronics safety. By earning the stamp of approval from the trusted industry nonprofit, Totem all but ensures the Zen Rider’s battery won’t arc on you when you plug it in, or burst into flames when you charge it. And, as more and more ebikes rely on high top speeds as their selling point, the Zen Rider goes in the opposite direction by only offering pedal assistance up to 15 mph. That’s just right for dense urban areas; similarly, Tern’s commercial cargo bikes only go up to 12 mph. Totem’s bike also has an easy-going and durable-looking step-through frame, with the battery mounted under the seat for better weight distribution. As ebikes become more widely adopted, I hope to see more bikes go in this direction—not necessarily faster or sexier, but safer, more durable, more reliable, and ready for years of use. (No price yet.) —Adrienne So
Best in Gaming
Take a swing.
PHOTOGRAPH: LITEBOXER
Liteboxer VR. Virtual reality has had a bit of a resurgence during the pandemic as we’ve all largely stayed indoors. If you’re not ready to go back to the gym with all the huffing and puffing and (probably) poor ventilation, give Liteboxer VR a try if you have the Oculus Quest 2. The company, which sells a physical pad you can box with at home, now has a VR version. You box a virtual pad in front of you, and you need to hit specific points at the right interval to score higher points. If it’s anything like FitXR (which we’ve tried), it’ll be fun and a workout. There’s even a live trainer to help you maintain your form and licensed pop music to motivate you to keep up the pace. It’s on the pricey end, costing $19 per month, but there’s a seven-day free trial, and it’s way cheaper than buying the IRL version. It goes on sale in the Quest app store on March 3. —Julian Chokkattu
Best Camera
Porch pirates begone.
PHOTOGRAPH: EUFY
Eufy Security Video Doorbell Dual. Your video doorbell can most likely use its onboard computer vision capabilities to detect family, friends, pets, and strangers. But can it detect packages? The Eufy Security Video Doorbell Dual boasts all the features a good doorbell cam needs—like a clear 2K camera and an included hub that acts as a Wi-Fi booster—while adding a secondary downward-facing camera that can accurately identify packages that have been dropped on your doormat. It's an increasingly popular trend in video doorbells, with similar functionality recently showing up on some models from Ring and Nest. But Eufy has beefed up its detection capabilities with radar and PIR (passive infrared) motion sensors to cut down on false positives and to ensure you never miss a visit. Also, it captures and stores video without requiring a subscription, and since the doorbell is battery powered, you don't need to hardwire it. The expected launch date is February 8, and it will cost you $260. That price includes the Homebase 2 hub with 16GB of storage. —Simon Hill
Best in Sustainability
Wash (way) up.
COURTESY OF P&G
Tide Infinity. Washing clothing on a spacecraft is near impossible. Astronauts on the International Space Station have to re-wear clothes over and over again until new ones arrive in supply shipments, a process which renders their clothing so irredeemable that the apparel is burned up in our atmosphere, never to be worn again. That's a problem Tide is aiming to solve. In collaboration with NASA, the brand just sent a prototype detergent called Tide Infinity up into orbit. The unscented, fully degradable formula is safe for a closed-loop water system like the one used on the ISS. Over the next few months, experiments will test the efficacy of key dirt- and odor-fighting ingredients in space. Future studies will take place to test stain removal, delivery methods, and potential laundry solutions for deep-space missions. Tide says it hopes to apply findings from its experiments to products to make our Earthbound laundry processes more sustainable. Perhaps we’ll be able to wash clothes in water-scarce locales or more efficiently reuse gray water. Or perhaps we’ll all be able to just do our laundry on our way to some distant exoplanet. While these studies are still in the very early stages, I’m excited at the prospect of making even the most mundane tasks better—both on and off the ground. —Louryn Strampe
Best in Health Tech
Wrapped up.
PHOTOGRAPH: MOVANO
Movano Ring. Move over, Oura. The Movano Ring is coming for you—potentially with clearance from the US Food and Drug Administration. It’s one of the only companies (along with Withings) that has applied for FDA clearance for its tracker, which would make it a certified medical device. This health-monitoring ring is expected to launch in the second half of 2022. Not only is Movano’s device smaller than the Oura, but the company also expects to make it more affordable and more widely accessible. The Movano can monitor common health problems like hypertension, and considering how nearly half of all adults in the US deal with high blood pressure, having a sleek and medically certified ring that can monitor it will be immensely more useful than standard-fare fitness trackers. —Julian Chokkattu
Best in Pet Tech
Po-tweet!
PHOTOGRAPH: BIRD BUDDY
Bird Buddy. The world doesn’t appreciate birds enough. That’s why, after stalking its Kickstarter campaign for the last year, I’m excited for Bird Buddy to finally become available. This camera-laden bird feeder allows you to not only see the cute little birds flying around your home, but it offers a chance to actually learn more about them by identifying bird species, noting foods they like, and sampling their bird songs all within its connected app. From there you can go off into the woods and try to spot them on your own, or just keep a log of your new buddies and learn to feed them what they really want. The company told me it’s hoping the data collected by its users can lead to meaningful change in conservation efforts by tracking bird migrations and populations around the globe. If I’m going to continue staring at a screen, it might as well be helping the birds. (And yes, this counts as pet tech; birds are everyone’s pets.) Bird Buddy feeders ship this spring for $235.

Reuters : Japan urges more chip tie-ups with Taiwan at trade talks

Japan urges more chip tie-ups with Taiwan at trade talks

TAIPEI, Jan 11 (Reuters) - Japan called for greater collaboration with Taiwan on semiconductors at a bilateral economic and trade meeting on Tuesday.

Japan-Taiwan Exchange Association Chairman Mitsuo Ohashi praised Taiwan Semiconductor Manufacturing Co Ltd (TSMC)'s plans to expand in Japan, saying, "I hope these collaborations can continue to expand, and positively impact the resilience of both Taiwan and Japan's supply chains."

"Currently, even though the pandemic has blocked exchanges between Japan and Taiwan, the economic and trade relationships between Japan and Taiwan have continued to deepen," Ohashi added via video.

Although Chinese-claimed Taiwan and Japan do not have formal diplomatic ties, they have close unofficial relations. Both share concerns about China, especially its increased military activities near the two.

The Taiwan-Japan Economic and Trade Conference has typically been held in Taiwan or Japan each year, but because of the pandemic, the two sides met virtually this week.

TSMC, the world's largest contract chipmaker, announced last year that it would set up a research and developmentcentre in Japan, as well as a $7 billion chip plant with Sony Group.

Tech powerhouse Taiwan is at the forefront of efforts to resolve a shortage of chips that has hampered auto production lines and affected consumer electronics makers around the world.

Chiou I-jen, chairman of the Taiwan-Japan Relations Association, thanked Japan for supporting Taiwan's bid in September to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

He said Taiwan hoped both sides could start a "constructive dialogue" on Taiwan joining the trade pact as soon as possible.

"Taiwan is of crucial importance to the world's supply chain, economy and trade," Chiou said, speaking at a Japanese hotel in Taipei. "If (Taiwan) can join the CPTPP, it will greatly increase the importance and visibility of this pact in the global economy."

Taiwan's bid angered China, which views the island as one of its provinces with no right to the trappings of a state. Taiwan says it is an independent country and has vowed to defend its freedom and democracy.

Business Of Fashion : Who to Hire to Build the Fashion Metaverse

Who to Hire to Build the Fashion Metaverse
Brands that want to engage with Web3, NFTS and other red-hot tech categories will need to play the long game when it comes to talent acquisition.

An unconventional posting could soon start cropping up across fashion job boards: “Wanted: Metaverse design specialist; no experience necessary.”
Fashion brands piling into the virtual fashion craze are discovering that finding the people needed to operate in the metaverse can be just as complicated as the technology itself. Experts in Web3, non-fungible tokens and other emerging categories have plenty of options: job postings mentioning “metaverse” skyrocketed by 1,042 percent between November 2020 and November 2021, according to Indeed. Posts using the keyword “crypto” are up 300 percent over the same period. Companies known more for their runway looks than their tech chops may not be the first choice for top talent.
Brands are better off playing the long game when it comes to talent acquisition and training, experts say. That can mean training current employees in new skills, and broadening the types of people they hire for tech and engineering roles in the first place. In some cases, that might mean hiring recent college graduates or early career professionals from adjacent industries who have completed months-long coding programs.
“What we’ve seen with a bunch of companies who need to fill positions [for the metaverse], is that they’ve had to have tremendous flexibility in the qualifications of those individuals,” said Abby Hunter-Syed, a partner at LDV Capital, an early-stage venture fund that invests in visual technology businesses.

Thinking Outside the Box
Three years ago, when Tommy Hilfiger set out to have 100 percent of its apparel produced via 3D design by 2022, the company knew this would require an overhaul of its organisational processes and its people.
So it created an internal incubator, called Stitch, that operated like a “corporate start-up” made up of two groups: software engineers who would develop proprietary 3D design technology and “creatives” who could train and “transform” the company’s existing design teams, said Martijn Hagman, chief executive of Tommy Hilfiger Global and PVH Europe.
While the brand is still a ways off from its ambitious target of using 3D design across its entire apparel range — it’s roughly 55 percent of the way there, Hagman said — the incubator itself was the critical tool in helping it attract the calibre of tech talent required to get such a project off the ground.
“You want to offer those tech-minded people an environment where they can really excel in their core competency and build something that is new, unique and inspiring to them,” said Hagman. “To attract this talent, the Tommy Hilfiger and PVH names alone are not enough.”
The brand will use this same strategy with a new incubator, Metaverse Studio, which will help the company “experiment and test and learn” how to become a formidable player in the virtual reality space, he said.
Like many fashion brands, Tommy Hilfiger is also relying on third parties to realise its virtual ambitions, Hagman said. In addition to collaborations with Roblox and Animal Crossing, the brand has since 2019 worked with Obsess, an e-commerce platform that builds virtual stores.
But if the metaverse is to live up to its hype and fashion companies are to truly profit off of it long-term, they will need to map out a talent strategy that allows them to build their own bench strength. The starting place for most companies is finding an initial pool of 3D designers and engineers who are skilled at working with or developing technology.

“I think the biggest challenge to hire for today is a senior 3D engineer because everybody needs them,” said Hunter-Syed.
Attracting Talent
Not every company will need to form an incubator like Tommy Hilfiger but to attract experienced engineers, they’ll need to offer salaries that compete with tech giants like Google and Meta, rather than their fashion peers.
“The first step we had to take was to tell people that we can pay more and that we are making something really interesting,” said George Yashin, chief executive at Russia-based Zero10, an app and fashion-tech start-up that allows users to purchase and wear digital garments. “[In response] we got guys from some of the biggest corporations in Russia.”
Estonian artist Tommy Cash created a fashion NFT inspired by Adam’s Fig Leaf in partnership with AR wardrobe platform Zero10.
Another option is to hire recent design and engineering school graduates. A lack of experience isn’t necessarily a problem, said Neha Singh, founder and CEO of Obsess, which has also worked with Coach, Dermalogica, and Farfetch to create their online stores using augmented reality that mimics in-person shopping.
In 3D design, most specialists have backgrounds in architectural visualization — where they work with real estate developers and architects to create 3D renderings of buildings — or video game development, Singh said.
“What we actually need is a combination of those [expertises] as well as a few other skills – and this is hard to find,” she said. “So, in a way, less experience is good because these [people] are willing to learn … they can look at things that are being done in the metaverse and build their skill set towards it.”
A “passion for fashion” should be at the top of the list of qualifications, said Hunter-Syed.
“What you’re really looking for is people who are artists who now have to become 3D,” she said.

WWD : A Wardrobe-building Selection of Brands to Check Out at Pitti Uomo

A Wardrobe-building Selection of Brands to Check Out at Pitti Uomo
WWD picked a selection of the most interesting brands showing at Pitti Uomo to help attendees browse the fair's main areas easily.

From left: Looks from Waste Yarn Project, Itoh and Umòja.

Despite the COVID-19 pandemic still ravaging the globe, leading men’s trade fair Pitti Uomo is kicking off today in a IRL format, drawing the usual mix of established and up-and-coming names, with some 600 exhibitors showcasing their fall 2022 collections at the Fortezza da Basso venue.
Long deemed as a great resource for high-quality men’s fashion, Pitti Uomo has been adapting to the ever-evolving category, striking a balance between classic formalwear and more avant-garde brands, either for their sustainable credentials or contemporary positioning. While some marquee names including Brunello Cucinelli and this edition’s special guest Ann Demeulemeester have bowed out due to the pandemic, there are plenty of names to check out.


Here, WWD picks some of the more interesting brands showing at the fair’s pavilions to help buyers and attendees easily browse the three main areas, called Dynamic Attitude, Superstyling and Fantastic Classic.

Related Galleries

Formalwear Updated
Itoh
Itoh, fall 2022
COURTESY OF ITOH
Offering an aesthetic rooted in the Indian background of founder Amit Babbar, Itoh is based in New Delhi and characterized by an understated and relaxed take on formalwear, seen through the lens of contemporary Indian style. Each seasonal collection is conceived as a small capsule valuing the handwoven fabrics that Babbar sources from across India, spanning from cotton-silk to wool-linen blends and canvas. For fall 2022, Babbar is aiming to transcend seasonality, offering a collection rich in zingy colors and earthy tones with collarless madras checks and pleated shirts worn under generous and creased overdyed suits as well as fluid striped pajama sets, conceived as a contemporary and cool alternative to business suits.
Hannes Roether
Hannes Roether
Committed since their debut collection in 2007 to offering timeless men’s fashion crafted from luxurious materials for gentlemen looking for edgy everyday tailoring, German designers and life partners Hannes Roether and Nicky Wendt offer a workwear-inflected version of the suit, such as oversized corduroy options and pin-striped three-piece sets with stand-up collar jackets worn over finely knitted turtlenecks. Checkered overcoats and military-inspired blazers crafted from fustian complete the understated but refined lineup.
Knitwear From the Earth
Alpha Studio
Alpha Studio, fall 2022
COURTESY OF ALPHA STUDIO
A knitwear specialist for 35 years, Alpha Studio, which was founded in Florence by Franco Rossi, has been offering Made in Italy knitwear with a timeless quality in a wide selection of fabrics and knitting techniques. For fall 2022, the brand has developed a collection of argyle sweaters, rib-knit turtlenecks and mélange crewnecks done in a muted color palette of buttery whites, beige and camel exalting the natural quality of the yarns while conjuring a shabby-chic aesthetic.
Waste Yarn Project
Waste Yarn Project, fall 2022
COURTESY OF WASTE YARN PROJECT
The brand’s name says everything about Paris-based designer Siri Johansen’s ethos. The knitwear specialist’s founder uses deadstock and surplus yarns to deliver genderless knits created by hand on a manual machine in which color schemes are often randomly selected to mirror supply, turning each piece into a one-of-a-kind creation. Boasting extensive experience in knitwear design at marquee fashion houses, Johansen embarked on his solo fashion project with Sebastian Maes, a knitwear manufacturer, scouting deadstock yarns that could be given a second chance. “What comes out are individually made pieces that embrace randomness with infinite possibilities,” said Johansen. For the fall collection, his second, the designer developed cardigans, blankets and crewnecks done in blocks of candy colors, resulting in an eye-catching offering.


Winterproof Outerwear
Filson
Filson
COURTESY PHOTO
Filson heads to Florence for Pitti Uomo, but this time with WP Lavori in Corso as its European distributor and licensee. WP Lavori in Corso, which distributes brands such as Levi’s, Beams, Engineered Garments, Nanamica and more, aims to help Filson with their sales network in order to expand the 124-year-old label in Europe. This season, Filson is offering its signature apparel, outerwear and accessories built for the outdoors, like the lined wool Packer Coat, Denim Cruisers, down jackets and insulated vests, flannel and moleskin shirts, and utility pants and jeans. Filson is well-known for its original rugged twill briefcase, computer bag and large rucksack that lead the way for the extensive accessories range for braving the outdoors and commuting through the city.
Premiata
Premiata, fall 2022
COURTESY OF PREMIATA
Footwear sensation Premiata, the shoe brand that has been gaining steam in recent years, is ready to hit Pitti Uomo with some news: Its first ready-to-wear men’s collection, comprising sportswear-inflected styles with a strong focus on outerwear, with workwear-inspired parkas and oversized puffer jackets layered over tracksuits. They all boast performance-driven materials such as nylon and water-repellent organic cotton. “I’ve developed a wardrobe-building collection for metropolitan warriors, looking for multifunctional, structured and versatile clothing,” said Vincenzo Mazza, a member of the founding family’s fourth generation now leading the brand. The collection, which is manufactured in Italy by La Rocca, will be distributed across Premiata’s main markets, including Italy, Russia, as well as the U.S.
Naviglio Milano
Naviglio Milano fall 2022
COURTESY OF NAVIGLIO MILANO
Naviglio Milano was founded in early 2020 by fashion buyer Alessio Aramini with the idea of repurposing vintage styles for a contemporary outerwear brand with a sartorial feel. Its name directly references Milan’s picturesque Navigli neighborhood and its canals. Aramini said he looked at old-school overcoats one would find in his dad’s or grandpa’s closets, trying to update the look and using eco-friendly fabrics, many of which are recycled. The fall 2022 collection, called “Differentiated,” nods to the notion of individuality in that each coat is designed imagining a character. Case in point: A yellow corduroy coat echoes the styles of ‘60s Mods, while a knee-long double-breasted peacoat references the signature ‘90s fashion editor style.


Holden
Holden
COURTESY PHOTO
Outerwear brand Holden continues to merge performance, fashion and sustainability in their offering, which is designed in Venice, Calif., and produced in Europe. For fall 2022, the brand draws inspiration from art, music, culture and the outdoors and how these ideas and concepts intersect. This season features down parkas and kimono-style puffer jackets, bright fleece jackets and apparel, a hybrid capsule comprised of down styles in Italian materials, like pants in contrast colors, and water-repellent footwear made with Primaloft Eco recycled insulation. In addition, Holden produced genderless items to complement the men’s and women’s offerings.
The Footwear Edit
Kleman
A lace-up shoe from Kleman for fall 2022.
COURTESY OF KLEMAN
A family-run shoemaker based in Nantes, France and established in 1945 amid World War II thanks to the endurance and passion of founder René Cléon, the Kleman brand as it is known today was launched in 1988 and soon became a trusted supplier to several French government departments. Priding itself on not following fashion trends, the brand, now helmed by Mathieu Cléon, continues to offer sturdy, unisex styles imbued with a workwear, feel including the leather moc-toe boots and derbies, left unchanged since the ‘80s original designs. For fall 2022, the brand is expanding its signature collection with the addition of trekking-style details and more eco-friendly options, including designs made of vegetable tanned leather and recycled materials.
Run Of
Run Of’s Runwastable sneakers for fall 2022.
COURTESY OF RUN OF
In sync with younger consumers’ demand for uniqueness and sustainability, Italian sneaker brand Run Of is introducing at Pitti Uomo its most advanced upcycling project, called Runwastable, a low-top sneaker crafted from repurposed biker jackets, which customers are allowed to select and have turned into their new shoes. The brand, which was established in 2020 by Matteo Ciuti, art director and product designer, offers vintage-tinged luxury running sneakers that blend high-low materials and boast performance features such as its patented outsole. Ciuti said his aim is to transcend the fashion-y sneaker trend and offer Made in Italy footwear with character.
Umòja
Umòja, fall 2022
COURTESY OF UMÒJA
Founded in 2018 by Dieuveil Ngoubou and Lancine Koulibaly, Umòja — meaning unity in Swahili — is a sneaker brand that prides itself on being 100 percent plant-based and plastic-free, all the while valuing the textile tradition of West African countries. The result of a two-year development process, the brand’s signature and bestselling MMEA style is a low-top design crafted from cotton, linen, hemp and hevea milk sourced in Burkina Faso, France and Portugal from trusted and audited suppliers, making the style fully traceable and recyclable.


Brandblack
Brandblack
COURTESY PHOTO
Los Angeles-based footwear label Brandblack debuts its fall 2022 collection, called “Blur,” which does away with embellishments to focus on function and fashion in minimal products. The brand highlighted key footwear styles for this season from its performance category, including the Rare Metal 2 basketball silhouette, the lightweight nylon Sansin, the Santa Monica sneaker boot and the Kaiju that features their newest running technology. In its Moda category, Brandblack’s offerings include the sporty Luso sneaker, the California-inspired Bravissimo and Capistrano sneakers and their bestselling Saga silhouette. Much of the performance line is crafted with Vibram soles and sports-centric construction while the Moda offering features high-quality materials like full grain leather and suede overlays.

WWD : Brunello Cucinelli 2021 Revenues Climb 30.9%

Brunello Cucinelli 2021 Revenues Climb 30.9%
The strong performance led Cucinelli to define 2021 "one of the best years" for his namesake fashion house.

MILAN — Brunello Cucinelli believes the year 2021 “has been one of the best” for his fashion house.

The Italian brand reported its preliminary 2021 revenues on Monday, registering 30.9 percent growth in the 12 months ended Dec. 31. Sales amounted to 712 million euros, compared to 544 million euros in 2020. At constant exchange rates, revenues grew 32.4 percent. Compared with 2019, sales rose 17.2 percent.

“We have achieved some important results worldwide, both in terms of economics and image, so that we can define this time just passed: the year of rebalancing,” said Cucinelli, executive chairman and creative director of his namesake company, in a statement released at the end of trading. “The spring 2022 collections and the fall 2022 pre-collections received great appreciation from both buyers and international press, and based on these results, we imagine a fine, gracious and balanced growth of around 10 percent for the current year. All this will allow us to work with healthy focus and dedication, envisaging a bright future for our Casa di Moda, for the territory and the next generations.”

Before Christmas, as reported, Cucinelli said he would like his company to be called Casa di Moda, and feels that it has deserved the right to be defined that way. “Our values ​​and our fashion are representative of a fashion house,” he said at the time.

On Monday, Cucinelli confirmed his “very concrete” expectations of a balanced growth of around 10 percent for both 2022 and 2023, “given the performance of the collections, the selected boutique network development project and the like-for-like results we expect.”

In addition, Cucinelli said the company is “progressively returning to the profitability levels prior to the start of the pandemic, which have always been based on the values that inspire us: the right growth, the right profit, the right balance between profit and gift. Thus we have concrete expectations that we will be able to end the first five-year 2019-2023 period of our 2019-2028 10-year plan very favorably, and slightly higher than the expectations we had before the pandemic began.”

In 2021, sales in Europe grew 26.5 percent to 219 million euros compared with 2020, representing 30.8 percent of the total. Compared with 2019, sales climbed 23.8 percent. Balanced retail and multibrand sales contributed to the performance.

The main European luxury capitals, such as Paris, Milan and London, showed a significant rebound and pointed to the customers’ desire to return to physical stores and to events, Cucinelli said, citing the inauguration of the brand’s New Bond Street boutique in London and that of Avenue Montaigne in Paris.

Cucinelli also cited “excellent” results in Russia, which has significantly contributed to the brand’s growth in Europe. In the second half of the year, the company saw a recovery of the countries in Central-Northern Europe, of second-tier cities and a progressive recovery in the Mediterranean area, also thanks to the strengthening of regional tourism and the first arrivals of international customers, in particular from North America.

Revenues in Italy accelerated in the last part of the year. In the full year 2021, sales climbed 23.2 percent to 84.2 million euros compared with 2020, accounting for 11.8 percent of the total. Compared with 2019, they declined 6.2 percent. However, in the last quarter, revenues were almost in line with the same period of 2019.

Sales in the Americas were up 36.7 percent to 238.2 million euros compared with 2020, representing 33.4 percent of the total. Revenues in the region rose 15.8 percent compared with 2019.

A growing desire to “dress well” for both men and women, a balanced presence and domestic tourism all contributed to the performance, with resorts in the U.S. becoming a reference point for exclusive stays. Online sales also helped drive sales, complementing revenues in the physical channel.

Sales in Asia grew 32.9 percent to 170.6 million euros, representing 24 percent of the total. Sales were up 26 percent compared with 2019. The last quarter of the year showed a significant acceleration of sales, thanks in particular to the performance of mainland China.

“We believe these results are brilliant, both for the absolute value of the performance and for the way in which we have achieved them,” Cucinelli said. “In the pursuit of balanced, healthy and quiet growth, we believe that our approach to China, in full respect of its Millennial culture, can give us beautiful and sustainable growth in the coming years.”

Japan, which had shown some volatility during the year, thanks to an acceleration in the fourth quarter, closed 2021 substantially in line with 2019, and very solid results were achieved in South Korea and in some countries of South East Asia.

Retail sales climbed 56 percent to 419.3 million euros compared with 2020, representing 58.9 percent of the total. Compared with 2019, the channel was up 23.5 percent.

Solid like-for-like sales, new openings, the expansion of existing spaces and new concessions contributed to showing an acceleration of the channel in the last part of the year.

As of Dec. 31, the number of boutiques amounted to 114 compared to 107 boutiques in the prior year, with four openings and three wholesale boutique conversions, including a store in the Dubai Mall and a space in the exclusive resort town of Gstaad.

There are 43 directly managed shops within department stores, compared to 31 hard shops at the end of December in the previous year, primarily related to the conversion to the direct management of 10 spaces within Nordstrom. In the last part of 2021, the company added the Madison Avenue flagship in New York.

In 2021, wholesale revenues grew 6.3 percent to 292.7 million euros, representing 41.1 percent of the total. Compared with 2019, the channel was up 9.1 percent.

The company has been investing in its “Casa Cucinelli” project, where it aims to recreate that same atmosphere and lifestyle experience — including Italian cuisine — of the Solomeo headquarters. This has led to the creation of multifunctional spaces in Milan, London, Paris and New York. The goal is also to open additional ones in the future in Shanghai and Tokyo.

In 2021, the company invested 61 million euros, compared with 51.6 million euros in 2020, mainly allocated to retail experiences and to the digital, technology, production and logistic investments.

Through a strong cash generation related to operating activities and a solid management of net working capital, as of Dec. 31 net financial debt decreased to about 23 million euros, compared with 93.5 million euros at the end of the previous year.

“We think that 2021 is the year in which our interpretation of humanistic capitalism and human sustainability has become even clearer and appreciated by the sensibility of many people in the world,” said Cucinelli, referring to two company foundations.

He pointed to the issue, which he discussed during his speech at the last G20 Summit in Rome in October, of “strict compliance with the law, which is linked, for example, to the duty to pay the right taxes in one’s own country. In our view, this too is part of the moral sustainability we are referring to.”

At the end of 2021, the company communicated the target of a 60 percent reduction in greenhouse gas emissions in terms of economic intensity by 2028 and in absolute terms by 70 percent for scope 1 and 2 emissions and by 22.5 percent for scope 3.

(ZH) "Trade Of 2022" Surges As China's Most Distressed Property Developers Near

"Trade Of 2022" Surges As China's Most Distressed Property Developers Near Bailout

On Saturday, we discussed that what may arguably be the trade of the year, one with the most convex, best Upside/Downside opportunities we have encountered in a while, had emerged in China courtesy of the latest panic in Beijing which saw China's authorities finally realize they need to step in and bail out the imploding property development (and housing) sector.
Specifically, in the latest gradual easing of financial conditions in the property market, regulators told banks to step up lending to developers after at least two quarters of consecutive declines. At the same time, borrowing by major property firms used to fund mergers and acquisitions will no longer be counted toward the notorious three red lines metrics that limit debt, which as we said, suggested that "a wave of consolidation is about to sweep China which should stabilize the property market at least in the short-term as insolvent firms are absorbed by their viable peers."
We didn't have long to wait because just one day later, on Monday, shares of massively beaten down Shimao Group which we previously said had become a distressed bellwether for financial contagion in the property industry due to its recent investment grade rating and sudden collapse in bond prices...
... soared as much as 14% in Hong Kong - a surge that continued on Tuesday morning - after a report in REDD that state-backed property giant China Vanke was in talks with the developer for asset acquisitions (i.e. a soft nationalization), a move made possible just days earlier by Beijing's latest directive easing loans for M&A in the space. Incidentally, this took place just as Moody’s and S&P both downgraded Shimao’s credit rating.
And with a growing likelihood of a white knight bailout, Shimao’s deeply beaten down dollar bonds also climbed after the report, with a note due in July rising 3 cents on the dollar to 47.6 cents after cratering as low as a record 26.6 cents last week.
Now, of course, none of the above suggests that China's property sector is fixed; in fact as Bloomberg's Sofia Horta e Costa writes, Shimao’s unprecedented 19% rally on Monday was more a result of short covering rather than a shift in sentiment, noting that it doesn’t take much for a short squeeze. And since the developer had lost almost 90% of its market value since a record in 2020, betting against the stock was a popular trade among hedge funds, meaning that more than 16% of its free float was sold short as of Friday, according to IHS Markit data, near the highest level since 2012.
But that's precisely the reason why the risk/return on Chinese housing is so extremely high: with virtually all bad news priced in, the real convexity is in the explosive move higher that any piece of good news would trigger, whether it be a state-mandated white knight bailout, or even more easing from China which has now clearly ended its experiment with crushing the most important asset in its economy.
It's also why we said on Saturday that a pair trade of shorting US homebuilders - especially with the Fed set to hike rates, pushing mortgage rates higher and hitting US homebuilders in the process - and with going long Chinese property developers now that China is officially panicking and soon willing to do anything to support its housing market could be the best trade of 2022.
Sure enough, just one day later, having hit an all time low just this past Friday, the pair trade is already starting to move rapidly higher...
... a move which will only accelerate as the squeezed shorts flee to cover.
Which is not to say this is a risk-free trade: on the contrary, this week will be a major test for China’s real estate sectoras Guangzhou R&F has a $725 million bond coming due on Thursday, plus another $21 million in interest, while Evergrande is seeking to avoid its first default on a yuan bond the same day when bondholders vote on whether to allow the firm to defer payment. However, if recent overtures from Beijing are any indication, China's authorities have decided that there has been enough pain in the property sector and it is now time to ease the pain.
If that is the case the only question is not if but when the ratio of Chinese to US housing recover all of the losses observed in the post-Covid era.

WSJ : Tech Leaders Create Proofs of Concept for the Metaverse

Tech Leaders Create Proofs of Concept for the Metaverse
‘The metaverse is going to play a role in business,’ AmerisourceBergen CIO Mark Spykerman says

Companies of all stripes are positioning themselves to tap the potential business value of the metaverse, an immersive virtual world that some envision as the next digital frontier for work, play and shopping.

Technology companies, including Meta Platforms Inc. and Microsoft Corp. , are battling for talent to build the hardware that is crucial for accessing the metaverse. Microsoft’s augmented-reality team has lost around 100 people in the past year, many of them to Meta, The Wall Street Journal reported on Monday. Meta makes the Oculus virtual-reality headset, while Microsoft makes an advanced AR headset called HoloLens.

Although it isn’t clear when the metaverse will be widely adopted, chief information officers at businesses ranging from consumer products to pharmaceuticals say they are planning to launch proofs of concept later this year to explore how it could address real-world challenges.

“The metaverse is going to play a role in business,” said Mark Spykerman, CIO at AmerisourceBergen Corp.

Edward Wagoner, CIO of commercial real estate services company Jones Lang LaSalle Inc., said the company is considering investing in the metaverse through several different paths.

First, he said, it is looking at “buying specific virtual locations within high traffic areas to test various scenarios,” including getting a sense of how advertising, offers and services might work there.

The company also is looking at how the metaverse will provide opportunities to optimize hybrid work arrangements, a mix of in-office and remote work, through a higher level of virtual interaction.

To do so, JLL is considering investing in startups “to help us prototype and create these metaverse-related opportunities,” Mr. Wagoner said.

Visa Inc. also is exploring the workplace potential of the metaverse.

“What we’re aiming for is sort of a reflection of a physical world in a virtual world that brings forth the conversation, the training, the simulations, the interactions where a few people leaving a conference room can have a hallway chat with something like an avatar or a hologram or something that you can project and look at,” said Rajat Taneja, president of technology at Visa.

Visa this year plans to prototype and test the technology, Mr. Taneja said.

Scientists, in particular, can make use of the technology to simulate what might sometimes be challenging to do in real life because of logistical constraints, said Paul von Autenried, CIO at Bristol-Myers Squibb Co.

“We have scientists doing real work in laboratories with beakers and chemicals and their ability to do their work and free up their hands is very valuable,” he said. “The metaverse for me triggers an avalanche of thoughts and technology in the space of augmented reality and sort of technology that lies at the intersection of human physical interaction and what could be done with digital innovation.”

Vittorio Cretella, Procter & Gamble Co.’s CIO, said the metaverse will become a common way companies interact with their customers.

At last week’s CES 2022, P&G for the second year hosted a virtual experience, LifeLab, where visitors could create avatars and move around a digital exhibit space to learn more about new P&G products.

“When we talk about metaverse and immersive experience, I think, for me, it’s about engaging with the consumers at the right time, on the media channel they prefer and with the right content,” he said.

Dave Williams, chief information and digital officer at pharmaceutical company Merck & Co., said he sees many possibilities to apply the technology. “We’ve got some really good examples in our environment of how we leverage those existing technologies, especially during the pandemic to connect experts who are in very different parts of the world,” he said.

“I see that can be a huge opportunity in terms of connecting people, learning, development,” he said.

WSJ : Bridgewater’s Ray Dalio Endorses China’s ‘Common Prosperity’ Drive

Bridgewater’s Ray Dalio Endorses China’s ‘Common Prosperity’ Drive
The longtime China bull said the U.S. and other countries could benefit from a similar approach

Bridgewater Associates LP founder Ray Dalio backed China’s push for “common prosperity,” or greater equality, under President Xi Jinping and said countries such as the U.S. could benefit from a similar approach.

Beijing’s pursuit of common prosperity has been a driver behind its wide-ranging crackdowns on sectors such as e-commerce, videogames, property and after-school tutoring. The heightened regulatory pressure in turn has caused steep declines for many Chinese stocks listed in the U.S. and Hong Kong, and prompted many investors to reassess the risks and rewards of Chinese assets.

Mr. Dalio, a longtime China bull, however, has warned market watchers not to misinterpret the actions as demonstrating that Chinese leaders were “showing their true anticapitalist stripes,” and has stressed the benefits of investing in the country.

“Common prosperity is a good thing,” Mr. Dalio said in a video appearance at UBS Group AG’s Greater China Conference on Monday. “It’s another way of saying prosperity for most people.”

Mr. Dalio said his views on the topic were “pretty much aligned” with those of the Chinese leadership, and widespread opportunity would lead to a better economy and a fairer system.

“As Deng Xiaoping and others understood, it’s a cycle,” Mr. Dalio said. “First you get rich, and then you make a point of distributing those opportunities in a more equal way.” Mr. Deng, China’s former paramount leader, unleashed economic reforms from the late 1970s onward. Those changes allowed China to grow much faster than it had under former Communist Party leader Mao Zedong, who died in 1976.

“A lot of people don’t know the true thinking, even though there have been attempts to describe it, and tend to make the mistake of thinking that this is like a return to communism under Mao, rather than understanding it’s just part of the evolutionary process,” he said.

Mr. Dalio said he thought that through its own system, the U.S. “needs more common prosperity, a lot of countries do.” His presentation showed U.S. wealth and income gaps at heights last hit in the 1930s.

Ahead of the same conference, a senior banker told reporters that China was committed to welcoming global investors and to further opening up its financial markets.

Tommie Fang, UBS’s head of China global markets, said Friday that he had recently spent a week in Beijing meeting with financial regulators. Mr. Fang said he had seen “a lot of positive energy, pro-business and opening-up” attitude in his meetings with the central bank, securities, banking and foreign-exchange regulators, and leadership at the new Beijing Stock Exchange.

In late July, after a crackdown on tutoring roiled markets, the China Securities Regulatory Commission met privately with representatives of global financial institutions and tried to assuage investors’ concerns, saying China would consider the market impact before introducing future policies.

Mr. Fang, who attended the July meeting, said: “I firmly stand by the view that the policy environment in China is more stabilized and the valuations are more attractive versus the beginning of last year.”

He said Chinese regulators were “making very clear and dedicated efforts to enhance the dialogue” with their U.S. counterparts over U.S.-listed Chinese companies, which face the threat of delisting in a dispute over access to audit papers.

Mr. Dalio told conference attendees that his hedge-fund management firm had thrived since it started applying its all-weather approach, which aims to make money regardless of broader market moves, to investing in mainland China.

“We’ve been doing that for about three years onshore. That’s done very well, whether the direction of the market is up or down. I’m just thrilled to be a participant,” he said. In November, The Wall Street Journal reported that Bridgewater had raised the equivalent of $1.25 billion for its third investment fund in China, its largest to date.

Mr. Dalio advised investors to be wary of holding cash, given its drawbacks on an inflation-adjusted basis. “Stop viewing cash as a safe investment. Investors think of cash as safe because it doesn’t have much volatility. The mind-set needs to change,” he said.

FT : Crypto craze takes gaming industry by storm

The gamers getting behind crypto
Yosuke Matsuda, president of storied video game developer Square Enix, had a gift for crypto-land on New Year’s Day: a wholehearted endorsement of NFTs, the metaverse and the play-to-earn blockchain games, where playing can earn cryptocurrencies.

“From having fun, to earning, to contributing, a wide variety of motivations will inspire people to engage with games and connect with one another. It is blockchain-based tokens that will enable this.”

Square Enix is not the only gaming company hoping to get a slice of the crypto-hype. French publisher Ubisoft announced its NFT platform Quartz last year, allowing users to buy cosmetic options or “skins” for your avatar, while Electronic Arts chief executive Andrew Wilson said that “collectible digital content is going to play a meaningful part in our future”.

The games industry has long sought new ways to keep users paying for content. Loot boxes, which offer a random assortment of items for avatars, became endemic among mobile games in the mid-2000s and feature in popular franchises such as Team Fortress 2 and Fifa. NFT proponents argue that blockchain items could be transferable across games and further stimulate virtual economies — markets for resales of skins exist, but they are unauthorised.

Blockchain games, such as Axie Infinity, have an even better pitch: they allow players to earn in-game assets which they can convert into hard cash. Square Enix’s Matsuda differentiated between consumers who “play to have fun” and those who “play to contribute”, creating new content for the game world — and also making more money for games companies.

But when it comes to what gamers are willing to pay for, they are discerning. Loot boxes have been an ongoing source of controversy, with opponents likening the mechanics to gambling. And monetising user-generated content (UCG), which is traditionally viewed more as a passion project than corporate handiwork, has been a thorny business. PC storefront Steam’s experiment with adding premium options to its UCG workshop in April 2015 provoked a mass backlash and a u-turn by the gaming giant later that month.

While Ubisoft and others are piling in, other gaming companies have drawn a line in the sand. Steam’s owner Valve announced in October a ban on NFTs from its expansive store. The new policy appears to align with Steam’s stance prohibiting items that have real-world value on the platform. In December, GSC Game World, the developer of upcoming survival shooter game S.T.A.L.K.E.R. 2, reversed plans to offer NFTs after a vociferous backlash from fans. “The interests of our fans and players are the top priority for the team,” the developer said.

As for blockchain games, there are questions around the sustainability of their economic model. Analysts argue that they rely on new player growth to remain viable. Equally fundamental is how much entertainment they offer, says Edward Castronova, professor of media at Indiana University and one of the most respected voices on the study of virtual economies.

“If it’s not something more fun than other things, people are not going to do it,” he said, emphasising that companies cannot simply rely on telling users about how great their blockchain technology is. “You can’t just say ‘we’re excited’ and expect people to buy in.”

Castronova is not a dyed in the wool crypto-critic, adding that he sees possibilities for blockchain-based gaming to offer a genuine economic incentive — so long as they are not too onerous.

Turning games into yet more gig economy work is not as much of an innovation — see the long and dubious history of “gold mining” in games like World of Warcraft. Simply tacking “blockchain” onto that may not be the winning pitch crypto’s true believers think it is