Musk can’t just walk away
Good morning! Musk’s Twitter deal is apparently on thin ice. But getting out of it isn’t as simple as walking away.
Depending on how you look at it, Twitter was either in disarray or business as usual yesterday.
The deal to buy Twitter might be in trouble. Musk and his team are still struggling to figure out how many bots are really on the platform, sources told The Washington Post.
- Musk's team has apparently stopped taking part in certain talks around funding for the deal.
- One source said that on top of it, “Twitter has not been cooperative.”
But is the deal really in trouble? Stopping the acquisition isn’t as simple as paying the $1 billion breakup fee provided for in the deal. Twitter has stronger protections against Musk walking away.
- As Bloomberg’s Matt Levine noted, “He SIGNED A BINDING AGREEMENT TO BUY TWITTER. And that agreement does not have any outs for ‘I think there are too many bots.’”
- If the problem is big enough that Musk would actually try to pull out of the deal, experts have said it could set off a legal battle where Twitter tries to force Musk to buy the company, as it is entitled to do under the agreement.
- For that matter, if Musk and his team have stopped working on arranging financing, that could violate parts of the agreement that require him to make "best efforts" to close the deal.
Everyone’s been talking about this bot thing since May, and Twitter has continued to stand by spam accounts making up just 5% of users — not the 20% that Musk has claimed with no real evidence. The bot issue isn’t a deal breaker: It’s a sign that a court date might be sooner than later.
— Sarah Roach
A ‘massive shared challenge’
In a rare joint message between MI5 and the FBI yesterday, officials warned business leaders to stay vigilant of the Chinese government stealing the IP of tech companies in the West. This highlights Washington’s continued focus on China as an ongoing challenge to the U.S.
The FBI warned businesses not to underestimate China. “The Chinese government is set on stealing your technology — whatever it is that makes your industry tick — and using it to undercut your business and dominate your market,” said Christopher Wray, the head of the FBI.
- The warning comes a day after the National Counterintelligence and Security Center warned of an aggressive campaign by China to influence U.S. state and local leaders. Wray called China’s influence a “massive shared challenge.”
- Liu Pengyu, a spokesperson for the Chinese embassy in Washington, told the Associated Press that China “firmly opposes and combats all forms of cyber-attacks” and said that the FBI's accusations were groundless.
The U.S. is trying to steer investor money away from China with these warnings, Protocol Policy reporter Hirsh Chitkara told me.
- But some investors aren’t taking this too seriously: VC firm Sequoia’s China arm just raised $9 billion for four new funds for health care and tech companies in the country.
- And some VCs, researchers and tech workers argue that claims such as those made by the FBI are clouded by xenophobia.
Investors have high hopes for China and consider our economies too intertwined to burn any critical bridges, Hirsh added. But not being skeptical of business relations could pose serious risks to U.S. investors. Remember what happened with DiDi and the Ant Group?
— Nat Rubio-Licht
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Executives that don't align CX ambitions with accounts receivable leave money on the table: Fewer than half of executives (44%) see better communication with customers as a benefit of digitizing AR. Meanwhile, 72% state that their AR department isn't customer-oriented enough, implying that executives understand the need for customer-oriented AR departments, but aren't aware that they can close that gap as part of their AR digitization project.
People are talking
Elizabeth Warren is a big fan of one universal charger for phones and other devices:
- “We can clear things up with uniform standards — for less expense, less hassle, and less waste."
Volkswagen's Herbert Diess thinks EV delivery times will get shorter:
- “We will see a ramp-up in the second half of the year to really be able to reduce delivery times for our EVs.”
Jeff Bezos commented on Drake’s Instagram post showing a photo of the rapper and another of a young Bezos:
- “Started from the bottom now we’re here.”
Twitter cut 30% of its talent acquisition team, just a couple months after the company paused hiring.
André Madeira is Neon’s new CTO. Madeira was recently director of engineering at Coinbase.
Rajeev Misra is stepping back from his role at SoftBank to pursue another venture. He’ll continue overseeing the original Vision Fund investments.
Louis Yang quit ByteDance, a source told Bloomberg. Yang was a co-founder of Musical.ly, which later merged into TikTok.
James Murray, director of the U.S. Secret Service, is leaving his position to take a top security job at Snap.
Mike Recupero is out as GameStop’s CFO, Axios reported. The company is also facing a “number of reductions” to staff.
Joe Megibow is Bright Cellars’ new CEO. Megibow’s held leadership roles at Purple, Expedia and others.
Bridgett Frey joined Uniswap Labs as head of comms. She was most recently the comms director for Sen. Chris Van Hollen of Maryland.
In other news
Sunny Balwani was convicted on all counts of fraud and conspiracy, which is eight more counts than Elizabeth Holmes was convicted of.
Startups are going through a rough patch. Funding dropped for the first time in three years, and sales and IPOs fell this year.
Donald Trump left his social media company’s board in early June, weeks before the SEC and a federal grand jury in Manhattan issued subpoenas.
Elon Musk is expected to talk at Sun Valley tomorrow, the last day of the conference, but it’s unclear which topics he’ll cover. Anyone's guess, to be honest.
Celsius is being sued by a former investment manager for allegedly running a "Ponzi scheme" and inflating the price of its digital coin, among other things.
Aave is introducing its own stablecoin, backed by collateral and pegged to the value of the U.S. dollar.
Meta is launching Meta accounts for its VR hardware, having previously mandated Facebook logins. The U-turn highlights the company's bet on the metaverse.
Steve Jobs was awarded a posthumous Presidential Medal of Freedom alongside politicians and athletes like Simone Biles.
When data collection is a good thing
Workplace wearables are making a comeback. Companies that once used Apple Watches to promote healthy work-life balance are now offering tech that can track whether an employee is more likely to get injured or give insight into how long it takes to recover after a shift.
The data gathered by companies is used to create internal policies and cognitive assistance wearables that can be used for upskilling and training warehouse workers. And experts told Protocol Workplace reporter Amber Burton that employees are more willing to participate than you might think.
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Executives that don't align CX ambitions with accounts receivable leave money on the table: A resounding 96% of respondents claimed that there is work to do in digitizing their AR departments, yet 60% agreed that their AR departments haven’t been prioritized as much as other departments for digitization. At a time when the importance of securing cash flow is higher than ever, many businesses are not putting enough focus on it.
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