Category: UNCATEGORIZED

Lately, my inbox has been chock-full of pitches for weed businesses.

A couple of years ago it was bitcoin/blockchain startups, then came scooters; now, it seems “CannTech” is hitting an all-time high thanks to support from venture capitalists. By the way, I didn’t make up the term CannTech, but it seems just as good as anything else, so I’m rolling with it.

According to data collected by PitchBook, VCs have put $1.2 billion in U.S.-based cannabis companies so far in 2019. That’s significantly more than last year’s record high of $836 million, and we aren’t even halfway through 2019.

At this rate, we can expect roughly $2.5 billion invested in CannTech in 2019, i.e. more capital invested in the space in a single year than has been funneled into the space in the last decade.

What’s going on? A few things. Of course, states are increasingly legalizing medical and/or recreational marijuana. That’s allowed companies like Eaze, a marijuana delivery company, to grow at unprecedented rates. The startup, for example, closed its Series C in December on $65 million and is already fundraising again, this time at a $500 million valuation.

In addition to legalization, VCs, and more importantly, limited partners, have woken up to the business opportunity of cannabis. Soon, gone will be the days of strict morality clauses that dissuaded VC firms from supporting startups focused on weed. The firms that were early to understand the space, like DCM Ventures or Snoop Dogg’s Casa Verde Capital, will reap the benefits.

Speaking of DCM, the firm put on a huge, first-of-its-kind summit this week focused on CannTech: “For three years I was struggling with a lot of pain issues,” DCM co-founder David Chao told the audience. “One day I was playing Xbox with Blake Krikorian [co-founder of Sling Media] and I said ‘you know Blake, I have this pain problem’ and he said, ‘oh, you should try pot.’ And I said ‘why should I do that? I haven’t smoked since college?’ “

Long story short, Chao can thank his friend Blake for making him aware of an exploding market, and he can thank DCM’s scrappy partner, Kyle Lui, for helping the firm score some major investments in the space, like Eaze.

“We were the first Sand Hill VCs to invest in cannabis and everyone started calling me saying ‘you’re crazy, why are you doing this?’ ” Lui said.

It’s still very early days in the CannTech space, but the market is expected to be worth as much as $80 billion by 2030. That can only mean interest will soar from here.

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IPO corner

Uber: It was a disappointing debut, to say the least. The ride-hailing business (NYSE: UBER), previously valued at $72 billion by venture capitalists, priced its stock at $45 apiece for a valuation of $82.4 billion on Thursday. Then it began trading Friday morning at $42 apiece, only to close even lower at $41.57, down 7.6% from its IPO price.

Slack: Not a whole lot of news to share here yet, other than that the workplace messaging business will host its investor day on Monday. It’s invite-only, though Slack, like Spotify, will live-stream the event to the public. More details on that here.

Luckin Coffee: The Chinese upstart going after Starbucks is set to debut on the Nasdaq under the symbol “LK.” In a new filing, Luckin said it plans to sell 30 million shares at an initial range of $15-$17. That gives an estimated raise of $450 million to $510 million, but it could be bumped up if underwriters take up the additional allocation of 4.5 million shares. So, as a grand total, the listing could raise $586.5 million if the full offering is bought at the top of the range.

Lyft: Not an IPO update but the company did release its first-ever earnings report. Here’s the TL;DR: revenues of $776 million on losses of $1.14 billion, including $894 million of stock-based compensation and related payroll tax expenses. The company’s revenues surpassed Wall Street estimates of $740 million, while losses came in much higher as a result of IPO-related expenses.

M&A

Harry’s razors are crappy, I’m told. Alas, the brand is worth $1.37 billion to Edgewell Personal Care, the company behind Schick and Banana Boat. Founded in 2013, Harry’s had raised about $375 million in venture capital funding. Edgewell says its $1.37 billion payment will break down to roughly 79% cash and 21% stock, giving Harry’s shareholders an 11% stake in Edgewell.

Big rounds

• VCs value Carta at $1.7B with $300M round
• Gett raises $200M at $1.5B valuation
• BigBasket becomes a unicorn with $150M investment 
• Unity has filed to raise up to $125M at $6B valuation
• Sumo Logic gathers $110M at $1B valuation 

Small(er) rounds

• Tourlane raises $47M from Sequoia and Spark Capital
• Cybersecurity insurance startup Coalition raises $40M
• K-Zen Beverage, a cannabis-infused drink brand, nabs $5M
• Recent YC-grad MedCrypt raises $5M 
• Sextech company scorned by CES scores $2M

Inspiration

Meet Beat Saber, an eight-person startup with no funding that’s turned into VR’s biggest success story. Venture capital isn’t always the answer, folks.

~Extra Crunch~

Our premium subscription service was loaded with A+ content this week. TechCrunch contributor Jon Evans wrote a piece titled “Against the Slacklash,” wherein he makes the case that Slack isn’t inherently bad. “Rather, the particular way in which you are misusing it epitomizes your company’s deeper problems.” Plus, Eric Peckham asked nine top VCs, including Cyan Banister and Charles Hudson, to share where they are putting their money when it comes to media, gaming and entertainment.

#Equitypod

It’s time for another transcribed edition of Equity. This week for the regularly scheduled episode we had the whole crew pop into the San Francisco studio. Kate Clark, Connie Loizos and Alex Wilhelm were joined by Om Malik, former journalist and current VC at True Ventures.

They convened just after Uber priced, so they had a lot to dig into: The low price, would it pop and would the former CEO and co-founder Travis Kalanick be at the ringing of the bell in New York (he wasn’t).

But it wasn’t all Uber; they talked Carta, Cruise and Harry’s. Below is an excerpt. And come back soon for an emergency episode where Alex and Kate will go deeper on the Uber IPO. For access to the full transcription, become a member of Extra Crunch. Learn more and try it for free. 

Alex: Well, I want to go back to the price really quick because $82 billion is below the 90 we had heard after we’d heard the 120 back in October. So this is a dramatic downgrade in price, which I think as said Om said is actually pretty smart because they’ll have a nice pop and things will get better.

Connie: And also, when you look back, it never really matters that much. I mean, I feel like a couple of people have already pointed this out in the media today. But Google, Facebook, I mean, there’s been so many companies where their IPOs didn’t seem to even go very well. I just don’t think it really is going to matter in the long term what happens tomorrow.

Alex: Well, the difference though is Uber needs to raise a bunch of money to stay alive. I mean, Facebook when they went public had a relatively rough post IPO period, had $1 billion in trailing gap net income. They were fine. Their IPO wasn’t that important aside from the liquidity then. It wasn’t a fundraising metric. At this price, they are going to raise less money than they could’ve at a higher price, and they burn tons of it.

Kate: I think there are a lot of reasons why they probably did lower their targets, but I think one probably has to do with Lyft’s performance. So I think we should just quickly go over. Lyft did release their first earnings report this week, which was pretty interesting. The TL;DR is that they posted first quarter revenues of $776 million on losses of $1.14 billion, which did include 894 million of stock-based compensation related payroll tax expenses, which in other words, just major IPO expenses. So losses were huge, yes. The company’s revenues did surpass Wall Street estimates, which were 740 million. But of course, with all the IPO expenses, losses came in significantly higher.

Truecaller, an app that helps users screen strangers and robocallers, will soon allow users in India, its largest market, to borrow up to a few hundred dollars in the nation.

The crediting option will be the fourth feature the nine-year-old app adds to its service in the last two years. So far it has added to the service the ability to text, record phone calls and mobile payment features, some of which are only available to users in India. Of the 140 million daily active users of Truecaller, 100 million live in India.

The story of the ever-growing ambition of Truecaller illustrates an interesting phase in India’s internet market that is seeing a number of companies mold their single-functioning app into multi-functioning so-called super apps.

Inspired by China

This may sound familiar. Truecaller and others are trying to replicate Tencent’s playbook. The Chinese tech giant’s WeChat, an app that began life as a messaging service, has become a one-stop solution for a range of features — gaming, payments, social commerce and publishing platform — in recent years.

WeChat has become such a dominant player in the Chinese internet ecosystem that it is effectively serving as an operating system and getting away with it. The service maintains its own app store that hosts mini apps and lets users tip authors. This has put it at odds with Apple, though the iPhone-maker has little choice but to make peace with it.

For all its dominance in China, WeChat has struggled to gain traction in India and elsewhere. But its model today is prominently on display in other markets. Grab and Go-Jek in Southeast Asian markets are best known for their ride-hailing services, but have begun to offer a range of other features, including food delivery, entertainment, digital payments, financial services and healthcare.

The proliferation of low-cost smartphones and mobile data in India, thanks in part to Google and Facebook, has helped tens of millions of Indians come online in recent years, with mobile the dominant platform. The number of internet users has already exceeded 500 million in India, up from some 350 million in mid-2015. According to some estimates, India may have north of 625 million users by year-end.

This has fueled the global image of India, which is both the fastest growing internet and smartphone market. Naturally, local apps in India, and those from international firms that operate here, are beginning to replicate WeChat’s model.

Leading that pack is Paytm, the popular homegrown mobile wallet service that’s valued at $18 billion and has been heavily backed by Alibaba, the e-commerce giant that rivals Tencent and crucially missed the mobile messaging wave in China.

Commanding attention

In recent years, the Paytm app has taken a leaf from China with additions that include the ability to text merchants; book movie, flight and train tickets; and buy shoes, books and just about anything from its e-commerce arm Paytm Mall . It also has added a number of mini games to the app. The company said earlier this month that more than 30 million users are engaging with its games.

Why bother with diversifying your app’s offering? Well, for Vijay Shekhar Sharma, founder and CEO of Paytm, the question is why shouldn’t you? If your app serves a certain number of transactions (or engagements) in a day, you have a good shot at disrupting many businesses that generate fewer transactions, he told TechCrunch in an interview.

At the end of the day, companies want to garner as much attention of a user as they can, said Jayanth Kolla, founder and partner of research and advisory firm Convergence Catalyst.

“This is similar to how cable networks such as Fox and Star have built various channels with a wide range of programming to create enough hooks for users to stick around,” Kolla said.

“The agenda for these apps is to hold people’s attention and monopolize a user’s activities on their mobile devices,” he added, explaining that higher engagement in an app translates to higher revenue from advertising.

Paytm’s Sharma agrees. “Payment is the mote. You can offer a range of things including content, entertainment, lifestyle, commerce and financial services around it,” he told TechCrunch. “Now that’s a business model… payment itself can’t make you money.”

Big companies follow suit

Other businesses have taken note. Flipkart -owned payment app PhonePe, which claims to have 150 million active users, today hosts a number of mini apps. Some of those include services for ride-hailing service Ola, hotel booking service Oyo and travel booking service MakeMyTrip.

What works for PhonePe is that its core business — payments — has amassed enough users, Himanshu Gupta, former associate director of marketing and growth for WeChat in India, told TechCrunch. He added that unlike e-commerce giant Snapdeal, which attempted to offer similar offerings back in the day, PhonePe has tighter integration with other services, and is built using modern architecture that gives users almost native app experiences inside mini apps.

When you talk about strategy for Flipkart, the homegrown e-commerce giant acquired by Walmart last year for a cool $16 billion, chances are arch rival Amazon is also hatching similar plans, and that’s indeed the case for super apps.

In India, Amazon offers its customers a range of payment features such as the ability to pay phone bills and cable subscription through its Amazon Pay service. The company last year acquired Indian startup Tapzo, an app that offers integration with popular services such as Uber, Ola, Swiggy and Zomato, to boost Pay’s business in the nation.

Another U.S. giant, Microsoft, is also aboard the super train. The Redmond-based company has added a slew of new features to SMS Organizer, an app born out of its Microsoft Garage initiative in India. What began as a texting app that can screen spam messages and help users keep track of important SMSs recently partnered with education board CBSE in India to deliver exam results of 10th and 12th grade students.

This year, the SMS Organizer app added an option to track live train schedules through a partnership with Indian Railways, and there’s support for speech-to-text. It also offers personalized discount coupons from a range of companies, giving users an incentive to check the app more often.

Like in other markets, Google and Facebook hold a dominant position in India. More than 95% of smartphones sold in India run the Android operating system. There is no viable local — or otherwise — alternative to Search, Gmail and YouTube, which counts India as its fastest growing market. But Google hasn’t necessarily made any push to significantly expand the scope of any of its offerings in India.

India is the biggest market for WhatsApp, and Facebook’s marquee app too has more than 250 million users in the nation. WhatsApp launched a pilot payments program in India in early 2018, but is yet to get clearance from the government for a nationwide rollout. (It isn’t happening for at least another two months, a person familiar with the matter said.) In the meanwhile, Facebook appears to be hatching a WeChatization of Messenger, albeit that app is not so big in India.

Ride-hailing service Ola too, like Grab and Go-Jek, plans to add financial services such as credit to the platform this year, a source familiar with the company’s plans told TechCrunch.

“We have an abundance of data about our users. We know how much money they spend on rides, how often they frequent the city and how often they order from restaurants. It makes perfect sense to give them these valued-added features,” the person said. Ola has already branched out of transport after it acquired food delivery startup Foodpanda in late 2017, but it hasn’t yet made major waves in financial services despite giving its Ola Money service its own dedicated app.

The company positioned Ola Money as a super app, expanded its features through acquisition and tie ups with other players and offered discounts and cashbacks. But it remains behind Paytm, PhonePe and Google Pay, all of which are also offering discounts to customers.

Integrated entertainment

Super apps indeed come in all shapes and sizes, beyond core services like payment and transportation — the strategy is showing up in apps and services that entertain India’s internet population.

MX Player, a video playback app with more than 175 million users in India that was acquired by Times Internet for some $140 million last year, has big ambitions. Last year, it introduced a video streaming service to bolster its app to grow beyond merely being a repository. It has already commissioned the production of several original shows.

In recent months, it has also integrated Gaana, the largest local music streaming app that is also owned by Times Internet. Now its parent company, which rivals Google and Facebook on some fronts, is planning to add mini games to MX Player, a person familiar with the matter said, to give it additional reach and appeal.

Some of these apps, especially those that have amassed tens of millions of users, have a real shot at diversifying their offerings, analyst Kolla said. There is a bar of entry, though. A huge user base that engages with a product on a daily basis is a must for any company if it is to explore chasing the super app status, he added.

Indeed, there are examples of companies that had the vision to see the benefits of super apps but simply couldn’t muster the requisite user base. As mentioned, Snapdeal tried and failed at expanding its app’s offerings. Messaging service Hike, which was valued at more than $1 billion two years ago and includes WeChat parent Tencent among its investors, added games and other features to its app, but ultimately saw poor engagement. Its new strategy is the reverse: to break its app into multiple pieces.

“In 2019, we continue to double down on both social and content but we’re going to do it with an evolved approach. We’re going to do it across multiple apps. That means, in 2019 we’re going to go from building a super app that encompasses everything, to Multiple Apps solving one thing really well. Yes, we’re unbundling Hike,” Kavin Mittal, founder and CEO of Hike, wrote in an update published earlier this year.

And Reliance Jio, of course

For the rest, the race is still on, but there are big horses waiting to enter to add further competition.

Reliance Jio, a subsidiary of conglomerate Reliance Industry that is owned by India’s richest man, Mukesh Ambani, is planning to introduce a super app that will host more than 100 features, according to a person familiar with the matter. Local media first reported the development.

It will be fascinating to see how that works out. Reliance Jio, which almost single-handedly disrupted the telecom industry in India with its low-cost data plans and free voice calls, has amassed tens of millions of users on the bouquet of apps that it offers at no additional cost to Jio subscribers.

Beyond that diverse selection of homespun apps, Reliance has also taken an M&A-based approach to assemble the pieces of its super app strategy.

It bought music streaming service Saavn last year and quickly integrated it with its own music app JioMusic. Last month, it acquired Haptik, a startup that develops “conversational” platforms and virtual assistants, in a deal worth more than $100 million. It already has the user bases required. JioTV, an app that offers access to over 500 TV channels; and JioNews, an app that additionally offers hundreds of magazines and newspapers, routinely appear among the top apps in Google Play Store.

India’s super app revolution is in its early days, but the trend is surely one to keep an eye on as the country moves into its next chapter of internet usage.

This morning, the SEC approved as the U.S.’s 14th stock exchange Long Term Stock Exchange (LTSE), an outfit that was conceived in 2012 by “Lean Startup” author Eric Ries as a place  where public market shareholders who hold onto their shares through thick and thin would be rewarded for their loyalty.

Ries thinks such rewards are important because he believes in public markets. Among other things, by establishing a common currency, being publicly traded enables companies to more easily acquire other companies. It enables employees to more freely sell their shares. It also allows retail investors to participate in the growth of tech companies — growth from which they’ve largely been shut out in recent years as the average time a company remains private as stretched to roughly 12 years.

Indeed, Ries’s biggest issue with public market shareholders is their focus on short-term results, citing it as the biggest driver for startups to remain privately held. After all, it’s hard to innovate when you’re being sued over disappointing earnings.

Whether LTSE can usher in rules that encourage both companies and shareholders to focus on the longer term remains to be seen. LTSE has not received approval over any kind of listings standards. It hasn’t even submitted these yet.

While ideally, the exchange wants to welcome “values-based” companies that limit executive bonuses and grant more voting power to shareholders who hang on for the ride, Ries seems to recognize that he may have to settle for less owing to some pushback, including by the Council of Institutional Investors, a group of institutions that fear long-term voting could ultimately empower founders and company insiders at the expense of other shareholders.

During a call today, he told us that LTSE won’t necessarily give more voting power to shareholders who hang on for the long term. “These rewards could be voting or other things,” he said.

Certainly, Ries will see some rewards if LTSE takes off. While numerous reports today note that famed VC Marc Andreessen is one of LTSE’s financial backers, the biggest shareholder right now is Ries himself, who owns 30 percent of the for-profit company, according to government filings.

Other major shareholders include John Bautista, a cofounder of Long Term Stock Exchange who is also an attorney with the law firm Orrick; Founders Fund, which owns 14 percent of the company; Collaborative Fund, which owns 7.8 percent; and Obvious Ventures, which owns 6.7 percent. The company has raised roughly $19 million altogether to date.

Ries is hardly alone wanting companies to be able to go public sooner without worrying about activist investors. We’d written about the case for tenured voting in late 2017, noting then that concept has been around for decades. But while it resonates with founders, few others have embraced the idea. Back in the 1980s, for example, U.S. stock exchanges determined that tenured voting was unnecessarily complicated and too hard to track. Meanwhile, bankers don’t like the idea because anything that looks different to the market is harder to sell.

Interestingly, another Andreessen-backed startup to make headlines this week — Carta — seems like a bet that LTSE won’t realize its vision completely. The seven-year-old, San Francisco-based startup largely helps private company investors, founders, and employees manage their equity and ownership. But it raised $300 million in Series E funding at a $1.7 billion valuation led by Andreessen Horowitz. The reason, it says: its plans to become what Carta CEO Henry Ward describes as the world’s largest marketplace for private company shares.

Carta paints the evolution as a natural one, now that so many startups and institutional investors use its platform already. And investors seem to agree that Carta has more pieces in place than any platform before it. As VC Om Malik of True Ventures told us yesterday, citing the company’s “data density” and “clarity” into the goings on of the many participants on its platform: “That’s one company I wish I was a stockholder in, I like it that much.”

In fact, Ward talks about Carta democratizing access to the private market, but it seems more interested in becoming a hub for startups and institutional investors to get their private company trades done. (At least, Ward, with whom we spoke last week, did not answer simple questions about who will be able to use the platform in the future.)

Whether either company realizes its bold ambitions will take time to know. In the meantime, it will be interesting to understand whether together they can become a safer, smoother, less stressful way for startups to go public, or instead the two wind up competing for mindshare, with Carta hoping companies will stay private, while LTSE is pushing for them to get out in the world — and onto its exchange.

Facebook might have another Cambridge Analytica on its hands. In a late Friday news dump, Facebook revealed that today it filed a lawsuit alleging South Korean analytics firm Rankwave abused its developer platofrm, and has refused to cooperate with a mandatory compliance check regarding how it used Facebook data.

TechCrunch has attained a copy of the lawsuit, first uploade by NBC News’ Dave Ingram. It alleges that Rankwave misused Facebook data outside of the apps where it was collected, purposefully delayed responding to a cease-and-desist order, claimed it didn’t violate Facebook policy, lied about not using its apps since 2018 when they were accessed in April 2019, and then refused to comply with a mandatory audit of its data practices.

Rankwave-Complaint

Facebook writes taht “Rankwave used data associated with Rankwave’s apps to offer advertising and marketing services, and failed to comply with Facebook’s requests for proof of Rankwave’s compliance with Facebook policies, including an audit. These actions are prohibited by Facebook’s policies, by which Defendant contractually agreed to abide.”

More specifically, Facebook cites that its “Platform Policies largely restrict Developers from using Facebook data outside of the environment of the app, for any purpose other than enhancing the app users’ experience on the app.” But Rankwave used Facebook data outside those apps.

Facebook alleges that “Rankwave’s B2B apps were installed and used by businesses to track and analyze activity on their Facebook Pages . . . Rankwave operated a consumer app called the “Rankwave App.” This consumer app was designed to measure the app user’s popularity on Facebook by analyzing the level of interaction that there users had with the app user’s Facebook posts. On its website, Rankwave claimed that this app calculated a user’s “Social influence score” by “evaluating your social activities” and receiving “responses from your friends.”

Facebook is seeking monetary damages plus injunctive relief restraining Rankwave from accessing the Facebook Platform, requiring it to comply with Facebook’s audit, requiring that it delete all Facebook data.

You can learn more about Rankwave’s analytics practices from this 2014 presentation.

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

We are back, as promised. Kate Clark and Alex Wilhelm re-convened today to discuss the latest from the Uber IPO. Namely that it opened down, and then kept falling.

A few questions spring to mind. Why did Uber lose ground? Was it the company’s fault? Was it simply the macro market? Was it something else altogether? What we do know is that Uber’s pricing wasn’t what we were expecting and its first day was not smooth.

There are a whole bunch of reasons why Uber went out the way it did. Firstly, the stock market has had a rough week. That, coupled with rising U.S.-China tensions made this week one of the worst of the year for Uber’s monstrous IPO.

But, to make all that clear, we ran back through some history, recalled some key Lyft stats, and more.

We don’t know what’s next but we will be keeping a close watch, specifically on the next cohort of unicorn companies ready to IPO (Postmates, hi!).

It’s been nine years since UberCab made its first appearance on the WordPress pages of this website. In the ensuing years, the startup has grown from an upstart looking to upend the taxi cab cartels, to a juggernaut that has its hands in every form of transportation and logistics service it can think of.

In the process, Uber has done some things that might give (and in fact has given) some shareholders pause.

From its first pitch deck to this historic public offering, TechCrunch has covered the über startup that has defined the post-financial-crisis era of consumer venture investing.

Here are some of the things that shouldn’t get swept into the dustbin of Uber’s history as the company makes its debut as a public company.

• In 2014 Uber used a tool called “God View” to track the movements of passengers and shared those details publicly.At the time, the company was worth a cool $18.2 billion, and was already on the road to success (an almost pre-ordained journey given the company’s investors and capitalization), but even then, it could not get out of the way of its darker impulses.

• A former executive of the company, Emil Michael, suggested that Uber should investigate journalists who were critical of the company and its business practices (including PandoDaily editor Sarah Lacy).

• From 2014 to 2016, the company used a software program codenamed “Hell” to illegally monitor the location and movement of Lyft drivers. It was a tactic that opened Uber up to a criminal investigation from the Federal Bureau of Investigation.

• As it expanded internationally, Uber came under fire for lax hiring practices for its drivers. In India, the company was banned in New Delhi, after a convicted sex offender was arrested on suspicion of raping a female passenger.

• Last year, the Equal Employment Opportunity Commission opened an investigation into the company for gender discrimination around hiring and salaries for women at the company. Uber’s problems with harassment were famously documented by former employee Susan Fowler in a blog post that helped spur a reckoning for the tech sector.

• Uber has been forced to pay fines for its inability to keep passenger and driver information private. The company has agreed to 20 years of privacy audits and has paid a fine to settle a case that was opened by the Federal Trade Commission dating back to 2017.

• While Uber was not found to be criminally liable in the death of an Arizona pedestrian that was struck and killed by a self-driving car from the company’s fleet, it remains the only company with an autonomous vehicle involved in the death of a pedestrian.

• Beyond its problems with federal regulators, Uber has also had problems adhering to local laws. In Colorado, Uber was fined nearly $10 million for not adhering to the state’s requirements regarding background checks of its drivers.

• Uber was also sued by other companies. Notably, it was involved in a lengthy and messy trade secret dispute with Alphabet’s onetime self-driving car unit, Waymo. That was for picking up former Waymo employee Anthony Levandowski and some know-how that the former Alphabet exec allegedly acquired improperly before heading out the door.

• Uber even had dueling lawsuits going between and among its executives and major shareholders. When Travis Kalanick was ousted by the Uber board, the decision reverberated through its boardroom. As part of that battle for control, Benchmark, an early investor in Uber sued the company’s founder and former chief executive,  Travis Kalanick for fraud, breach of contract and breach of fiduciary duty.

• Uber’s chief people officer, Liane Hornsey was forced to resign following a previously unreported investigation into her alleged systematic dismissals of racial discrimination complaints within Uber.

• Lawsuits against the company not only dealt with its treatment of gender and race issues, but also for accessibility problems with the ride-hailing service. The company was sued for allegedly violating Title II of the Americans with Disabilities Act and the California Disabled Persons Act.

• The ride-hailing service also isn’t free from legal woes in international markets. Earlier this year, the company paid around $3 million to settle charges that Uber had violated local laws by operating in the country illegally.

• Finally, the company’s lax driver screening policies have led to multiple reports of assault by drivers of Uber passengers. Uber recently ended the policy of forcing those women to engage in mandatory arbitration proceedings to adjudicate those claims.

• Not even the drivers who form the core of Uber’s service are happy with the company. On the eve of its public offering, a strike in cities across the country brought their complaints squarely in front of the company’s executive team right before the public offering, which was set to make them millions.

Aspiring space tourism outfit Virgin Galactic has just announced its readiness to shift its operations to New Mexico’s Spaceport America, from which the company’s first commercial flights will take off. “Virgin Galactic is coming home to New Mexico where together we will open space to change the world for good,” said Virgin founder Sir Richard Branson at a press event.

The plan isn’t exactly a surprise, since Virgin Galactic and New Mexico collaborated on the creation of the spaceport, which at present is the only thing of its kind in the world. But moving from a testing and R&D hangar to a place where actual customers will board the spaceships is a major milestone.

I talked with George Whitesides, VG’s CEO, about what the move really means and, of course, when it will actually happen.

We’re fulfilling the commitment that we made years ago to bring an operational spaceline to the world’s first purpose-built spaceport,” he told me. “So what does that mean? One, the vehicles are moving, and all the stuff that goes along with operating those vehicles. And all the people that operate the vehicles, and the staff that are so called customer-facing.  And you’ll have all the relevant supply chain folks and core infrastructure folks who are associated with running a spaceline.”

Right now, that rather complicated list really only adds up to about a hundred employees — a large part of the workforce will remain in Mojave, where R&D and new vehicle engineering will continue to be based in the form of The Spaceship Company.

“As we move towards commercial services, we’re thinking more about what comes next, like hypersonic and point to point spaceflight,” Whitesides said.

That said, VG isn’t finished with its existing craft just yet. You can expect a couple more, depending on what the engineers think is necessary. But it’s not a “huge number.”

Moving to Spaceport America from its Mojave facilities is being undertaken now for several reasons, Whitesides explained. In the first place, the craft is pretty much ready to go.

“The last flight we did, we basically demonstrated a full commercial profile, including the interior of the vehicle,” he said. “Not only did we, you know, go up to space and come down, but because Beth was in the back — Beth Moses, our flight instructor — she was sort of our mock passenger. She got up a couple times and moved around, she was able to verify our cabin conditions. So we started thinking, maybe we’re at a place where we could move.”

The paperwork from the FAA and other authorities is in order. The spaceport has been ready for some time, too, at least the difficult parts like the runway, fuel infrastructure, communications equipment, and so on. Right now it’s more like they need to pick the color for the carpet and buy the flatscreens and fridges for inside.

“But the people perspective is a key part of this,” Whitesides continued. “These people have families, they have kids. We always thought, wouldn’t it be nice to move over the summer, so they don’t have to leave in the middle of a school year? If we start now, our employees can more easily integrate into the community in New Mexico. So we said, actually let’s just do this right now. It’s a bold choice and a big deal but it’s the right thing to do.”

And what about the vehicles, VMS Eve and VSS Unity? How will they get there?

“That’s the great thing about an air launch system.” said Whitesides. “It’s the easiest part, in a way. Once all the other stuff is down there we’ll look deep into each other’s eyes, and say ‘are we ready?’ And then we put together the spaceship and go. It’s built to fly longer distances than that — so we’ll start the day with our base of operations in Mojave, and end the day with our base of operations in New Mexico.”

And a lovely base it will be. The spaceport, designed by Foster & Partners in the UK, is a striking shape that rises out of the desert and should have all the facilities necessary to run a commercial spaceline — it’s probably the only place in the world that would work for that purpose, which makes sense as it was built for it.

“Because we’re horizontal take-off and landing, operationally on the ground side, it basically looks like an airport. The coolest looking airport ever, but an airport,” Whitesides said. “It’s got a big beautiful runway — but you’ll notice that it’s got Earth to space comms links, this special antenna, and instead of a tower we have a mission control, and of course there’s the special ground tankage — oxidizer tanks and that kind of propulsion related infrastructure.”

The airspace surrounding the spaceport is also restricted all the way from the surface up to infinity, which helps when your flights span multiple air traffic levels. “And it’s already a mile up, so that’s an asset,” Whitesides observed. A mile closer to space — more a convenience than a necessity, but it’s a good start.

The actual moving operations should take place over the summer. The remaining test flights aren’t yet scheduled but I’m sure that will soon change — and you’ll definitely hear about it when the first commercial flights are put on the books.

A defamation case filed last year against Tesla and SpaceX CEO Elon Musk after he repeatedly called a British cave diver “pedo guy” will go to trial on October 22, a U.S. district judge determined Friday.

Vernon Unsworth, the British cave diver, filed a defamation lawsuit in September 2018  in the U.S. District Court for the Central District of California after Musk called him a “pedo guy” and made other statements insinuating he was a pedophile in a public attack on Twitter.

U.S. District Judge Stephen V. Wilson denied a motion to dismiss the case and instead scheduled a date for trial. The decision means that Unsworth’s case is strong enough to go to trial.

Musk’s lawyers argued that statements on the internet, and more specifically on unmoderated forums like Twitter are presumptively opinion, not objective fact. Defamation law doesn’t apply to opinions or insults. But Wilson rejected Musk’s argument, in part because of an email interaction he had with Buzzfeed reporter and ex-TechCrunch journalist Drew Olanoff .

“Considering the totality of the circumstances—including the general context of Defendant’s statements, the specific context of the statements, and the statements’ susceptibility of being proved true or false—a reasonable factfinder could easily conclude that Defendant’s statements, as pleaded in the complaint, implied assertions of objective fact,” Wilson wrote in the decision.

The lawsuit alleges that between July 15 and August 30, Musk periodically used Twitter and emails to the media to publish false and defamatory accusations against Unsworth, including accusations of pedophilia and child rape.

The initial “pedo guy” attack came after Unsworth gave a critical interview to the media saying Musk’s mini sub “had absolutely no chance of working.” The diving expert ended an interview segment by suggesting Musk should “stick his submarine where it hurts.”

Musk lashed out on Twitter and insinuated that Unsworth was a pedophile. He later deleted the offending tweet and tried to backpedal — even offering an apology of sorts on Twitter. And it could have all ended there. But then Musk dug it all up again during a debate with Olanoff — once again on Twitter. Olanoff had brought up the “pedo guy” attack as an example of Musk telling untruths.

 

GitHub today announced the launch of a limited beta of the GitHub Package Registry, its new package management service that lets developers publish public and private packages next to their source code.

To be clear, GitHub isn’t launching a competitor to tools like npm or RubyGems. What the company is launching, however, is a service that is compatible with these tools and allows developers to find and publish their own packages, using the same GitHub interface they use for their code. The new service is currently compatible with JavaScript (npm), Java (Maven), Ruby (RubyGems), .NET (NuGet) and Docker images, with support for other languages and tools to come.

“GitHub Package Registry is compatible with common package management clients, so you can publish packages with your choice of tools,” Simina Pasat, Director of Product Management at GitHub, explains in today’s announcement. “If your repository is more complex, you’ll be able to publish multiple packages of different types. And, with webhooks or with GitHub Actions, you can fully customize your publishing and post-publishing workflows.”

With this, businesses can then also provide their employees with a single set of credentials to manage both their code and packages — and this new feature makes it easy to create a set of approved packages, too. Users will also get download statistics and access to the entire history of the package on GitHub.

Most open-source packages already use GitHub to developer their code before they publish it to a public registry. GitHub argues that these developers can now also use the GitHub Package Registry to publish pre-release versions, for example.

Developers already often use GitHub to host their private repositories. After all, it makes sense to keep packages and code in the same place. What GitHub is doing here, to some degree, is formalize this practice and wrap a product around it.