Author: azeeadmin

23 Jan 2019

Oracle says racial discrimination lawsuit is ‘meritless’

Oracle says the racial discrimination lawsuit filed by the U.S. Department of Labor’s Office of Federal Contract Compliance Programs is “meritless.” This comes after Oracle declined yesterday to comment on the OFCCP’s filing that alleges Oracle withheld $400 million in wages from underrepresented employees.

“This meritless lawsuit is based on false allegations and a seriously flawed process within the OFCCP that relies on cherry picked statistics rather than reality,” Oracle EVP and General Counsel Dorian Daley said in a statement to TechCrunch. “We fiercely disagree with the spurious claims and will continue in the process to prove them false. We are in compliance with our regulatory obligations, committed to equality, and proud of our employees.”

In a filing yesterday, the OFCCP alleged Oracle withheld $400 million in wages from racially underrepresented workers (black, Latinx and Asian) as well as women. The department argues that Oracle’s “stark patterns of discrimination” started back in 2013 and continues into the present day. More specifically, the OFCCP alleges Oracle discriminated against black, Asian and female employees. This has all ultimately resulted in the collective loss of more than $400 million for this group of employees, the suit alleges.

23 Jan 2019

Verizon Media Group is laying off 7 percent of its workforce

The Verizon division formerly known as Oath is laying off 7 percent of its workforce, which amounts to roughly 800 employees.

Oath was created after Verizon acquired AOL, followed by Yahoo, bringing them together two years ago as a combined digital media entity with a new name. However, it seems that the organization hasn’t performed as well as Verizon executives had hoped, with layoffs, the departure of AOL CEO Tim Armstrong and Verizon’s recent $4.6 billion writedown on the media business — it announced a “voluntary redundancy” program, a.k.a. buyouts, at the same time.

Plus, Verizon decided to retire the Oath brand at the end of last year. (TechCrunch was part of AOL, then Oath, and is now part of Verizon Media Group.)

“Our goal is to create the best experiences for our consumers and the best platforms for our customers,” a Verizon spokesperson said in a statement. “Today marks a strategic step toward better execution of our plans for growth and innovation into the future.”

In an email to employees, Verizon Media Group CEO Guru Gowrappan also positions the cuts as part of a broader strategy, with the company focused on three core areas in the first quarter of this year: growing the “member-centric ecosystem,” increasing usage/spending on its B2B products and increasing video supply and distribution.

“I want to be clear that we will continue to scale, launch new products and innovate,” he wrote. “We are an important part of Verizon and the $7+ billion in revenue we generate through our member-centric ecosystem puts us among the top tech/media companies in the world. Now is the time to go on the offensive, go deep on our big priorities and do everything we can to advance the business.”

You can read the full email below.

Team –

Last quarter, our leadership team worked to create the strategy that will propel Verizon Media. We honestly assessed where we are and outlined ambitious but achievable goals that poise us for growth. We shared it broadly with you, and together committed to deliver on our OKRs with meticulous planning, collaboration and rigorous execution.

As hard as it may have felt at times, we’ve made some great strides to serve our customers globally – from consolidating ad platforms, to expanding the Microsoft partnership, growing live programming and content offerings for our Supers, and prioritizing and launching 8 new or substantially updated products at Build It 2018.

In Q1, we’ll have 3 priority areas: first, grow our member-centric ecosystem with must-have mobile and video products and stem desktop declines; second, increase usage and spends flowing through B2B platforms; third, expand our video supply and overall distribution through partnerships. As we work to deliver on both short-term objectives to stabilize our business, we are also focused on long-term strategies that will accelerate distribution, growth and innovation as part of Verizon.

This week, we will make changes that will impact around 7% of our global workforce across the organization, as well as certain brands and products. These were difficult decisions, and we will ensure that our colleagues are treated with respect and fairness, and given the support they need. Resources and other career support will be provided to help our team members navigate the transition.

In addition, we’ve completed an exhaustive review to prioritize the programs that are currently in our portfolio – consumer products, ad products, platform features, partnerships and data centers.

While every business unit has to manage their P&L, these decisions are being made to streamline resources and invest in opportunities that will help us grow. You all know by now that I deeply believe in an owner mindset and focus as a key ingredient for success – going deep on fewer, key things that will have the greatest impact on our customers and business, and doing them exceptionally well.

I want to be clear that we will continue to scale, launch new products and innovate. We are an important part of Verizon and the $7+ billion in revenue we generate through our member-centric ecosystem puts us among the top tech/media companies in the world. Now is the time to go on the offensive, go deep on our big priorities and do everything we can to advance the business. We will talk more about this and answer questions Friday at Open House.

Our world continues to evolve at a faster pace, and we need to leap ahead of consumer trends. We are reimagining our future, and building new products that will become invaluable to consumers today and in the years to come. That’s the spirit of our company and the spirit we all embody as its Builders.

Best,
Guru

23 Jan 2019

Aibo learns to be a better watchdog

I wanted to love the new Aibo. Really, I did. But once I aactually spent some time with it, it turned out that it was a $3,000 dog with only a handful of tricks. It seems the days of buying true robot dog companionship are still a long ways away.

A few months after bringing the pup to market, Sony’s announced a few updates that should rekindle some interest. First, there’s a new paint job. Aibo now comes in Choco Edition — a dark brown and bronze edition that makes it look a bit more like a real dog. That version is going to cost the same as its white coated counterpart.

More importantly, Aibo’s finally set to learn a few new tricks. Most notable among them is the addition of a security package that utilizes on-board sensors to keep your home safe. It’s one of the features the company suggested early on, making use of the dog’s face tracking and 3D mapping technology.

In Japan, the deal comes courtesy of a partnership with home security firm, Secom. Like everything else in Aibo land, however, it will cost you — in this case, an additional $13.50 a month for paw patrol. All of this likely isn’t enough to get too many people on board with the robot, given the price point, but at least Sony’s big sticking to its promise of supporting the pup. 

23 Jan 2019

Facebook may proactively close Pages and Groups before they’re in violation of policy

Facebook today announced changes to the way it handles the removal of content from Facebook Pages that’s in violation of the social network’s Community Standards, as well as when the Page has posted items that are rated false by a third-party fact checking service. It says it will also make it harder for those whose Pages have been shut down for violations from returning with new Pages featuring the same, duplicated content by proactively banned other Pages and Groups, in some cases.

To address the first two issues, Facebook says it’s introducing a new tab on Facebook Pages – the “Page Quality” tab – which will inform those who manage the Page which content has been removed for violating standards and what was rated “fake news.”

The section will explain if content was removed for being “hate speechgraphic violenceharassment and bullying, and regulated goodsnudity or sexual activity,” or being “support or praise” of people and events that are not allowed to be on Facebook, the company explained today in a blog post detailing the upcoming changes.

The “people or events” not allowed on Facebook are those associated with real-world harm. This could include people associated with hate groups, terrorist activity, mass or serial murder, human trafficking, or organized crime or violence. Facebook also removes any content that expresses praise or support for those involved in such activities.

The tab will also inform Page managers which content may have been demoted by Facebook algorithms, if not removed entirely. This includes content that has been found to be false news by independent fact-checking organizations. Facebook began taking action against clickbait several years ago, then later began to flag and down-rank fake news, as that essentially became the new clickbait.

But those who distributed fake news headlines weren’t necessarily aware that their content’s distribution was being reduced as a result. This tab will now inform them.

Facebook says it will identify several types of down-ranked news items, including content recently rated “False,” “Mixture” or “False Headline” by third-party fact-checkers.

However, it won’t actually show those items it deemed “clickbait,” or those that it removed for being spam or due to an IP violation.

In other words, the new Page Quality tab isn’t a full window into everything being removed or down-ranked, only those areas that are today of utmost importance to Facebook to get under control.

“We hope this will give people the information they need to police bad behavior from fellow Page managers, better understand our Community Standards, and, let us know if we’ve made an incorrect decision on content they posted,” the company explained in its announcement.

Proactive Bans

Related to this, Facebook says it’s seen an increase in people using their existing Pages to duplicate the content that had been pulled down from Pages that were banned for violating Facebook’s Community Standards.

While it’s had policies that prohibited people from creating new Pages (or groups, events, accounts, etc.) for this purpose, it hadn’t yet been policing the use of existing Pages – and that, effectively, became a loophole for the violators to abuse.

Now, Facebook says when it removes a Page or Group for policy violations, it may also remove other Pages and Groups – even if the other Pages and Groups haven’t “met the threshold to be unpublished on its own.”

In other words, if Facebook believes the other Pages and Groups will be used as the new home for the content found to be in violation, it will proactively remove them…before they actually do so. (That’s likely to cause some debate.)

Facebook says it will make this determination based on a broad range of factors – like if the other Pages or Groups have the same admins or a use similar name, for example.

The new “Page Quality” tab will launch tomorrow, while the proactive removals will begin in the weeks ahead.

23 Jan 2019

YC-backed Our World in Data wants you to know that the planet is doing okay

News is exhausting. Mexican murders are sky-high. Ebola is ravaging the eastern Congo. China is erasing an entire culture of Islam from its Western hinterlands. That news — negative and intense though it is — can easily occlude the many positive, longer term stories that are fundamental drivers of the world. Africa is reaching new levels of prosperity. Violence around the world is in retreat. Famine is down, a lot.

These trends are present, but getting high-quality data around them and correctly interpreting them can be challenging. How do you piece all these disparate threads together and start to make sense of the whole?

Enter Our World in Data. The non-profit startup, which started as a research project at Oxford University, builds datasets on human progress around the world and then uses visualizations and deep, clear explanations to allow people to grok exactly what’s happening as well as how to think about it.

Our World in Data is backed by YC in its current batch, and is one of three non-profits this cycle (we profiled another one of them, Upsolve, which is helping consumers file for bankruptcy). The portal has been receiving about a million users per month and two citations a day in major newspapers, and the team is hoping to scale those metrics up as part of the YC program.

Max Roser, the founder and program director, officially organized the firm as a non-profit a few weeks ago, but has been working on it with a team of researchers over many years. “It began kind of slowly as a research project in around 2012,” he said. It was “a fairly small-scale project in the evenings and weekends in the beginning and got bigger and bigger over time.”

He points out that the progress we have seen in human society has happened at a blistering fast rate. “Even in today’s richest and happiest places, the changes have happened very recently. […] Just two hundred years ago, a huge majority of the population lived in extreme poverty.”

Roser sees an opportunity to revolutionize how academic research is disseminated with Our World in Data. “Our mission is to get research out of institutions,” he explained. “We come from this millennium-old institution with University of Oxford … and they have published research in exactly the same way since the invention of the printing press. […] In the communication of research, we haven’t adopted the technologies available with the internet at all … and we are trying to bring these two worlds together.”

Hannah Ritchie, a researcher with the project who holds a PhD in GeoSciences from the University of Edinburgh, said that “our top priority is reaching as many people as we can” and she sees the project becoming the “really credible go-to reference.”

Our World in Data may not be a conventional startup, but it is hitting a thesis close to home here. Arman and I have been doing a dive into the world of societal resilience startups – companies that are trying to protect humanity from itself by building self-healing systems, improving the climate, making our traffic more on time, improving the speed of construction and much, much more. But before we can do all that, we first need to understand what’s even going on with our world in the first place, and that is where Roser, Ritchie and the rest of their research team here can be hugely helpful.

Share your feedback on your startup’s attorney

We want to help startup founders work with attorneys who are right for them. My colleague Eric Eldon wrote a piece today describing our methodology and a little bit more of why we are doing this project.

We have had hundreds of founders give us their recommendations. If you have worked with a great early-stage startup attorney that you recommend, let us know using this short Google Forms survey and also spread the word. We will share the results and more in the coming weeks.

Stray Thoughts (aka, what I am reading)

Short summaries and analysis of important news stories

Startup socialism with capitalist characteristics

Robert P. Baird does a great job describing the rise of Jacobin, the socialist magazine startup that has become a linchpin in leftist politics. It’s a story of a college founder who hustled his way to financial independence and growth. From the article:

Sunkara, for his part, told me that there’s no contradiction between his entrepreneurial enthusiasm and his socialist ideals. “The market logic of creating a publication,” he says—attracting readers, getting them to subscribe, finding competitive advantages that will keep them on the rolls—“is politically pure.”

Is Surveillance Capitalism a thing?

Nicholas Carr wrote a deep dive review for the LA Review of Books of Shoshana Zuboff’s hot new book “The Age of Surveillance Capitalism.” There has been a ton of discussion triggered here, particularly in light of France’s record $57 million fine against Google over GDPR violations earlier this week, and Carr wrote what is probably the best review and context piece available. Still, the question to me remains the same: does anyone actually care that their devices monitor them? Judging by device and services sales, I think much less than privacy advocates appreciate.

Why are investors still investing in Apple’s supply chain?

Bloomberg has an interesting conundrum to discuss: why are investors still standing behind companies like Han’s Laser Technology Industry Group Co., which have seen huge valuation losses over the slowdown in iPhone sales? It’s a bit of a complicated story, but basically investors still believe that high-end manufacturing will drive excess profits even in a chaotic, slower growing, and competitive world. An interesting discussion worth reading.

What’s next & obsessions

  • I have a lot of short books on my desk to read.
  • Arman is reading Never Lost Again by Bill Kilday, a history of mapping at Google and beyond.
  • Arman and I are interested in societal resilience startups that are targeting areas like water security, housing, infrastructure, climate change, disaster response, etc. Reach out if you have ideas or companies here <danny@techcrunch.com>
23 Jan 2019

A new ABC documentary and podcast about Theranos features never-before aired depositions

The rise and fall of Theranos, the blood-testing company whose technology never worked despite its promises otherwise, has already been covered extensively. Most notably, the two-time Pulitzer Prize-winning reporter who broke open the story of Theranos’s secrets and lies, John Carreyrou, went on to author a best-selling book about the saga in Bad Blood.

Still, with Theranos founder and CEO Elizabeth Holmes continuing to face criminal charges that she knowingly defrauded investors, along with Theranos’s former president and COO (and Holmes’s longtime lover) Ramesh “Sunny” Balwani, the company and the pair’s trajectory remain a point of fascination for many.

A new documentary produced by ABC’s “Nightline” airing tonight — along with a six-part podcast series whose first episode is being released today (the others will be pushed out every Wednesday through February’s end)  — will undoubtedly stoke even more questions about how investors and customers like Walgreens bought the act in the first place.

So we gathered after speaking yesterday with Rebecca Jarvis, ABC News’s chief business, technology, and economics correspondent, who led a three-year investigation into Theranos and Holmes, a Stanford drop-out who would go on to win acclaim as the youngest self-made female billionaire in the world before everything, very slowly, crashed down around her.

Some outtakes from our chat with Jarvis follow, edited lightly for length.

TC: You’ve been covering this story for years. Given all that you’ve seen in the depositions that “Nightline” plans to air as part of this documentary, and everything you’ve learned in your reporting, who was the worse actor in all of this, Holmes or Balwani? John Carreyrou certainly painted him as a kind of Svengali figure.

RJ:  Most of what we’ve seen publicly to this point have been official statements, or statements made in very nurturing environments, or interviews don’t don’t explicitly look at the technology itself. When we got access to these depositions — and it’s thundreds of hours of footage — we couldn’t believe our eyes, watching Elizabeth Holmes’s deposition. It was just remarkable, hearing her having to answer to questions in a way that she’d never had to previously.

As for [the way Holmes and Balwani operated], Tyler Schultz [a former employee who later became a whistleblower] has said, for example, that he was flagging things that were wrong to Elizabeth, and after he would flag a concern, she would react with a non-response. It was Sunny who became known as the enforcer, telling Tyler to watch himself and not to continue to raise these issues.

TC: Are they open about their romantic relationship in the footage being aired?

RJ: Yes. We’ve never heard of them speak of it before, and viewers will see them talking about this relationship.

TC: What was something in the many depositions you pored over that really took your breath away?

RJ: One of the things that we heard over and over again, talking with various parties, including customers of Theranos, is that Elizabeth Holmes had told them that these Theranos-manufactured devices had been deployed in hospital rooms, emergency rooms and medevac helicopters among other places, and she’s asked if this is accurate, and in every single case, the answer is no.

Naturally, too, this whole thing was predicated on being able to run tests on a few drops of blood, and for the first time, you see Elizabeth having to answer questions about what the devices were really capable of. A lot of what comes up is how much of this was aspiration versus reality, and the great divide between those two things.

TC: The government filed its criminal fraud case against former Holmes and Balwani last June. Does the documentary cover the status of that case?

RJ: At this point, both of them have pleaded not guilty to the DOJ’s charges. She’d settled with the SEC without admitting wrongdoing; Balwani is still fighting the SEC’s charges. But they’ll have to face the DOJ in court. When will that happen [is a question mark]. The government shutdown has slowed the ability to get millions of documents to the DOJ and to prosecutors.

TC: How much do the podcast and the documentary have in common?

RJ: The podcast encompasses a greater breadth of our work. For example, among the numerous interviews in the podcast that you’ll hear is with Rochelle Gibbons, the wife of a former chief scientist at Theranos [Ian Gibbons] who’d committed suicide, an act she blames on Theranos. You’ll hear how the deal with Walgreens came together from behind-the-scenes accounts. Walgreens ultimately sued Theranos and settled with Theranos for an undisclosed sum, but people look at story and ask how this could have made it into Walgreens in the first place; we looked in depth at how it happened, talking with the people who were there and who share what they were shown by people from Theranos. We also talk with her honors physics teacher in high school and her family friendsl

TC: Do you think Holmes has a personality disorder?

RJ: I don’t have the medical training to answer that question. I”m not a psychologist. But people around her have used the word “sociopath.”

Her family friends give a real sense of what she was like as a kid. They paint  a picture of someone who was incredibly precocious, who wanted to be successful and who believe her family’s history had a lot to do with this. There’s a kind of paradise lost backstory tying back to the Fleischmann yeast fortune, which had dwindled as it passed through the hands of generations, before it made it to her father, Christian Holmes. It’s something that people who were around the family say was a talking point among them.

TC: Were you ever concerned about your safety, reporting on Theranos? Holmes has repeatedly been portrayed as a bully.

RJ: I didn’t feel that way. We did pay Theranos a number of visits over the years and we did get kicked out. But we talked with other people who worked at Theranos at the time the story [of its failings] starting getting out into the mainstream, and for example, one employee who was crashing on the couch of a friend for a few days, at an address that she hadn’t even given to her mother, was sent a legal notice there, which made her believe she was being followed.

TC: How else did the company try to intimidate employees?

RJ: The fear was always that your job was on the line if you raised concerns. If you said, “This isn’t working,” you’d get in trouble and be asked: “Do you like working here?” A lot of people wound up quitting.

TC: Knowing what you do, do you have sympathy for the investors who’d gotten involved in Theranos? There’s only so much due diligence one can do but were there warning signs they should have heeded?

RJ: It’s true that early-stage venture investments, there isn’t a ton of due diligence you can do. For the story, we talk with one attorney who is suing on behalf of 200 investors, and he talks about his long, storied career, in which he has also gone up against Bernie Madoff. And in both of these cases, he points to affinity fraud. If an investment is good enough for you, who are a person in my social circle who I respect, it’s good enough for me. Betsy DeVos’s family was involved. Rupert Murdoch. Robert Kraft, owner of the New England Patriots. The Walton family. But it wasn’t just big names. We hear from a retired executive assistant who got a tip to put money into this, that it was the next Apple, and she lost $150,00 of her retirement savings — the biggest investment of her entire life.

[Renowned VC] Tim Draper wrote Holmes her first check for $1 million around the time she dropped out of Stanford. His daughter Jessie was a friend of hers. But the board you hear about came together in 2011 after she landed the support of [the dean of Stanford’s engineering school] Channing Robertson, who helped her put her board together. He was a very well-liked professor who was taken with her. Because he came on board right as she was leaving Stanford, he really gave credibility to her. Meanwhile, other Stanford professors were wondering: how does a young student with less than two years of college experience know enough about medical devices and the medical industry to develop a product like this?

23 Jan 2019

Sherpa, a Spanish voice assistant, expands Series A to $15M as it passes 5M users

When we think of the AI platforms that are shaping how we use voice to interact with phones, home devices and other services, we tend to think of Amazon’s Alexa, Apple’s Siri, Google and Microsoft’s Cortana. But there are other players that may prove to have a compelling value proposition of their own. Sherpa.ai, a voice assistant out of Spain that also provides predictive recommendations with a focus on the Spanish language, today is announcing that it has expanded its Series A by $8.5 million to $15 million as it passes 5 million active users of its app.

Investors include Mundi Ventures, a Spanish VC fund focused on AI, and Alex Cruz, the chairman and CEO of British Airways.

In a still-heated tech climate where were startups are raising tens and sometimes hundreds of millions of dollars in rounds that sometimes happen only months apart, Sherpa’s Series A has been a comparatively slow burn: the startup first announced a Series A of $6.5 million nearly three years ago.

Apart from the fact that European startups do tend to raise and spend more conservatively, Xabi Uribe-Etxebarria, the startup’s founder and CEO, says that it chose to extend this Series A now while it’s still working on closing its Series B for later this year, which will be in the region of $20 million, which will include new investors and likely more detail on how it plans to evolve the business.

“We’re announcing several agreements with big OEMs in the next few months,” he said. “I spoke with our investors and they thought it would be better to get a small amount of capital now to launch those deals to use the momentum to get a better valuation on our Series B.”

The company is already working with Porsche to bring its assistant and recommendation service into its vehicles, and Uribe-Etxebarria said future partnerships, along a similar B2B2C model, will be with “other automakers, telcos and other device manufacturers of smart speakers and PCs.” From what I have heard, Sherpa has been approached by a number of others that have been building voice assistants, as well as the companies building the hardware and other objects that will be housing them. Uribe-Etxebarria would not comment except to say that he is under NDA with several companies.

Sherpa.ai has experienced tremendous growth and is poised to become the most advanced conversational and predictive AI OS in the industry,” said Rajeev Singh-Molares, partner at Mundi Ventures and former President of Alcatel-Lucent Asia-Pacific, in a statement. “Sherpa has shown phenomonal potential and amazing growth since the first close of the Series A. By increasing our investment in this company, we are able to accelerate Sherpa.ai on its journey.”

Scale isn’t everything

At a time when Amazon’s Alexa alone has passed the 100 million-mark in terms of devices that have been sold that are powered by its voice assistant, and Google, Microsoft and Apple appear to be quickly playing catch-up by integrating into a number of third-party and their own devices themselves,  Uribe-Etxebarria says he believes Sherpa stands apart from these for a couple of reasons.

One is the spectre of competition, and possibly the history of how things played out in mobile, where carriers really lost their way with users and value-added services with the rise of apps.

“The companies we are working with don’t always want agreements with companies that also compete with them,” he said. “Take the telco we’re working with. It has its own video and music offerings, its own retail operation. At the end, they would be competing with the likes of Apple or Amazon, so they don’t want to give them access to their users. Car manufacturers might feel the same way.”

The second reason, he says, has to do with Sherpa’s technology.

When the company launched several years ago, voice-based personal assistants were still relatively new and all the biggies were launching in English. These days, they all have Spanish versions, so this is no longer a unique selling point. (Of the company’s 5 million users, between 80-90 percent of those are using Sherpa’s Spanish content.) And even if it were, Sherpa’s basic speech recognition and text-to-speech are powered by third-party technology, which Uribe-Etxebarria calls “commodities.”

What is more unique, he says, is the company’s predictive recommentations, which is built in-house by his team of natural language and other AI specialists. It covers over 30 different specialist categories spanning areas like automotive, entertainment, news, travel and so on, and analyzes 100,000 parameters per user to be able to predict what information a user needs before a question is even asked, whether it’s news or whatever it is that you first do with your phone when you wake up, which emails you will need to see first, or what you might want to know when you arrive at a particular location.

“This is what our competitors are very interested in,” he said. “We are at least two or three years ahead of others on this front.”

Sherpa had a significant boost across the Spanish-speaking world when Samsung hooked up with the company to preload the app on all of its devices sold across those countries. That changed after Samsung launched Bixby, its own assistant, but Uribe-Etxebarria said that their partnership is not quite over yet.

“We are still speaking because Bixby can be improved a lot,” he said.

23 Jan 2019

Sequoia-backed NEXT gets $97M as investment in logistics heats up

Despite its “unsexy” reputation, the logistics industry is attracting massive investment from venture capitalists.

With a fresh $97 million in Series C funding, NEXT joins a fleet of heavily funded logistics platforms, including Flexport, Huochebang and Convoy. The company, which connects shippers and carriers through an online marketplace, raised the capital from Brookfield Ventures, with participation from Sequoia Capital and logistics solutions provider GLP. NEXT declined to disclose the valuation or whether its latest financing included debt.

In 2018, global logistics startups collected more than $6 billion in VC funding, nearly double the $3.2 billion invested in the space the year prior, according to PitchBook. A significant portion of the 2018 capital went to Chinese ventures at about 40 percent. U.S. logistics businesses raised 19 percent, or about $1.2 billion, across 114 deals.

“The logistics space is under more pressure than ever before — with more shipments coming into our ports than drivers and warehouses have the capacity to manage,” NEXT co-founder and chief executive officer Lidia Yan said in a statement.

NEXT was founded in 2015 by Yan and her husband Elton Chung. The round brings the business’s total raised to $125 million, including a $21 million round in January 2018.

Headquartered in Lynwood, California, NEXT plans to use the investment to fill 150 positions in 2019, as well as complete the launch of Relay, a new service targeting the “systemic congestion” at shipping ports.

“NEXT continues to address the critical issues that face logistics management in the U.S. — from the nationwide driver shortage to congestion and operations at our busiest ports,” Sequoia partner Omar Hamoui said in a statement. “We’ve been impressed with NEXT’s ability to execute, and the introduction of Relay proves they have the team and expertise to continue innovating in ways that will ease the pain points of carriers and shippers.”

23 Jan 2019

Millions of bank loan and mortgage documents have leaked online

A trove of more than 24 million financial and banking documents, representing tens of thousands of loans and mortgages from some of the biggest banks in the U.S., has been found online after a server security lapse.

The server, running an Elasticsearch database, had more than a decade’s worth of data, containing loan and mortgage agreements, repayment schedules and other highly sensitive financial and tax documents that reveal an intimate insight into a person’s financial life.

But it wasn’t protected with a password, allowing anyone to access and read the massive cache of documents.

It’s believed that the database was only exposed for two weeks — but long enough for independent security researcher Bob Diachenko to find the data. At first glance, it wasn’t immediately known who owned the data. After we inquired with several banks whose customers information was found on the server, the database was shut down on January 15.

With help from TechCrunch, the leak was traced back to Ascension, a data and analytics company for the financial industry, based in Fort Worth, Texas. The company provides data analysis and portfolio valuations. Among its services, the Ascension converts paper documents and handwritten notes into computer-readable files — known as OCR.

It’s that bank of converted documents that was exposed, Diachenko said in his own write-up.

Sandy Campbell, general counsel at Ascension’s parent company, Rocktop Partners, which owns more than 46,000 loans worth $4.4 billion, confirmed the security incident to TechCrunch.

“On January 15, this vendor learned of a server configuration error that may have led to exposure of some mortgage-related documents,” he said in a statement. “The vendor immediately shut down the server in question, and we are working with third-party forensics experts to investigate the situation. We are also in regular contact with law enforcement investigators and technology partners as this investigation proceeds.”

An unspecified portion of the loans were shared with the contractor for analysis, the statement added, but couldn’t immediately confirm how many loan documents were exposed.

In a phone call, Campbell confirmed that the company will inform all affected customers, and report the incident to state regulators under data breach notification laws.

From our review, it was clear that the documents pertain to loans and mortgages and other correspondence from several of the major financial and lending institutions dating as far back as 2008, if not longer, including CitiFinancial, a now-defunct lending finance arm of Citigroup, files from HSBC Life Insurance, Wells Fargo, CapitalOne and some U.S. federal departments, including the Department of Housing and Urban Development.

Some of the companies have long been defunct, after selling their mortgage divisions and assets to other companies.

Though not all files contained the highly sensitive and personal data points, we found: names, addresses, birth dates, Social Security numbers and bank and checking account numbers, as well as details of loan agreements that include sensitive financial information, such as why the person is requesting the loan.

Some of the documents also note if a person has filed for bankruptcy and tax documents, including annual W-2 tax forms, which are targets for scammers to claim false refunds.

One record, picked at random and redacted, reveals a loan agreement for an individual, including personal information such as the loan amount, name, address and Social Security number (Image: TechCrunch)

But the database stored documents in a random order, and were not easily followable or presented in an easy to read or formatted way, making it difficult to follow from one document to another, said Diachenko.

We verified the authenticity of data by checking a portion of names in the database with public records.

“These documents contained highly sensitive data, such as Social Security numbers, names, phones, addresses, credit history and other details which are usually part of a mortgage or credit report,” Diachenko told TechCrunch. “This information would be a gold mine for cyber criminals who would have everything they need to steal identities, file false tax returns, get loans or credit cards.”

Although the documents originate from these financiers, one bank — Citi, which helped to secure the data — said it had no current relationship with the company.

“Citi recently became aware that a third party, with no connection to Citi, was storing certain mortgage origination and modification documents in an unsecure online environment,” said a Citi spokesperson. “These documents contained information about current or former Citi customers, as well as customers from other financial institutions. Citi notified law enforcement, initiated a thorough forensic investigation and worked quickly to ensure the information could no longer be publicly accessed.”

Citi confirmed that “third party is a vendor to a company that had purchased the loans and we have found no evidence that Citi’s systems were compromised.”

The bank added that it’s working to identify potentially affected customers.

Dozens of other companies are affected, including smaller regional banks and larger multinationals.

A Wells Fargo spokesperson said the data was obtained by Ascension from other entities that purchased Wells Fargo mortgages. When reached, neither HSBC nor CapitalOne had comment at the time of publication. A Housing and Urban Development spokesperson did not respond to a request for comment. The department is currently affected by the ongoing government shutdown. If anything changes, we’ll update.

It’s the latest in a series of security lapses involving Elasticsearch databases.

A massive database leaking millions of real-time SMS text message data was found and secured last year, as well as a popular massage service and, most recently, AIESEC, the largest youth-run nonprofit for working opportunities.


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23 Jan 2019

Amazon is piloting its own delivery robot

It was, of course, just a matter of time before Amazon deployed delivery robots. The company has had a robotics wing for a number of years now, though much of its public-facing side has been focused on warehouse logistics. Today, however, it took the wraps off Scout.

The six-wheeled robot looks a fair bit like a number of the delivery robots already being piloted on sidewalks all over the world. This one, however, was apparently developed in-house by Amazon. As the company notes, the electric system is the size of a beach cooler and cruises along at roughly a walking pace.

The ‘bot is going to be piloted in Snohomish County, Washington, which boarders Seattle’s King County. The company no doubt wanted to get word out before residents were confused by little blue robots cruising around their otherwise quiet neighborhoods. There’s even an ad with jaunty startup music to assure people they’ve got nothing to fear.

The pilot program involves six Scouts to start. The ‘bots are designed to autonomously reach their destination, but these early models will be accompanied by Amazon employees to make sure everything goes as planned. If Amazon does adopt Scout more widely, the robot could eventually replace last mile logistics from carriers like UPS, FedEx and USPS.