October 22, 2017

The CEO of our portfolio company JumpCloud, Raj Bhargava, reached out to me after my rant on digital security earlier this week.

Since JumpCloud plays in the world of digital authentication, they are well versed in security issues and are helping organizations with securely connecting their users to their IT resources (systems, app, storage, WiFi, servers, etc.).

He pointed me to a five-step video they put up about how IT organizations can step-up their WiFi security – not only from KRACK, but from man-in-the-middle attacks and from having poor WiFi security hygiene.

Also published on Medium.

BI Intelligence

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It hasn't been smooth sailing for telecoms in recent years. Native voice and messaging services, which once accounted for the vast majority of telecoms' subscriber revenue, are struggling to compete with over-the-top (OTT) apps, like Facebook Messenger, WhatsApp, and Viber — and they're losing.

A fierce and ongoing price war among the Big Four carriers is only compounding the pressure telecoms are facing. The consequent resurgence of unlimited data plans is straining carriers' networks, and revenues are suffering.

Nevertheless, telecoms are now better positioned than ever to play a bigger role in their subscribers' lives. Consumers spend more than half of their digital time on smartphones, compared with a third on PCs. This shift has effectively placed telecoms at the front door of consumers' digital experience.

In a new report from BI Intelligence, we examine where the wireless industry stands as a result of the price war and uptick in data demand from consumers. We also look at how technological advancements and the adoption of new product lines could incentivize the next wave of revenue growth for telecoms. Finally, we explore potential barriers to carriers' growth, and examine which of the Big Four carriers are poised to lead the pack.

Here are some of the key takeaways from the report:

In full, the report:

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Yongrim, JuJu, and Kyurim Rhee, siblings and cofounders of Libro Library. Libro Library

Around two years ago, Yongrim Rhee had a problem: Too many surfboards.

The then-Google employee's Californian home was overflowing with more than 40 boards, and he wanted to do something with them. So he and his siblings came up with a plan for a business: An app that let you lend out your spare boards to others. Surfboard sharing-as-a-service!

They didn't end up making it.

But from there, a new and broader idea emerged: A neighbourhood sharing app, where users could list their spare possessions for others in the neighbourhood to borrow.

They didn't end up making that either.

Instead, the Rhees decided to focus on a single, narrow segment: Books.

And from there, Libro Library was born.

It turns private bookshelves into public libraries

A screenshot showing a user's library. Libro Library

In a nutshell, Libro Library is an app that turns your private book collection into a public lending library. You list the books you're willing to lend out, and users can then select to borrow them — and vice versa.

It's still in the early stages, and the three siblings — JuJu, Yongrim, and Kyurim — are currently its only three employees (chief executive officer, chief product officer, and chief strategy officer respectively). It's being tested in specific regions, and book exchanges become available in an area if enough people "enroll" for it.

Right now, that's only in South America, in cities like Buenos Aires and Santiago de Chile. Around 400 books are scanned into the system a day, Kyurim said, while it has thousands of active users.

(Also, it's iOS-only for now, though there are plans for an Android app further down the line.)

It's an almost anachronistic idea in an era of ebooks and digital sharing — but in an interview with Business Insider in London, Yongrim and Kyurim emphasised the importance of the physicality of books and the emotional attachment they provide.

"We have a lot of books ourselves, print books we're talking about, and we grew up pre-ebook times," Yongrim said. "We never fell out of love with print books, we share this sentiment with users, they tell us 'oh, we love the smell of the books, and these almost intangible thing that ebooks don't [have]."

The team is still working out how to make money

This nostalgic sentiment is informing certain design choices the trio are making on the app. "We want to maintain the features of libraries we really like. In the old days, you can open the book, you can see who checked out a book before," said Kyurim, as he explained Libro Library is trying to implement something similar. "So you can see who the book's passed through. This is a feature we think will be really compelling for our readers."

They've bootstrapped the business with their savings so far, but are now on the hunt for outside investment. They're not yet certain how they'll make money off the app ("this might sound naive, we don't really have a monetising strategy," Yongrim admits), but they're exploring a few different routes.

They might charge independent authors to distribute books through the platform, or put up relevant adverts on the app. Or they could provide analytics to publishers, letting them track the movement of their titles as they change hands.

They're keen, however, to keep it free at the point of use — so the actual users on the hunt for new books to read won't have to pay to see what's available in their area.

Working with siblings has 'its own set of challenges'

The app can scan books to work out what they are. Libro Library

Before Libro Library, Yongrim worked as a software engineer at Google in Mountain View, California, and now lives in London. Kyurim was a network engineer in Washington D.C., where he still lives. And JuJu, who lives in New York, has worked as an artist and coordinator.

All this adds up to an unusual dynamic — not only are they siblings, but they also lives thousands of miles from one another, across timezones. 

It makes communication far easier, they said — but it can also be far harder to switch off. Startups can already be all-encompassing, and the trio will sometimes find themselves chatting work at family get-togethers in the States. ("It's going to come up, it's like this ugly beast that's in the corner," said Kyurim.)

And in professional situations, things can sometimes get too familial: "The word 'let's be professional' comes up quite a lot," Yongrim joked.

"It comes with its own set of challenges," he said of working with his brother and sister. "When it's bad ... sometimes I feel like 'what have I done, why did I start this business with my siblings?' But then it gets really bad, I feel like with anyone else it would've been over but because it's my siblings I think ... 'let's thin this through and stay together.'"

Kyrurim added: "If something bad happens, if we have a bad fight, we have to get over that. I can't stop being your brother. I can walk away from my coworkers, yeah, I don't wanna talk to that person any more, but I can't stop being a brother to him."

But despite this optimism — there's still a danger that if things do go badly wrong, it could seriously damage some of their relationships. It's a risk that Yongrim has encountered before.

"I've done a startup before with my best friend from college, and we don't talk any more," he said. "So I am somewhat experienced in that. So they know what I've gone through, it was such a painful experience, so in that sense we were somewhat prepared ... I was like 'I'm never going to let that happen again,' because in retrospect it really wasn't worth destroying my friendship over.

"I don't think it was my fault," he added with a laugh. "He shouldn't have done that, but that's sort of what I'm talking about. Being siblings you never let it go that far."

BI IntelligenceThis is a preview of a research report from BI Intelligence, Business Insider's premium research service. To learn more about BI Intelligence, click here.

Media consumption is at a saturation point. After rising for much of the last decade, total digital time spent has been nearly static since the start of 2015. As a result, it's increasingly difficult for content producers to win over minutes of consumers' time.

One platform, though, is poised to move the needle and provide a new avenue to boost digital time spent: the connected car. Consumers will spend more time in cars that offer a range of connectivity options, giving them the chance to use the services they know and love in the car.

The key question for service providers is how to take advantage of the connected car by integrating their services into this growing platform.

In a new report from BI Intelligence, we provide a roadmap for service providers looking to offer their services in the car. We analyze media consumption and overall digital time spent trends, and then forecast the growth of the connected car market in relation to the digital time opportunity. Finally, we propose potential routes that service providers can take to get into connected cars and ride-hailing vehicles.

Here are some of the key takeaways:

In full, the report:

Interested in getting the full report? Here are two ways to access it:

Beck Diefenbach/Reuters

Bill Gates will fund a massive investment in education, pledging more than $1.7 billion into public schools, The Washington Post reported.

Gates has long been a thought leader on improving school outcomes through the Bill and Melinda Gates Foundation, where he's invested more than $3.4 billion in public education in the US, according to The Post.

But the eye-popping sum of his newest investment harks back to another tech titan's massive investment in public schools — one that was largely deemed a failure.

Facebook Founder and CEO Mark Zuckerberg. Stephen Lam/Reuters

In 2010, Mark Zuckerberg donated $100 million to Newark, New Jersey's failing public-school system with the intention of turning around the schools in five years.

The goals Zuckerberg set out to achieve — to enact a number of reforms that would make Newark a model city for education reform — were largely panned, and multiple sources tore into Newark Public Schools for squandering his money and not delivering on any of the goals it set out to achieve.

Critics also argued Zuckerberg's strategy was top heavy, done quickly and without input from parents or local administrators, who could have provided guidance on how the changes would play out among the community.

After his so-called blunder in Newark, Zuckerberg appeared to employ a different strategy for affecting positive change in schools. In 2014, he committed $120 million to school districts around the San Francisco Bay Area, focusing on reform at the community level, rather than a heavy-handed, top-down approach, as the Newark reform plan has been described.

Gates will invest more than 10 times as much as Zuckerberg did in Newark. He appears cognizant of the need to engage school communities in the process, noting he wants schools and educators to drive the process, according to The Post.

Bill Gates. Eric Vidal/Reuters

"The actual tactics about great teaching, about how to reform the schedule, how to get students who are off track on track — those will be driven by the schools themselves,” Gates said before an audience in Cleveland, Ohio, according to The Post. " We will let people come to us with the set of approaches they think will work for them in their local context."

Gates, the richest man in the world, has been at the forefront of some of the biggest ideas in education, if sometimes equally unpopular. He invested heavily in the Common Core State Standards, the controversial set of nationwide education standards that almost all 50 states signed into law.

Following near-universal praise and adoption of the standards in 2010, there has since been equally swift backlash against the standards on both sides of the aisle.

Lara O'Reilly/Business Insider

 

BuzzFeed is investigating allegations of harassment by its employees, people familiar with the matter said.

The investigation comes after several of its staffers appeared on a list, titled "Sh---- Media Men," which was distributed among journalists across several news organizations. The existence of the list, which names men from a variety of publications, was reported by BuzzFeed last week.

The allegations on the list include verbal, physical and sexual abuse, but were added anonymously so it is unclear who wrote them. The list makes clear that these are "allegations and rumors," and that readers should "take everything with a grain of salt." 

BuzzFeed staffers, both current and past, are represented in multiple versions of the list reviewed by Business Insider. The number of BuzzFeed employees on the list sparked a conversation among current and former employees about the publication's own workplace culture, according to people familiar with the matter. 

An anonymous reporting tip line was distributed to editors this week in which employees can report harassment if they don't feel comfortable going to their managers, according to a person with knowledge of the matter.

"We cannot discuss specific personnel matters, but we take allegations of inappropriate conduct extremely seriously, including anonymous ones," BuzzFeed spokesman Matt Mittenthal said.

The list was widely distributed among journalists in the wake of the Harvey Weinstein scandal that has rocked Hollywood.  

Female journalists, in conversations with Business Insider, say that a list of this nature is necessary to warn other women and because women may otherwise hesitate to report harassment to management for fear of retribution.

Silicon Valley has been encroaching on Wall Street's turf. Margin Call screenshot

Business Insider recently compiled a list of the top talent on Wall Street age 35 and under, interviewing dozens of bankers, asset managers, and traders in the process.

We asked the crop of dealmaker candidates making waves in investment banks and private-equity shops the same question: What's your biggest concern about the industry?

While responses varied — some bemoaned market trends, like record-low volatility and sky-high valuations — a strong current ran through the vast majority of answers that underscores Wall Street's challenge in keeping up with Silicon Valley.

Most notably, bankers are concerned with Wall Street's ability to recruit and retain young talent given the competition from tech giants and startups that offer juicy perks, a more relaxed lifestyle, and an exciting, entrepreneurial environment.

There's a reason Goldman Sachs is rebranding itself as a tech company and trying to hire engineers in droves.

The industry has changed swiftly since the financial crisis, and the stable, predictable career trajectory calcified over decades on Wall Street has largely been thrown out the window.

"When I joined the industry 10 years ago, if you were smart and had an interest in business, chances are you were coming into finance and consulting," one private-equity standout told us. "We were able to get the best and brightest undergrads. With the advent of startups and tech — Google, Snapchat, or entrepreneurs — we're finding it more difficult to recruit that top tier."

A handful noted that banks, despite marked improvements in recent years, still struggled to offer a healthy work-life balance. Many of the people we spoke with in their early 30s had recently become parents, mixing that daunting responsibility into the cocktail of one of the most competitive, high-pressure career tracks out there.

Here's what a couple of others had to say:

And in the same vein, young financiers are concerned that the technologies coming out of Silicon Valley may further drain the pool of opportunities.

"There's a lot of fear about how much technology can replace day-to-day tasks," one banker told us.

Former Citigroup CEO Vikram Pandit said last month that 30% of banking jobs could be gone within five years from the threat of automation and artificial intelligence, though relationship-based practices like investment banking face less risk than trading operations.

"I do think we need to be better coordinated about how Wall Street will protect itself against outsiders who are going to be encroaching on the banks' turf," another rising banker told us, highlighting Apple Pay, PayPal, and blockchain as emerging threats.

Banks may continue to struggle to lure talent back from Silicon Valley, but they're awake to technology threats.

Investments in private tech companies by banks have soared in recent years. Goldman Sachs is leading the charge, but Citigroup, JPMorgan Chase, and Morgan Stanley are all very much in the game as well.

Get the latest Bank of America stock price here.

It seems that Nintendo has finally cracked the code to get more of its consoles into American homes.

Nintendo's Switch console has been the top-selling games console in the US for five of the past seven months since its March release, despite the fact that the console has been hard to find for many buyers, according to new data from Nintendo charted for us by Statista. It's a stark contrast to the company's previous console, the Wii U, which didn't enjoy much success. 

That's compared to other "current-generation console hardware" sold in the same months of 2016, according to Nintendo. Of course, both Sony's PlayStation 4 and Microsoft's Xbox One were released in 2013, which could account for their slower sales compared to Nintendo's Switch, but Microsoft released a smaller and sleeker Xbox One S in August and Sony is selling its 4K/HDR-capable PlayStation 4 Pro. Microsoft also plans to release an Xbox One X in November, which also supports 4K and HDR.

Nintendo has sold over 2 million Switch consoles to date in the US, and it has yet to go through the holiday season when sales are usually even greater for devices like games consoles. 

Mike Nudelman/Business Insider

An illustration of Europe's ATV spacecraft breaking apart and burning up as it reenters Earth's atmosphere. ESA/D. Ducros

At any given moment, thousands of satellites swarm over our heads at altitudes ranging between a few hundred miles and tens of thousands of miles.

But, of the manmade items in space that are larger than your fist, orbiting satellites are a minority. About 95% of what's out there is space junk: out-of-control space stations, used rocket parts, dead satellites, lost astronaut tools and more.

This dangerous orbital garbage is moving roughly 10 times faster than a speeding bullet and takes a long time to crash back to earth.

"This debris can stay up there for hundreds of years," Bill Ailor, an aerospace engineer and atmospheric reentry specialist, told Business Insider.

And it gets worse.

Just one collision in space can create thousands of new high-speed, out-of-control pieces and threaten other spacecraft. Meanwhile, perhaps 170 million pieces of debris larger than 1 millimeter — such as flecks of paint and bits of explosive bolts — move around Earth at tens of thousands of miles per hour, according to the European Space Agency.

"Countries have learned over the years that when they create debris, it presents a risk to their own systems just as it does for everybody else," said Ailor, who works for the nonprofit Aerospace Corporation.

The chart below, which Business Insider created using data from Space-Track.org (registration required), shows the top 10 entities with the most trackable objects around Earth as of October 2017.

There's a lot of stuff in space that shouldn't be there anymore. Andy Kiersz/Business Insider

The chart shows Russia has the most objects currently in space, numbering more than 6,500 objects. However, it's not the biggest contributor to space junk, shown in red.

The US owns the title of dirtiest country in space for now, and just by a hair. Russia has 3,961 pieces of detectable space debris compared to the 3,999 pieces of trackable space trash in orbit created by American activity.

China has only recently ramped up its space program, yet it's in a close third with 3,475 hunks of space junk. This is because the nation in 2007 destroyed one of its own satellites in an anti-satellite weapons test.

This highly controversial move instantly created more than 2,300 trackable pieces of junk, more than 35,000 pieces larger than a thumbnail, and perhaps hundreds of thousands of pieces too small to track.

Getting old spacecraft out of orbit is a key to preventing the formation of space junk, and many space agencies and corporations now build spacecraft with systems to de-orbit them.

But Ailor and others are eager to push the development of new technologies and methods that can lasso, bag, tug, and otherwise remove the old, uncontrolled stuff that's already up there and continues to pose a threat.

"I've proposed something like a XPRIZE or a Grand Challenge, where would you identify three spacecraft and give a prize to an entity to remove those things," he said.

An illustration of space junk. Satellites and debris are not to scale. ESA

The ultimate goal is to prevent alarming scenario known as Kessler Syndrome: when so much stuff is in space, one collision leads to several others, and those crashes lead to even more — littering space with so much debris that it becomes incredibly risky to leave Earth.

The biggest hurdle in defeating space debris, however, is likely human.

"It's not just a technical issue. This idea of ownership gets to be a real player here," Ailor said. "No other nation has permission to touch a US satellite, for instance. And if we went after a satellite ... it could even be deemed an act of war."

Ailor said someone needs to get nations together to agree on a treaty that spells out laws-of-the-sea-like salvage rights to dead or uncontrollable objects in space.

"There needs to be something where nations and commercial authorities have some authority to go after something," he said.

Technology is moving front and center on Wall Street, and it has many people worried about their jobs.

Wall Street is ramping up spending on technology and hiring more people with tech skills, especially in trading where profits have been harder to come by and banks are looking to cut costs.

According to data from Coalition, on average the top 12 investment banks decreased headcount in sales and trading near 6% in 2016. Meanwhile, tech spending increased 1% in front office systems, according to Bloomberg reporting. 

JPMorgan, specifically, is on track to spend $9.5 billion a year in technology. And 47% of Goldman Sachs' recent job listings are in technology, according to CB Insights. 

So that means traditional Wall Streeters need to brush up on their tech skills, right? It turns out that it might not be so simple. There's a good chance that even if a trader tries to adjust to this shifting landscape, by sharpening his or her tech skills or learning how to read code, they could still lose their jobs.

Bloomberg is running a series of stories on the tech revolution on Wall Street, and in a story by Sarah Ponczek and Dakin Campbell, Cathy Bessant, the chief technology and operations officer at Bank of America, said technology is changing too fast for folks in finance to catch up. 

"Those of us in leadership roles know what's coming, we're helping to drive it and know what skill sets we need," said Bessant.

What she said education in tech needs to start early on for folks in finance. Still, Bloomberg reported that Bessant is "skeptical that on-the-job training will be enough." She told Bloomberg:

“The kind of skills that we’ll need have to be taught beginning at a much earlier age. Whether you can train the same worker at the same time you’re changing their job remains to be seen.”

Wall Streeters, consider yourselves warned.

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