What Matters Today

• JD.com started trading in Hong Kong today, with its shares jumping. That's narrowed the discount against its U.S. depositary receipts, potentially signaling to other Chinese companies that listing in Hong Kong is a good idea. JD's big debut comes as the company set records for its annual "6.18" shopping event, with over $34 billion in sales.
• The Justice Department is set to back a SoftBank-owned investment fund in court today. A lawyer will argue in favor of Fortress Investment Group in a lawsuit brought on by Apple and Intel, which allege that Fortress is breaking competition laws by hoarding patents.
• After the U.S. pulled out of negotiations with the EU over a digital services tax, European leaders have spent the morning responding. France's finance minister called the move "a provocation," the Spanish government said it would not accept "any type of threat," and the EU suggested it will go ahead with the tax without American involvement.

Today's News

As of 5:30 a.m. PDT: Nasdaq Futures: -0.36% | Euro 600: -1.05% | Nikkei: -0.45% | Hang Seng: -0.07%

OPPORTUNITIES

• Uber started selling its ride-hailing software to transit agencies, starting with a paratransit program in Marin County.
• TikTok reportedly made $200 to $300 million in worldwide revenue last year, and is aiming for $500 million in U.S. revenue this year.
• Spotify has reportedly signed an exclusive podcast deal with Kim Kardashian West.
• SK Materials started producing high-purity etching gas, used in chipmaking. Samsung and SK Hynix are reported to be customers. The move is part of broader Korean efforts to be less reliant on Japanese supply chains.
• Amazon expanded Flex, its gig work delivery platform, to more Indian cities.

THREATS

• Wirecard said more than $2 billion of cash was missing after a series of fraud allegations. Its stock is down more than 50% today.
• Apple has reportedly rejected Facebook's new gaming app five times since February.
• New Tesla registrations in California were down 70% year-on-year in May, according to Dominion Enterprises.
• A group of civil-rights organizations called on advertisers to boycott Facebook.
• Oppo canceled a live-streamed phone launch in India, reportedly due to the growing movement in the country to boycott Chinese products.

DEALS

• Saudi Arabia's Public Investment Fund will invest $1.49 billion in Jio Platforms, Reliance Industries confirmed.
• Upgrade, a credit card fintech, raised $40 million at a $1 billion valuation. The round was led by Santander's venture arm.
• Dish confirmed that it will acquire Boost from T-Mobile, clearing the way for T-Mobile's Sprint acquisition.
• India's competition commission is reviewing Facebook's Jio investment.
• Australia's competition commission raised concerns about Google's Fitbit acquisition.
• UiPath is reportedly in talks to raise new funding at a valuation north of $10 billion.

Diving Deeper

Shopify wants to be the AWS of ecommerce

I've spent the past few weeks diving deep into the future of ecommerce and Shopify's role in it, and I've come to one big conclusion: Shopify is the most interesting tech company in the world right now. Today on Protocol, I have a story explaining why.

• Shopify wants to power all of ecommerce. "We've tried to systematically figure out … the things that are very tricky about starting an online business," Chief Product Officer Craig Miller recently told me. "And we've attempted to solve those."
• That started off with a website-builder but has now expanded into point-of-sale solutions, logistics (Shopify has a network of partnered warehouses and will open its own warehouse later this year) and finance (with bank accounts and loans).
• It provides the back-end for online merchants, no matter where they're selling. That's why it has integrations with Amazon, eBay, Facebook and Walmart.

And as ecommerce fragments, with other players all coming for Amazon's crown, that move makes an awful lot of sense.

• "If you force customers to buy through only one channel … you're just going to frustrate customers," said former Amazon executive James Thomson, who is now a partner at ecommerce consultancy Buy Box Experts.
• That means merchants have to be on every channel, and so they need software that can handle running 10 different storefronts all at once — which is exactly what Shopify can do.

Shopify's future success doesn't depend on any one platform succeeding. To Shopify, it doesn't matter if you buy Kylie Jenner's lipsticks on Amazon or on Instagram — Shopify takes your subscription fee either way. All Shopify needs is for more people to start selling online, and that seems inevitable.

• In that sense, Shopify is more like AWS than Amazon's retail business: It's designed to be invisible, everywhere and agnostic. And seeing as AWS is the biggest profit-driver of the $1.3 trillion Amazon, Shopify's $95 billion valuation could end up seeming awfully cheap.

My full Protocol story dives into much more detail, explaining the rationale behind the Shop app and why Shopify's not too worried about Big Tech competition: Read it here.

Overheard

• "We have to do more than talking points or cosmetic changes." — The Internet Association's Sean Perryman told Protocol that it would start lobbying for police reform.
• "This is a watershed moment." — David A. Thomas, president of Morehouse College, said Reed Hastings and Patty Quillin's $120 million donation to HBCUs "will send a signal" about the importance of the institutions.
• "The window is open ... Everyone has figured out that a virtual IPO is possible. There's an appetite for companies to go public." — Deloitte's Previn Waas said ZoomInfo and Vroom have shown that listings are back in vogue.
• "The travel industry will not be our focus in the short term." — China Growth Capital's Wang Daoping said that there could be opportunities for digital transformation in the future, though.

Interview

How to fight a titan

Shopify isn't the only company that's realized there's a big opportunity in building an omnichannel ecommerce platform. Ecwid, a freemium player that boasts 1.5 million merchants, is after a piece of the pie too.

• Freemium was a necessity because of Shopify's deep pockets, Ecwid CEO Ruslan Fazlyev told me. "They kind of buy their way" into new markets, he said. Ecwid, which had raised less than $7 million before last month, couldn't do that.
• The "only way to really grow is to use product as your advertising," he said — hence the freemium model, which relies heavily on word-of-mouth.

That's not the only way Ecwid's taking on Shopify. Much of its team, including Fazlyev, comes from X-Cart, an open-source shopping cart platform founded in 2000. That experience means "we don't waste any time ... we know exactly how to build stuff," Fazlyev said.

• Geography is also an advantage. "Most of my engineering team is Russian, and that really brings our costs down," he told me.
• And Ecwid is trying to be even more omnipresent than Shopify is. "We are built to integrate and embed," Fazylev said, highlighting partnerships with Square, Clover and Wix, which integrate with Ecwid rather than building out high-end ecommerce platforms themselves.

Despite all that, it's an uphill battle. Though Ecwid did recently raise $42 million, it's going up against an absolute titan. Fazylev is well aware of that.

• Ecwid is fighting "not necessarily for the first spot," he said, instead going up against Magento and BigCommerce for second place. Ecwid wants to be "the Pepsi to the Coke of Shopify," he explained, "to basically make sure that there is choice in this world of commerce."

Closing Bell

Back to abnormal

When we started Index all the way back in March, it seemed like tech was heading for a big upheaval. Unprofitable companies were going to collapse, startups were going to find it impossible to raise, and IPOs were utterly out of the question. So it seems fitting to bring this incarnation of Index to a close with new news about Nikola, the electric truck company. After a Bloomberg report accused the company of exaggerating its debut truck's capabilities, CEO Trevor Milton went on a Twitter tirade against the journalist, saying he will be "suing the shit" out of the "hackjob" writer. Nikola, for those keeping track, is worth $23 billion without a single cent in revenue. Truly, the tech industry is back to normal.