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‘Concerned’ Think Tanks Beef Up Cybersecurity Following Suspected Russian Hacking

A spokesperson from the German Council on Foreign Relations, Eva-Maria McCormack, said the think tank was “concerned” that it was the target of cyberattacks last year and that it was implementing measures to counter future threats. McCormack made the comments to RFE/RL a day after Microsoft said European think tanks were targeted by suspected Russian hackers.

Politicians pushing back on corporate power celebrate victory in Amazon’s NYC reversal

New York State Sen. Michael Gianaris hosts a rally protesting Amazon’s planned New York office. (GeekWire Photo / Monica Nickelsburg)

In the first few weeks of 2019, progressive politicians have started a national conversation about income inequality and corporate power.

Turns out it’s more than just talk.

On Thursday, Amazon reversed plans to build a giant New York City office in response to a vocal group of officials and activists who have been fighting the deal.

“A number of state and local politicians have made it clear that they oppose our presence and will not work with us to build the type of relationships that are required to go forward with the project,” Amazon said Thursday in a statement.

The news: Behind closed doors, Amazon and New York leaders reached an agreement to give the Seattle e-commerce giant up to $3 billion in government incentives to build one half of its second headquarters — or “HQ2” — in Queens. That neighborhood elected left-leaning politicians to the city and state, who formed a coalition to oppose the deal. Parts of Queens are also represented by U.S. Rep. Alexandria Ocasio-Cortez, one of the most high-profile critics of corporate power.

Faced with a fight, Amazon decided not to build the project, after all, in a sign that pitchforks can be effective at pushing back Big Tech’s influence.

The movement: Ocasio-Cortez and her peers are shining a spotlight on the growing wealth and influence of big tech companies like Amazon. She has floated the idea of a 70 percent marginal tax rate that would hit tech industry plutocrats. Ocasio-Cortez celebrated Amazon’s breakup with New York in a tweet Thursday. “Today was the day a group of dedicated, everyday New Yorkers & their neighbors defeated Amazon’s corporate greed, its worker exploitation, and the power of the richest man in the world,” she said.

It’s a sentiment echoed by Sen. Elizabeth Warren, the presidential hopeful with a wealth tax proposal that would cost Amazon CEO Jeff Bezos more than $3 billion. “Amazon — one of the wealthiest companies on the planet — just walked away from billions in taxpayer bribes, all because some elected officials in New York aren’t sucking up to them enough,” Warren tweeted. “How long will we allow giant corporations to hold our democracy hostage?”

New York Sen. Michael Gianaris speaks with Seattle City Councilmember Lisa Herbold at a hearing on Amazon. (Photo via the Office of Senator Michael Gianaris)

The national conversation is reverberating through municipal governments, which are getting savvier about the cost of economic development. Last month, Seattle City Councilmembers Teresa Mosqueda and Lisa Herbold visited New York to warn opponents of the Amazon deal about what it’s like to have the tech giant as a neighbor.

“We’re sending a strong message that we’re not interested in a race to the bottom or a Hunger Games like approach to attract businesses,” Mosqueda said in an interview with GeekWire Thursday. “What we want is respect and investment in the local communities and infrastructure that make companies successful.”

Yes, but: Progressive politicians are making a lot of noise about the influence of corporations and the 1 percent, but it isn’t clear whether that message resonates with the population at large. In New York, for example, two polls showed that a majority of registered voters supported the Amazon project.

Palmetto gets $20 million credit line for its solar and energy efficiency installation marketplace

For homeowners that want to go green, but have trouble figuring out how to do it, Palmetto Clean Technologies has the answer.

The company has an army of salespeople to pitch the benefits of solar power and energy efficiency, and will connect would-be clean energy consumers with financing options, installers, and software to monitor and manage their equipment.

What Palmetto lacked, until the new $20 million credit line it has received from the utility-backed investment firm, Energy Impact Partners, is a way to smooth its revenues while it fronted the costs of solar panel acquisitions and installation.

“One of the big problems that we’re solving for in our industry is the Chinese wall between project finance and corporate finance,” says Chris Kemper, the company’s chief executive.

With the new money from Energy Investment Partners, Kemper says that the company will be able to manage project installations and the inherent cash flow issues that need to be solved.

Kemper says that Palmetto has managed to solve a few key problems for consumer-facing clean energy installations.

Consider the company the Avon of clean energy. The company has representatives who go out and pitch consumers on the benefits of clean energy, they negotiate a price for installation with their clients and help customers sort through financing options and local installation needs.

We make our money by a very thin margin by way of improving and scaling these workflow processes,” says Kemper.

Indeed, behind the salesforce is Palmetto Clean Technology; providing logistics and infrastructural support, information on clean energy’s benefits, and a bundle of software tools that customers can use to manage and monitor how their solar installations are operating — and ideally saving them money.

“We’re the first platform company in the residential clean technology space and our emphasis is to bring the ability to start or become an entrepreneur in this sector,” says Kemper. “[And] we manage cash-out and cash-in.”

The sales force that Palmetto employs negotiates their own prices with customers, while Palmetto makes what Kemper calls a small margin on connecting solar power project financiers, installers, and equipment providers with potential customers.

“It’s very complex workflows.. You’re dealing with local and state licenses and deal with local utilities. We streamline those complexities for the sales and build partners as well as the homeowner,” says Kemper. 

The main thing that Palmetto solves for, says Kemper, is the cost of customer acquisition. It’s still very hard for installers and financiers to reach the broad swath of homeowners that are ready and willing to install solar power on their homes.

“We’re trying to build a business model for subsidy-free, credit-free clean energy,” Kemper says.

For Kemper, the consumer adoption of renewable energy and energy efficiency technologies in homes is all about price. “Price is the ultimate value lever,” he says. “We’re able to price systems below other competitors because we operate at a systems level… At the end of the day energy is a commodity and commodities are all about pricing.”

The argument was compelling enough to net the company a $6 million equity financing round last September, largely, it seems on the back of Kemper’s pricing point. At the time, the company’s backers included the venture capital firm Greycroft, with participation from institutional investors like Lerer Hippeau, Box Group, and NBA commissioner emeritus David Stern.

Now Energy Impact Partners, an energy investment firm backed by some of the largest utilities from across the nation, has signed on to back the company and its vision as well. The strategic importance of getting utilities on board with consumer solar can’t be overstated — and the potential for solar development in the U.S. is vast.

“We’ve reached an inflection point in the renewable market where transitioning to solar can create immediate cost savings for homeowners with no cash outlay, ” said Greycroft Principal Will Szczerbiak, at the time.

Dubai airport briefly halts flights after drone spotted

Earlier today, Dubai’s International airport shut down flights for roughly half an hour, owing to the sighting of a drone flying nearby. Departures were halted from 10:13 a.m. to 10:45 a.m over “suspected drone activity,” though arriving flights were still able to land. 

The airport’s social team took to Twitter to update the situation, while noting, “Authorities warned that flying drones without obtaining permission is subject to legal liability as per UAE laws.”

DXB consistently ranks among the top three busiest airports by passenger volume. In 2018, the airport saw more than 88 million passengers. It’s the latest in a recent string of scares involving personal drones flying too close to a commercial airport. At the height of the holiday season last year, London’s Gatwick airport was closed for a day and a half over similar concerns.

An increase in such activity has led to more action from drone manufacturers and increased calls for legislation around the products.

DXB says it is working with local authorities to address the incident. “Dubai Airports has worked closely with the appropriate authorities to ensure that the safety of airport operations is maintained at all times and to minimize any inconvenience to our customers,” the airport said in a statement to The New York Times. 

Urban unicorn renewal

Three cities, three dead urban unicorn renewal projects.

In just the past few days, we’ve had Foxconn renege on Wisconsin, Amazon renege on NYC and GE renege on Boston. Each followed the Anna Karenina principle that every unhappy economic development deal is unhappy in its own way: for Foxconn, it was trade tariffs and slowing iPhone sales; for Amazon, it was populist protests plus the usual NYC corruption; for GE, it was the reality of looking at a mirror and finding that you’re staring at a dumpster fire.

Yet, there are eerie similarities, other than the fact that I have practically lived next door to every single one of these projects (if you call Wisconsin next door to the better-looking state of Minnesota).

In each case, there was the perfect alchemy of the modern urban unicorn renewal plan. A well-known but sordid tech company paints a picture of revolutionizing a city’s economic base. They splash huge numbers on the board, or at least a coveted status symbol. Seeing their legacies secured, politicians latch on to these projects, negotiating with alacrity and without due process because — wow — the company with suicide nets or the company where employees pee in bottles (undercover!) is coming to town.

I get it. And look, if these projects panned out, they would indeed be great for their home cities. As I wrote about Amazon HQ2 a few weeks ago:

These spillover effects are at the heart of agglomeration economies. With Amazon’s arrival, more software engineers will locate to NYC. They will start companies, join other tech firms and expand the vitality of the community. As Edward Glaeser argues convincingly in his book The Triumph of the City, density of talent matters enormously for the success of the city. Amazon thickens the market for tech talent, and that is a huge win for both NYC and DC.

Yet, these projects rarely work out, and behind this all is the plague of Silicon Everywhere. As I wrote four years ago:

There are many commentators who argue that there is a bubble in Silicon Valley today. They may or may not be right, but there is certainly a bubble in places named after the preeminent global tech ecosystem.

Silicon Border. Silicon Hills. Silicon Steppe. Silicon Prairie. Silicon Roundabout. Silicon Gulf. Silicon Avenue. Silicon Canal. Silicon Alley. Silicon Beach. Silicon Forest. Philadelphia has a groaner of a region with Philicon Valley (whoever invented this should be banished from marketing for five years or forced to market Path).

And so we got “Wisconn Valley,” which actually is a brilliant fusion of Foxconn, Silicon and Wisconsin that now has its very own government homepage. GE was going to restart Boston’s tech scene, except the 800 jobs in its headquarters office were predominantly accountants and lawyers, which of course is where the real innovation of any company takes place.

These silicon dreams need to be crushed, beaten, stamped out and destroyed. So should these mega-project economic development deals, which always seem to go through a cycle from euphoria to lassitude.

In their wake, tech leaders should be encouraging a culture of bottoms-up economic development. Mayors should partner with local startups to encourage the growth of small companies and then coordinate pathways to help them succeed. Economic development money should turn into seed capital, boot camp credits, university research transfer grants and a whole lot more options for small-scale — human-scale — interventions. The unicorn urban renewal project is dead, but it always has been.

Welcome to the Extra Crunch Daily

Image via Flickr by Prayitno used under Creative Commons

Assuming you haven’t unsubscribed yet, welcome to the new Extra Crunch Daily newsletter, which is stochastically delivered to you “daily” depending on the misery index of my morning commute courtesy of NY Governor Andrew Cuomo.

We have been A/B-ing this format a bit over the past few months, and have talked about the future of geoengineering, power politics of GPS, societal resilience startups, the disappearing Form D filing, Softbank’s debt obsession, the internet’s transformation into a nation state and why TechCrunch’s parent company is … well, I shouldn’t say that, lest I kick that damn hornet’s nest again.

This newsletter is about context, big ideas and arguments. It’s also about touching on any of the 35-odd spaces that I seem to cover in a given day, so it’s basically professional ADHD in written format. I write when I am in that liminal space between curiosity and anger, that “Why??” which follows “What!!!”

I’m joined on this project by Arman Tabatabai, our intrepid research consultant from New York. He’s always willing to learn a completely new subject because I had a dream last night (Monday morning at 8am: “so what do you know about geoengineering?”), and for that he’s amazing and this newsletter couldn’t go on without him.

Patreon EC-1 and the challenge of private companies

We debuted Extra Crunch this week with the launch of Patreon’s EC-1. I was inspired by the S-1 that companies file with the SEC when going public and thought: “why don’t we do that, but for private companies.”

A couple of hundred hours later, and that’s basically what we got with this first edition. With Patreon, TechCrunch’s media columnist Eric Peckham wrote a bonanza of analysis on the company’s founding story, product, business, thesis and competition, and he even threw in a reading guide so you can read everyone else’s coverage of the company. There are pretty generous pours of these articles in front of the paywall too, so do share them with colleagues.

The hope is that these projects can spark the imagination, give ideas around strategies and tactics that might work in a startup context and, of course, help evaluate the future of the company we are holding under the microscope.

We have three other companies in the hopper right now coming up in this series. Have ones you want to see covered? Think there could be an interesting deep dive we are missing? Hit reply and tell me — right now — or send me an email at danny@techcrunch.com.

Obsessions

This is an open agenda that I use to track what the hell I am writing about on a regular basis.

  • We are going to be talking India here, focused around the book “Billionaire Raj” by James Crabtree.
  • We have a lot to catch up on in the China world when the EC launch craziness dies down. Plus, we are covering The Next Factory of the World by Irene Yuan Sun.
  • Societal resilience and geoengineering are still top-of-mind.
  • Some more on metrics design and quantification.

Thanks

To every member of Extra Crunch: thank you. You allow us to get off the ad-laden media churn conveyor belt and spend quality time on amazing ideas, people and companies. If I can ever be of assistance, hit reply, or send an email to danny@techcrunch.com.

This newsletter is written with the assistance of Arman Tabatabai from New York.

We’re Ready to Unite With Russia, Belarus Leader Lukashenko Says

Belarus is ready to merge with Russia, Belarussian President Alexander Lukashenko said on the third and last day of his bilateral talks with President Vladimir Putin on Friday.

Rumors resurfaced this year that Russia could annex Belarus as Putin’s constitutional term limits bar him from running for the presidency in 2024.

“The two of us could unite tomorrow, no problem,” Lukashenko said in a video shared by a Komsomolskaya Pravda tabloid Kremlin reporter on Twitter Friday.

“But are you – Russians and Belarussians – ready for it?” Lukashenko said as quoted by Interfax. “We’re ready to unite and consolidate our efforts, states and peoples as far as we’re ready.”

Putin, meanwhile, stressed that “fully independent states simply do not exist in the world,” bringing the European Union as an example of interdependence. 

The Russian president has voiced support for Russia to unite with Belarus as early as 2011.

Belarus Ready to ‘Unite’ With Russia, Lukashenko Says

Belarus is ready to merge with Russia, Belarussian President Alexander Lukashenko said on the third and last day of his bilateral talks with President Vladimir Putin on Friday.

Rumors resurfaced this year that Russia could annex Belarus as Putin’s constitutional term limits bar him from running for the presidency in 2024.

“The two of us could unite tomorrow, no problem,” Lukashenko said in a video shared by a Komsomolskaya Pravda tabloid Kremlin reporter on Twitter Friday.

“But are you – Russians and Belarussians – ready for it?” Lukashenko said as quoted by Interfax. “We’re ready to unite and consolidate our efforts, states and peoples as far as we’re ready.”

Putin, meanwhile, stressed that “fully independent states simply do not exist in the world,” bringing the European Union as an example of interdependence. 

The Russian president has voiced support for Russia to unite with Belarus as early as 2011.

Future unicorns: Algorithm predicts the next $1B companies, including one Seattle startup

Sales automation startup Outreach was the only Seattle company to make CB Insights’ list of future unicorns. (Outreach Photo)

Can algorithms predict the next billion-dollar companies better than human venture capitalists? It seems possible, at least based on a formula created by CB Insights and The New York Times.

Back in 2015, the companies published a list of 50 startups that would eventually becomes “unicorns,” or those valued at $1 billion or more. It identified candidates using CB Insights’ Mosaic algorithm, which analyzes the health of a startup based on various data including strength of market, financial performance, and overall traction — a “FICO score for startups,” as described by the investment data firm.

Fast forward to today, and 48 percent of the companies on the 2015 list are now considered unicorns. “At the risk of sounding immodest, that is pretty good,” CB Insights wrote this month. “And if we were a venture firm, this kind of hit rate would make us legendary.”

That’s why it’s worth giving the 2019 list a look.

(CBInsights Photo)

The 50 future unicorns hail from various industries and the median company has about $111 million in total funding. A majority are based in the U.S., with 22 from California, five in New York, and two in Massachusetts.

Outreach CEO Manny Medina. (Outreach Photo)

There is just one from Seattle: sales automation startup Outreach, which raised $65 million this past spring, announced it was moving into a new headquarters space this summer, made its first acquisition, and was the only Seattle company to crack the top 25 in LinkedIn’s Top Startups list for 2018.

Outreach CEO Manny Medina said the company more than doubled its revenue in 2018 and met all goals and metrics. Outreach now has more than 3,100 customer accounts and 50,000-plus users. It employs 315 people and plans to reach 450 by the end of 2019.

“This upcoming year we will make more investments in scaling the business efficiently and prepare for an IPO a few years out,” Medina told GeekWire. “This includes continued investment from our product to support, measure, and automate customer facing workflows. Our job is to make all sales reps great and drive higher revenue efficiency for their companies.”

The 5-year-old sales engagement platform uses machine learning to help customers such as Cloudera, Adobe, Microsoft, Docusign, and others automate and streamline communication with sales prospects.

Medina, a former director at Microsoft, originally launched a recruiting software startup called GroupTalent in 2011 with his co-founders Andrew Kinzer, Gordon Hempton, and Wes Hather. But the entrepreneurs pivoted in 2014 to focus on building tools for salespeople.

Chris DeVore, managing director at Techstars Seattle — Outreach was a 2011 graduate of the accelerator — said the company is a good example of why he focuses on investing in people over ideas.

“Outreach is one of my favorite stories,” DeVore told GeekWire last week. “The business they set out to build wasn’t working, but because they stuck together as a founding team and kept adapting and learning, they figured out how to find a productive thing. But that wasn’t because of where they started or the early metrics. It was because as humans, they were so committed and resilient and so gritty that they figured it out.

“And that’s really what you’re betting on,” DeVore continued. “It’s a 10-year journey and it’s never always up and to the right. There are always setbacks and near-death moments. It’s the human capacity for resilience and persistence every time that will turn a bad investment into a good one.”

While it’s a safe bet to invest in tenacious and dogged founders, CB Insights’ track record with its Mosaic score shows how data-driven formulas can drive smart investment decisions.

That strategy has worked well for firms such as Seattle-based Lighter Capital, an online revenue-based funding vehicle that uses proprietary technology to figure out which companies to back. Lighter Capital has invested in more than 300 companies across 500 deals since 2012 and plans to invest in close to 200 startups this year, CEO B.J. Lackland told GeekWire last month.

A recent PitchBook study found that 38 percent of venture capitalists use data to source and evaluate investment opportunities.

“Our survey shows strong adoption of data to inform investment decision-making and a growing appetite to increase usage,” Steve Bendt, vice president of marketing at PitchBook, said in a statement. “While the majority of respondents believe VC investing will always involve the human element, there’s enthusiasm to explore how machine learning can automate traditional VC.”

Samsung’s new Tab S5e is super thin, supports Bixby, and costs just $399

Samsung’s tablets have a lot going for them as enlarged Android devices, but the models really worth considering are quite expensive. Samsung announced the new Galaxy Tab S5e today, a mid-range tablet that the company is hoping will capture people’s attention with select premium features and a more accessible $399 price tag.

The high-end nature of the Tab S5e comes in its design. The all-metal unibody is the thinnest and lightest of any Samsung tablet, weighing about 14 ounces and measuring 5.5mm thick. Samsung didn’t skimp too much on the display, either, sticking a 10.5-inch, 2560×1600 AMOLED panel with a 16:10 aspect ratio on the tablet. It’s also the first Samsung tablet with Bixby built in, allowing users to call on the voice assistant to answer questions, control connected SmartThings devices, and more.

Samsung highlights the multitasking capabilities of the tablet, including a new continuity feature and Dex support. The former lets users make and receive calls and texts from the tablet (it will be available in Wi-Fi and LTE versions) while the latter is Samsung’s experimental desktop version of Android. Users can connect a keyboard, mouse, and even an external monitor to the tablet and use Dex to expand Android into a desktop-like software that makes it easier to do many things at once.

However, the Tab S5e’s internals aren’t exactly built for multitasking. It runs on an octa-core Snapdragon 670, which is suitable for mid-range tablets, but it may not be powerful enough to run software like Dex smoothly for too long. It also supports up to 128GB of onboard storage (up to 512GB with an added microSD card), and up to 6GB of RAM. The 7,040 mAh battery inside the tablet should help it stay alive for 14.5 hours. These are decent specs considering the $399 price—you won’t be getting an entry-level tablet, but it’s not designed to be as powerful or efficient as Samsung’s Tab S4.

Unlike the Tab S4, which comes with Samsung’s S Pen stylus, you won’t get it with the Tab S5e and you can’t even use a stylus for note-taking or sketching either. This is disappointing because Samsung’s stylus is one of our favorites and we appreciate the company’s Air Command on-screen interface as well.

The announcement comes just one week before Samsung is expected to launch its newest flagship smartphone, the Galaxy S10. To coincide with the February 20th Unpacked event, Samsung will open three new retail locations in Los Angeles, Houston, and New York to show off its products and other in-store demos.

The Samsung Tab S5e will be available in Q2 2019 starting at $399. LTE models will be available after the Wi-Fi models come out.

Listing image by Samsung