The Briefing by Martin Peers, Jessica Lessin and the team at The Information

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The Briefing

By Martin Peers, Jessica Lessin and the team at The Information

Get smarter about the day’s news in tech, media and finance by following Silicon Valley’s most-read executive newsletter.

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Recent Editions

SolarCity co-founders Pete and Lyndon Rive. Photo by Bloomberg.

A Rare Look Inside a Private Tech Stock Loan

By Alfred Lee · Aug 7, 2015 7:23am PDT

The business of helping shareholders in private tech companies turn their stock into cash is not without risk. But for those investors willing to lend money against stock in companies before they go public, the returns can be generous. One such investor, 137 Ventures, appears to have made at least a 50 percent return in 17 months on a loan it... The business of helping shareholders in private tech companies turn their stock into cash is not...

Vessel co-founder Jason Kilar. Photo by Bloomberg.

As Pay TV Pie Crumbles, Question Is Where Spending Goes

By Martin Peers · Aug 6, 2015 7:01am PDT

The years-long debate about whether mainstream TV networks are vulnerable to pay TV cord-cutting should now be over, thanks to Walt Disney’s disclosure on Tuesday that its near-term cable channel profits would be affected by ESPN subscriber losses. Little wonder that media stocks plunged on Wednesday. The more interesting question now is how big... The years-long debate about whether mainstream TV networks are vulnerable to pay TV cord-cutting...

Photo by Amir Efrati. Art by Matt Vascellaro.

The Big Interview

Pinterest’s Revenue Man Tries to Bring Ad Plan into Focus

By Amir Efrati · Aug 5, 2015 11:03am PDT

Every work day, Tim Kendall, Pinterest’s head of monetization, dons a T-shirt emblazoned with the word “Focus.” He started wearing it at the beginning of last year when he was still the company’s “head of product”—a misnomer, given that CEO Ben Silbermann effectively ran product—and wanted to inspire colleagues and himself. He said he’d continue... Every work day, Tim Kendall, Pinterest’s head of monetization, dons a T-shirt emblazoned with the...

The Information’s Latest Startups To Watch

By The Information Staff · Aug 5, 2015 7:00am PDT

The Information’s Latest Startups To Watch

By The Information Staff · Aug 5, 2015 7:00am PDT

The second installment of The Information’s Startups To Watch series highlights how international the startup scene is. Among the companies profiled is one that was dreamed up in an English barn, another with Chinese roots, one developed by an Australian living in San Francisco and a fourth created by three Canadians. As was the case with our... The second installment of The Information’s Startups To Watch series highlights how international...

Source: SEC Filings; Graphic by Peter Schulz

Private Tech Draws Wide Array of Mutual Funds

By Alfred Lee · Aug 4, 2015 7:01am PDT

Uber broke boundaries when it took investments from Fidelity and BlackRock last year. Suddenly, mutual funds widely held by 401(k)s were plunging into private tech. But institutional investing in Uber is more widespread than previously understood. Scores of mutual funds now own shares in the ridesharing company, according to regulatory filings... Uber broke boundaries when it took investments from Fidelity and BlackRock last year. Suddenly,...

YouTube star Tyler Oakley. Photo by Bloomberg.

The Problem with Being YouTube Famous

By Tom Dotan · Aug 3, 2015 10:00am PDT · 4 comments

Here’s an issue for all those media firms jockeying to cash in on the enormously popular YouTube stars and their giant audiences: is the nature of the medium making stars out of people too early, stunting their chances of growing into sustainable acts? That question came to mind at last month’s Vidcon—the annual conference of online video stars,... Here’s an issue for all those media firms jockeying to cash in on the enormously popular YouTube...

Art by Matt Vascellaro.

Chinese Tech Investors to Watch

By Tom Dotan and Jessica E. Lessin · Aug 3, 2015 7:00am PDT · 1 comment

In investing, everyone wants an “in” in China. So we assembled a list of the local Chinese investors insiders know and rely on to scout the best tech investments in the country. These are the people who global funds like Tiger Global, DST and Coatue network with as they look for the next Alibaba. Many of them are early-stage and invest alongside... In investing, everyone wants an “in” in China. So we assembled a list of the local Chinese...

Qatalyst CEO Frank Quattrone. Photo by Bloomberg.

Cloud Giants Eye Mesosphere

By Amir Efrati and Steve Nellis · Aug 2, 2015 5:22pm PDT

Qatalyst CEO Frank Quattrone. Photo by Bloomberg.

Cloud Giants Eye Mesosphere

By Amir Efrati and Steve Nellis · Aug 2, 2015 5:22pm PDT

Software startup Mesosphere has hired investment banking firm Qatalyst Partners to evaluate a buyout bid it recently received from a major cloud computing company and to engage with other potential bidders, according to a person involved in that process and a person who was briefed about it. Because the bid came from a major public cloud... Software startup Mesosphere has hired investment banking firm Qatalyst Partners to evaluate a...

The Hazard of Hype in Tech Reporting

By Jessica E. Lessin · Jul 31, 2015 10:22am PDT · 2 comments

There’s something about tech media coverage that isn’t sitting well with me right now. It’s actually more of a question I keep coming back to: How do you cover a very hyped industry without hyping it up more? It’s not an easy question to answer. Even writing about something while pointing out its flaws is a little hypey. Take, for instance a... There’s something about tech media coverage that isn’t sitting well with me right now. It’s...

*Calculation: More Optimistic - Less Optimistic = The Information Score

Subscriber Survey

Steady Pessimism Around Some Private Tech

By Martin Peers and Peter Schulz · Jul 31, 2015 7:00am PDT

Nine months into our subscriber survey, some clear trends are emerging. The biggest standout from the data is that sentiment around Square, Lyft and Dropbox has been consistently pessimistic.Overall, there’s been more negativity towards private companies than public ones. In the latest month, attitudes towards Lyft and Pinterest worsened,... Nine months into our subscriber survey, some clear trends are emerging. The biggest standout from...

Buzzfeed COO Jonah Peretti. Photo by Bloomberg

Buzzfeed’s Quest For Media Partners

By Tom Dotan and Martin Peers · Jul 30, 2015 1:47pm PDT

Discussions between new and traditional media companies are heating up but in a way that highlights the profitability and audience problems afflicting each side. The negotiations that seem to be in vogue these days involve an online video outlet partnering up with a television network to get TV ad dollars and subscription fees. The TV companies... Discussions between new and traditional media companies are heating up but in a way that...

Fitbit CEO James Park. Photo by Bloomberg.

The Tax Accounting Behind Fitbit’s Big Profit Swing

By Alfred Lee · Jul 30, 2015 7:00am PDT

Fitbit CEO James Park. Photo by Bloomberg.

The Tax Accounting Behind Fitbit’s Big Profit Swing

By Alfred Lee · Jul 30, 2015 7:00am PDT

When Fitbit filed to go public this spring, investors focused on its dramatic swing to profitability—a narrative that helped launch one of the most successful IPOs of the year. The stock has more than doubled since its June debut on Wall Street. Some of that attention is warranted: First quarter profits soared on higher sales of the... When Fitbit filed to go public this spring, investors focused on its dramatic swing to...

Art by Matt Vascellaro.

The Big Interview

Sebastian Thrun’s Big Business Model Shift

By Steve Nellis · Jul 29, 2015 10:47am PDT · 2 comments

Over the past few years, investors have dumped hundreds of millions of dollars into online education, and now companies like Coursera, Udemy and edX are searching for profitable long-term business models. That’s led Udacity founder Sebastian Thrun to abandon his initial approach of charging for videos and to instead charge for degrees in... Over the past few years, investors have dumped hundreds of millions of dollars into online...

Source: Pitchbook

How to Avoid the Series A Crunch

By Peter Schulz and Reed Albergotti · Jul 28, 2015 10:12pm PDT

It’s no secret everyone wants to build an app company and lots of investors want to fund one. But new data show the degree to which individual firms in the sector face taller odds of raising the next round of funding compared with startups other areas like financial software and network management. The Information asked Pitchbook, which collects... It’s no secret everyone wants to build an app company and lots of investors want to fund one. But...

SugarCRM CEO Larry Augustin. Contributed photo.

Navigating a Startup’s Awkward Teenage Years

By Steve Nellis · Jul 28, 2015 7:00am PDT

The $23.2 billion market for sales software is ripe for consolidation. Five big players—Salesforce.com, SAP, Oracle, Microsoft and IBM—dominate the market, but about half is controlled by a slew of smaller companies. Perhaps the most prominent of those smaller players is Cupertino-based SugarCRM, whose rapid growth in the past few years could... The $23.2 billion market for sales software is ripe for consolidation. Five big players—...

A Sergey Brin-backed synthetic burger. Photo by Bloomberg.

Google Bid for ‘Cheeseburger’ Company Impossible Foods

By Jessica E. Lessin and Amir Efrati · Jul 27, 2015 3:42pm PDT

A Sergey Brin-backed synthetic burger. Photo by Bloomberg.

Google Bid for ‘Cheeseburger’ Company Impossible Foods

By Jessica E. Lessin and Amir Efrati · Jul 27, 2015 3:42pm PDT

Google is showing an appetite for the food business. The company recently tried to buy Impossible Foods, maker of a plant-based cheeseburger, for between $200 million and $300 million, according to two people with knowledge of the deal. A deal wasn’t reached—one person said Impossible Foods wanted a higher price—and whether Google will look... Google is showing an appetite for the food business. The company recently tried to buy...

Chart by Sam Lessin.

Modest Proposals

The Hidden Costs of Pivoting

By Sam Lessin · Jul 27, 2015 10:00am PDT · 2 comments

Instagram was famously a pivot from Burbn, a failed check-in app. Twitter was a pivot from Odeo, a failing podcasting platform. Slack was a pivot out of a failing game company. The successful pivot is revered in Silicon Valley. But, while some entrepreneurs snatch victory from the jaws of defeat, I think the Valley would be a far healthier... Instagram was famously a pivot from Burbn, a failed check-in app. Twitter was a pivot from Odeo,...

Google CEO Larry Page. Photo by Bloomberg.

Tough Climb for Google’s Cloud Revenue

By Amir Efrati and Steve Nellis · Jul 27, 2015 7:00am PDT · 2 comments

Urs Hölzle, the man in charge of Google’s high-profile cloud-computing business, likes to tell colleagues that five years from now, they’ll “laugh about what the cloud was like” in 2015 because it will have evolved so drastically. How much Mr. Hölzle shapes that evolution will determine whether Google will have a big business in selling... Urs Hölzle, the man in charge of Google’s high-profile cloud-computing business, likes to tell...

Three Signs the Optimism is (Slowly) Ending

By Jessica E. Lessin · Jul 24, 2015 7:00am PDT

Something changed this week. Last week, after on-demand cleaning company Homejoy announced it was shutting down, my phone was going off with emails and texts predicting more failures on the horizon. “This is only the beginning,” one VC told me. Concern about unsustainable expectations—and margins—is nothing new in Silicon Valley. But... Something changed this week. Last week, after on-demand cleaning company Homejoy announced...

Photo by Bloomberg.

China’s Stock Market Troubles Threaten Private Funding

By Tom Dotan · Jul 23, 2015 12:08pm PDT · 1 comment

Photo by Bloomberg.

China’s Stock Market Troubles Threaten Private Funding

By Tom Dotan · Jul 23, 2015 12:08pm PDT · 1 comment

As the valuations of Chinese tech companies continue to rise, tech investors in the country are starting to grumble about the high prices. And China’s volatile stock market seems to be making the problem worse. Investors are worried that the market volatility could hurt future IPOs in China at the same time that investors are starting to balk at... As the valuations of Chinese tech companies continue to rise, tech investors in the country are...