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Equity transcribed: Digging into the Uber S-1

Posted by on Apr 13, 2019 in Equity podcast, TC, Uber, Uber IPO | 0 comments

Welcome back to this week’s transcribed edition of Equity, TechCrunch’s venture capital-focused podcast that unpacks the numbers behind the headlines.

And because it’s another week, why not another emergency episode? This time Kate Clark and Alex Wilhelm popped in the studio an hour before they were due to record the regular episode in order to dig into the Uber S-1. Not only did they dig into it, but they did so in real-time. That’s what happens when you only have 10 minutes to get through almost 300 pages of numbers. And if it’s numbers you like, this is the episode for you.

The duo talks Uber’s profits and losses and provides context into it all. And just to prove just how juicy this ep is, Equity Shots tend to be about 15 minutes long. Not this one. There was a lot to get to. And who better to lead the conversation than Kate and Alex? So join them as they walk you through what the Uber S-1 holds.

For access to the full transcription, become a member of Extra Crunch. Learn more and try it for free. 


Kate Clark: Hello and welcome to Equity Shot. This is TechCrunch’s Kate Clark, and I’m joined today by Alex Wilhelm of Crunchbase News.

Alex Wilhelm: Hello.

Kate: We are going to tackle some breaking news. But, a warning from Alex first.

Alex: Yeah, so it’s 2:09pm here on the West Coast on Thursday, which means that the S-1 dropped, I don’t know, about 45 minutes ago, maybe an hour. And there was a lot to do before the show, but we wanna get this out as soon as we can, so we did our note dock by hand, and we got the S-1 pulled up, and we have a lot to go through. But, there may be an awkward pause in this, because we don’t have every single number pulled out ahead of time.

Kate: We are literally scrolling through the document live. We have a piece of paper taped to the wall in the studio with a very rough outline of what we’re gonna talk about. And we agreed that we’re going to try to take it slow and carry you guys through these important numbers as best we can.

Alex: Yes, and we are gonna start with yearly numbers to stay at the highest possible level, and we’re gonna talk about revenue first.

Alex: Now, keep in mind that we’re not talking about bookings, which is the total spend on Uber’s platform, we’re gonna talk about revenue, which is Uber’s portion of that overall platform spend. So, in 2014, because the S-1 goes back all the way to 2014, Uber had revenue of 495 million. That nearly quadrupled in 2015 to 1.99 billion … call it 2 billion flat. In 2016 that grew to 3.85 billion. It expanded to 7.9 billion in 2017, and 11.3 billion in 2018. So, basically a half a billion, to 11.3 billion from 2014 to 2018.

Kate: Yeah, quick reminder, a lot of these we’ve seen. I know there’s been plenty of reports highlighting Uber’s 2018 revenues of around 11 billion, but this is the first time we’re getting a full glimpse into financial history all the way back to 2014, and then also losses, which were interesting.

 

Alex: Very, very interesting.

Kate: I’ll quickly run through losses beginning in 2014. So, Uber lost 670 million that year, they were not profitable. The next year they lost 2.7 billion, again, not profitable. The next year they lost 370 million, guessing there was a big … oh, no, that was the year of the divestiture of … we just talked about this.

Alex: Uber China.


Source: The Tech Crunch

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What to watch for in a VC term sheet

Posted by on Mar 15, 2019 in Column, lawyers, startup lawyers, Startups, term sheets, Venture Capital, Verified Experts | 0 comments

When startup founders review a VC term sheet, they are mostly only interested in the pre-money valuation and the board composition. They assume the rest of the language is “standard” and they don’t want to ruffle any feathers with their new VC partner by “nickel and diming the details.” But these details do matter.

VCs are savvy and experienced negotiators, and all of the language included in the term sheet is there because it is important to them. In the vast majority of cases, every benefit and protection a VC gets in a term sheet comes with some sort of loss or sacrifice on the part of the founders – either in transferring some control away from the founders to the VC, shifting risk from the VC to the founders, or providing economic benefits to the VC and away from the founders. And you probably have more leverage to get better terms than you may think. We are in an era of record levels of capital flowing into the venture industry and more and more firms targeting seed stage companies. This competition makes it harder for VCs to dictate terms the way they used to.

But like any negotiating partner, a VC will likely be evaluating how savvy you appear to be in approaching a proposed term sheet when deciding how hard they are going to push on terms. If the VC sees you as naïve or green, they can easily take advantage of that in negotiating beneficial terms for themselves. So what really matters when you are negotiating a term sheet? As a founder, you want to come out of the financing with as much overall control of the company and flexibility in shaping the future of the company as possible and as much of a share in the future economic prosperity of the company as possible. With these principles in mind, let’s take a look at four specific issues in a term sheet that are often overlooked by founders and company counsel:

  • What counts in pre-money capitalization
  • The CEO common director
  • Drag-along provisions
  • Liquidation preference.

What counts in pre-money capitalization


Source: The Tech Crunch

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Inside Tufts University’s grade-hacking case

Posted by on Mar 13, 2019 in Security, TC, tufts university, zack Whittaker | 0 comments

Each week, Extra Crunch members have access to conference calls moderated by the TechCrunch writers you read every day. This week, security reporter Zack Whittaker discussed his exclusive report about Tufts University veterinary student Tiffany Filler who was expelled on charges she hacked her grades. Being Canadian and therefore in the U.S. on a student visa, she had to immediately leave the country.

From the transcript:

Firstly, given the legal risks, the potential public relations nightmare, and the ethics behind what looked like a failed due process, why didn’t Tufts hire a third-party forensics team to investigate the incident, especially given the nature of the allegations?

Secondly, how did Tufts decide that the student was to blame for these hacks? Attribution for any hack or cyber attack is often difficult, if not impossible. And the school’s IT department showed no evidence it was qualified to investigate the source of the breaches and demonstrates a clear lack of forensics, given the conclusions it came to, according to a forensics expert we spoke to.

This was definitely one of the toughest stories I’ve had to report in years, in the last seven or eight years, covering cybersecurity, national security. Those are rare for security reporters to focus on a single person for the reporting. Typically I write about data breaches or vulnerabilities or hacks that affect thousands, if not millions, of users around the world.

But this story was far too interesting not to dig into. We tried not to determine whether or not she was guilty or innocent. The fact of the matter is that both sides had conflicting evidence, but Filler offered … it was everything, and Tufts declined to comment on 19 very specific questions we sent.

This is a deeper look into a complicated story that also contains lessons for startups in varying stages of existence. Read on.

For access to Whittaker’s full transcription and for the opportunity to participate in future conference calls, become a member of Extra Crunch. Learn more and try it for free. 


Eric: This is Eric Eldon, the managing editor of Extra Crunch, and with me today is Zack Whittaker, our security correspondent, who covers a wide range of security and hacking issues and a variety of things. Over the past year, he has been doing a deep investigation into a rather troubling case that has happened at Tufts University .

For the format today, Zack is going to tell us all about his approach for the next few minutes in his own words. Then he will open it up to questions for all of you on the phone as well as myself. So without further ado, I’ll let Zack get started.

Zack: Yeah, thanks a lot Eric, much appreciated. Big thanks to everyone who read the story. It took a long time to get this far. The story went out on Friday. It’s received a really good reception, very happy with it. I’m very tired, for what it’s worth. Yeah, this took a long time, weeks and weeks of talking to people, calling people, and trying to figure out exactly what happened here.

Even then, we still ended with more questions than answers. For anyone who read, this was a very deep story, a deep-dive story about a veterinary student, who was accused of hacking her grades. Tufts University pulls this student, her name was Tiffany Filler, out of her classes. She was still in her bloodied scrubs from treating patients, and faced several accusations from the university. Tufts said she systematically broke into several user accounts, modified permission access to those accounts, and changed grades of others.

The school says its IT department used extensive logs and database records to trace activity back to her computer, based off a unique identifier and a Mac address, as well as using other indicators, such as the network she was allegedly using, the campus’s wireless network, or her own off-campus residence.


Source: The Tech Crunch

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Mixtape podcast: Tech’s concern for the homeless

Posted by on Feb 26, 2019 in concrn, homeless, Neil Shah, oakland, Podcasts, TC, TechCrunch Mixtape | 0 comments

Welcome to the latest episode of TechCrunch Mixtape with Megan Rose Dickey and myself. This week we talk about mental illness within the homeless population, specifically how people can help situations that are typically addressed by police.

Neil Shah, CEO of Concrn, joined us in the studio to talk about the ups, downs and ups again of leading an app that lacks the appeal of many Silicon Valley upstarts.

Billed as the “compassionate alternative to 911,” Concrn allows users to report a homeless person who is experiencing distress due to mental illness. Rather than involving 911, a call to Concrn will alert trained employees who are then dispatched to help de-escalate the situation, helping to ensure their safety — and hopefully keep them out of the system.

“I started working in homeless services; I started helping people get jobs,” Shah tells us. “And one of the things I noticed was that certain people from the homeless community were fully capable — they just needed to get connected to services, connected to job opportunities. Get some training.”

The company has experienced some growing pains in its relatively short life. It tried to partner with the San Francisco Police Department last fall, but the partnership never came to fruition.

“We are on pause [in San Francisco] and we have been since December,” Shah says. “I was disheartened at first because I felt like we failed in some ways there. But what I realized more is that for so many different factors, SF actually is not a good place for us to operate right now.”

So the company turned its attention to the smaller city across the bay.

“We feel like the Oakland community was way more open to something like this in general.”

Shah was also on a panel at Disrupt SF about creating a lifeline in communities. Check it out below. And click play above to listen to this week’s episode.

And if you haven’t subscribed to Mixtape yet, what are you waiting for? Find us on Apple PodcastsStitcherOvercastCastBox or whichever other podcast platform you can find.


Source: The Tech Crunch

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Mixtape podcast: Instacart’s apologetic week

Posted by on Feb 8, 2019 in Instacart, JUMP, modelland, Podcasts, Scooters, TC, TechCrunch Mixtape, Tyra Banks, Uber | 0 comments

It’s that time of the week again when Megan Rose Dickey and I talk about the good and could-be-better tech companies. This week, we talked about Instacart getting caught shorting its shoppers out of dough they rightfully deserved. Of course, the company apologized for its “misguided” approach. Which at least sounds better than apologizing for getting caught — and getting caught, the company did.

And wouldn’t you know it, scooter drama persists in San Francisco. The city this week shot down an appeal by JUMP to let it deploy its Uber-run scooters. The company, it seems, could have filed a better application in the first place, so back to the drawing board it goes to try to convince the municipality to relent.

Finally this week we talk about Tyra Banks’s Modelland, a physical space that will open in Santa Monica, Calif., later this year. It will give visitors an opportunity to experience life in a tech environment. I am intrigued at what this could be.

Click play above to listen to this week’s episode. And if you haven’t subscribed yet, what are you waiting for? Find us on Apple PodcastsStitcherOvercastCastBox or whichever other podcast platform you can find.


Source: The Tech Crunch

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