indexindexauthorShakeel HashimNoneNeed to dive deep into the financial movements that matter to tech? Get Shakeel Hashim's newsletter every Friday.f11fbe35a3
×

Get access to Protocol

I’ve already subscribed

Will be used in accordance with our Privacy Policy

Power

Palantir’s COO says it was a 'luxury' being a private company

After the company's direct listing fizzled out, COO Shyam Sankar says he's "maniacally and monastically" focused on creating value.

Palantir

The debut marked the end of a somewhat turbulent listing process.

Image: Protocol

Palantir might be one of the most talked-about companies in tech, but upon its listing Wednesday, investors didn't seem too interested. Though its stock opened at $10 per share, it spent the day slipping, closing down more than 5% at $9.50.

"I'm trying to realize how much of a luxury it really was [being private], of not looking at the stock price on a daily basis," COO Shyam Sankar told Protocol after he was informed of the slip, adding that he would be "maniacally and monastically [focused] on creating long-term value."

The listing was beset by other issues, too. Insiders, who were already hampered from selling all their shares in the direct listing thanks to an unusual lockup period, struggled to sell any at all, CNBC reported, thanks to a glitch in Morgan Stanley's share-sale system. Given the stock slip, that could have cost them a fair amount of money.

The debut marked the end of a somewhat turbulent listing process. Palantir chose to go public via a direct listing instead of an IPO, making it one of four high-profile companies to ever do so. (The others are Spotify, Slack and Asana, which also listed today.) And it had a lot of work to do in explaining to investors exactly what it does. "We are kind of an unusual company," Sankar said, explaining the company's long sales cycles, "and investors were kind enough to spend a lot of time understanding the business."

Palantir got its start building Gotham, a data dashboard for defense and intelligence agencies, but it now has bigger aims. Its Foundry product does something similar but for the private sector, creating what the company calls "a central operating system for [companies'] data." BP, Ferrari and Airbus are clients.

Critics have said the company is more like a services business than a software one, partially because of the heavy customization to its platform it reportedly does for clients. "That was one of the reasons that we had investors come see demos, to see this quote unquote extensive customization work," Sankar said. Recent R&D investments, he argued, have made it much easier for customers to tailor the platform to their needs, without Palantir's help. "A lot of those investments really hit in the back half of 2019," he said, adding "much more product leverage." Its financials suggest that might be true: Palantir's revenue is trending in the right direction, with a $165 million net loss in the first half of 2020, compared to $280 million for the same period a year earlier.

But financials may not be Palantir's biggest problem. Given its work with the military, ESG-minded investors may give the company a wide berth. "It's intrinsic to who we are," Sankar said. "Whether we will qualify for ESG or not, that's kind of a non-goal. I think investors should decide whether they think we're an interesting business or not."

Palantir's choice of customers could also disrupt it from winning new business, too. The company says it won't work with customers whose positions are "inconsistent with our mission to support Western liberal democracy," noting specifically that it will not work with the Chinese government. That could work to Palantir's benefit — the U.S. government might be more inclined to work with it than with a competitor that has Chinese dealings — but it also limits the potential revenue opportunity.

Others may take issue with its work with ICE, where its technology is used to help organize raids — something activists have targeted the company for. When asked if the ICE work could prevent other organizations from wanting to work with Palantir, Shankar said "it's quite possible," adding that the company works "on difficult problems, and we're going to embrace the complexity and the nuance of these problems." After all, he pointed out, "we started building software to help America and her allies kill and capture terrorists — that's really complex and nuanced." Palantir's work "gives us great joy, the things that we're enabling in the world, whether it's capturing human traffickers or cyber criminals," he said. "Customers will have to decide … for themselves."

For now, Palantir's big mission is to move. The company is relocating its headquarters from Palo Alto to Denver, which was "largely a cultural decision," Shankar said. "Counterfactually, you couldn't have started a business like this anywhere but Palo Alto; but also without our founders, you couldn't have started this business in Palo Alto, either. It was kind of a special set of circumstances, but I think for the next phase of our journey, Denver's the right home."

Correction: This article was updated at 3:15 p.m. PT to fix Planatir's opening and closing prices.

Politics

'Woke tech' and 'the new slave power': Conservatives gather for Vegas summit

An agenda for the event, hosted by the Claremont Institute, listed speakers including U.S. CTO Michael Kratsios and Texas Attorney General Ken Paxton.

The so-called "Digital Statecraft Summit" was organized by the Claremont Institute. The speakers include U.S. CTO Michael Kratsios and Texas Attorney General Ken Paxton, as well as a who's-who of far-right provocateurs.

Photo: David Vives/Unsplash

Conservative investors, political operatives, right-wing writers and Trump administration officials are quietly meeting in Las Vegas this weekend to discuss topics including China, "woke tech" and "the new slave power," according to four people who were invited to attend or speak at the event as well as a copy of the agenda obtained by Protocol.

The so-called "Digital Statecraft Summit" was organized by the Claremont Institute, a conservative think tank that says its mission is to "restore the principles of the American Founding to their rightful, preeminent authority in our national life." A list of speakers for the event includes a combination of past and current government officials as well as a who's who of far-right provocateurs. One speaker, conservative legal scholar John Eastman, rallied the president's supporters at a White House event before the Capitol Hill riot earlier this month. Some others have been associated with racist ideologies.

Keep Reading Show less
Emily Birnbaum

Emily Birnbaum ( @birnbaum_e) is a tech policy reporter with Protocol. Her coverage focuses on the U.S. government's attempts to regulate one of the most powerful industries in the world, with a focus on antitrust, privacy and politics. Previously, she worked as a tech policy reporter with The Hill after spending several months as a breaking news reporter. She is a Bethesda, Maryland native and proud Kenyon College alumna.

People

Poshmark made ecommerce social. Wall Street is on board.

"When we go social, we're not going back," says co-founder Tracy Sun.

Tracy Sun is Poshmark's co-founder and SVP of new markets.

Photo: Poshmark/Ken Jay

Investors were keen to buy into Poshmark's vision for the future of retail — one that is social, online and secondhand. The company's stock price more than doubled within a few minutes of its Nasdaq debut this morning, rising from $42 to $103.

Poshmark is anything but an overnight success. The California-based company, founded in 2011, has steadily attracted a community of 31.7 million active users to its marketplace for secondhand apparel, accessories, footwear, home and beauty products. In 2019, these users spent an average of 27 minutes per day on the platform, placing it in the same realm as some of the most popular social media services. This is likely why Poshmark points out in its S-1 that it isn't just an ecommerce platform, but a "social marketplace." Users can like, comment, share and follow other buyers and sellers on the platform.

Keep Reading Show less
Hirsh Chitkara
Hirsh Chitkara (@ChitkaraHirsh) is a researcher at Protocol, based out of New York City. Before joining Protocol, he worked for Business Insider Intelligence, where he wrote about Big Tech, telecoms, workplace privacy, smart cities, and geopolitics. He also worked on the Strategy & Analytics team at the Cleveland Indians.
People

Affirm CEO Max Levchin: ‘I see an ocean of opportunities’

The fintech startup's stock soared more than 90% in its IPO debut today.

It was a blockbuster debut for Affirm. The fintech startup's shares soared more than 90% when it went public on Wednesday.

The day itself began quietly for CEO Max Levchin: He kicked it off with a Zoom call with his kids, made a latte for his wife and joined a group chat with some high school friends, one of whom is recovering from COVID-19. "We were very happy to hear that he's doing well," he told Protocol shortly after his startup began trading on the Nasdaq Global Exchange.

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Signal at (510)731-8429.

Power

Affirm takes 'buy now, pay later' public today. Investors may balk at the risk.

The San Francisco startup's rise highlights the rapid growth of payment and lending platforms, especially among millennials.

Affirm, the "buy now, pay later" startup, is going public on Wednesday in one of the most anticipated IPOs this year.

Affirm's IPO, which could value the company at a reported $10 billion, highlights the rapid growth of ecommerce and related payment and lending platforms amid the pandemic, as well as new ways that consumers, particularly younger ones, seek to make purchases: Many are eschewing credit cards to avoid going into debt.

Keep Reading Show less
Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. Before that, he worked as a staff writer at Forbes, covering social media and venture capital, and also edited the Midas List of top tech investors. He has also worked at newspapers covering crime, courts, health and other topics. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

Power

The NYSE China flip-flop: A battle between profit and accountability

Western investors want transparency. But what if guaranteeing that closes a door on the U.S. profiting from China's tech success?

The New York Stock Exchange can't decide whether to delist certain Chinese tech apps.

Photo: Julien Chatelain

The New York Stock Exchange's flip-flopping statements this week over the delisting of Chinese tech stocks highlight a longstanding dispute over how much access Chinese corporations should have to U.S. capital markets. It's a debate that some experts say pits profit against accountability, and one that will likely continue under the Biden administration.

The confusion began last week, when the NYSE announced that it would delist the stocks of three Chinese telecom companies — China Telecom, China Mobile and China Unicom — to comply with the Trump administration's order in November barring U.S. companies and individuals from investing in Chinese firms that work with the Chinese military.

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Signal at (510)731-8429.

Latest Stories