Sequoia Capital partner Michael Moritz John Phillips/Getty

Sequoia Capital partner Michael Moritz has argued that Silicon Valley employees spend too much time pushing for benefits like time off and paternity leave, while their Chinese counterparts are forging ahead by working 12-hour days and working weekends. Moritz made the comments in an opinion piece for The Financial Times.

Welsh-born Moritz is a highly influential venture capitalist, with early investments in Google, LinkedIn, and PayPal. He was also on the board of travel company Skyscanner when it sold to Chinese firm Ctrip in 2016 for £1.4 billion.

In his opinion piece, Moritz praised the "furious" pace of work in China. Californian employees, he argued, expected too much — like having time off at the weekend.

He wrote: "Here [in China], top managers show up for work at about 8am and frequently don’t leave until 10pm. Most of them will do this six days a week — and there are plenty of examples of people who do this for seven."

Later in the piece, he added: "If a Chinese company schedules tasks for the weekend, nobody complains about missing a Little League game or skipping a basketball outing with friends."

He drew unflattering comparisons with Californian tech firms, and complained that debates around paternity leave and political correctness were a distraction from work.

Here's what he wrote, emphasis ours:

"In California, the blogosphere has been full of chatter about the inequity of life. Some of this, especially for women, is true and for certain individuals their day of reckoning has been long overdue. But many of the soul-sapping discussions seem like unwarranted distractions. In recent months, there have been complaints about the political sensibilities of speakers invited to address a corporate audience; debates over the appropriate length of paternity leave or work-life balances; and grumbling about the need for a space for musical jam sessions. These seem like the concerns of a society that is becoming unhinged."

Moritz does not give examples of "distractions" such as paternity leave and conference speakers being criticised for their views.

Facebook — which is not a Sequoia portfolio firm — has been forefront of the paternity leave discussion in Silicon Valley. CEO Mark Zuckerberg revealed in August he would take two months of paternity leave after the birth of his second child, an unusual move in a country where there is no guaranteed paid leave for new mothers.

Mark Zuckerberg with his daughter Max. Mark Zuckerberg/Facebook

There also are not many public examples of corporate speakers being forced off a schedule due to their views.

It's possible Moritz had Y Combinator president Sam Altman in mind. Altman was widely criticised in December for a controversial blog post in which he too drew unflattering comparisons between China and California, specifically around the discussion of uncomfortable ideas.

Altman wrote: "Earlier this year, I noticed something in China that really surprised me. I realized I felt more comfortable discussing controversial ideas in Beijing than in San Francisco. I didn’t feel completely comfortable—this was China, after all—just more comfortable than at home." Later in the post, Altman argued that a physics genius should be permitted to say "disparaging things about gay people" if it led to new ideas.

Curiously, Moritz doesn't acknowledge that he is comparing a highly developed country with an emerging economy, nor does he acknowledge that long hours can encourage greater inefficiencies due to tired and demotivated workers.

It's not the first time Moritz has been bullish about China. In a 2015 interview with Business Insider, he said Europe tended to "underestimate" China, citing Tencent, Alibaba, and Huawei.

A scientist works at Zai Lab's drug development facility in Shanghai, China October 18, 2017. Reuters

Over the past few years, biotech startups have been successful at raising large amounts of capital just as they're starting out. It's led to a lot of unicorns, with multi-billion-dollar valued companies having raised hundreds of millions in their series A or B rounds.

But it begs the question: Is all this money flowing into biotech so early on a good thing?

On a recent trip to San Francisco, Business Insider posed this question to venture capitalists. For the most part, there was a sense of excitement about the money itself flowing into the industry, mixed with concern that expectations might be set too high. 

"I think we are in a situation, which for companies is seemingly positive, where we have a lot of capital being put to work and a lot of capital sources coming into the U," Carol Gallagher, a partner at New Enterprise Associates, told Business Insider.

"I think history would tell us that at some point there can be too much capital and it's not really discerning, and so then what happens is companies get funded and maybe take longer, or don't actually have the right team or right science and get funded anyway, and there's a disappointment."

A new inflection point

One reason startups could be raising more money earlier in their existence, according to Gallagher, could be because it's taking longer to get to the point where investors are willing to fund the company even more. Instead of getting funding after, say, bringing a drug into animal trials, companies now need to get to the point where the treatment's tested in humans in order to get more funding needed to run those trials. 

"The larger size of the series A is coming more from this realization that there just really isn't a value inflection that's very significant ahead of the actual clinical proof of concept," Gallagher said. That's because at an earlier stage where the treatment is being tested in animals, there's still a good chance that the treatment might not work in humans.

"I think that one of the biggest challenges for our industry will be that we just aren't that good at being predictive," she said. 

Jon Norris, managing director for Silicon Valley Bank's healthcare practice, told Business Insider that oftentimes while the round number might look quite large, the deals are tranched, meaning that the round may be for $75 million, but initially the company may get a fraction of that. As the company progresses through development, they may start to get more.  

Betting on more multi-billion dollar biotechs 

Alexis Borisy, a partner at Third Rock Ventures, said that the reason some companies are raising larger funding rounds early on may have more to do with what the company is trying to develop.

"I think the question is more, 'What is the company trying to build? What is the fundamental innovation?' and 'What's the right amount of capital to assemble the right team, build the right culture, go deploy what you're doing in that field of science and medicine to the point where you are really going to be doing something?'" Borisy said. 

The number of biotech startups he sees launch in any given year hasn't grown, he said. The same is true for the number of billion-dollar exits he's seen that would validate a large amount of funding so early on. For the amount of funding going in at an early stage to pan out, there would need to be more multi-billion-dollar companies resulting from it for it to benefit investors. 

"There's a lot of capital in this space, which is great I think for patients," Borisy said. "I think it's great returns for society. As far as, will all that money have great financial returns, the general math would suggest that it's probably not going to be true."

Avoiding hype

In some cases, certain startups have just been overhyped to their sky-high valuations.  In those instances, venture capitalists, including those in corporate venture arms, have to pass their own judgment.

"Are we going to try to compete with those? Probably not, because we're not going to believe the valuations, we'll do our own calculations, because if we're going to overpay for the valuation then we know we will have to take a P&L hit," Tom Heyman, president of J&J's Development Corporation, the oldest life sciences corporate venture fund, told Business Insider. 

That requires some restraint to wait on the sidelines.

"There's a discipline that says we're not going to be a momentum players, we’re not going to follow the hype of celebrity," Gallagher said.

Microsoft has named Matt Booty the new corporate VP of Microsoft Studios, the division that incorporates Xbox and all of its gaming efforts.

As VentureBeat first reported, Booty was one of the key people in Microsoft's "Minecraft" business, and his promotion is crucial to the company's overall gaming strategy and ambition.

Back in September, CEO Satya Nadella appointed previous Microsoft Studios VP Phil Spencer as an executive VP in the company's top board, alongside the people overseeing Windows 10, the Surface brand, the Office 365 suite, and more.

This move had left the position vacant, and Booty is now stepping up to fill in. VentureBeat reports that executives said that this sets in motion a "clear succession plan" for the firm's gaming business.

Spencer, who reports directly to Nadella, will remain in charge of the overall gaming strategy for the company, while Booty — who reports to Spencer — will have to execute that strategy with the help of all the other studios' heads, who will now report to him.

Booty's team includes first-party development houses like 343 Industries, The Coalition, Mojang, Rare, Turn 10 Studios, and Global Publishing. Spencer said that Booty will be in charge of managing and expanding those operations, as part of a larger company plan to devote more resources to its gaming arm.

"I wanted to make sure we had the right organization in place to deliver on our content goals. With that, I made the decision that I wanted to anoint a leader of our Microsoft Studios organization, which if you've tracked it, I've had the leaders of our individual franchises reporting to me for the last three and a half years," Spencer told VentureBeat.

"That's been great in driving our all-up strategy and getting us to the point where Satya was willing and eager to make the investment in gaming that he's made, but it's also become very clear to me that we're going to invest more in content, which we are doing, and that a unified studios leadership organization was going to be critical to our long-term success."

Get the latest Microsoft stock price here.

Amazon CEO Jeff Bezos. Isaiah Downing/Reuters

Good morning! Here is the tech news you need to know this Friday.

1. Intel has admitted the Spectre and Meltdown patches have impacted the performance of a broad range of processors. Those include chips of the Ivy Bridge, Sandy Bridge, Skylake, and Kaby Lake families, with a performance impact between 2% and 25%.

2. Snap reportedly laid off about 24 people across eight different teams, mostly in the unit that curates users' videos. Some staff have reportedly asked to be relocated to Los Angeles too.

3. Spotify has partnered with eight firms, including BuzzFeed, to launch a new initiative called Spotlight. The podcast-like feature will have news as well as political programming, and is part of a company effort to diversify its revenue stream.

4. Amazon has narrowed down the search for its second headquarter (HQ2) to 20 cities from 238 proposals. Toronto is joined by 19 US cities, and the firm is expected to make the final choice sometime this year.

5. WhatsApp has officially announced a free Android app for businesses. The app, simply called WhatsApp Business, is coming to the US, UK, Mexico, Italy, and Indonesia first, with a global rollout planned for the coming weeks.

6. Apple announced it will fix iOS' most recent bug with an update sometime next week. The bug, called "chaiOS," allows users to send a malicious link and make the Messages app crash upon receipt.

7. Uber has closed its $8.8 billion (£6.3 billion) deal with SoftBank, which now controls 15% of the company. New board member Rajeev Misra said that the firm should return to focus on the US, Europe, Latin America, and Australia to become profitable.

8. Microsoft has promoted "Minecraft" boss Matt Booty to corporate VP of Microsoft Studios. He will oversee game development and publishing for Xbox, PC, and mobile.

9. Instagram has updated its app with an optional feature that displays when you last logged in. It's visible by default only to users you have talked to via direct messages.

10. Google software engineer Grzegorz Milka has revealed during a conference that, as of now, less than 10% of active Google accounts use two-factor authentication. He also said that only about 12% of US customers have a password manager to protect their accounts.

Reuters/KCNA

North Korea's involvement in major hacking offensives appears to be growing.

The country has been linked to a recent attack on South Korean cryptocurrency exchanges, according to cybersecurity experts. 

Researchers from the US cybersecurity firm Recorded Future say a new hacking campaign targeting South Korean cryptocurrency exchange Coinlink employed the same malware code used in the 2014 attack on Sony Pictures and last year's global WannaCry attack.

Beginning in late 2017, hackers attempted to collect the passwords and emails of employees at Coinlink, but were unsuccessful.

Recorded Future released a full report on Tuesday analyzing the methods used in the recent Coinlink attack, versus methods used in previous cyberattacks. The firm found what it called strong evidence that a cybercrime unit called the Lazarus group was behind the Coinlink attack, as well as several previous large-scale campaigns, based on the type of code they have used in previous attacks.

According to the report, the Lazarus group operates under a North Korean state-sponsored cyber unit.

The group has been conducting operations since at least 2009, when they launched an attack on US and South Korean websites by infecting them with a virus known as MyDoom, the report said. The group has mainly targeted South Korean, US government, and financial entities, but has also been linked to the major attack on Sony Pictures in 2014.

In recent years, researchers noticed a change in North Korean cyber operations as they began to shift their focus to attacking financial institutions in order to steal money to fund Kim Jong Un's regime, the report said.

In 2017, the group began targeting cryptocurrencies, and their first offensive was aimed at Bithumb, one of the world's largest bitcoin exchanges. Lazarus hackers stole $7 million in the Bithumb heist at the time, according to the report.

The WannaCry attack in 2017, which affected computer systems at schools, hospitals, and businesses across 150 countries, also used malware code that was linked to Lazarus.

Additionally, a December attack on the South Korean bitcoin exchange YouBit reportedly mirrored previous North Korean offensives, leading experts to suggest that groups associated with the North were behind that attack as well.

Recorded Future's report comes amid recent allegations that North Korea has begun mining and hacking cryptocurrencies in order to sidestep crippling economic sanctions.

“This is a continuation of their broader interest in cryptocurrency as a funding stream,” Priscilla Moriuchi, director of strategic-threat development at Recorded Future, told the Wall Street Journal this week.

The US has released statements blaming North Korea for several recent attacks. But  North Korea still denies any involvement, despite mounting evidence.

Get the latest Bitcoin price here.>>

Australian software giant Atlassian, known for its popular collaboration tools, including Jira, Confluence, and HipChat, is on something of a tear.

Its stock has nearly doubled in the last year. And in its most recent quarter, which the company announced Thursday, its revenue hit $212 million, up 43% from the same period a year earlier.

That's put the company tantalizingly close to a big achievement, noted Atlassian President Jay Simons, in an interview with Business Insider.

"We're kind of knocking on the door of $1 billion in [annual] revenue," he said. "That's a milestone to be proud of." 

Driving Atlassian's growth is what BTIG analyst Joel Fishbein, in a note to clients, recently called a "viral sales strategy." The company doesn't have a direct sales team. Instead, it attracts new customers largely through word of mouth. The approach seems to be working; Atlassian added 5,000 new customers in its most recent quarter, Simons said.

"Customers are buying our products; we're not selling them," he said.

The company is expanding globally, opening up new customer contact centers all over the world. It's also betting big on recent acquisitions such as Trello, a project management tool that puts Atlassian into more direct competition with Microsoft Office.

Still, much of Atlassian's growth is coming from its existing corporate and institutional customers, Simons said. Typically, the company's tools initially found traction with customers' programmers, IT staff, and other technical workers. Now they're starting to attract users in customers' legal departments, sales teams, and other nontechnical departments, he said.

"There's still a lot more teams to reach," Simons said. 

Atlassian had a minor setback on Thursday. Its stock plunged about 5% after the company announced a $65 million loss that was partially due to changes brought by the recently passed tax law.

Despite that, per Nasdaq, Atlassian is rated a "Strong Buy" by seven out of the 11 financial analysts covering the company, with the rest rating it a "hold."

Instagram has a new feature that tells your friends when you were last checking the app,  and it's turned on by default. 

People started noticing the new feature in the Instagram apps for iOS and Android on Thursday. Thankfully, it doesn't tell everyone when you were last on Instagram — only the people with whom you share private messages, or those you tag in your Instagram Stories.

For those people, it shows the last time you opened the app, or the last time you were on the Instagram messaging screen.INstagram

 

Luckily, if you'd rather keep your Instagram addiction to yourself, it's easy to turn the feature off.  

Tap on your profile page, then click on the settings gear underneath to your name, next to "Edit Profile." Inside the settings menu there's a toggle for "Show Activity Status."

Turn it off, and the fact that you check your Instagram every five minutes will remain a private matter. 

Instagram

There's a catch, though — if you turn it off, then you won't be able to see when other people were last active. Such is the price you pay for privacy.

Another recent tweak to the Instagram experience is a new indicator that makes it easier to see if an account follows you. 

Now, if you're looking at the profile of someone who follows you, but whom you don't follow, you'll see "Follow Back" instead of "Follow."

"This has been live on Android for a while but we rolled it out to iOS users in December," an Instagram representative said. 

The new tax law was designed to help corporations. But Atlassian's bottom line and stock price took hits on Thursday because of it.

The Australian software giant, which makes Jira and HipChat, announced a $65 million loss for its most recent quarter thanks in part to a one-time charge related to the tax rate changes in the new law. The loss amounted to 28 cents a share, compared to a penny a share loss in the same period a year earlier.

The company's stock was down nearly 5% in afterhours trading on the news.

The charge relates to how companies can use their past losses to offset future profits when calculating their taxes. When a company posts a loss, it basically get to store that loss as a kind of a credit that can nullify future profits and reduce the taxes they might otherwise have to pay.

With the corporate tax rate going from 35% to 21% under the new tax plan, the value of those stored credits in terms of the amount of taxes they could wipe out is lowered. Atlassian wrote off that difference in value. Although it's a one-time charge, in practice the move means that Atlassian won't save as much on future taxes as it would have under the old tax law.

The charge put a damper on an otherwise strong quarterly report. Atlassian posted revenue of $212.6 million for the last three months of 2017, up about 43% from the same period a year earlier. Excluding the tax charge and certain other expenses, it would have earned $31 million, or 13 cents a share, in the just-finished quarter, up from about $22 million, or 10 cents a share, in the holiday quarter of 2016.

Generally speaking, Atlassian is having a good run, with a market cap of over $12 billion and a stock price that's roughly doubled since January 2017.

Atlassian is not the only company having to adjust its bottom line to account for the changes in the tax law. IBM posted a $5.5 billion charge in its own quarterly earnings for reasons also related to the new tax plan, indicating that even the largest tech companies are going to see some short-term fallout from the big changes. 

Get the latest IBM stock price here.

In pushing for the tax law Congress passed last year, President Trump and other supporters argued it would encourage companies to take the cash they'd stashed overseas and use it to open factories and hire workers in the US. While some may end up doing that — Apple suggested Wednesday, for example, it would use some of its foreign stash to expand its data centers and open a new campus — most expect to do something a little less exciting with their overseas money, most notably, pay down debts.

As illustrated by this chart from Statista — which is based on data from Bank of America Merrill Lynch — when it comes to how the biggest corporations plan to spend their overseas cash, capital expenditures, which represent investments in things like new equipment and new buildings, are a distant fourth on their priority lists, trailing not only debt repayment, but buying back their own shares and purchasing other companies.

It's unclear where Apple stands on the issue. Since 2012, the iPhone maker has accrued $97 billion in debt, which represents nearly half of the amount of overseas cash it will have left after it pays taxes on its stash. But the company notably omitted debt repayment when talking Wednesday about how it might use its foreign funds.

Statista