WeWork pulled its IPO in 2019 after mulling a massive valuation cut to drum up investor interest, and cofounder Adam Neumann was ousted as CEO and chairman. WeWork has been slashing jobs and selling or shuttering businesses. WeWork has announced real-estate veteran Sandeep Mathrani as its new CEO, replacing Artie Minson and Sebastian Gunningham, who served as co-CEOs since Neumann was ousted. It's also seen a big board shakeup. Marcelo Claure will stay on as chairman, according to The Wall Street Journal, which first broke the news of Mathrani's appointment. Here's how we got here, and what's next for WeWork after it nabbed a lifeline from SoftBank. You can read our stories by subscribing to BI Prime.

Here's everything we know about what's going on inside WeWork:

The latest

Plotting a path forward

WeWork is now paying a retainer of $500,000 a month to Publicis for crisis PR and advertising services just weeks after almost running out of cashWeWork just overhauled its compensation plan, and we have the full memo with details on cash bonuses, base salary changes, and new equity grantsWeWork shutters its restaurant-based coworking subsidiary, Spacious, and lays off the entire staff of about 50 employeesBANK OF AMERICA: WeWork and other IPO disasters could start a domino effect that sends US stocks tumbling. Here's how.WeWork's turnaround plan calls for it to stanch its losses while opening hundreds of new locations. Here's why business and real-estate experts are baffled.WeWork offered about 1,000 people a surprisingly good deal to move to a contractor, but then sent some of them a letter with another dealSome WeWork employees believe working for the company has hurt their careersHere are all the people SoftBank has trusted to turn WeWork around, including the 4 new executives it just announcedInside WeWork's leaked all-staff meeting: The embattled company's path to profitability will focus on 6 pillars, and 4 men were named to executive rolesAs WeWork lays off thousands of employees, its competitors say they're ready to hire hundreds next year as they expandTishman Speyer is opening its own flex offices without go-betweens like WeWork. We got a look at the landlord's new space in New York.Adam Neumann personally invested tens of millions in startups while he ran WeWork. Founders who took his money reveal what it was like.After WeWork's meltdown, competitors say their investors want 'quality' revenue and a plan to navigate downturns

SoftBank bailout

Fallout after the failed IPO

Neumann's personal finances

Neumann's exit

Tanking valuation 

Financials, business history, and real estate

WeWork just released an investor presentation that offers numbers the company didn't include in its widely-derided IPO documentsInsiders say WeWork's IT is a patchwork of cheap devices and Band-Aid fixes that will take millions to fixWeWork used massive discounts — in some cases, essentially giving away space for 2 years — to try to poach customers from rivalsWeWork says it has 527,000 'memberships,' but that's not as straightforward as it seemsWeWork opened 400 locations in 3 years. In some cases, it used deep discounts to convince existing customers to relocate to help fill them.We got a peek at WeWork's top landlords. Here's who is most exposed to the fast-growing, but money-losing, coworking company as it prepares to IPO.Here's what we know about Fibra Uno, the Mexico real estate company that's WeWork's biggest landlord. It highlights how quickly the co-working company has been growing overseas.WeWork's CFO says it will generate $2 billion in profit on the desks it's opened this year, and it shows the importance of the 'space-as-a-service' modelWeWork's 'entirely new, nonsense' way of evaluating its profits is eerily similar to the tech bubbleThe past 4 years of WeWork's pre-IPO financials show just how important cash flow is to the company's growthWeWork reported its financials for 2018 and both its revenue — and losses — doubledOne of WeWork's buildings is profitable, and the company says it's a vindication of its modelWeWork documents reveal it owes $18 billion in rent and is burning through cash as it seeks more funding

Coworking rivals

Road to the failed IPO

Neumann's leadership

SoftBank's role

Deals

 

Original author: Business Insider

About a dozen homeowners in South Texas' Boca Chica Village neighborhood have not sold their properties to SpaceX to make way for a planned Starship spaceport.SpaceX and a real-estate firm it hired have told residents they could be removed — and for far less money — through an eminent-domain process started by Cameron County.However, one homeowner told Business Insider that she and her husband would not sell to SpaceX, and they apparently aren't alone. Meanwhile, the Institute for Justice, a libertarian nonprofit group, has discussed possible pro bono legal representation of such residents.But people who've already sold to SpaceX fear that the county would try other ways to complicate residents' plans to keep their homes before any eminent-domain process.SpaceX did not respond to Business Insider's requests for comment.Click here for more BI Prime stories.

This is the third story in a Business Insider series about SpaceX in South Texas called "Last Town Before Mars." Read the previous stories here.

Celia Johnson was born in Brownsville, a midsize city in South Texas that borders Mexico. Like most families in the area, hers didn't come from money, so she found recreational escape as a kid by piling into a relative's car and driving 30 minutes east down Highway 4.

Boca Chica Boulevard, as the road is also known, winds through a rugged, wildlife-rich area famous for migratory birds, ocelots, and invasive nilgai antelope. The pavement abruptly ends in a splash of tan-white sand between a pair of dunes capped with beach grasses, opening to the roughly 7-1/2-mile-long Boca Chica Beach. A few miles to the south is the US border and the mouth of the Rio Grande; a few miles north, past a shipping inlet, is South Padre Island, a spring-break hot spot.

Save for locals who fish, cook, camp, four-wheel, or drink, the strip of sand is serene and undeveloped. Some nearby residents say Boca Chica Beach looks much like it did during the days when pirates harbored their vessels in the Laguna Madre Bay, which the beach shelters from storms.

A great blue heron on Boca Chica Beach in Texas. Dave Mosher/Business Insider When Johnson began taking her own kids, she'd pass through a remote neighborhood of one-story brick homes called Boca Chica Village less than 2 miles west of the beach. One day in 1992, her son spotted a "for sale" sign in the front yard of a home.

"My son said, 'Mom, this house is for sale — call the lady, call the lady!'" Johnson told Business Insider.

Johnson bought the house that year, making it an annual retreat from brutal winters in Michigan, where she spent most of her adult life, as well as a gathering point for her extended family.

As she entered retirement, though, Johnson, now in her 70s, increasingly viewed it as a low-tax retreat to spend the rest of her life. To supplement her Social Security income, she also rents out a second home she bought later.

"It's brought nothing but happiness. It's always been a backup for me," she said. "This is a house that was a dream come true when I bought it."

But now SpaceX, the rocket company founded in 2002 by the tech entrepreneur Elon Musk, wants her and all her neighbors to leave. The goal: Make way for developing a potentially world-changing spacecraft called Starship and, eventually, build a Mars spaceport.

A senior executive at SpaceX told residents that if Musk "loses his patience," the company would tell Cameron County, where Boca Chica is, that it may pack up and leave. SpaceX and Jones Lang LaSalle, a real-estate firm hired to conduct a village buyout, told homeowners that if that happens, the Cameron County Spaceport Development Corporation might use its eminent-domain authority to remove them.

Despite such intimidating circumstances, some families don't plan to sell to SpaceX.

What's more, they may not be alone if a court battle comes to pass. The Institute for Justice, a libertarian nonprofit law firm in Washington, DC, has signaled it may offer pro bono legal services to affected residents. The outfit is no stranger to property-rights cases; in 2004, its seminal Kelo v. New London suit landed in the US Supreme Court.

Renée Flaherty, an attorney with the firm, told Business Insider that while its board members had not yet approved legal representation for Boca Chica residents, the case would be "right in the wheelhouse" for the institute and "pretty likely" to be taken on if Cameron County moved to use eminent domain.

"The fact that Texas gave this spaceport corporation eminent-domain authority ... why would they give them that power if they didn't plan on exercising it? They've bent over backward for SpaceX, they're not going to let them leave, and SpaceX knows that," Flaherty said.

"Texans love their property rights. If SpaceX wants to be the future of humanity — I agree that what they're doing is awesome — they need to be on a solid foundation. And abusing eminent domain should not be a part of that foundation."

SpaceX's rocket 'Neverland' in South Texas

Many residents of Boca Chica Village chose the area for its solitude. Jennifer Lee

SpaceX's plan is to use the more than 100 properties it's purchased since 2012 to develop, build, and launch Starship, a 39-story, fully reusable, Mars-capable steel rocket system.

"We love Texas and believe we are entering a new and exciting era in space exploration," James Gleeson, a SpaceX representative, told The Atlantic in a story published on Tuesday, adding that "South Texas will play an increasingly important role in our efforts to help make humanity multi-planetary."

In mid-September, the rocket company offered to buy out all homeowners at three times a base appraisal, primarily and ostensibly for safety reasons.

Residents still in the area say they've seen contractors renovating the homes, SpaceX workers sleeping in them, and a real-estate developer sizing up other properties for improvement. One company-owned house has become a kind of recreation center, with a bar, pool and picnic tables, and string lights, said one former homeowner, who requested anonymity to maintain their privacy but whose identity Business Insider verified.

"It's made me madder than anything else they've done. Like they're getting ready for a party or something. This is in the middle of our neighborhood," the person said. "It feels like we're not dead yet and they're already celebrating. It's a kick in the gut."

Johnson said the real goal in buying the village seemed to be creating a private "Neverland" for Musk, SpaceX employees, and VIPs amid a multiplanetary-spaceship operation.

"I live on the site and work in the factory and then go sleep over there in that little village over there," Musk told KRGV News during a Starship job fair in early February. (Business Insider reported on Musk's living situation in South Texas in mid-January.)

Though more than half the village has sold to SpaceX since the deal was offered to homeowners there, many residents have not committed; one family even pulled out at the last minute. Getting everyone moved out seems so important to the company that it keeps dispatching its senior finance director, Dave Finlay, to meet with villagers almost weekly. Though residents described Finlay as affable, he's apologized to them for being bound to negotiation-limiting aspects of the deal.

"Elon wants to pay more attention to this than any project, more than anything else — even if he has to give up Tesla," Johnson said Finlay told her during a visit on Tuesday, referring to the electric-car company of which Musk is CEO.

"In other words: We will get moved out of here no matter what, and he will use whatever money to remove us," Johnson said. "But not by paying us, except through an appraisal based on condemned homes."

SpaceX did not respond to any request for comment from Business Insider for this series. Tesla also did not respond to a request for comment.

Johnson continues to talk to Finlay, and she said his new idea to sway holdouts was the most interesting to her yet: Put a three-times-appraisal value toward SpaceX fully relocating residents to similar properties with brand-new yet similar homes built on them.

"He made another offer about buying some acreage from the county that's got the same waterfront view as here but is 5 miles inland and building houses equivalent to what I have now, including the square footage," Johnson said.

Johnson said that while she's seriously considering the option, she's leaning toward no.

Nothing is certain in a future where Johnson sticks to that decision, but she would not be alone.

'The houses will go to the county on Monday'

The previous owner of an A-frame house in South Texas now owned by the SpaceX subsidiary Dogleg Park LLC. It was once a model home of a planned community called Kopernik Shores. Dave Mosher/Business Insider

As early as 2015, SpaceX representatives told village residents in at least one private meeting that they could all stay — despite all living less than 2 miles from a planned launchpad.

To satisfy US Federal Aviation Administration safety protocols and county agreements, everyone would just have to temporarily evacuate their homes for up to 15 hours on launch days, which were originally supposed to occur once a month. SpaceX said it would put residents in a Brownsville hotel for free, according to some meeting attendees.

On September 28, 2019, about two weeks after SpaceX's buyout offers arrived, residents brought up the hotel-lodging plan with Musk himself during a rare private meeting. Walter Mitchell, who had owned a home in the village since 2005 with his wife, Patricia (the couple sold to SpaceX around early November), specifically asked the billionaire CEO about the idea.

"There are people here that want to keep their property," Mitchell said he told Musk. "I said, 'You guys said in that meeting that you would take us and put us in hotels.' I said, 'Can that work? And they can keep their property?'"

According to interviews with several meeting attendees, Musk said something to the effect of, "Well, if they don't mind frequent shuttles to a hotel frequently, we could probably do that."

But in recent months, SpaceX's actions have suggested that it's trying very hard to avoid this. Brig. Gen. Wayne Monteith, the head of the FAA's Commercial Space Transportation Office, previously told Business Insider that permanently removing residents was not something the federal government had mandated and was instead part of SpaceX's "business case."

In the distant future, that business may be too busy to keep Boca Chica habitable, at least in the current regulatory environment. Musk has said he'd like to fly a Starship and land its Super Heavy rocket booster three times a day from a launch site. Even further into the future, SpaceX aims to replace transcontinental and overseas flights with super-rapid Starship "Earth to Earth" flights; such a scheme may ultimately see 1 million or more launches a year globally, Caryn Schenewerk, SpaceX's senior counsel, said at an FAA conference in January.

An FAA representative told Business Insider on Thursday that SpaceX's safety parameters were "still under evaluation" and that its launch-permit work for Starship prototypes and beyond "is in very preliminary stages."

Whatever the rationale for pushing to clear out Boca Chica Village, many current and former homeowners said that SpaceX and Jones Lang LaSalle had tried to intimidate them into selling and that eminent domain had been the most common tool.

"I have felt like, from the very beginning, that SpaceX has been holding a gun to my head," Johnson said.

Eminent domain is the ability of a government to condemn properties for a "compelling public use," though the US Supreme Court in 2005 — in the case led by the Institute for Justice — interpreted that definition to include private "economic development" projects. Texas, along with dozens of other states, had an allergic reaction to the ruling and spent more than a decade shoring up private-property rights.

Musk has said eminent domain would be a last resort to remove residents. When asked by homeowners, Finlay has said SpaceX has no authority to condemn properties. But in the same beat, he said or implied that SpaceX could ask Cameron County for help or the rocket company would leave — and that local officials would almost certainly act to keep it.

In November, Johnson reached an impasse with a JLL representative when she said she wanted to sell only her rental house, not her main home.

"She called back and said, 'It's both or nothing.' And I said, 'It's nothing then.' And she gave me some spiel about 'I'm going to talk to you like you're my mother or aunt,'" Johnson said. "Then she said, 'We'll close the books on you. The houses will go to the county on Monday.'"

The same JLL representative brought up the legal process in a voicemail, obtained by Business Insider, that was left with Harvey Bloomer, whose family has owned a Boca Chica home for decades, on November 19, a Tuesday.

"SpaceX is riding me because they want to have all the offers in by Tuesday. And they said that if they don't hear back from people, they will assume that they are no longer interested. This worries me because that three-times value will be off the table and you won't be able to get anything close to that offer should the county step in and proceed with eminent domain," the JLL representative said in the voicemail. "That's what is in the newspapers that they're going to do. So give me a call."

JLL declined to speak on the record with Business Insider about either incident and other aspects of this story.

Finlay has also summoned the specter of eminent domain with residents, including in emails sent to the Bloomers that Business Insider obtained.

"I am very concerned that you may be unaware of highly relevant facts related to properties within a designated Space Port in the State of Texas. I would really appreciate if we could connect so that I can explain further," Finlay wrote on February 4. "My goal is to provide full transparency of a difficult situation and to work hard to facilitate the very best outcome for you and your family based on your unique needs in a challenging situation."

JLL and SpaceX have not managed to persuade the Bloomers to sell, and they may never do so. Mary Bloomer said her husband spent parts of his childhood growing up in the beachside home and wouldn't give it up — not even for millions of dollars, or if SpaceX or JLL had handled negotiations differently — since he feels the home is irreplaceable.

"It's not about the money. It comes down to this property being worth more to us than probably any amount you could offer," the Bloomers told Finlay in response to one of his messages.

Mary Bloomer says she still doesn't understand why SpaceX chose Boca Chica instead of somewhere else without a neighborhood.

"Why did they have to do this with this little village of people? They should have thought of this when they first came in," she said.

"I personally don't have anything against him," she added of Musk. "I don't want to stop their progress. I just want to keep my house."

An uncertain future awaits the last town before Mars

A prototype of SpaceX's Starship rocket, MK1, at the company's South Texas launch facility in Boca Chica on September 28. Future versions of Starship are designed to be massive enough to take people to the moon, Mars, and beyond. Loren Elliott/Getty Images

The Bloomers said that a family next door, which Business Insider could not reach for comment, is on board with going to court over an eminent-domain process should the county come knocking and the Institute for Justice, or some other outfit, be willing to represent them for free.

As many as three other Boca Chica homeowners — Johnson included — might join them in challenging Musk's space company.

But the Bloomers are also aware that nothing in life is guaranteed, and that SpaceX may find some way to settle with other holdouts.

"We might be the last ones left, and then I don't know what chance we have," Mary Bloomer said.

If the county does try to condemn homes in Boca Chica through eminent domain, it's possible only those of the residents could be removed, leaving the houses purchased by SpaceX.

"As a general rule, condemnors can pick and choose what they condemn and what they don't. This presumes the right to take exists and there is no fraud or hanky-panky of course," Clay Beard, a partner at Dawson & Sodd, LLP, who's represented private landowners in eminent domain cases for decades in Texas, told Business Insider. "Leaving some and taking others may be evidence of fraud but, again, [it's] a long road in proving it."

Yet because of eminent domain's deep unpopularity in Texas (and in general), it seems unlikely that Cameron County would pursue it as the next option.

That's one major reason Maria and Ray Pointer decided to sell to SpaceX this year. They got somewhat close to the price they sought for their property, and they worried that county officials might make their lives next to impossible to enjoy in Boca Chica.

"The county is not going to lose SpaceX. They'll find another way," Maria Pointer told Business Insider. "They've got 1,000 things they can do. It's not worth it at my age to play that card."

Flaherty said lawyers at the Institute for Justice "strongly believe the negotiations between SpaceX and property owners should be private."

Business Insider requested an interview with County Judge Eddie Treviño Jr., but his office said the judge was traveling for work and unavailable to speak until mid-February. We later requested an interview with the next-best official but did not immediately receive a response.

SpaceX, of course, does not have to stay in Texas, or even on land.

Though Musk recently explained why South Texas is ideal for launching Starship, renderings from years ago show Starship launching from an ocean platform. The Daily Breeze, a community newspaper in Torrance, California, also reported in January that SpaceX may revive a plan to manufacture Starships at the Port of Los Angeles, which would permit the company to ship them practically anywhere in the world.

What happens next is up to SpaceX and, largely, Elon Musk himself.

This story is part of a Business Insider series about SpaceX in South Texas called "Last Town Before Mars."

Do you have a story to share about the spaceflight industry? Send Dave Mosher an email at This email address is being protected from spambots. You need JavaScript enabled to view it. or send him a Twitter direct message to @davemosher. You may also consider more secure communication options listed here.

WATCH: Why SpaceX is trying to buy out a small Texas village

Original author: Dave Mosher

Business Insider polled 44 executives across the financial services world to find an answer to a seemingly simply question: what is the definition of fintech?Fintech first entered the mainstream vernacular roughly a decade ago, but with every passing year the term gets harder and harder to define.We split the responses into three groups: traditional players, fintech investors, and fintechs themselves.The goal was to understand how different types of firms and people define a term that's applied widely but is nearly impossible to explain concisely. In 2019, VCs poured more than $24 billion into startups that put a tech spin on spaces ranging from asset management to lending to payments to insurance, according to a CB Insights tally of fintech investment.Click here for more BI Prime stories.

It's arguably one of the most commonly-used terms on Wall Street, yet no one can agree what it means. 

Fintech first entered the mainstream vernacular roughly a decade ago, but with every passing year the term gets harder and harder to define.

As Wall Street puts more research and focus towards technology, what can be categorized as a fintech continues to expand. And with tech players like Amazon and Uber making noise about getting into financial services, things have gotten even more confusing. 

Now, one can hardly read a story about Wall Street without at least a slight suggestion of the power, potential or problems tied to fintechs.

Business Insider set out to pin down what exactly a fintech is by asking the people that should know the answer best: the investors that fund them; the traditional players that partner and compete with them; and startups themselves. 

The responses were illuminating, as they provide perspective on how the most powerful players view up-and-coming technology.

And seeing these responses is crucial if you want to understand how incumbents are tackling the buy or build question, and for unpacking what's truly a disruptor and what's really just a fancy app. 

Some said that "fintech" isn't enough to capture what's really going on, and that there's a serious need for more precise terms. One pointed out that the first ATMs in the 1960s could be counted as the official birth of fintech. And several even argued that the term needs to be retired.

Click below to see responses from all three groups:

We asked 9 execs at Wall Street giants like Goldman Sachs, BlackRock, and JPMorgan what 'fintech' means to them. Here's why they say fintechs are friends, not foes.

Wall Street players largely dismissed the notion of any competition or rivalry. There was a lot of talk about partnerships, and some said that incumbents have been the real drivers of fintech all along. 

14 big investors like Bain Capital Ventures, Kleiner Perkins, and Point72 weigh in on how the meaning of fintech is evolving — and no one can agree if the term should be expanded or retired

Long answer short — it's complicated. Some big investors see defined borders, others described more of a continuum, and a few try to avoid the term entirely.

Fintech has become a buzzy label that often doesn't really mean anything. We asked execs at 21 startups like Brex, Kabbage, and N26 what really counts.

The lines between big tech, startups out of Silicon Valley — or Alley — and the legacy players of Wall Street are blurring. Here's where startups think they fit in. 

 

Original author: Dan DeFrancesco and Shannen Balogh

Like many companies, Facebook's business has been affected by the novel coronavirus outbreak.Its supply chain for hardware has been disrupted, and it cancelled a conference it was hosting in San Francisco.Employees are being asked not to travel to China, where the virus originated.Visit Business Insider's homepage for more stories.

Misinformation and rumours about the novel coronavirus outbreak are spreading on Facebook, prompting the social network to talk to the World Health Organization (WHO) about how to battle the fake news — but that's not the only way the virus has affected Facebook.

Like numerous companies, Facebook's core business has been impacted by the viral illness, which has sickened more than 64,000 people and killed nearly 1,500 over the past few months — from upsetting hardware supply chains to forcing it to cancel planned industry conference appearances.

Its effects on Facebook illustrate has the outbreak is disrupting global businesses, and how the issue might wreck further havoc if not contained in the months ahead.

Facebook's hardware supply chain has been affected

Like other tech companies, Facebook's supply chain for its virtual reality hardware is heavily reliant on Asian suppliers, which have been disrupted by the coronavirus. Oculus Quest, its latest VR headset, is facing shortages as a result.

"Oculus Quest has been selling out in some regions due to high demand. That said, like other companies we're expecting some additional impact to our hardware production due to the Coronavirus," a spokesperson said. "We're taking precautions to ensure the safety of our employees, manufacturing partners and customers, and are monitoring the situation closely. We are working to restore availability as soon as possible."

Facebook's Portal, a smart speaker and video-chat device, isn't currently affected by the outbreak.

Facebook employees are being advised against travel to China

Facebook is advising employees against traveling to China and requiring those who need to go to seek company approval in advance, Bloomberg previously reported.

Meanwhile, employees who have visited are being asked to work from home.

Facebook pulled out of a major tech conference

Facebook was one of numerous tech companies to pull out of Mobile World Summit, a major mobile industry event that was due to take place in Barcelona in late-February.

Facing widespread drop-outs, conference organisers GSMA made the unprecedented decision this week to cancel this year's event entirely.

It also cancelled its own San Francisco marketing conference

Facebook has cancelled a conference it had scheduled for mid-March.

The Global Marketing Summit, a 5,000-person San Francisco that was planned for March 9-12, will no longer go ahead, the company announced on Friday.

In a statement, spokesperson Anthony Harrison said: "Our priority is the health and safety of our teams, so out of an abundance of caution, we cancelled our Global Marketing Summit due to evolving public health risks related to coronavirus."

If the outbreak continues to spread over the next few months, it raises questions about the future of another, more significant Facebook event — F8. It's a developer conference that acts as Facebook's largest event of the year, and is scheduled for May.

Do you work at Facebook? Contact this reporter using a non-work device via encrypted messaging app Signal (650-636-6268), encrypted email (This email address is being protected from spambots. You need JavaScript enabled to view it.), standard email (This email address is being protected from spambots. You need JavaScript enabled to view it.), Telegram/Wickr/WeChat (robaeprice), or Twitter DM (@robaeprice). PR pitches by standard email only, please.

Read more:

Original author: Rob Price

 

Hello, readers!

Big mergers and acquisitions are team efforts. But at the very top, a battled-tested senior banker provides critical advice and connections that can determine a transaction's success or failure. Alex Morrell worked with financial data firm MergerLinks to publish our first-ever rainmakers list this week. You can see rankings for the top 20 M&A bankers for North American deals here. 

Casey Sullivan wrote about how private-equity firms, long reliant on human judgment to pick investments and figure out how to generate the best returns, are finally starting to add formalized data-crunching to the mix. Still, it will likely be some time until we see an industry-wide revolution — as one recruiter put it, "you can't go from zero to artificial intelligence." Here's how 6 firms like Blackstone and Cerberus are building data-science teams — and what's holding some back from going all in. 

Bradley Saacks and Dan DeFrancesco, our dynamic data duo, talked with 10 insiders to unpack a shakeup at Crux Informatics, which is backed by $41 million from investors including Goldman Sachs, Citi and Two Sigma. The New York-based startup aimed at helping digest and process data has undergone big changes in both its technology and executive leadership. 

Dan also chatted with Tradeweb cofounder and CEO Lee Olesky about what he sees as the next big opportunity for the electronic marketplace operator. The next stage isn't just about growing the various marketplaces it already runs, but helping to facilitate more interaction between them, Olesky said. He said he's always viewed Tradeweb as a type of search engine for customers to find the best price, counterparty, and way to perform a transaction.

Meanwhile, Bradley reported that a Citadel portfolio manager with a medical degree is going it alone and launching his own healthcare-focused hedge fund. Seems like a timely move — despite the huge outflows facing the broader hedge fund industry, healthcare funds have been a bright spot where investors are still hoping to put more money in. 

We also had a fresh WeWork scoop from Meghan Morris. WeWork's head of enterprise sales is out, and the abrupt departure means a role that's key to the coworking giant's turnaround plan is now vacant.

Keep reading for more deep dives: we talked with six former colleagues of WeWork's incoming CEO to learn more about his leadership style; delved into the murky world of litigation finance; asked a Goldman psychologist about the stickiness factor when it comes to fintechs; and chatted with Interactive Brokers insiders to understand the firm's strategy when it comes to being a first mover. 

Have a great weekend!

Meredith

If you aren't yet a subscriber to Wall Street Insider, you can sign up here. Are there stories you'd like to see more of, or new areas you'd like to read about? My line is open — This email address is being protected from spambots. You need JavaScript enabled to view it..

$35 billion fintech Stripe just inked a deal with hospitality PoS-maker Lightspeed — and it's a case study in navigating the tricky world of payments

Montreal-based point-of-sale software company Lightspeed announced a new partnership with the buzzy $35 billion startup Stripe last week.

But Lightspeed's Stripe partnership, which will power Lightspeed's online and in-store payments offering, isn't so cut-and-dry. Behind the scenes, payments are complicated with a multi-pronged network of players on the value chain. There are layers of processors, facilitators, and, ultimately, both online and in-store checkouts that the end consumers see. 

Payments related to the sale of CBD, gambling, or adult entertainment, for example, are restricted from the Stripe platform. Stripe explains that given their partnerships with financial institutions like Visa and Mastercard, it needs to work within the requirements of those companies.

READ MORE HERE>>

WeWork's new CEO Sandeep Mathrani has to pull off one of the most difficult turnarounds Silicon Valley has ever seen. Insiders explain what he's like, and why he's the guy to do it.

WeWork's incoming chief executive may be the antithesis of Adam Neumann, the coworking giant's cofounder and former CEO whose swirling charisma was at the center of the implosion of its planned initial public offering. 

Sandeep Mathrani, who spent years at a publicly traded mall company, doesn't like to drink with his colleagues after work or play ping pong in the office in the afternoon, former coworkers said. The engineer turned real-estate executive is more likely to be found interrogating colleagues about their data in presentations and has a knack for cutting operational costs.  

READ MORE HERE>>

Litigation finance has boomed into a $10 billion-plus business. Here's why a shadowy industry that dates back centuries is exploding.

They met at a conference in Santa Monica a decade ago, and over dinner Jonathan Molot and Christopher Bogart, both lawyers, hatched an idea to provide outside funding for lawsuits, a practice that had largely been forbidden for decades, even centuries, in some countries.

Funding lawsuits has its roots in the feudal era when the wealthy could financially back another person's legal action in return for a share of any winnings.  Champerty, as it is called, and similar ways of profiting from lawsuits were later outlawed in England.  Later, many US states had the same or a similar prohibition. 

But in recent years, such funding barriers have been weakened.

READ MORE HERE >>

A Goldman Sachs psychologist breaks down why customers stay loyal to old institutions over buzzy banking startups — and reveals the mental barriers fintechs need to tackle

The concept of "stickiness," or customers' tendency to stay with the brands to which they've long been tied, can pose a challenge to new players looking to gain market share in financial services.

We spoke with Patrick Perkins, a psychologist and managing director at Goldman Sachs who oversees executive coaching there, about the ways fintechs and incumbents can think about design and brand loyalty as new options crowd the space.

"The bar is very high for people to actually make significant changes in their financial choices, because they're more motivated to really stick with what they know," Perkins said. "They're more motivated to minimize that chance of a loss and retain their sense of power and control."

READ MORE HERE>>

Interactive Brokers has upended Wall Street time and again. Its cofounder explains how causing chaos is key to staying competitive in a cut-throat industry.

Interactive Brokers, the Greenwich, Connecticut-based brokerage, has led the way during several phases of the industry's fiercely competitive war over price and capabilities that's played out in recent months. 

Senior leaders from the firm, including chairman Thomas Peterffy, spoke with Business Insider recently about their strategy — and what comes next.

Their products have been replicated time after time in this cutthroat industry, they're quick to note, and they say they are concerned about tipping off competitors with much talk of future plans. 

"We are basically computer programmers. We are not experts of finance," Peterffy told us. "What we lack in expertise in finance we make up in our technology expertise."

READ MORE HERE>>

Fintech and proptech

Original author: Meredith Mazzilli

Every week, Parrot Analytics provides Business Insider with a list of the nine most in-demand original TV shows on streaming services in the US.This week's list includes Netflix's "Stranger Things" and DC Universe's "Harley Quinn."Visit Business Insider's homepage for more stories.

DC Universe's adult-oriented animated series, "Harley Quinn," got a big boost in audience demand this week, likely due to the release of the movie "Birds of Prey (and the Fantabulous Emancipation of One Harley Quinn)."

Every week, Parrot Analytics provides Business Insider with a list of the nine most in-demand TV shows on streaming services in the US.

The data is based on "demand expressions," Parrot Analytics' globally standardized TV-demand measurement unit. Audience demand reflects the desire, engagement, and viewership weighted by importance, so a stream or a download is a higher expression of demand than a "like" or a comment on social media, for instance.

This week, Netflix's "The Witcher" fell behind "Stranger Things." Expect the latter to gain an even bigger boost in the week ahead thanks to the release of the first teaser for season four on Friday.

Below are this week's nine most popular original shows on Netflix and other streaming services:

Original author: Travis Clark

The Army has been ramping up its recruiting effort, seeking more soldiers from a mix of backgrounds and with differing skill sets.The service has developed a variety of outreach methods to get those recruits.One of its most innovative may be the Army Esports Team, which draws on the Army's own gamers to attract young Americans.Visit Business Insider's homepage for more stories.

After whiffing on its recruiting goal in 2018, the Army has been trying new approaches to bring in the soldiers it needs to reach its goal of 500,000 in active-duty service by the end of the 2020s.

The 6,500-soldier shortfall the service reported in September 2018 was its first recruiting miss since 2005 and came despite it putting $200 million into bonuses and issuing extra waivers for health issues or bad conduct.

Within a few months of that disappointment, the Army announced it was seeking soldiers for an esports team that would, it said, "build awareness of skills that can be used as professional soldiers and use [its] gaming knowledge to be more relatable to youth."

By January 2019, more than 6,500 soldiers had applied for a team that was expected to have about 30 members. In September 2019, the Army credited the esports team, one of two new outreach teams set up that year, as having "initiated some of the highest lead-generating events in the history of the all-volunteer force."

Staff Sgt. Michael Showes, far right, with fellow Army Esports Team members and a game enthusiast at an exhibition in San Antonio, January 19, 2019. US Army/Terrance Bell

"It's essentially connecting America to its Army through the passion of the gaming community," Sgt. 1st Class Christopher Jones, noncommissioned-officer-in-charge of the team, said in January 2019.

Team members who were competing would train for up to six hours a day, Jones said at the time, and they received instruction on Army enlistment programs so they could answer questions from potential recruits.

"They will have the ability to start a dialogue about what it is like to serve in our Army and see if those contacts are interested in joining," Gen. Frank Muth, head of Army Recruiting Command, said in early 2019.

Thousands of soldiers play esports, Muth said, and the audience for it has grown into the hundreds of millions — West Point even recognized its own official esports club in January — but the appeal wasn't obvious at first to Army leaders, Army Secretary Ryan McCarthy said Friday.

"This was one [idea] that when the first time Gen. Frank Muth briefed ... Army senior leadership, we're like, 'What are you talking about, Frank?'" McCarthy told an audience at the National Press Club in Washington, DC.

"We're about 18 months into it," McCarthy said, and with that team, Army recruiters were "getting their finger on the pulse with 17- to 24-year-old Americans. What are they into? How do they communicate? And [finding] those right venues and shaping our messaging to talk about here's the 150 different things you can do in the Army and the access to education and the kinds of people that you can meet and being a part of something as special as this institution."

The Army Esports Team trailer at ArmyCon 2019, October 12, 2019. Army Esports Team/Facebook

In 2019, the Army rolled out an esports trailer with four gaming stations inside, as well as a semi-trailer with eight seats that could be adjusted so all eight players played the same game or their own on a gaming PC, an Xbox 1S, a PS4 Pro, and a Nintendo Switch, Jones, the NCO-in-charge, told Task & Purpose in October. 

One of the senior leaders dispatched to an esports event was Gen. Mark Milley, who was Army chief of staff at the time and is now chairman of the Joint Chiefs of Staff, which is the president's top uniformed military adviser.

"He said, 'You're going to make me do what?'" McCarthy said Friday. "Then when he went, he learned a lot, and he got to engage with young men and women, and what we found is we're getting millions of leads of 17- to 24-year-olds to feed into Army Recruiting Command to engage young men and women to see if they'd be interested in a life of service."

The esports team is part of a change in recruiting strategy, McCarthy said, that has focused on 22 cities in traditional recruiting grounds in the South and Midwest but also on the West Coast and the Northeast with the goal of informing potential recruits about what life in the Army is actually like as well as about the benefits of serving, such as money for college or soft skills that appeal to employers.

The service has also shifted almost all its advertising spending to digital and put more uniformed personnel into the Army Marketing Research Group to take more control of its messaging.

McCarthy on Friday called it "a comprehensive approach" to "improve our performance in a variety of demographics, whether that's male-to-female ratios or ethnicities." That geographic focus yielded "a double-digit lift" among women and minorities, McCarthy said last year.

Army Gen. Frank Muth, back row, third from right, with members of the Army Esports Team in front of USAE gaming truck, in Washington, DC, October 14, 2019. US Army Esports Team/Facebook

The outreach hasn't been universally welcomed.

After the 2018 recruiting shortfall, service chiefs, including then-Army Secretary Mark Esper, said schools were not letting uniformed service members in to recruit. Anti-war activists attempted to disprove that claim by offering $2,000 to schools that admitted to barring recruiters.

Suggestions the Army start recruiting children in their early teens also received criticism for both its impracticality and the harm it could do to the military as an institution.

But recruiting has improved year-over-year, hitting the goal set last year and being ahead of pace now, McCarthy said.

"This has been a major turnaround, because I think we just got a little lazy and we started losing touch with young men and women ... but you have to sustain this," McCarthy added. "We're in a war for talent in this country — 3.5% unemployment, they have a lot of opportunities."

"We travel to a lot of American cities, and we meet with mayors and superintendents of schools and other civic leaders to try to educate those influencers, to try to help us in recruiting, and it's yielded tremendous benefit."

Original author: Christopher Woody

UK Prime Minister Boris Johnson has canceled a planned trip to meet with President Donald Trump next month after a furious row between the two men.Johnson had been due to visit Washington shortly after his election victory in December.The visit has been repeatedly delayed, however, amid a series of disagreements between the two leaders.Trump slammed the phone down on Johnson last month after the prime minister defied him on the issue of Huawei's involvement in the UK.Visit Business Insider's homepage for more stories.

UK Prime Minister Boris Johnson has canceled a trip to the US planned for next month after a furious phone call from President Donald Trump in which Trump slammed down the phone on the prime minister.

Johnson had been due to visit Washington last month but repeatedly delayed the trip after a series of rows with the president over Iran, Huawei, and a rejected request by the prime minister to extradite the wife of a US diplomat.

The disagreements culminated in a phone call last month in which Trump hung up on Johnson, according to officials with knowledge of the conversation.

Johnson has now canceled his trip altogether, and is not planning on visiting the country until the G7 summit in June.

A Downing Street source confirmed that the trip had been cancelled due to fears of further clashes with the president.

However, Downing Street insisted on Thursday that Johnson would concentrate instead on his domestic agenda over the coming months.

"When the Eye of Sauron is off the Whitehall machine, things stop working," one source told The Sun newspaper.

"That is why he has stripped down all his foreign travel this year to get his agenda done."

Reuters The prime minister had been one of Trump's few close international allies, with the president labeling Johnson "fantastic," a "good man," and "Britain Trump."

Relations broke down in recent weeks, however, following a series of high-profile threats from Trump and a series of pointed interventions against Trump by Johnson and senior members of his government.

The call last month, which one source described to the Financial Times as "very difficult," came after Johnson defied Trump and allowed the Chinese telecom company Huawei the rights to develop the UK's 5G network.

Johnson backed Huawei despite multiple threats by Trump and his allies that the US would withdraw security cooperation with the UK if the deal went ahead. The US fears that Huawei's technology could have backdoors for the Chinese government.

Trump's threats reportedly "irritated" the UK government, with Johnson frustrated at the president's failure to suggest any alternatives.

Following the call, US Vice President Mike Pence said the Trump administration had made its disappointment with the UK "very clear to them."

Original author: Adam Bienkov

Los Angeles startup X1 helps businesses keep track of "data in the wild," from inappropriate emails and photos to sensitive company information being shared improperly by employees.CEO Craig Carpenter said the big data analytics startup is providing an important service at a time when businesses need to stay on top of the way data is being stored and handled for privacy and compliance reasons. "It could be anything, harassing photos or emails," Carpenter told Business Insider. "They can take action. They can delete it. They can pop it up in front of a user and say, 'Hey, listen, this does appear to be appropriate. We've got a problem here."Here's the pitch deck X1 used to raise $5 million from investors including Palisades Growth Capital:Click here for more BI Prime stories.

Businesses nowadays deal with a deluge of data, much of it stored in all sorts of devices and accounts that are not easy to monitor.

Tracking all of that information can be critically important for businesses for legal reasons, or to simply be aware of what's going on in the organization.

The Los Angeles startup X1 uses big data analytics to help business track what CEO Craig Carpenter calls "data in the wild," which covers confidential company documents to jokes and photos shared by employees on their network. The startup's customers include Disney, Chevron, and Bank of America.

"We have, you know, gobs and gobs of data out there," he told Business Insider. "They don't know if they have all sorts of really bad information in their system that they don't have it in a file share somewhere so you can audit and you can take action."

The challenge for most businesses, he said, is that "less and less corporate data over the last 5 to 10 years is in structured systems that are managed by corporations by more." In many cases, businesses must deal with information in semi or unstructured format, and it's not necessarily under a  company's control," he added.

The information may be stored in multiple laptops and other devices, or in a Dropbox folder and other tools that may or not be supported by the company, Carpenter said. 

And it's important for businesses to know where their information  is located to comply with privacy and transparency regulations, such as the California Consumer Privacy Act which just took effect this year and the General Data Protection Regulation in Europe. The information could also be useful and even critical in internal investigations and risk assessment audits or in legal disputes.

"It's for legal proceedings," he said. "It's for investigations. It's for monitoring. It's for privacy settings."

The data "could be anything," Carpenter said. "It could be harassing photos or emails, whatever the case may be. And they can take an action or delete it. They can pop it up in front of a user and say, "Hey, listen, this doesn't appear to be appropriate. We've got a problem here."

Launched in 2003, X1 was initially focused on using analytics to boost business productivity before pivoting to data discovery and compliance, Carpenter said.

The startup raised $5.1 million from investors, including Palisades Growth Capital and George Kadifa, the former head of HP Software.

Here's the pitch deck X1 used:

Original author: Benjamin Pimentel

Amy Nobile founded Love, Amy in April 2019 to help people find love on dating apps after meeting who she calls "the love of her life" on Bumble post-divorce.Nobile conducts photoshoots for dating app profiles, holds sexting consultations, and "ghost banters" with clients' matches. Less than a year in, Nobile has built a full-fledged business from word-of-mouth, transforming a side-hustle into a service that charges clients $5,000 for three months.But Nobile insists she's more "mirror" than matchmaker, helping clients first find love within before finding it in a partner.Visit Business Insider's homepage for more stories.

The best way to make someone fall in love with you on a dating app is with a photo featuring a dog — even if that means borrowing your neighbor's tiny Maltese.

On a recent Saturday afternoon in downtown Manhattan, a 30-something, Ivy League-educated consultant did just that, curling up on her couch, cuddling a toy dog as his owners cooed at him encouragingly.

Amy Nobile, a petite, fit, blonde in a red sweater, furiously snapped away on her iPhone in an attempt to capture the perfect photo to send send suitors swiping in the consultant's favor.

Nobile charges $5,000 to help people find love on dating apps. The 50-year-old founded the high-end dating concierge service Love, Amy in April 2019 after finding "the love of her life" on Bumble post-divorce. Based in New York City, her clients range in age from 25 to 75, and are of various genders and sexual orientations across the country.

I joined her and the consultant a week into their working relationship for the wardrobing and photoshoot included in Nobile's three-month package. The consultant, whose name is not being published for professional reasons, posed in a black and tan wrap dress and jeans paired with a simple tee at various locations including Washington Square Park and a local café.

"It's important the clothes make them feel good," Nobile said. "It's all about showing off their figure in a way that's not too sexy."

The only accessory missing was a dog.

"Dogs are a great conversation starter," according to the dating concierge. Luckily, the consultant happened to cross paths with her neighbors during the shoot — and they were eager to lend their pup to the cause.

Amy Nobile helps people find love on dating apps. Hollis Johnson/Business Insider

The power of manifestation

Some may call running into the tiny Maltese a coincidence, but Nobile would call it manifestation — the concept of making something happen with your thoughts and beliefs. Growing up outside of Detroit, Nobile said she began "manifesting from an early age."

"When you look back, you can connect the dots," she recalled. "During childhood, I loved to imitate people, I was the friend girlfriends would turn to for advice."

A graduate of Albion College in Michigan, Nobile studied communications and ended up interning at NBC in New York City. That spawned a career in public relations, where she met her now-ex-husband. The couple relocated to San Francisco when Nobile was 26, where she navigated motherhood — she's the mother of two teenagers — with best friend Trisha Ashworth, whom Nobile had met in an NYC acting class.

"I loved Amy immediately because I could tell she was authentic with no pretense," Ashworth said. "She is super goofy and brings out the goof in me."

The two began hosting Starbucks meetings with other moms to dive into the struggles of motherhood. From those conversations came three books the pair co-authored about empowering women and, eventually, a spot on Oprah's couch. The duo, who also founded a jewelry company called Ash + Ames, penned a fourth book about reinvention after 40.

Nobile, by this point back in NYC, said she couldn't write the final tome without taking a look at her own 20-year marriage. After realizing she and her husband had grown apart, they decided to amicably separate. She then took on what she called a social experiment: making dating her job. Re-entering the dating world post-divorce, she said, "was like landing on Mars or learning Mandarin."

"I'd heard of some of the apps, but the only resource I had were a few single girlfriends who had nothing but negative things to say about them," Nobile said.

She cast her net wide and went on up to six dates a day until she met her current partner. Her friends, discouraged by dating apps and impressed by Nobile, asked for help. Nobile took over one of her friend's profiles and, as she tells it, landed the friend more dates in a month than she'd gone on all year. Nobile transitioned her cupid side hustle into a full-time job within three months. And that's how Love, Amy was born. 

Finding a hole in the dating scene

On the kitchen counter of Nobile's apartment — a luxury high-rise with picturesque views in Manhattan's Financial District — sit eight iPads, one for each of her current clients. 

Nobile with her eight iPads and one of her "woo-woo" accessories. Hollis Johnson/Business Insider

Since her clients are located across the country, not needing to log in and out of separate dating app accounts lets her give clients undivided attention while also tricking location services. Nobile says she's had 66 clients since launching her business 10 months ago, typically juggling seven at a time.

A number of those clients are members of the 40-plus crowd who are diving back into the dating world post-divorce and are skeptical of using technology to do so.

"It's frustrating, time-consuming, and exhausting," Sally, 52, said of trying dating apps after her marriage dissolved. When she first started working with Nobile, the dating expert took one look at Sally's profile and told her, "You need better pictures." And so Nobile marched over to Sally's apartment with a stylist friend in tow.

"Amy made it manageable," she said. "I wanted someone to just help me stay in the game."

Nobile says she's been surprised by the number of  millennials, nearly 40% of her clients, who have prioritized their careers over finding a relationship and need a professional to help them flirt.

As the consultant explained to her neighbors as she scooped up their dog: "I like to outsource all aspects of my life."

The art of ghost bantering

In the age of digital everything, Love, Amy is something of an exception. The business doesn't have a Facebook page. It has an Instagram account, but its following isn't very big — a mere 384  — and it's mostly dedicated to reposting famous love quotes.

I first heard of Love, Amy the way most of her clients have, through word of mouth. I soon found myself in Nobile's apartment listening in on a wrap-up call with a 33-year-old woman working in finance who, as Nobile told me in the pre-call debrief, had "found the one."

"I never would have swiped on him — he was a little nerdy and I was vain," said the 32-year-old. "I'd rather meet someone authentically, and you changed my mind on that."

"It's human nature to have a type," Nobile responded. "I needed to nudge you ... The turning point was when you became vulnerable."

Between ongoing coaching and post-date analysis, Nobile spends at least four to six hours a day on the phone with her clients. She's always on-call, even if the client is frantically texting mid-date from the bathroom.

Nobile "ghost banters" for clients, swiping and matching on their behalf. Hollis Johnson/Business Insider

Spending time with clients, whether in person or over a video call, helps Nobile get a better sense of their vibe and build a rapport. It also helps with what Nobile calls "ghost bantering" — impersonating clients on their dating apps.

It's a process that draws on what she identified as an early knack for imitating other peoples' voices and style of speaking, and one that helps draw clients, particularly some of Nobile's shyer clients, out of their shells.

"I'm such an introvert," said Sally, a writer. "Amy turned that around and made it an advantage. I don't think of it as deception, because Amy helps you be true to yourself."

As we spoke, Sally announced she was sitting next to her boyfriend of six months. She met him on Hinge with Nobile's help.

Personal happiness, good energy, and self-care

"Finish this sentence: My best friends who really know me would say that my 'dirty little secret' is..."

It's one of the 70-plus prompts on the seven-page intake form Nobile sends all clients after their initial meeting. The form is part of their homework, along with reading two books — "The Happiness Advantage" by Shawn Achor and "Manifesting Made Easy" by Jen Mazer — and taking a character strength survey.

It doesn't just give Nobile an idea of a client's personality, history, or the type of love they seek, but also allows her to see if they're prioritizing themselves. "You can only meet someone as deeply as you've met yourself," said the dating concierge.

But not every singleton who applies gets accepted.

Nobile told me if she thinks a client is "blocked" — spiritually, physically, or mentally — she turns them away with tips on self-care and tells them to come back. Someone who feels emotionally stuck in the past might receive contacts for meditation, energy work, or therapy. Once they're "clear and ready," she puts together a dating strategy.

It's not surprising coming from someone who describes herself as a bit "woo-woo" when it comes to her spirituality. Nobile, who meditates and does pilates daily, begins every morning blasting music and dancing around in her underwear, giving thanks for her life.

"As adults, we get so boxed into behaviors adults should have," said the love guru. "I was given advice by a shaman once to look at life through the eyes of a child. When you're a child there's no restrictions."

"The profile isn't the person"

While Nobile found success by tapping into a niche market, she isn't the only one to do so. Meredith Golden of SpoonMeetSpoon coaches customers on perfecting profiles and, like Nobile, impersonates them on the apps. Alyssa Dineen of Style My Profile helps style clients' wardrobes and craft profiles.

April Davis of the traditional matchmaking service, Luma Search maintains that matchmakers like herself have an advantage because they actually get to meet the suitors in person. But, she said, there is a market need for online dating consultants. "Dating apps are a part-time job," she said, and online dating concierges "are experts at communication and more efficient."

Nobile's clients struggle with the impersonal aspect of online dating, she said. Hollis Johnson/Business Insider

As Nobile puts it, dating apps have "shifted the dynamic of dating in the way we begin relationships and the way the seeds are planted."

Nearly 40% of heterosexual couples in 2020 met their partner online. Since 1980, when dating first hit screens, the percentage of couples meeting in person has decreased, with one exception: Those who met in a bar or restaurant. 

"I'm the bridge that marries the technology with the energy and connection of a real relationship ... it's this chasm that people are missing," Nobile said. 

The toughest hurdle her clients grapple with is that the process is impersonal. Nobile said when it comes to online dating, chemistry often doesn't ignite until you're comfortable in the second or third date.

She admits that there's a perception that online dating is less romantic because people think it's inorganic. But, she noted, it's all about infusing flirtation. 

"We have to figure out a way to communicate our essence, charm, and warmth [online]," Nobile explained, adding that people often mistakenly feel as though they can only introduce flirting once the date is taken offline.

"I have supersmart clients — doctors, lawyers, CEOS — and when I really drill down in my third meeting with them, I find out they have a sixth sense of humor but they're withholding that," she said.

She recalled working with one client, a doctor, who communicated very formally over text and email. "The minute I entered her home, I figured out she had a kooky sense of humor. I infused that in her profile and bantering, and now she's attracting guys who understand her humor."

Nobile described the relationship between romance and technology as a complicated one.

"The more technology proliferates, the lonelier people feel and the need and desperation for love grows," she said. "People are frustrated by technology, but they need it to succeed in love; that dichotomy is baffling to a lot of people."

More than a wingwoman

You may think Nobile is a modern-day matchmaker, or a "wingwoman" or "fairy dating godmother," as some clients refer to her. But she's quick to tell you differently.

"I'm more of a mirror, so people can take a look at who they are, who they want, and meet quality people." 

And if the instant success of Love, Amy says anything, it's that she's a savvy business woman. She landed early press in The New York Times, bringing in an initial wave of business. In 2020, Nobile said she will increase rates twice, though she refuses to comment on specifics regarding earnings.

No matter what, Nobile — who fondly discusses the breast cancer survivor she walked through her first intimate experience after reconstructive surgery and the man in a wheelchair who she'll soon be working with — is adamant that the human touch can't be lost as business expands. While she envisions eventually having ambassadors or a team, right now, she said, it has to be her.

"It takes a certain type of person," Sally said. "Amy understands human nature in a way most people wouldn't and she's got the energy."

After all, Nobile says, everyone is searching for a soul mate.

"At the end of the day, how many people are like 'Oh, I had a crazy awesome career?'" she asked. "No, you're ruminating on love."

Original author: Hillary Hoffower

Chris Martin is the CEO of C. F. Martin & Co., the most famous maker of acoustic guitars in the world.The company was founded by his great-great-great-grandfather, a German immigrant, in 1833.Martin has been steering the company into its third century, tackling numerous challenges while remaining focused on the brand's core value: quality.Visit Business Insider's homepage for more stories.

Christian Frederick Martin IV is a genial, mellow raconteur who shouldn't be mistaken for a man who doesn't know his business.

The 64-year-old CEO has to. It's his job to ensure that the company that bears his name, founded in 1833 by his great-great-great-grandfather, remains the best acoustic-guitar maker in the world.

"It's my obligation to continue to reach for the perfect guitar," he said in an interview at C. F. Martin & Co.'s factory and headquarters in Nazareth, Pennsylvania.

He's not kidding around. For well over a century, the company's acoustic guitars have defined the sound of essentially every musical genre, but particularly country and bluegrass, folk, and rock 'n' roll. Willie Nelson plays a Martin (an especially battered example named "Trigger"). Dolly Parton played a Martin. Joni Mitchell played a Martin. Led Zeppelin's Jimmy Page played a Martin. Hank Williams. Johnny Cash. Eric Clapton. Neil Young. John Mayer. Coldplay's Chris Martin (no relation). Kurt Cobain. Ed Sheeran. Elvis Presley!

And that's just the tip of a vast iceberg that strummed and plucked what Martin has been crafting from wire and wood since before the Civil War. I could occupy your time for many more paragraphs simply reviewing the bluegrass kings who have favored Martin's groundbreaking dreadnought design, which has become the default shape and style of pretty much every inexpensive starter acoustic one can buy. (A modern version of the original, first sold in 1931, can be had for $3,600 as a D-28 model, vintage examples of which from before World War II go for nearly $100,000.)

A brand with a history deeper than almost anyone else's

Elvis was a fan. Matthew DeBord/Insider

If there were ever a company that could rest on its considerable laurels, it's C. F. Martin & Co. With annual revenue of about $120 million and reliable profits, the privately held company operates its famous factory in Pennsylvania, about two hours west of New York City, as well as a plant in Navojoa, Mexico. Its core product is the acoustic guitar, though Martin also manufactures strings, ukuleles, and accessories like straps.

While there's considerable variety in Martin's offerings, what the company is really selling is quality, quality, and more quality. There likely isn't a guitarist on earth who hasn't coveted a Martin at some point.

Chris Martin credits the founder, Christian Frederick Martin (the first), with establishing the brand's astoundingly durable reputation.

"We don't know what possessed him to be a guitar builder," Martin said, adding that C. F.'s family might have been happier had he entered the family furniture business and not been seduced by musical instruments.

C. F. "developed his own style," Martin said, and would take quality as far as he could, always with the musician in mind.

Chris Martin summed up a typical player's attitude toward the company's guitars as "These things aren't cheap, but I need a good tool."

Or, as Clapton put it when discussing several new signature models in 2013, it was Martin that had "the seal of approval from the master musicians."

Avoiding the curse of being just for wealthy guitar players

A worker at Martin's Pennsylvania factory. Matthew DeBord/Insider

That summarizes the Martin philosophy. The priciest guitars are essentially handcrafted by master luthiers in Martin's custom shop, while the least-expensive models, at less than $500, are renowned for their value. And the heart of the lineup is reasonably priced, given the predictable level of performance delivered.

Musicians might prefer Gibson or Taylor or Collings guitars, but they know that if they pick up a Martin, at any price point, it will do more than get the job done.

In that context, Martin's yearly output of about 100,000 instruments is a testament to how effective it's been at pursuing quality in the US and Mexico. And while production in Mexico is now politically complicated, Martin has been committed to it since 1989, when it experimented by shifting string production south of the border. In 2014, the company celebrated 25 years in Navojoa by creating a special commemorative dreadnought model adorned with regional graphics.

Mexico and Asia are the main alternatives to US-based manufacturing, and while the uptick in quality from China and Indonesia in recent years has been stunning, the experience of Martin and others — including Fender, in California — has been that Mexico can deliver a consistently superb guitar at a competitive price.

Guitar tops are cut precisely with lasers. Matthew DeBord/Insider

For Chris Martin, who became CEO in 1986, the move to Mexico was all about making sure his company didn't become so elite that it lost musicians at the beginning of their journey.

"I saw us becoming a brand that people decided they weren't wealthy enough to own," he recalled. "That was never my family's intent. But we can't compromise, and that's an ongoing conversation."

Martin is a trim, witty man who is constantly seeking to keep the family business relevant, and that requires some innovative thinking. For example, when string production moved to Mexico, string makers in Pennsylvania were confronted with job losses. Martin offered them a deal: Learn to build guitars, and stay with us. Some employees chose to retire, but many took him up on the offer.

Martin quality at lower prices has been a boon for the company — and its dealers.

"They say, 'Thank you for giving me a range of guitars,'" Martin said. "Now we can take you from $500 to your heart's desire, and the dealers like that. We need the dealers to make this work."

Managing the challenges and opportunities of e-commerce and sustainability

Inlays in a fretboard. Matthew DeBord/Insider

That's a bold stance to take as the music business shifts from brick-and-mortar sales to e-commerce. And Martin isn't ignoring the opportunity. He knows the company could enjoy robust online guitar sales, if it chose to go that way. But it prefers to work with authorized Martin dealers. (Martin fans can buy accessories, branded clothing, and other modest items via the company's website.)

"It allows you to use the internet as a tool," Martin said, adding that it's critical for retailers to emulate their physical presence in the digital world.

But beyond that, Martin wants customers to put their hands on what they hope to buy, especially if they choose to invest in a limited-edition or custom-made guitar. Chris Martin is a Porsche aficionado — he owns several 911s, the German automaker's iconic sports car — and was inspired by the factory-delivery model. Martin's "Buy from Factory" program enables customers to order a guitar and then visit the factory in Nazareth to collect it, or to select an instrument from the stock on hand.

A more pressing challenge for Martin is literally fundamental. Environmental regulations have restricted manufacturers from importing endangered woods, making it difficult for Martin to continue business as usual in an age of climate change and sustainability.

But Chris Martin isn't backing away from that one either.

"We can take the circuitous route to explain why it matters to us — or I can just say that it's purely selfish," he quipped. "If we don't pursue sustainability, I can tell my daughter to sell this thing as fast as you can."

Martin has embraced Forest Stewardship Council standards for some of its all-solid-wood guitars, and for other models it's blended solid-wood tops made from abundant Sitka spruce with high-pressure laminated body materials and fretboards made of paper-like materials. A few Martins effectively use no solid woods whatsoever. Again, these guitars sound as good as a Martin should, though for the purists the company has to come up with ways to build all-wood versions of its stalwarts and the reproductions of classics that the vintage-guitar market has created a demand for.

Interestingly, Martin's most sustainable guitars are also popular with performing musicians, who appreciate their value, durability, and lack of susceptibility to the temperature and humidity changes that affect all-wood instruments.

Defying the gloom and doom around the guitar business

Pulled into Nazareth. Matthew DeBord/Insider

Observers of the guitar market have argued that the instrument's popularity is in terminal decline, an argument bolstered by a 2017 Washington Post article that lamented the six-string's twilight. But Chris Martin doesn't buy it.

"If you look at very commercial music, sometimes it's hard to find a guitar," he said. "But if you go below that, there's lots of guitars."

He said that for one of Martin's key customer groups — acoustic-only musicians who play house concerts and small venues — there remains abundant grassroots activity.

"The electric-guitar companies are more reliant on a superhero," he said.

So the Martin proposition is no less appealing now than it was 100 years ago. The business renews itself, thanks to the founder's great-great-great-grandson remaining true to the company's principles.

"There's always been a fantastic pool of people who've wanted to work here," said the CEO, whose name is on the headstock of every instrument the company makes.

"The brand has never been as strong as it is today. How many people, when you ask them what they do for a living, they can say, 'I make the best of its kind'?"

Original author: Matthew DeBord

Earlier this week US officials accused Chinese tech giant Huawei of spying for the Chinese government by using telecoms backdoors designed for use by law enforcement.WhatsApp seized on the story as an example of why it shouldn't build backdoors in its encrypted messaging for law enforcement.WhatsApp and its parent company Facebook have been fighting off US government demands to build methods for law enforcement to infiltrate encrypted messaging.Visit Business Insider's homepage for more stories.

The US government may have shot itself in the foot in its ongoing struggle to make tech companies give it access to encrypted messages and devices.

The Wall Street Journal reported earlier this week that US officials accused Chinese tech giant Huawei of spying through backdoors built in telecoms equipment intended for use by law enforcement.

Although the US has long accused Huawei of spying for the Chinese government, this was the first time it gave a specific detail about how it thinks the company does this, saying it had built equipment capable of tapping into "lawful interception interfaces," backdoors purposefully left in telecoms equipment so it can gain access.

Huawei has repeatedly denied spying for China, and refuted the specific allegations made in the Journal piece, calling them a "smokescreen."

Now a major US tech company is using the government's Huawei allegations to push back against it.

Head of WhatsApp, Will Cathcart did an interview with the Wall Street Journal on Wednesday, announcing that the Facebook-owned messaging platform has hit 2 billion users. Cathcart also stressed that WhatsApp plans to hold the line against pressure from the US government to build ways to infiltrate WhatsApp encrypted messaging for law enforcement.

A WhatsApp spokesperson specifically pointed the Journal to the Huawei case as an example why WhatsApp shouldn't grant the government's wish. The argument runs that backdoors pose a broad security risk as even if they only intended to be used by law enforcement, they could be exploited by other malicious actors.

Privacy experts also worry backdoors could be used as tools for mass surveillance by authoritarian regimes.

"The US government's concern about possible backdoors in Huawei-built networks only underscores why it is untenable for the government to demand that US-based tech companies create backdoors for domestic law enforcement agencies," Andrew Crocker, Senior Staff Attorney at the digital rights group the Electronic Frontier Foundation, told Business Insider in a statement. "Once built, these mechanisms can be co-opted by governments around the world." 

Facebook isn't the only tech company fending off demands to break encryption. Apple also tangled with the government in 2015 when the FBI demanded it help the agency break into a shooter's iPhone. Apple refused, and eventually the FBI dropped its court case against the company, after saying it had found a third party capable of helping it open the phone.

Last month, the FBI made a similar request which Apple once again denied, prompting President Trump to lash out at the company on Twitter.

Original author: Isobel Asher Hamilton

Head of WhatsApp Will Cathcart told the Wall Street Journal the app now has 2 billion users.WhatsApp has accumulated 500 million more users since 2018, but still has fewer users than the core Facebook app.Cathcart stressed that WhatsApp is going to fight to keep its platform encrypted and private despite pressure from the US government and others to build ways for law enforcement to access private chats.Visit Business Insider's homepage for more stories.

WhatsApp is bracing itself for a clash with the US government over encryption.

In an interview with the Wall Street Journal published Wednesday, head of WhatsApp Will Cathcart revealed the messaging app has now hit 2 billion users, up from 1.5 billion two years ago. It still falls behind Facebook core app, which has 2.5 billion users worldwide.

Cathcart used the interview as a chance to draw a line in the sand over end-to-end encryption, the system that allows WhatsApp users' messages to stay private and inaccessible even by WhatsApp itself.

Recently WhatsApp and its parent company Facebook have come under pressure from the US government to create ways for law enforcement to circumvent encryption. Attorney General William Barr last year asked Facebook to delay its plans for encrypting all its messaging platforms — which Facebook rejected.

"For all of human history, people have been able to communicate privately with each other [...] And we don't think that should go away in a modern society," Cathcart told the Journal.

The US isn't the only government that's been pressuring WhatsApp to provide encryption backdoors. Last year the allied "Five Eyes" countries (the US, UK, Canada, Australia, and New Zealand) united in pushing for encrypted services to build "safeguards" for law enforcement — but stopped short of calling for actual technological "backdoors," security vulnerabilities deliberately left in a system.

The argument against backdoors runs that they weaken the system as a whole as they could be exploited by malicious actors other than law enforcement.

Cathcart said that despite Faceook CEO Mark Zuckerberg's grand plans to weave together Facebook's suite of social media platforms including Instagram and WhatsApp, WhatsApp's engineers are still focused on a constrained set of products comprising private messaging, payments, and customer-service tools for businesses.

Original author: Isobel Asher Hamilton

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British oil-and-gas titan BP said on Wednesday that it aims to reduce its total emissions to net zero by 2050 and shift investment to renewable energy.Bloomberg TV anchor Alix Steel asked BP CEO Bernard Looney why he doesn't leave clean energy to companies like Tesla that can "think out of the box in a particular way" and aren't "moving a company around that's 110 years old.""Why are you not Elon Musk?" she asked."I struggle enough with who I am," Looney replied.Visit Business Insider's homepage for more stories.

One of the world's biggest oil-and-gas companies announced on Wednesday that it aims to reduce its total fossil-fuel emissions to net zero by 2050, and shift investment away from conventional fuel sources to renewable ones. Tesla CEO Elon Musk's name quickly came up.

"We are aiming to make absolute reductions to net zero of around 415 million tonnes of emissions — 55 million from our operations, 360 million from the carbon in our upstream production," Bernard Looney, who became CEO of 110-year-old British energy giant BP this month, said in a presentation.

"That is not far off the total emissions of the United Kingdom, the world's sixth largest economy and the second-biggest national economy so far, to set a net-zero aim," he continued.

Bloomberg TV anchor Alix Steel asked Looney how BP could overhaul its business without investors losing out.

"You have returns for oil-and-gas investments that can be plus 25%," she said. "For renewable investing, you're looking at 8% to 10%. You need the cash flow from the oil and gas to fund the transition."

"Why is this not better left to Google, Amazon, and Tesla?" she asked. Players outside of oil and gas can do "all the cool new energy things" and "at least in Tesla's case, have the ability to think out of the box in a particular way," she continued. They aren't "moving a company around that's 110 years old," she added.

"Why are you not Elon Musk?" Steel asked.

"I struggle enough with who I am," Looney replied. He redirected the question to Nick Boyle, the CEO of Lightsource Renewable Energy, a solar-energy specialist that BP bought a 50% stake in two years ago.

"He is Elon Musk," Looney joked.

"Thank you, Bernard," Boyle said. "No pressure."

Oil-and-gas companies should lead the clean-energy revolution because they specialize in delivering large engineering projects in remote places, know energy markets inside out, and boast the trading capability and financial resources to drive through renewable-energy initiatives, Boyle said.

Fossil-fuel giants like BP have "powered the world for the last 100 years" and are "in a perfect position to power the world the next 100 years," he added.

Original author: Theron Mohamed

SoftBank CEO Masayoshi Son wants the Japanese conglomerate to be seen as an investment company, not an operating one.Son used the rabbit-duck illusion to make his case during SoftBank's earnings presentation on Wednesday.He urged investors to look at SoftBank's "shareholder value," not its revenues and profits.Asked if he had turned from Bill Gates into Warren Buffett, Son replied that he was more adventurous than Buffett and "still making some craziness."Visit Business Insider's homepage for more stories.

SoftBank CEO Masayoshi Son wants the Japanese conglomerate to be viewed as an investment company, not an operating one. He used the rabbit-duck illusion, shown above, to make the case during his third-quarter earnings presentation on Wednesday.

"What do you see?" the boss of the $100 billion company asked the crowd of investors and analysts. "From your left, it looks like a duck. From your right — in the same picture, same slide — it looks like a rabbit."

The eccentric executive — who invested $20 million in Alibaba back in 2000 after noticing a "sparkle" in the eyes of founder Jack Ma — argued that SoftBank could be viewed two ways as well. He showed a slide that was split down the middle, with "EBIT" (earnings before interest and tax) on the left and "shareholder value" on the right.

"Looking from left, EBIT; looking from right, shareholder value," Son said. "If you want to know how SoftBank is performing, not from the left, you have to look at SoftBank from the right."

Son's view isn't surprising, given SoftBank's operating income nosedived 99% last quarter, from nearly $4 billion to less than $25 million. The decline stemmed from its Vision Fund, which posted a $2 billion loss after writing down the value of its investments in WeWork, Uber, and other businesses.

Instead of profits, Son urged the crowd to focus on SoftBank's shareholder value — the equity value of its holdings minus net debt — which swelled by 22% to $228 billion between the end of December and February 12. A key driver was Uber's stock rallying by more than a third this year.

"Like I said, from left, you see the face of a duck; from right, you see the face of a rabbit," Son concluded.

Given SoftBank is now an investment company rather than an operating company, its revenues and profits are "irrelevant," Son said in his presentation. "You can forget about those numbers."

A journalist asked Son if he was now an investor instead of a businessman. Son pointed to Warren Buffett, the billionaire investor and Berkshire Hathaway CEO, as an example of someone who's considered both.

"So you have changed from Bill Gates to Warren Buffett?" was the next question. 

The comparison was fair, "roughly speaking," Son replied. "Mr Buffett and myself are a little bit different," he continued. "I'm the one that's leading the information revolution."

The SoftBank chief added that he's not as conservative as the 89-year-old Buffett, who famously invests in proven, profitable companies.

"Mr Buffett is not an adventurous investor, he's a smart one," Son said. "But I'm still making some craziness."

Son, who visited Buffett three years ago to seek an investment in SoftBank-owned Sprint, has looked up to the investor for years.

"Warren Buffett in the technology industry, that is what I would like to become," he said in an earnings presentation in 2017.

SoftBank is the "Berkshire Hathaway of Internet," Son said in an earnings briefing in 2012.

Original author: Theron Mohamed

Snapchat is testing a major redesign of its flagship app.According to The Verge's Casey Newton, the company is carrying out two tests rolled out to a small percentage of Snapchat's user base.The first is a test of breaking news headlines inside the app.The second is a redesign of the app's features and layout, including five screens rather than three, the relocation of its Snap Map, and the introduction of a navigation bar."We're exploring ways to streamline navigation across Snapchat, soliciting feedback from our community to inform future versions of our app," a Snap representative told Business InsiderVisit Business Insider for more stories.

Snapchat is testing a major redesign of its flagship app.

According to The Verge's Casey Newton, citing screenshots sent by anonymous sources, the company is carrying out two tests rolled out to a small percentage of Snapchat's user base.

One test is said to involve the introduction of breaking news headlines related to US and world news from selected news publications including NowThis, the Wall Street Journal, and the Washington Post.

In a section of the app called "Happening Now," these headlines are curated and can be tapped to bring up a full-screen news brief containing a photo and a short article.

The second is a redesign of the app's features and layout, including five screens rather than three, the relocation of its Snap Map, and the introduction of a navigation bar.

"We're exploring ways to streamline navigation across Snapchat, soliciting feedback from our community to inform future versions of our app," a Snap representative told Business Insider on Thursday. "This test's UI offers more space to innovate and increases the opportunity to engage with and discover even more of what Snapchat has to offer. This test is currently visible to a small percentage of our users."

The navigation bar's introduction is especially interesting, as it's a feature Snapchat has long resisted introducing despite the app's ease-of-use.

Indeed, the app's user unfriendliness was what drove Snapchat CEO Evan Spiegel to launch its previous big redesign. This introduced a friends page that included both chat messages and ephemeral stories, and feed that prioritized posts from close friends, among other features.

Snapchat will have to be careful this time round, though, as that overhaul – which took place in 2017 – was not met well by users. The company said it lost 2% of its 191 million daily users as a result of the redesign, while over 1 million people signed a petition urging it to reconsider the changes.

Original author: Charlie Wood

Cisco CEO Chuck Robbins. Business Insider

Good morning! This is the tech news you need to know this Thursday.

The CEO of Cisco disagreed with a Trump administration proposal to take an ownership stake in Nokia and Ericsson to counter China's 5G offensive. Chuck Robbins said he disagreed with a Trump Administration proposal to buy an ownership stake in Ericsson and Nokia to counter China in 5G.Apple has added $18 billion in market value after its Chinese factories accelerated their post-coronavirus re-openings. Foxconn, which produces Apple's iPhones and Airpods, hopes to resume 80% of all China production in March, according to Reuters.Google says the EU's hardline antitrust punishments threaten internet innovation as it starts the first of three legal battles against $9 billion in EU fines. The tech giant has criticized the EU's antitrust measures as it begins to challenge the EU's strict antitrust punishments.SoftBank's Masayoshi Son is reportedly considering a new type of fund for startup investing as the Vision Fund 2 struggles to gain funds. According to Bloomberg, Son may make startup investment deals using only SoftBank's capital for one or two years.Tesla is recalling 15,000 Model Xs because of a power-steering issue. On its website, the electric carmaker said it's recalling most of the Model X SUVs it built before October 2016.Amazon's top spokesman has blasted politicians and 'elite newspapers' for falsely accusing Amazon of 'taking over grocery in America'. Jay Carney made the remarks after the Federal Trade Commission announced an antitrust probe into acquisitions made by Amazon and other tech giants.Facebook's ambitious plan to build a constellation of satellites isn't dead — and it could launch the first one into space as soon as March 2020. Years of scandals haven't dimmed Facebook's extraterrestrial ambitions.Facebook's dating app rollout in Europe has been delayed after regulators raise questions about data privacy. The social media giant recently launched its in-app dating feature in the United States, and was scheduled to launch it in Europe the day before Valentine's Day.Android founder Andy Rubin's startup Essential is shutting down, saying there is 'no clear path' to deliver its new phone to customers. The three-year-old company was initially regarded as a promising venture, but struggled as its product the Essential Phone failed to gain traction.Jeff Bezos has reportedly broken California's record for the most expensive home sale of all time with his purchase of a $165 million Beverly Hills mansion. The Amazon CEO's new estate was originally designed for Warner Bros. executive Jack Warner in the 1930s and features a nine-hole golf course.

Have an Amazon Alexa device? Now you can hear 10 Things in Tech each morning. Just search for "Business Insider" in your Alexa's flash briefing settings. You can also subscribe to this newsletter here — just tick "10 Things in Tech You Need to Know."

Original author: Charlie Wood

The Federal Trade Commission's move to probe past acquisitions by the big tech firms is one more regulatory worry for those companies.The agency plans to study the "hundreds" of deals the companies have made over the last 10 years that the companies hadn't previously had to report to it.There's growing concern inside and outside the agency that the companies have used such deals to quash nascent competitors.As a result of the study, the FTC could force the companies to unwind some of their past purchases or submit prospective ones for its review, legal experts said.Click here for more BI Prime stories.

In recent years, the big tech companies have made dozens of acquisitions that have largely flown under the radar screen, because the firms they acquired were relatively small.

Those acquisitions are now on the radar screen of regulators, most notably the Federal Trade Commission, which announced on Tuesday that it was going to be examining smaller-scale purchases made in the past by Microsoft, Google, Facebook, and Amazon. That's not a good sign for those companies. The FTC's study could result in much greater scrutiny of any future purchases of small startups that they make or in the agency forcing them to undo some of their past acquisitions.

"I think this is a first step that could lead to enforcement action. It could lead to new policies," said Doug Melamed, a professor of the practice of law at Stanford Law School.

US antitrust law — under the Hart Scott Rodino Act — requires larger companies that plan to make acquisitions over a certain size to notify antitrust authorities at the FTC and the Department of Justice. Regulatory authorities at those agencies often review those purchases and, in some cases — such as the attempt by the parent company of Schick razors to buy startup shaving company Harry's — they move to block them.

But companies have no duty to notify regulators about smaller acquisitions. The assumption is that such transactions don't generally affect competition in a significant way and that regulators should focus their time and resources on the bigger deals.

Some worry that small acquisitions could cause big problems

Some experts and market observers, though, have started to question that assumption. In the tech industry, there are relatively few large-scale deals that are subject to government review. But there are lots of smaller deals each year that go unreported to regulators. In a conference call with reporters, FTC chairman Joe Simons estimated that the number of purchases the big five companies have made over the last decade that weren't previously disclosed to his agency numbers in the hundreds.

At least some of those deals could have affected competition by allowing the dominant firms to extinguish nascent, would-be competitors. Just such concerns were raised when Facebook two years ago snapped up tbh, a fledgling social media app that was targeted at teens. Facebook shut down tbh less than a year after acquiring it.

"There's a huge question here of the shadow that the big-tech firms cast across Silicon Valley or across the startup world," Melamed said.

The study comes amid growing scrutiny of the tech giants. The European Union has already hit Alphabet with three fines of more than a billion dollars each for anti-competitive actions and has begun probes into Apple, Facebook, and Amazon. Meanwhile in the US, federal and state regulators have launched antitrust probes into those four companies. The FTC's action is likely a part of that broader inquiry into and reassessment of the power of the tech companies, legal experts told Business Insider. 

But the questions go beyond Silicon Valley. In a statement that accompanied the FTC's announcement of its study, the agency's two Democratic commissioners urged it to look at the impact smaller-scale acquisitions have had in industries beyond tech. The dialysis industry has consolidated into two major national players, and research indicates the two companies gain power through making numerous acquisitions that were below reporting thresholds.

"Similar patterns of 'stealth consolidation' have been observed in pharmaceutical and hospital markets," commissioners Christine Wilson and Rohit Chopra said in their statement. "We urge the Commission to consider similar ... studies across other industries to ensure that we have a more complete understanding about the competitive effects of non-reportable mergers writ large."

The FTC has plenty of power

While the study represents the agency's first broad look at small-scale mergers in the tech industry, it's not completely unprecedented. The FTC has wide-ranging authority under the Federal Trade Commission Act to conduct studies into how industries or businesses operate, and it has used that authority in the past to examine mergers and competition in particular industries.

There's good reason for the agency to conduct this particular study, the legal experts said. Not a lot is known about how all the small acquisitions made by the tech giants are affecting competition in the industry, they said.

While there's growing concern about that the big companies are quashing competition, "there hasn't been, as yet, great studies and great data to demonstrate something like that is going on," said Prasad Krishnamurthy, a professor at the University of California-Berkeley's law school. He continued: "There is a dearth of research on the topic."

It's too early to know what the study will find or how the agency or other policymakers will respond to it. But one potential outcome could be that the FTC forces the big tech firms to undo some of their previous small-scale mergers. Simons himself suggested on the call that the agency could head in that direction as part of its inquiry.

The agency has the authority to undo mergers and acquisitions after the fact — even ones that weren't required to be reported to it. It did just that late last year when it ordered the dissolution of a merger between two prosthetic knee companies, finding that their combination was anticompetitive. The merger had taken place two years earlier and had not been subject to Hart-Scott-Rodino reporting requirements.

Unwinding mergers after the fact is "not widely done, for obvious reasons, but it has been done
and they have the power to do it," said Donald Polden, a professor at Santa Clara University School of Law.

The FTC could also step up its scrutiny over small-scale acquisitions in the future, whether by individual firms or across the board. The latter, though, likely would require Congress to update Hart-Scott-Rodino, Polden said.

Krishnamurthy is hopeful that one of the outcomes of the study will be that the big tech companies have to start notifying regulators even when they make these kinds of smaller acquisitions, because of the general worry about their impact on competition.

"This is not a concern that is going to go away," he said.

Got a tip about the tech industry? Contact this reporter via email at This email address is being protected from spambots. You need JavaScript enabled to view it., message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.

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Original author: Troy Wolverton

In the past year, Google Cloud has announced it will acquire the data analytics company Looker, as well as smaller companies like Alooma, Elastifile, and CloudSimple. At the Goldman Sachs Technology and Internet Conference on Tuesday, Google Cloud CEO Thomas Kurian said that acquisitions are a way for the company to expand its reach.Kurian also said that Google Cloud is not dependent on acquisitions to grow, but it will make acquisitions "appropriately when the time is right."Visit Business Insider's homepage for more stories.

It's been about nine months since Google Cloud announced it would acquire data analytics company Looker, the biggest acquisition by CEO Thomas Kurian. And to hear Kurian talk, it seems like he's not done shopping yet. 

At the Goldman Sachs Technology and Internet Conference in San Francisco on Tuesday, Kurian described how vital acquisitions are to Google Cloud's overall strategy, which is focused squarely on catching up to larger rivals Microsoft and Amazon in the cloud market.

"We look at our ability to expand our reach through complementary products in the market segments we're in, and one of the benefits of scaling our direct and indirect distribution is when we acquire something, we now have a much more scaled distribution channel through which to inject the technology into market, thereby allowing us to accelerate things," Kurian said.

According to a recent filing by Google Cloud's parent company Alphabet, the $2.4 billion acquisition of Looker is almost through all of the regulatory hurdles and on track to close soon. Analysts have said the Looker acquisition is a shot at Microsoft, Amazon, and Oracle, which all have competitive offerings. 

But Google Cloud has been busy making a string of smaller, less high-profile acquisitions on Kurian's watch too.

Besides Looker, Google Cloud also announced acquisitions of the data migration startup Alooma, Alphabet's cybersecurity company Chronicle, the file storage company Elastifile, and the VMware partner CloudSimple. Most recently, Google Cloud announced it will acquire AppSheet, which makes it easier for people to build mobile apps.

Last year the company completed a total of $1 billion worth of acquisitions according to Alphabet's most recent 10-K filing, a figure that includes deals made by Google Cloud as well as other business that are part of Alphabet.

When Kurian first took the reins as CEO, analysts said he was likely to make some large acquisitions because of his background at Oracle, which makes M&A a big part of its strategy. So far, he's lived up to expectations.

Still, Kurian said, Google Cloud is not completely relying on acquisitions

"We are very focused on executing our plan," Kurian told the audience. "We're not dependent on acquisitions to grow. We've obviously shown that, and we'll make acquisitions appropriately when the time is right."

Do you work at Google Cloud? Got a tip? Contact this reporter via email at This email address is being protected from spambots. You need JavaScript enabled to view it., Signal at 646.376.6106, Telegram at @rosaliechan, or Twitter DM at @rosaliechan17. (PR pitches by email only, please.) Other types of secure messaging available upon request. You can also contact Business Insider securely via SecureDrop.

Original author: Rosalie Chan

Cisco CEO Chuck Robbins disagreed with a recent Trump Administration proposal for the US government to invest in Ericsson and Nokia in order to counter China's gains in 5G.Robbins was reacting to Attorney General William Barr's statement last week that the US should take an ownership stake in the European telecom giants to prevent China, particularly Huawei, from dominating the 5G wireless market."I don't think the US government should make investments in these companies," Robbins told analysts on Cisco's fiscal second quarter earnings call. "I actually think the US is in fine shape. I think both from a carrier deployment perspective, I think we're in great shape. And I think we're in a good position with the technology."Cisco shares fell 4% after hours after the company reported lower revenue, although the tech giant beat Wall Street estimatesClick here for more BI Prime stories.

Cisco CEO Chuck Robbins said he didn't think the United States should invest in Ericsson and Nokia which the Trump Administration has proposed as a way to counter China's 5G offensive.

Robbins was reacting to Attorney General William Barr's suggestion that the US should take an ownership stake in the European telecom giants to prevent China, particularly Cisco rival Huawei, from dominating the 5G wireless market.

Barr's comments last week sparked a rally in Nokia and Ericsson shares, and the issue came up during Cisco's fiscal second-quarter earnings call on Wednesday when an analyst asked Robbins "on this whole 5G investment commentary coming, you know, coming out of the government."

"I don't think the US government should make investments in these companies," Robbins responded, as he also suggested that the US had a strong position when it comes to 5G, the next generation superfast wireless technology that's expected to lead to dramatic changes in networks.

"I don't think the US government should make investments in these companies," Robbins told analysts on Cisco's fiscal second quarter earnings call. "I actually think the US is in fine shape. I think both from a carrier deployment perspective, I think we're in great shape. And I think we're in a good position with the technology."

Robbins said he has helped political leaders in Washington understand the US position in the 5G rollout.

"Obviously, they're very interested in having US companies participate in 5G and, frankly, lead in 5G," he said. "We've spent a lot of time helping them understand that and working to make sure that there's a recognition that there's a lot of technology that's been built and being built here in the United States that is leading in these 5G infrastructures."

Cisco shares shed 4% late Wednesday after the tech giant reported a dip revenue, although its results beat Wall Street estimates.

Cisco reported a profit of $2.9 billion, or 68 cents a share, compared to a profit of $2.8 billion or 63 cents a share for the year-ago quarter. Revenue slipped 4% to $12 billion. Adjusted profit was 77 cents a share. 

Analysts had expected the company to report a profit of 76 cents a share on revenue of $11.98 billion.

Got a tip about Cisco or another tech company? Contact this reporter via email at This email address is being protected from spambots. You need JavaScript enabled to view it., message him on Twitter @benpimentel or send him a secure message through Signal at (510) 731-8429. You can also contact Business Insider securely via SecureDrop.

Original author: Benjamin Pimentel