Year: 2019

08 Feb 2019

Amazon may be rethinking its New York City headquarters

Amazon’s decision to open HQ2 in New York City has been a controversial decision since day one. The company has been championing the estimated 25,000 jobs the move could bring to the metropolitan area, while citizens and local government officials have balked at promised tax breaks and the added strain on housing and an aging infrastructure.

The unexpected friction has apparently been enough to cause Amazon to reconsider its plans for Queens’ Long Island City neighborhood. That’s according to a new report from the Bezos-owned Washington Post.

The paper cites “people familiar with the matter,” including one who stated, anonymously, “The question is whether it’s worth it if the politicians in New York don’t want the project, especially with how people in Virginia and Nashville have been so welcoming.”

After a months-long protracted campaign that had local governments falling over one another to be the site of the company’s second headquarters, Amazon no doubt expected minimal pushback here. And certainly New York City rolled out the red carpet for the company in closed-door meetings — much to chagrin of the city council and high-profile progressive politicians like Alexandria Ocasio-Cortez.

Amazon has experienced much less pushback with its Virginia proposal, while plans to start hiring locally in New York have been delayed as city government reviews the plans and awaits feedback from constituents. 

Update: Amazon has responded with a comment, “We’re focused on engaging with our new neighbors – small business owners, educators, and community leaders. Whether it’s building a pipeline of local jobs through workforce training or funding computer science classes for thousands of New York City students, we are working hard to demonstrate what kind of neighbor we will be.”

08 Feb 2019

Daily Crunch: Bezos accuses National Enquirer of blackmail

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here:

1. Jeff Bezos accuses National Enquirer of blackmailing him — and publishes the details himself

Amazon CEO Jeff Bezos says he is being blackmailed with nude selfies by AMI, owner of the National Enquirer, over claims the publisher has acted as a political operative. In a Medium post, Bezos described the process by which he has been targeted by AMI.

AMI, meanwhile, says it was engaging in “good faith negotiations.”

2. Apple tells app developers to disclose or remove screen recording code

This follows an investigation by TechCrunch that revealed major companies, like Expedia, Hollister and Hotels.com, were using a third-party analytics tool to record every tap and swipe inside the app.

3. Spotify will now suspend or terminate accounts it finds are using ad blockers

In an email to users, the streaming music and podcast platform said its new user guidelines “mak[e] it clear that all types of ad blockers, bots and fraudulent streaming activities are not permitted.” Accounts that use ad blockers in Spotify face immediate suspension or termination under the new rules, which go into effect on March 1.

4. T-Mobile plans to offer à la carte media subscriptions, but no TV ‘skinny bundle’

The mobile operator’s strategy will focus on helping customers pick and choose which paid TV subscriptions they want to access — a move that very much sounds like T-Mobile is going the “Amazon Channels” route with its mobile streaming plans.

5. Woody Allen just sued Amazon for $68 million

Woody Allen filed a $68 million suit with the Southern District of New York over a four-picture deal with Amazon. The suit arrives as Allen’s latest film, “A Rainy Day in New York,” has been set in limbo, months after completion.

6. Sprint calls AT&T’s 5G E label ‘false advertising’ in new lawsuit

AT&T’s adoption of the “5G Evolution” label has already been controversial among industry followers and fellow carriers alike for watering down the meaning of next-gen connectivity — and now Sprint is looking to do something about it.

7. Subscription startup Scroll acquires news aggregator Nuzzel

Tony Haile, who previously led analytics company Chartbeat, is trying to rethink the business model for news at his new startup, Scroll. Now he’s adding aggregation and curation to the mix with the acquisition of Nuzzel.

08 Feb 2019

Item tracking startup Adero is laying off 45% of staff, just weeks after it pivoted

Pivots can be the making of a startup, helping teams refocus on a good idea when previous things haven’t worked. But sometimes, they are just one more step on a difficult track. TechCrunch has learned and confirmed that Adero — an Amazon-backed maker of Bluetooth-enabled tracking tags that until last December was known as TrackR — is laying off at least 45 percent of its staff. The cuts come as Adero refocuses on building software instead of hardware products, and attempts to build a B2B business that reduces its emphasis on the consumer market, ahead of plans to raise another round of funding.

The layoffs, which started last week, follow a pivot about two months ago from selling individual tracking tags — a business that had become increasingly commoditized — to developing solutions to organise and track groups of items that tend to be used together (such as the contents of a school backpack).

It’s not clear exactly how many employees are being affected, but when the pivot was announced at the end of November, the company had 60 employees, which would work out to 27 employees in this latest cut.

A spokesperson said that layoffs were  being made to put more focus on building software instead of hardware.

“As our new brand grows, we can now move to the next chapter in developing the intelligent organization platform,” he said. “As a result, we’ve parted ways with a portion of the team that was brought on to help design and deliver the consumer product. We will both support the consumer products and focus new energy on developing the platform that powers our consumer products so it can power the experiences of our strategic partners.”

The layoffs and shift at Adero underscore the more general, continuing challenges of building hardware startups. If the product is unique, chances are that the economies of scale to manufacture it will be too capital-intensive for even well-capitalised startups.

But often, the products are just not unique enough. Adero, for example, competes with Tile and a plethora of smaller brands selling tracking dongles are either very similar, or fulfil a similar purpose, and that in turn commoditizes the core product. The mission then becomes building services around the hardware that are in themselves distinctive, or at least trying to be.

“It took a superhuman effort to develop and deliver a new product from scratch — hardware, software, cloud — in nine months,” CEO Nate Kelly wrote in an emailed statement when contacted to provide more detail about the layoffs.

“We threw everything we had into that work and are happy to say that not only did we launch but we have, since launch, delivered two updates to iOS, one to Android and will be delivering… a firmware update that increases the reliability of the product and releases new functionality like removing the limits on the number of taglets.”

Adero’s relaunch in December saw the company building a new line of large and small tags that allowed users to group items that often travelled together to help track them more logically, with plans to add more predictive and other intelligent features over time. “We did more than launch new products, we also built a platform, Activefield, that can scale across many products, many companies and unlimited use cases,” Kelly said.

He added that now the company is trying to work with more (unnamed) strategic partners. That B2B shift also has translated to cutting costs and streamlining particularly in “areas where we had bulked up” to launch the consumer product. “We don’t need that level of support anymore,” he said.

“Now that we’ve launched on our website and on Amazon” — which is an investor in Adero — “we will continue to take our product into other channels and countries, but the push in consumer comes second in focus to the further development of the platform and the deployment into a number of strategic partners,” he said. “This is all very ambitious and we are a small company with limited resources so I’m having to make some changes to the org that makes us leaner and sharpens our focus on deploying our ‘powered by Activefield’ strategy.”

He said that while Adero will continue to support its consumer products, “we hope to come back to you soon to share some good news on partnerships.”

He added that Adero also hoped to have more news of a new round of funding later this quarter. To date, the company has raised about $50 million, but its valuation has yo-yoed from $150 million in August 2017, to just $40 million in July 2018. Investors in the company, in addition to Amazon, include Foundry Group, NTT and Revolution.

While the company would only confirm 45 percent of employees were laid off, our tipsters paint a slightly more dire picture of the company. One tip we received described the layoffs as covering “almost everyone” and another noted that “the majority of the team” at the Santa Barbara-based startup were now gone. “Very few remain to help close the business,” it said.

The news caps off a tricky year for Adero. In January 2018, still branded TrackR, it laid off around 42 employees — at the time just under half its employees. The layoffs came as it was emerging that the startup’s core product, its Bluetooth tag, was becoming increasingly commoditized, with dozens of me-too trackers sold alongside it on Amazon and other marketplaces. (Its biggest rival, Tile, has also seen some big changes and also appears to be shifting its focus to a wider home IoT play.)

Around the time of those layoffs, first one and then both of the company’s founders — Chris Herbert and Christain Smith — stepped away from day-to-day roles at the company. Herbert had been CEO and he was replaced by Kelly, who had been the COO.

Then came the funding round at a big devaluation. “Foundry and Revolution [two of the startup’s investors] were hoping that they would put this money in and I could fix and scale things, similar to how I’d scaled Sonos and so on,” Kelly said about the funding in November (his experience includes Sonos, Tesla and Facebook). “But within six weeks, it became evident that we didn’t need to scale but figure out what the future was and where this is going.”

Where this is going continues to be the question as Adero takes its next steps.

08 Feb 2019

Uber’s JUMP bikes are seeing high utilization rates

In the past year, more than 63,000 people took 625,000 rides on JUMP bikes in San Francisco, JUMP announced today. Each JUMP bike in San Francisco saw an average of seven rides per bike day compared to the docked bike industry average of one to two per day.

JUMP initially launched 250 bikes at the beginning of the year, followed by an additional 250 more in October. While fewer bikes on the road may correlate with the number of rides per bike per day, JUMP says its utilization rate remained consistent at over eight rides per bike per day post-expansion from 250 bikes to 500 bikes.

In San Francisco, there are 1,200 Ford GoBikes with about 5,500 active riders. Last year, Ford GoBikes saw 1.4 million total trips, according to the SFMTA. As of October, on a trip per bike per day basis, Ford GoBikes saw one to two trips per bike while JUMP saw eight to ten per bike per day. On an industry-wide basis, docked systems see an average of one to two rides per bike per day, according to 2017 data from the National Association of City Transportation Officials.

Meanwhile, JUMP rides have continued to decrease the number of Uber rides. In July, Uber reported finding the number of car trips decreasing by 10 percent while trip frequency of JUMP + Uber increased by 15 percent.

“Since that study was released in July, those trends have remained consistent,” JUMP CEO Ryan Rzepecki wrote in a blog post. “As overall engagement (Uber + JUMP) increased, Uber car trips decreased and Uber trips during peak period decreased even more for Uber users who started using JUMP on the Uber app.”

A couple of months ago, JUMP unveiled its next generation of pedal assist bikes featuring 4G capabilities, on-board diagnostics, retractable cable locks and phone mounts.

08 Feb 2019

How to prepare for an investment apocalypse

Unlike 2000 and 2008, everyone in the startup world is expecting a crash to come at any moment, but few are taking concrete steps to prepare for it.

If you’re running a venture-backed startup, you should probably get on that. First, go read RIP Good Times from Sequoia to get a sense for how bad it can get, quickly. Then take a look at the checklist below. You don’t need to build a bomb shelter, yet, but adopting a bit of the prepper mentality now will pay dividends down the road.

Don’t wait, prepare

The first step in preparing for a coming downturn is making a plan for how you’d get to a point of sustainability. Many startups have been lulled into a false sense of confidence that profit is something they can figure out “later.” Keep in mind, it has to be done eventually and it’s easier to do when the broader economy isn’t crashing around you. There are two complicating factors to keep in mind.

You’ll have to do it with less revenue

In a downturn, business customers skip investing in capital equipment and new software. Likewise, consumer discretionary spending goes way down. The result is you’ll likely have less revenue than you do now. Wargame a variety of scenarios — what you’d do if you lost 20%, 50%, or 80% of your revenue, and what decisions would have to be taken to survive.

Sometimes capital can’t be had at any valuation

When a downturn comes, capital markets don’t soften, they seize. Depending on how bad a hypothetical financial crisis got, there’s a good chance that investors would close up their checkbooks and triage. If you aren’t one of your investor’s favorite portfolio companies, there’s a decent chance you may be left in the cold. Don’t even assume you’ll be able to close a down round. Fortunately, showing a plan with a clear path to profitability will allay investors concerns that you’ll need their capital indefinitely and make it more likely you’ll be able to raise.

Planning around these three realities — the need for profits, while experiencing dropping revenue, in a world where capital can’t be had at any valuation — is going to lead to unpleasant conclusions. A dramatically diminished business, major layoffs, and a decisive drop in morale are likely outcomes. Thankfully, you can take steps now to help soften the landing, or if you’re really successful, avoid it entirely.

Avoid “Growth at all Costs” Mentality

Getting acquisition costs under control will help you in two ways. First, it’ll lower your burn rate. Chasing growth for growth’s sake is always a short-sighted decision, but especially during the late part of the business cycle. Avoid this even if you’re VC is encouraging it. Second, by carefully analyzing the inputs to your acquisition cost, it will force you to examine the dynamics of your business. It gives you an opportunity to decide if a poorly performing channel or lackluster sales reps are actually smart investments. Even cutting your payback period from 12 months to nine will provide an increased measure of visibility and control.

Increase the hiring bar

Instagram took over the web with a team of a dozen. Craigslist is a pillar of the internet with a staff of 40 employees. WhatsApp supported hundreds of millions of daily users with fewer than 50 people. Chances are you need fewer people than you think.

In his new book, Scott Belsky shares an algorithm he used building Behance into a $100M company — automate, automate, then hire. His point was that founders should encourage teams to push hard on improving processes and other labor-saving tools before adding more FTEs.

Don’t institute a hiring freeze or take other actions that might spook the staff, but do send the message that new hires should be the last resort, not the first response to a challenge.

Preach discipline – build it into the culture

Founders often try to change spending habits, and in turn culture, when it’s too late. Is there a fair bit of business class flying among the executive team? Do your employees stretch your free dinner policy by staying just past the dinner hour to take advantage of free food? At most tech ventures, everyone is truly an owner. Try to help the entire team to internalize that they are spending their own money.

Get to know your potential acquirers

The week the market drops 50% is not the week to start a M&A conversation. You should be getting to know the five most likely buyers of your company, now. Find out who the decision makers at each of the companies are and build relationships. Make it a point to catch up with these people at conferences and even consider sending them regular updates about your company’s progress (but not too much data). You’re not running a formal sales process, but helping build up the internal desire to buy your company if the opportunity presents itself. It may not be the exit of your dreams, but it’s nice to have options if you need them.

Jettison expensive office space

If you’re coming to a T-juncture regarding office space, you may want to prioritize price and lease flexibility over quality and location. I remember one of our offices at my start-up was a twelve month lease with 6 months free. The landlords were desperate, and so were we!

Front-load revenue

If you’re in the kind of business that will support annual contracts, figure out a way to offer them. Pre-sell credits to consumers at a discount. More fundamentally, think about how you might be able to adjust your business model so you can get paid before you deliver services. Plenty of viable businesses are asphyxiated by delays in accounts receivable, don’t allow your ambitions to be thwarted by accounting.

Diversify your customer base

One lesson learned in the 2000 bubble was that startups that serve other startups tend to be hit hardest. It’s important to think about how a downturn will impact your customer base. If more than 30% of your revenue comes from one industry (perhaps start-ups!), or heaven help you, a single customer, start thinking about managing risk by diversifying your customer base.

Raise a pre-emptive round (AND DON’T SPEND IT)

Topping up your balance sheet at this point isn’t a bad idea, provided you have the discipline to treat it as a rainy day fund. Communicate this rationale to your investors. It’s also important to use this moment to reflect on valuation. An eye-popping valuation will feel good when you sign the term sheet, but it’s going to feel like a millstone if the economy turns, and the market for blue-chip tech stocks drops precipitously.

Consider venture debt

Many VCs discourage venture debt. They’ll say “if you need more money, we’ll backstop you.” The problem is when things ugly, they may not be there. Debt providers are a good way to extend the runway. The thing is that it’s best to raise debt capital when you don’t need it. Venture debt can add ⅓ to ½ of additional capital to some funding rounds with minimal dilution and relatively modest interest rates. Do note that when things get bad, some debt funds can get aggressive so do your homework before taking the notes.

Don’t Panic

It’s tough to predict the top of the market. CNN, Time, The Atlantic, The Wall Street Journal, and many others argued Facebook paying $1B for Instagram was a sure sign of a bubble — in 2012. Reputable commentators have claimed that we’re in a bubble every year since, see 2013, 2014, 2015, 2016, 2017, and 2018. Going into survival mode in any of those years would have been a serious mistake for most startups.

Still, we’re only two quarters away from marking the longest economic expansion in US history. The good times have got to end at some point. Venture capital is a hell of a drug and withdrawal can be painful. Keep in mind that there’s no correlation between how much a company raised and how well they did on the public markets. If you’re struggling to make your startup’s economics work, read up on dozens of “invisible unicorns” who show that you can get big without relying on outsized amounts of venture capital.

If your house is in order when the downturn hits, you may actually be able to grow through it. As unprepared competitors go out of business, you’ll find that talent is more plentiful and customer acquisition costs plummet. Some of the best companies have been founded and thrived in the worst of times — if you’re prepared.

08 Feb 2019

Apple turns Ariana Grande and other musicians into Memoji for its latest ads

Just in time for the Grammy Awards, Apple has unveiled three new ads for Apple Music, featuring new singles from Ariana Grande, Khalid and Florida Georgia Line.

In each video, the musicians have been transformed in Memoji (the human-style Animoji variant that was announced last year), which lip synch to their latest songs. The ads probably won’t change any minds when it comes to Memoji and Animoji — but if you like the format, they’re are fun.

Apple actually created similar ads with Animoji lip synching to Childish Gambino and Migos before last year’s Grammys.

As The Verge points out, if you watch to the end of the videos and pay attention to the small print, you’ll notice that these Memoji were “professional animated.” So don’t feel too bad if your lip synching Animoji videos don’t look quite as good.

08 Feb 2019

Mixtape podcast: Instacart’s apologetic week

It’s that time of the week again when Megan Rose Dickey and I talk about the good and could-be-better tech companies. This week, we talked about Instacart  href="https://techcrunch.com/2019/02/05/instacart-faces-class-action-lawsuit-regarding-wages-and-tips/">getting caught shorting its shoppers out of dough they rightfully deserved. Of course the company apologized for its “misguided” approach. Which at least sounds better than apologizing for getting caught — and getting caught, the company did.

And wouldn’t you know it, scooter drama persists in San Francisco. The city this week shot down an appeal by JUMP to let it deploy its Uber-run scooters. The company it seems could have filed a better application in the first place, so back to the drawing board it goes to try to convince the municipality to relent.

Finally this week we talk about Tyra Banks’s Modelland, a physical space that will open in Santa Monica, California, later this year. It will give visitors an opportunity to experience life in a tech environment. I am intrigued at what this could be.

Click play above to listen to this week’s episode. And if you haven’t subscribed yet, what are you waiting for? Find us on Apple PodcastsStitcherOvercastCastBox or whatever other podcast platform you can find.

08 Feb 2019

Luxury handbag marketplace Rebag raises $25M to expand to 30 more stores

Rebag, an online resale marketplace for luxury handbags, is getting another infusion of capital as it prepares to expand its offline retail operations. The company this week announced $25 million in Series C funding, in a round led by private equity firm Novator, with participation from existing investors, General Catalyst and FJ Labs.

The round brings Rebag’s total raise to date to $52 million.

Rebag competes with other luxury goods resellers, like TheRealReal, and to some extent with broader resale marketplaces like thredUP or Poshmark, which also attract shoppers looking to buy quality pre-owned items. And it exists in alongside large marketplaces like eBay as well as rental shops like Rent the Runway, which offers an alternative to a site focused only on handbags.

In fact, Rebag founder and CEO Charles Gorra spent a brief period at Rent the Runway, before leaving to start Rebag in 2014. At the time, he said he saw an immediate opportunity to not just rent the items out, but to actually resell them on a secondary market.

Today, Rebag’s shop sells bags from over 50 designer brands, including all the majors like Chanel, Louis Vuitton, Hermes, Gucci, and others.

However, in the years following Rebag’s launch, the company has expand its offerings beyond just online resale to include brick-and-mortar retail and, more recently, a service called Rebag Infinity, which allows shoppers to turn in any Rebag handbag purchase within 6 months in exchange to receive a credit of at least 70 percent of the purchase price.

Last year, Rebag made headlines in the fashion world for selling the rare Hermès White Crocodile Himalayan Birkin collectible – typically an over $100,000 bag – for “just” $70,000, to celebrate the opening of its 57th Street and Madison Avenue store, its second Manhattan flagship location.

With the new funding, Rebag will expand its offline footprint, it says. The company currently operates five stores in New York and L.A. but plans to launch 30 more locations in the “medium term.” This will include both standalone storefronts, as well as presences within luxury malls.

It’s common these days for resale marketplaces these days to take their wares to offline shoppers. TheRealReal, Rent the Runway, ThredUP, and others all today offer real world locations, where shoppers can browse in person instead of just online.

Rebag says since it opened its retail stores las year, it moved from being a 100 percent digital operation to 80 percent digital, and 20 percent offline. Its sourcing network also grew to include over 20,000 stylists, partners, shoppers and sales associates.

With the funding, Rebag adds it will also refine its pricing and handbag evaluation tools aimed at standardizing the resale process, something that could represent another business for the brand (or make it attractive to an acquirer.)

“We are a technology company first,” noted founder and CEO Charles Gorra, in a statement. “Our goal is to become the standard for the luxury resale industry, just like Kelley Blue Book is the main resource for the auto industry.”

The company plans also to triple its team of 100, which today includes newer hires CTO Jay Winters (Delivery.com, Goldman Sachs) and CMO Elizabeth Layne (Bonobos, Appear Here).

Rebag doesn’t share its hard numbers about sales, revenues, valuation, customer base or others, but told us it has tripled revenues since its Series B.

 

08 Feb 2019

Extend Fertility banks $15M Series A to help women freeze their eggs

Fertility services are raising venture cash left and right. Last week, it was Dadi, a sperm storage startup that nabbed a $2 million seed round. This week, it’s Extend Fertility, which helps women preserve their fertility through egg freezing.

Headquartered in New York, the business has secured a $15 million Series A investment from Regal Healthcare Capital Partners to expand its fertility services, which also include infertility treatments, such as in vitro and intrauterine insemination. The company has also appointed Anne Hogarty, the former chief business officer at Prelude Fertility and vice president of international business at BuzzFeed, to the role of chief executive officer. Hogarty replaces Extend Fertility co-founder Ilaina Edison, who had held the C-level title since the business launched in 2016. Edison will remain on the startup’s board of directors.

Extend Fertility, in its New York cryopreservation and embryology lab and treatment center, completed 1,000 egg-freezing cycles in 2018.

“A lot of amazing things have happened for women over the last century,” Hogarty told TechCrunch earlier this week. “Now, women are permitted and encouraged to seek higher education, pursue a career, follow their dreams and end up with a partner who’s the right partner, not just any partner. Doing all those things has pushed the window for when women want to start a family from their 20s to their 30s and unfortunately, one thing that has not changed in that time is the biological clock.”

Hogarty explained Extend’s fertility services are more affordable than other options because the service was built specifically with egg freezing in mind, and the company later expanded to offer infertility treatments, whereas other services were established to provide IVF and other infertility treatments and integrated cryopreservation tools later.

We are really purpose-built to be an egg-freezing-first company, where many legacy institutions that were providing infertility services have legacy costs that come with … inefficiencies bred over decades and outmoded technology in their labs that may not be the most efficient and effective,” she said. “We have a state of the art lab with the latest equipment.”

It’s the classic innovator dilemma,” she added. “Infertility services are extraordinarily expensive and reproductive endocrinology is a new area of medicine. There are a lot of people and institutions that have been taking inordinate amounts of money for their infertility services so they weren’t looking to serve this population of women looking to preserve their fertility.”

One egg-freezing cycle with Extend costs women $5,500, and additional cycles come at a sticker price of $4,000. Each cycle includes a fertility assessment, private consultation, anesthesia and any monitoring a patient may need during their cycle. The costs don’t include medication, however. Extend can prescribe medications — which typically cost between $2,000 and $5,000 for fertility patients — but they still need to go through a third party to get their prescriptions filled and paid for. 

For reference, FertilityIQ, an online platform for researching fertility care providers and treatments, says the typical cost per cycle for egg freezing is more than $17,000 in New York City or $15,600 in San Francisco. Most egg-freezing services, including Extend, do not accept insurance, as most insurance providers don’t cover the steep costs of fertility or infertility treatments.

Some companies, however, are beginning to offer benefits that cover these costs. Facebook and Apple, for example, began subsidizing egg-freezing procedures for employees in 2014. Spotify and eBay, for their part, will pay for an unlimited number of IVF cycles.

Hogarty said Extend’s price point makes it one of the lowest-cost players in the market.

“We want as many women as possible to benefit from the advances from egg-freezing technology,” she said.

Extend Fertility, which has previously raised $10 million, plans to use the latest investment to open labs in new markets and expand its infertility services.

08 Feb 2019

AMI defends ‘good faith negotiations’ with Jeff Bezos but will investigate blackmail allegation

It’s the morning after the night before for AMI.

And what a night it was. The company is officially in damage control mode after it released a short statement defending its communication and behavior with Amazon CEO Jeff Bezos, who published evidence of blackmail that used leaked messages and nude photos of the billionaire that AMI had acquired.

AMI today defended its efforts. It claimed it had “acted lawfully” with its reporting of Bezos and that it engaged in “good faith negotiations” with him. Still, despite those claims, it said it has launched an investigation into the incident.

Here’s the statement:

American Media believes fervently that it acted lawfully in the reporting of the story of Mr. Bezos. Further, at the time of the recent allegations made by Mr. Bezos, it was in good faith negotiations to resolve all matters with him. Nonetheless, in light of the nature of the allegations published by Mr. Bezos, the Board has convened and determined that it should promptly and thoroughly investigate the claims. Upon completion of that investigation, the Board will take whatever appropriate action is necessary.

The company, which owns the National Enquirer among other media businesses, was accused of blackmail in an explosive essay that Bezos published on Thursday. In it, the Amazon CEO detailed AMI’s apparent offer of a ‘deal’ that would see it drop the publishing of naked selfies of the billionaire, sent to his new partner, in exchange for The Washington Post — the newspaper he owns — walking back its investigation into AMI’s connections in Saudi Arabia and relationship with President Trump.

This battle isn’t going anyway any time soon — watch this space for more updates.