Indonesia's Go-Jek acquires three companies to boost payment services

JAKARTA (Reuters) – Indonesia’s Go-Jek has acquired three financial technology businesses, as it expands from ride-hailing and other mobile on-demand offerings into payments and other services.

FILE PHOTO – A driver and passenger ride on a motorbike, part of the Go-Jek ride-hailing service, on a busy street in central Jakarta, Indonesia December 18, 2015. REUTERS/Darren Whiteside/File Photo

Go-Jek has bought offline payments processing company Kartuku, online payment gateway Midtrans, and saving and lending network Mapan, the company said in a statement on Friday. The acquisitions will take its combined debit card, credit card and digital wallet transactions to close to $5 billion, it said.

The value of the acquisitions was not disclosed.

The acquisitions “will accelerate financial inclusion for millions of Indonesians and stimulate economic productivity throughout the country,” Go-Jek founder and chief executive officer Nadiem Makarim said.

Go-Jek, backed by private equity firms KKR & Co LP and Warburg Pincus LLC [WP.UL], competes with Uber Technologies [UBER.UL] and Singapore-based Grab to lure customers in the Southeast Asian market, home to 600 million people.

According to the statement, Go-Jek currently has 15 million weekly active users and processes 100 million transactions per month.

Reporting by Ed Davies; Writing by Fergus Jensen; Editing by Stephen Coates

Your Organization Won't Survive Without People Analytics, But There's A Dark Side

People analytics is growing at an astounding pace, with organizations around the world pouring more and more resources into it every day. According to Ben Waber, founder and CEO of Humanyze, what we’re seeing now is just the tip of the iceberg. I first met Ben in Madrid when we were both speaking at a conference. Ben got his PhD at MIT in the Human Dynamics group and has studied behavioral analytics for many years. His company creates badges that employees wear at work, but these badges take traditional employee ID badges to the next level. They are equipped with a variety of sensors, such as radio-frequency ID that allows the badges to act like true ID badges, Bluetooth that measures someone’s location in an office, infrared that can tell who you are facing, and a microphone that measures not what you say, but how you say it and how much time you spend speaking–all metrics that truly measure human behavior.

This type of data can be used to help organizations understand things such as whether marketing is talking to engineering, whether the manager of a team actually spends time with his or her people, what top-performing employees do differently, and how the most successful salespeople speak with their customers. This type of approach is rarely done inside of organizations simply because the behavioral data doesn’t exist. Eventually it will, which will allow organizations to optimize and improve everything from how teams are structured to how compensation packages are created. Ben acknowledges that survey data is still useful and important to have, but it paints only a part of the picture. However, it’s still what most companies have. In the next decade or so, only a handful of companies will actually get to the next level of behavior analytics.

In many organizations, the people analytics function sits in HR. The challenge is that many HR teams don’t have data science capability because it’s a new skill set. HR has primarily always been about dealing with people and their interactions, hiring, and firing versus actually analyzing people from a data science perspective. However, as this area becomes more advanced, it is quite possible that it will grow into its own department that reports directly to the CEO.

There is, of course, a dark side of people analytics because data can be used to make decisions that either positively or negatively affect people. For example, people analytics can be used to calculate mass layoffs or determine ways to manipulate people. This is a delicate balance for organizations–not to mention the potential creepy factor of employees having data collected about their every move and action! People analytics models are designed by people, which means they will be inherently flawed. In her book Weapons of Math Destruction, Cathy O’Neil tells the story of a middle school teacher named Sarah Wyocki who was let go from a job with a Washington, D.C. school district because an algorithm decided that she was doing a poor job. The school district was determined to improve underperforming schools by eliminating bad teachers. Although she got rave reviews from the principal and parents, somehow she was classified as being in the bottom 2% of teachers. It turns out the elementary school where Sarah’s students came from was one of several schools under investigation for cheating on standardized tests by teachers who were erasing the wrong answers and filling in the correct ones to help preserve their own jobs. This meant that when Sarah’s students took standardized tests where no cheating was involved, their scores dropped considerably, thus making it look like they weren’t getting the education they should have been. Naturally the blame fell on the teacher. In this situation, the algorithm would have no way of picking this up, and Sarah and over 200 other teachers were fired. This story illustrates just how important it is for us to not place all of our decision-making eggs in the people analytics basket.

Today we are still at the very early stages of what’s possible with people analytics. Perhaps the biggest challenge for companies today is organizing, cleaning, aggregating, and standardizing data, a project that can easily take years depending on the size of the organization.

With technology advances and the integration of AI, you will one day be able to use voice commands to ask a smart assistant things like:

  • What’s the employee turnover?

  • Who are the top three employees on my team at risk for leaving the organization?

  • How many contingent workers are we using, and how much are we paying them each year?

  • What are the top skills and weaknesses on my team?

  • Which teams are the highest performing inside of our organization?

  • What employees should I consider for a new marketing team in California?

People analytics is absolutely growing into a core business capability that every organizations must invest in heavily. It is truly the foundation of employee experience.

Learn more about the future of people analytics here.

Bitcoin Futures Launch to a Dramatic Start

The eagerly anticipated launch of futures trading of the world’s largest cryptocurrency bitcoin got off to a positive start on Sunday, with the price nearly 9% ahead after briefly slipping below its opening level.

The launch of futures trading gives bitcoin the potential to win long-awaited legitimacy and a more widespread usage, but experts have worried that the risks associated with the currency’s Wild West-like nature could overshadow the debut.

The price action was unlike the wild swings seen in past weeks. The first bitcoin future trades kicked off at 6 p.m. (2300 GMT) on CBOE Global Markets Inc’s CBOE Futures Exchange, with January futures opening at $15,460, briefly dipping to a low of $15,420, and were last at $16,800, with 1,006 contracts traded.

“Even if there is an institution or institutional-sized trader out there, they are going to want to make sure that the mechanics work first, just for the futures,” said Ophir Gottlieb, chief executive officer of Los Angeles-based Capital Market Laboratories.

“I think the excitement will come when the futures market is established. That can take a few days,” Gottlieb added.

The futures are cash-settled contracts based on the auction price of bitcoin in U.S. dollars on the Gemini Exchange, which is owned and operated by virtual currency entrepreneurs and brothers Cameron and Tyler Winklevoss.

“It has been plain sailing so far for bitcoin futures trading,” said Naeem Aslam, chief market analyst at Think Markets in London. “Looking at the contract volume traded, we believe that there is a decent demand and this is driving up the price of bitcoin,” Aslam added.

On Sunday, bitcoin was up 4.83% at $15,400 on the Luxembourg-based Bitstamp exchange.

While bitcoin’s price rise mystifies many, its origins have been the subject of much speculation. It was set up in 2008 by someone or some group calling themselves Satoshi Nakamoto, and was the first digital currency to successfully use cryptography to keep transactions secure and hidden, making traditional financial regulation difficult if not impossible.

Many investors have stood on the sidelines watching its price rocket. However, it is possible to buy bitcoin without having to spend the full price of one coin. Bitcoin’s smallest unit is a Satoshi, named after the elusive creator of the cryptocurrency.

So far in 2017, bitcoin is up more than 1,400%. Somebody who invested $1,000 in bitcoin at the start of 2013 and had never sold any of it would now be sitting on around $1.2 million.

Heightened excitement ahead of the launch of the futures has given an extra kick to the cryptocurrency’s scorching run this year.

The launch may indeed have caused an outage of the CBOE’s website. The exchange said that due to heavy traffic on the CBOE Global Markets website on Sunday, the site “may be temporarily unavailable.”

CONTROVERSIAL MOVE

Bitcoin fans appear excited about the prospect of an exchange-listed and regulated product and the ability to bet on its price swings without having to sign up for a digital wallet. Others, however, caution that risks remain for investors and possibly even the clearing organizations underpinning the trades.

“You are going to open up the market to a whole lot of people who aren’t currently in bitcoin,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

The launch has so far received a mixed reception from big U.S. banks and brokerages, though.

Several online brokerages, including Charles Schwab Corp and TD Ameritrade Holding Corp, did not allow trading of the new futures immediately.

The Financial Times reported on Friday that JPMorgan Chase & Co, Citigroup Inc would not immediately clear bitcoin trades for clients.

Goldman Sachs Group Inc said on Thursday it was planning to clear such trades for certain clients.

Bitcoin’s manic run-up this year has boosted volatility far in excess of other asset classes. The futures trading may help dampen some of the sharp moves, analysts said.

“Hypothetically, volatility over the long run should drop after institutions get involved,” Gottlieb said. “But there may not be an immediate impact, say in the first month.”

This post has been updated.

The 1 Question You Need to Ask About Your Social Media Content in 2018

We all have seen, firsthand, how fast social media moves. With each passing year, it seems new platforms arise, old trends die out, and best practices become outdated. While 2018 will be no different in terms of change, by asking yourself the following question, you’ll put your brand in a terrific position to “win” in the game of social media:

Is my brand building community on social media?

The days where consistency and high quality content almost guaranteed a loyal following are long behind us. If you aren’t building community on social media, your brand will fall behind faster than ever before in 2018.

The Rise of the Algorithm on Social Media

The catalyst here has been the rise and rule of social media algorithms. Simply put, the algorithm tailors a platform’s news feed based mostly on engagement rather than general chronology. 

The algorithm is a natural progression and reaction to the increased volume of content across social media. Social media apps need to maximize the amount of time users spend on their platforms in order to maximize advertising dollars, and the algorithm is the most efficient way to do that.

Due to the success of the algorithm, it’s likely organic reach on social media will only continue to decrease over time. So, what’s the answer then? Well, the easiest way to ensure others remain highly engaged with your content is to build a community of loyal followers. 

How to Build Community on Social Media

1. Start a Facebook Group. 

Facebook’s primary mechanism for building community is Facebook Groups. Facebook has also been explicit in sharing that one of their main objectives going forward is to encourage community building on their network. For this reason alone, starting a Facebook Group centered around your brand’s interests wouldn’t be a bad idea. 

Keep in mind that your Facebook Group doesn’t have to be directly linked to your business. For instance, if you own a pizzeria in Jacksonville called Grandma Jo’s Pizza, your Facebook Group wouldn’t have to be (and shouldn’t be) named “Grandma Jo’s Pizza”. Instead, consider a title like, “Pizza Lovers of Jacksonville” or something along those lines.

2. Give your community members a name.

Giving the members of your audience a label will, whether consciously or subconsciously, reinforce the existence of the community your company is building. Additionally, it’ll allow your customers to know they’re a part of a movement, a club, as opposed to them just exchanging money for goods. 

Musicians like Justin Bieber use this practice by calling his fans, “Beliebers”, while brands like Starbucks do it in a more subtle way by catering to their “Gold members” within their rewards program.

3. Show your audience some love and recognition. 

The point of having a community is to facilitate relationships between the members. Customers and community members alike want to know you appreciate their time and money, so make sure you show them some love. Here’s a few ways to do it:

  • Post user-generated content (photos customers took while at your business, etc.) to your social media channels.
  • Showcase and commend fans who are doing wonderful things in the community (military service, volunteers, non-profit organizers, and more).
  • Have a weekly segment where you publish a top-rated testimonial or comment on your social media to get followers actively engaged in your content.

The list goes on and on here, but the important thing is to make sure your customers know they’re being recognized by you as the company.

4. Start a meetup.

Nothing beats face-to-face, human interaction when it comes to building relationships, and a meetup is an ideal medium for you to begin making those connections possible. Much like a Facebook Group, your meetup doesn’t have to be directly affiliated with your company. In fact, starting a local meetup in conjunction with your Facebook Group, “Pizza Lovers of Jacksonville” (to continue with the above example) would be a seamless way to build community both virtually and online.

By building a loyal core of fans around the mission your brand has, you’ll be in a terrific position to overcome the algorithm on social media. Going into 2018, ask yourself whether or not you’re taking the necessary steps to build community on social. When it comes to marketing, it could be very well be one of the most important questions you ask yourself this year.

New York Attorney General Wants Net Neutrality Vote to Be Delayed

New York’s attorney general urged the Federal Communications Commission to delay a vote rolling back net neutrality rules because of the large number of fake comments submitted to the agency on the issue.

The FCC is expected to vote on Feb. 14 on Chairman Ajit Pai’s plan to scrap the 2015 landmark net neutrality rules, moving to give broadband service providers sweeping power over what content consumers can access. Pai is a Republican appointed by President Donald Trump.

New York Attorney General Eric Schneiderman has been investigating allegations that more than half of the 21.7 million public comments submitted to the FCC about net neutrality used temporary or duplicate email addresses and appeared to include false or misleading information.

Schneiderman said the FCC agreed on Monday to assist in the probe. “We’re going to hold them to that – and, in the meantime, it’s vital that the FCC delay the vote until we know what happened,” said Schneiderman.

The 2015 rules changed the designation of internet service providers, or ISPs, usually big cable and telephone companies, so they were banned from blocking or throttling (slowing) legal content or from seeking payments to speed delivery of certain content, called “paid prioritization.”

FCC Commissioner Jessica Rosenworcel, who opposes the net neutrality rollback, agreed that the vote should be delayed.

Get Data Sheet, Fortune’s technology newsletter.

“The integrity of the public record matters. The FCC needs to get to the bottom of this mess. No vote should take place until a responsible investigation is complete,” she said.

Under Pai’s proposal, the Obama-era rules would be reversed and ISPs would only have to disclose blocking or throttling.

For security agencies, blockchain goes from suspect to potential solution

(Reuters) – Police and security agencies have so far only taken an interest in blockchain – the distributed ledger technology behind cryptocurrencies like bitcoin – for tracking criminals hiding illegal money from banks.

Adrian Kemp of HoustonKemp Economists speaks to Reuters in their office in Singapore November 24, 2017. Picture taken November 24, 2017. REUTERS/Edgar Su

But that’s changing as some civilian, police and military agencies see blockchain as a potential solution to problems they have wrestled with for years: how to secure data, but also be able to share it in a way that lets the owner keep control.

Australia, for example, has recently hired HoustonKemp, a Singapore-based consultancy, to build a blockchain-based system to record intelligence created by investigators and others, and improve the way important information is shared.

“They’ve been trying for years to come up with a centralized platform, but people are reluctant to share information,” said Adrian Kemp, who runs the consultancy, which was awarded a A$1 million ($757,500) grant by AUSTRAC, Australia’s financial intelligence agency, and the Australian Criminal Intelligence Commission.

Blockchain’s appeal for data sharing is threefold.

Its ledger, or database, is not controlled by any single party and is spread across multiple computers, making it hard to break. Once entered, any information cannot be altered or tampered with. And, by using so-called smart contracts, the owner of information can easily tweak who has access to what.

It’s a sign of how far blockchain technology has come within a decade since the publication of a pseudonymous paper describing bitcoin and the blockchain ledger that would record transactions in it.

Bitcoin has since become the preferred currency not only of libertarians and speculators, but also of criminal hackers. The bitcoin price is volatile, and hit record peaks late last month.

Governments are already exploring ways to store some data, such as land records, contracts and assets, in blockchains, and the financial industry, too, has experimented with blockchain technologies to streamline transactions and back-office systems, though with limited success.

SECURING SHARED DATA

The closest most law enforcement agencies have come to the blockchain has been working with start-up firms to analyze it for evidence of criminal deals.

But in the past year or so that attitude has begun to change.

The United States Air Force (USAF) has funded research into how blockchain could ensure its data isn’t changed. In May, the Defence Advanced Research Projects Agency (DARPA) awarded a grant to the company behind an encrypted chat program to make a secure messaging service based on the blockchain.

Amendments to a recent U.S. Senate defense bill require the government to report back on “the potential offensive and defensive cyber applications of blockchain technology and other distributed database technologies” and how foreign governments, extremists and criminals might be using them.

Adrian Kemp of HoustonKemp Economists poses for a picture in Singapore November 24, 2017. Picture taken November 24, 2017. REUTERS/Edgar Su

Britain, too, is exploring several uses of the blockchain, say consultants and companies working for several departments.

Cambridge Consultants, a UK-based consultancy, said it had worked with the Defence Science and Technology Laboratory, a UK Ministry of Defence (MoD) agency, on using a blockchain to improve the trustworthiness of a network of sensors on, for example, security cameras.

The UK’s justice ministry is looking at proving that evidence – video, emails, documents – hasn’t been tampered with by registering it all on a blockchain, according to a blog post on its website.

Marcus Ralphs, a former soldier and now CEO of ByzGen Ltd, which makes blockchains for the security sector, said he was working on projects with the MoD using blockchain to track the status and level of individuals’ security clearance. Other work included helping the Foreign and Commonwealth Office (FCO) improve the way work permits are issued and records stored.

“PASSING THE BUCK”

Adrian Kemp of HoustonKemp Economists speaks to Reuters in their office in Singapore November 24, 2017. Picture taken November 24, 2017. REUTERS/Edgar Su

These are early days.

Kemp says there’s no guarantee his project will be deployed more widely. And some who have worked with AUSTRAC are skeptical, saying such projects have more to do with agencies turning to the private sector because they’re running low on resources and ideas.

“The government is just looking to pass the buck on to private industry,” said Simon Smith, a cyber private investigator who has worked on cases involving AUSTRAC.

Many police forces and armies aren’t ready for the technological and mental leap necessary.

The Police Foundation, a UK think-tank focusing on policing and crime, is pushing British police to explore the blockchain, but its director, Rick Muir, said “we are still at the stage of ‘what is blockchain?’.”

Neil Barnas, a USAF major who last year wrote a thesis on the potential of blockchain in defense, said U.S. military and security agencies were slowly waking up.

The problem, he says, is that military minds are more inclined towards centralized systems than the decentralized ones that blockchain’s distributed ledger embraces.

That said, blockchain’s association with the criminal underworld has not dented its appeal to those who see its potential, said ByzGen’s Ralphs.

“The negative narrative around it has not at all watered down or diluted interest of the people we’ve been engaging with,” he said.

($1 = 1.3201 Australian dollars)

Reporting by Jeremy Wagstaff and Byron Kaye; Editing by Ian Geoghegan

Our Standards:The Thomson Reuters Trust Principles.

5 Celebrity Entrepreneurs Who Are Getting Involved In Blockchain Startups

Ethereum, known for creating the go-to platform for decentralized apps (dApps), has established itself as the preferred foundation for the sudden wave of blockchain startups.

For those that don’t know, blockchain technology became a mainstream talking point about six months ago when the price of Ether (Ethereum’s cryptocurrency token) started climbing from $30 all the way up to about $470, matching Bitcoin’s exponential growth.

According to Bloomberg, $1.3 billion was raised in 2017 through ICOs (Initial Coin Offerings), far exceeding what was raised through more conventional venture capital fundraising methods.

Earlier in the year, both Bitcoin as a currency and Ethereum as a platform for building decentralized applications were seen as pipedreams, at best. Nearing the end of 2017 here, it’s clear they are far from that–and will soon be more disruptive than many people (industry leaders included) are willing to admit.

But there are a handful of entrepreneurs who believe blockchain startups have a future ahead of them. Here are 5 entrepreneurs (you’ve probably heard of) that have taken a step into the world of blockchain tech:

1. Mark Cuban

Even though Mark Cuban has made it very clear he sees cryptocurrencies as risky investments, urging people to only invest if they’re “prepared to lose all their money,” he has still gotten involved himself.

A big supporter of the eSports community, Cuban recently participated in the ICO for Unikrn. According to CNBC, Unikrn is a blockchain startup that sells virtual tokens called UnikoinGold, “to be used on its platform to bet on eSports matches.” The startup has already raised over $25M.

In addition, Cuban has been an active advisor to the chat app Dust, whose ownership group recently announced would be releasing a new blockchain messaging technology platform called Mercury Protocol. Cuban has expressed his involvement and support of Mercury Protocol as well.

2. Kevin Harrington

Known for just about everything entrepreneurship related, Kevin Harrington is the founder of As Seen On TV, and has appeared as a guest investor on the hit series, Shark Tank. He is an advisor to a wide range of companies, and most recently, one of those companies has set out to solve some of the biggest problems in the shipping and logistics industries.

The blockchain based platform, ShipChain, is looking to accomplish what many other more conventional companies in the shipping and logistics space have yet to do. Alongside Harrington is the former CEO of DHL, one of the largest global logistics companies in the world.

As an active advisor in the company, it’s clear Harrington believes blockchain has huge potential to bring much-needed transparency to the outdated shipping and logistics industries.

3. Ryan Lewis

4 time Grammy Award-Winning producer, Ryan Lewis, recently announced that his next big project wasn’t music related–but blockchain based

Lewis shared in a recent interview that the blockchain platform, RedPen, would aim to better understand what the Internet is talking about at large, specifically “what’s at the heart of what everyone is saying about a topic or person online.” For example: instead of sifting through dozens of subjective articles to try to understand the main points of a major story, RedPen wants to curate only what’s most important for readers–at scale

While some celebrities have co-signed ICOs and blockchain startups the same way influencers promote products Lewis has made it clear he is a leading member of the RedPen team. He believes blockchain technology has more potential than people realize, and as a long-time tech fanatic, wants to be part of the innovation process that will move the space forward

4. Marc Andreessen

Known as the co-founder of Netscape, Marc Andreessen is someone whose voice matters in the tech community–especially when you consider the obstacles Netscape faced back before the Internet became ingrained in everyday society.

As the co-founder of the venture capital firm, Andreessen Horowitz, it should be noted when Andreessen says something is worth investing in. And back in 2014, he was already talking about “Why Bitcoin Matters.”

More recently, Andreessen Horowitz and other notable VC funds invested in MetaStable, a blockchain-focused fund that prides itself on investing in “coins, not companies.” Some of those other firms include Sequoia Capital, Union Square Ventures, Founders Fund and Bessemer Venture Partners, according to Fortune.

If Silicon Valley’s best are betting on blockchain platforms, then you know it’s time to start paying attention.

5. Sir Richard Branson

Sir Richard Branson has been a huge proponent of blockchain technology, starting with its implications for the world of finance. He recently made an investment in the company Blockchain, a Bitcoin wallet business he believes will help shift power into the hands of users–instead of centralized entities like banks.

According to CNBC, Blockchain raised $40 million from VC firm Lakestar, Google Ventures, and Richard Branson.

In addition, Branson recently hosted an elite blockchain-specific gathering on Necker Island–a summit for cryptocurrency and blockchain thought leaders to gather and discuss the future of the industry.

Bottom Line

It’s clear these big-name entrepreneurs are getting involved because they believe blockchain technology is going to be powerful and create a strategic advantage. If you haven’t been following along with the business impact of blockchain, I suggest you also read a few of my related articles: 

Micron And Cypress Semiconductors: Is The Market Failing Or Just A One Day Sale?

Numerous technology and semiconductor stocks fell today, with Micron (NASDAQ: MU) and Cypress Semiconductors (NASDAQ: CY) falling 8.7% and 7.0% respectively. I want to focus on the impact of this slide, and encourage investors to look at this as a great time for considering new opportunities for long positions in these companies.

I formerly wrote a piece on CY (you can read it here) and their growth potential as the Internet of Things (IoT) market grows, particularly with the popularity of smart technology entering the home and offices. Micron specializes in flash memory and storage, useful across the gamut of computing applications including mobile, workstation and IoT. For investors holding, be re-assured: the semiconductor industry is not going anywhere. As major firms move money out of technology holdings and into banking, which broadly saw an increase in price (ref. BAC, JPM, WFC), prospective investors would be foolish not to consider investing in a few technology stocks as stock prices begin to shore up.

While many investors (me included) are unsure what the outlook of the tech industry currently is, I think that this severe drop is a necessary correction, but that growth should still be expected for this sector. Many investors were spooked by Morgan Stanley’s cautionary expectations on pricing for NAND and labeling the stock still as overvalued. While I agree that the stock is overvalued, from considering the fundamentals of the company and their potential to further grow, I think that Micron is a great buy once it appears the stock has stabilized.

Considering the last 3 months, Micron has still seen incredible growth of 40%, including its most recent tumble. The RSI indicator shows that the stock is seriously undervalued, and I think that the ADX should be heeded at this point as it does not indicate that the stock has completely lost all of its momentum. Considering the last two support lines, it seems that we are reaching the previous support line around $42.50; yet I do not think that investors have any need to worry about the health of the stock unless the stock breaks through both support lines.

Price for MU for the last 3 months, with two support lines indicated in maroon. Relative Strength Index (RSI) and Average Directional Index (ADX) beneath. The ADX and RSI are both based on a 14 period calculation. Full size available here.

As a long-term value investor, I also think that the picture for CY is not as bleak as it instinctively appears. On the contrary, I believe that the stock has great potential, at a great price for new investors. Similar to Micron, CY is undervalued as indicated by the RSI and surprisingly, the ADX is not at an all-time low after the recent dip. Looking at the 50-period moving average, it shows that the stock has made sustained growth over the window of consideration, and that it will likely continue to perform well.

Price for CY over the last 3 months with 50-period moving average indicated in orange and support line in red. RSI and ADX below. Full size available here.

However, for all my optimism, it would be foolish to not look at the reasons for the sell-off. Morgan Stanley has downgraded its view on a number of semiconductor and tech stocks before its report on lower expectations for NAND memory pricing and a word of caution about the industry in general. Yet their price target for MU is up to $55 from $39, which gives bullish investors somewhat of a confidence boost. Regardless, stock valuation depends largely on investor confidence, and if Q4 reports show slowing growth, investors may begin to migrate away from technology in a more serious fashion.

In conclusion, I believe that this recent sell-off of technology and semiconductor stocks is not a major cause for concern for investors with open positions as long as the slide does not continue. For new investors, I think that this is an excellent opportunity to enter in a long position once prices stabilize. My word of advice to those who are nervous about continuing to hold, or to enter into a position would be to wait and see to determine whether this is a major change in market sentiment, or just an instinctive sell-off. Between CY and MU, I think that these stocks should continue to give investors a great return year-on-year and continue to outperform the competition.

Disclosure: I am/we are long CY.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: I may also be interested in initiating a long position in MU over the next 72 hours.

Amazon’s New Artificial Intelligence Features Are a Challenge to Silicon Valley

Amazon.com (amzn) this week announced a flurry of new machine learning features for its Amazon Web Services cloud computing business, raising its challenge to Silicon Valley’s biggest tech firms for the lead in artificial intelligence.

The new offerings will enable AWS customers to develop and quickly “train” their own artificial intelligence algorithms, build software applications capable of translating language on the fly, analyze video, and scan text for trends or key phrases.

Artificial intelligence (AI) refers to machines carrying out tasks that are normally associated with human intelligence. Machine learning (ML) is a subset of AI in which sophisticated computer algorithms are developed to recognize patterns in large volumes of data to solve problems on their own.

For example, with two of the new AWS features a company could quickly transcribe customer phone calls and then analyze the text for customer sentiment.

Already Apple (aapl) Facebook Inc (fb), Amazon and other top tech companies are developing and using AI for their own products, but the new offerings from AWS could make it easier and more affordable for startups and less tech-savvy enterprises to implement AI technology.

The product announcements, made at AWS’s annual conference in Las Vegas, cap off a year in which Amazon released 1,300 new AWS features, up from a little more than 1,000 in 2016.

“As always, Amazon is making it easier for companies to get started using new technologies,” said Mikhail Naumov, co-founder of DigitalGenius, a London-based customer service startup that uses AI. “Now they are making it easier for companies of all sizes to leverage powerful ML tools in their business.”

Despite being the pioneer and dominant player in the cloud computing market, AWS is playing catch-up to chief rivals Microsoft Corp (msft) and Alphabet Inc’s Google (goog) when it comes to new AI offerings, several of which will not be generally available until sometime in 2018.

For more on artificial intelligence, watch Fortune’s video:

Microsoft, for example, offered Translator, a direct competitor to the new Amazon Translate, as far back as 2011, Microsoft said. And Google Cloud Platform introduced the Google Natural Language API, a rival to the new Amazon Comprehend, last November. Throughout 2017 both Microsoft and Google announced AI services that rival those unveiled this week by AWS.

“If Amazon can offer products that are just good enough, it can use its leading position,” said Chris Nicholson, CEO of Skymind, a San Francisco startup that provides AI solutions for enterprises.

Among Amazon’s AI announcements is Amazon SageMaker, which lets companies build and quickly train machine learning algorithms. It also announced Amazon Rekognition Video, which uses AI to detect objects and faces in customers’ video content; Amazon Transcribe, which turns audio into text; Amazon Translate, which translates text; and Amazon Comprehend, which analyzes text for sentiment and key phrases.

“We expect the big three to continue to play a game of leapfrog over the next several years as the enterprise moves from experimental to industrialization of AI and machine learning,” said Ken Corless, a principal in Deloitte Consulting’s cloud engineering practice. “Given their market share, AWS’s announcements are significant as they are signaling to the market that they will not cede this space to Microsoft or Google.”

Uber signs first Southeast Asian e-wallet deal with Vietnam's MoMo

HANOI (Reuters) – U.S. ride-hailing company Uber Technologies Inc [UBER.UL] on Wednesday signed a strategic deal with Vietnamese financial technology firm MoMo to let passengers pay for rides using MoMo’s e-wallet, the pair said in a statement on Wednesday.

A Uber driver takes a client on a motorcycle in Hanoi, Vietnam November 28, 2017. REUTERS/Kham

The deal is Uber’s first e-wallet partnership in Southeast Asia, home to 600 million people, and could help the firm catch up with main regional rival Grab which has its own e-wallet service.

“Vietnam is one of Uber’s fastest-growing Asian markets… MoMo’s five million app users already pay for utility bills, airline tickets and other services with the wallet,” Uber and MoMo said in a joint statement.

Last year, Goldman Sachs Group Inc (GS.N) and a private-equity arm of Standard Chartered PLC (STAN.L) invested a combined $28 million in “fintech” firm MoMo, offering a means of tapping into Vietnam’s young, tech-savvy population.

“The partnership with Uber will open a seamless and cashless transport experience for the many Vietnamese without credit cards,” MoMo Chief Operating Officer Nguyen Manh Tuong said in the statement.

Reporting by Mai NguyenEditing by Christopher Cushing

Our Standards:The Thomson Reuters Trust Principles.

Early Thanksgiving/Black Friday Data Reports Suggest Strong Retail Sales

Thanksgiving has passed and the holiday shopping season has officially begun. Though many consumers started shopping earlier in the month, Thanksgiving and Black Friday sales are some of the first indications of how retailers will fare this holiday season. The reports and analyses are still being produced, but initial figures on Thanksgiving and Black Friday sales are encouraging.

According to the annual International Council of Shopping Centers (ICSC) Thanksgiving Weekend Shopping Report, more than 145 million adults spent time at malls and shopping centers and estimated spending, on average, $377.50. In addition to all the gift buying, venues for dining and entertainment also benefited from an added $78.70 in sales per adult.

The vast majority of consumers (87 percent) shoppers took advantage of in-store and online purchasing on Thanksgiving and Black Friday. Not only were there a lot of people shopping, nearly three out of four (74 percent) Thanksgiving/Black Friday shoppers spent the same or more than in 2016.

The news was especially good for brick and mortar retailers. ICSC estimates that 75 percent of all spending was captured by retailers with a physical presence. This doesn’t mean that people weren’t shopping online. However, retailers like Walmart, Best Buy and other physical stores with online components fared better their online-only competitors.

The data clearly shows the benefits of having an online store for small business owners with a physical location. While it may be too late for a business to setup a full ecommerce website from scratch between now and Christmas, there are some things current website owners can do to make their site more appealing to holiday shoppers. For example, having a way to buy online and pick up in-store has extra benefits. The ICSC survey found that 69 percent of those purchasing online and picking up in-store (click & collect) made an additional in store purchase

“Thanksgiving Weekend is a great indicator for what will be a holiday season full of spending, as we are seeing a very positive consumer sentiment and willingness to spend,” said Tom McGee, President and CEO of ICSC. “Shopping centers across the country should feel very optimistic about the season ahead. While the shopping season is longer this year, it’s not coming at the expense of the most popular shopping day of the year.”

Now that Black Friday has passed and Cyber Monday is here, businesses need to finalize their plans for December. It’s important that promotions in December meet the expectations of consumers. The ICSC data suggests that retailers will need to be as generous or more so than they were for Black Friday.

Three out of five (60 percent) consumers anticipate similar deals/promotions to the ones they saw this weekend. And more than one in four (28 percent) consumers said they think the deals/promotions in December will be better than what was found over the past weekend. Only 12 percent of consumers assume that December deals/promotions won’t be as good as the ones they saw on Black Friday.

Since deals and sales are some of the greatest motivators for consumers during the holiday season, business owners need to make sure their site prominently features their best deals and that these are also advertised heavily in search and social media campaigns.

For more recent data about creating a better holiday marketing campaign, read this article on last minute shoppers.

How To Give Gen Z-Ers The Shopping Experience They Want

Every few years marketers must come to grips with the fact that they don’t fully understand the motivations of the next generation that’s growing up and assuming more spending power. Although Gen Z has been on brands’ radars for the past few years, organizations are still trying to figure out who they, how they work and live, and, what they want from brands.

The members of Gen Z, 16-22 year olds, might surprise you with their shopping habits. Even though they’ve grown up with digital fluency, a smartphone always in their hand, they still prefer shopping in stores than online, according to a survey from IBM and the National Retail Foundation.  

But that doesn’t mean Gen Z wants the traditional in-store experience. They’re changing shopping habits entirely. Here’s how:

1. They want innovative, tech-driven stores.

Gen Z already makes up 25 percent of the US population, so it’s smart for any retailer to update their stores with what they want. According to a study from RIS and Tata Consulting Services, this means implementing new technologies in stores such as smartphone self checkout, interactive shoppable screens, and virtual try-on for apparel.

It makes going to the store an interactive, fun experience–which is the only way to draw in the generation that’s grown up with instant access to everything, from films to social media.

A great example of a retailer that’s doing this successfully is Apple. According to the CEO of Euclid, Brent Franson, “You’ve got the product playground that is the physical experience, supplemented by human beings that can answer questions…It’s a seamless and integrated experience.” 

2. They use their phones in tandem with shopping.

Step onto any street or into any shopping mall and any Gen Z-er is walking around with a phone in their hand. According to the same RIS study mentioned above, they use their smartphones for multiple reasons when it comes to shopping, including comparing prices while in-store, reading product reviews, and purchasing from the website instead of the brick-and-mortar store.

What does this mean for retailers? That it’s time to work with, not against, their smartphone habits and integrate phone usage with the shopping experience. Creating an app, for example, or implementing virtual reality in-store. It’s all about creating a frictionless shopping journey, so that the shopping experience is as easy for consumers as possible.

3. They want stores to be aesthetically pleasing.

In addition to updating stores with the right technology and combining store features with smartphone usage, retailers should also ensure that they’re using the right kind of store design.

Because Gen Z-ers have grown up with the Internet, aspirational browsing is an important shopping habit for them. It’s less about buying immediately for them than it is about finding the perfect item on Facebook or Pinterest, creating digital scrapbooks, and creating an entire experience around the purchase.

Which is why it’s important for a retailer to recreate the same experience in their stores. Gen Z-ers, according to retail consultancy FITCH, have the following aesthetic and sensory preferences when it comes to stores: they orientate by contrast and color before exploring product features, their focus is on the product instead of signage, and touch and access to the product, instead of off-putting clinical displays, are key. 

4. Social media is integral to their shopping experience.

According to a study from RetailDIVE, 80 percent of Gen Z purchases are influenced by social media. This should come as no surprise, considering that they’ve grown up with social media their entire lives: in one study 50 percent of them said they can’t even ‘live’ without YouTube.

But it’s not as simple as posting an ad on Facebook and waiting for Gen Z-ers to like a page or walk into a store. This generation hates having ads pop up on their phones–in large part because they view phones as an extension of themselves, and it’s an invasion of their private lives. Instead, they’re more drawn to mobile app awards or to branded content that’s entertaining, whether it’s got a story, music, or humor.

So when a retailer wants to attract new customers to come shop in-store, these preferences are important to consider.

If retailers want to be successful in selling to Generation Z, they still need to step up their game when it comes to the shopping experience. It’s not just about dressing mannequins in the latest trendy styles or guaranteeing fair labor standards for their workers. Gen Zers crave an interactive, engaging experience in every part of their lives–and for their shopping habits, this is definitely the case.

Black Friday, Thanksgiving online sales climb to record high

CHICAGO (Reuters) – Black Friday and Thanksgiving online sales in the United States surged to record highs as shoppers bagged deep discounts and bought more on their mobile devices, heralding a promising start to the key holiday season, according to retail analytics firms.

Customers push their shopping carts after making a purchase at Target in Chicago, Illinois. REUTERS/Kamil Krzaczynski

U.S. retailers raked in a record $7.9 billion in online sales on Black Friday and Thanksgiving, up 17.9 percent from a year ago, according to Adobe Analytics, which measures transactions at the largest 100 U.S. web retailers, on Saturday.

Adobe said Cyber Monday is expected to drive $6.6 billion in internet sales, which would make it the largest U.S. online shopping day in history.

In the run-up to the holiday weekend, traditional retailers invested heavily in improving their websites and bulking up delivery options, preempting a decline in visits to brick-and-mortar stores. Several chains tightened store inventories as well, to ward off any post-holiday liquidation that would weigh on profits.

TVs, laptops, toys and gaming consoles – particularly the PlayStation 4 – were among the most heavily discounted and the biggest sellers, according to retail analysts and consultants.

Commerce marketing firm Criteo said 40 percent of Black Friday online purchases were made on mobile phones, up from 29 percent last year.

No brick-and-mortar sales data for Thanksgiving or Black Friday was immediately available, but Reuters reporters and industry analysts noted anecdotal signs of muted activity – fewer cars in mall parking lots, shoppers leaving stores without purchases in hand.

People shop for items in Macy’s Herald Square in Manhattan, New York. REUTERS/Andrew Kelly

Stores offered heavy discounts, creative gimmicks and free gifts to draw bargain hunters out of their homes, but some shoppers said they were just browsing the merchandise, reserving their cash for internet purchases. There was little evidence of the delirious shopper frenzy customary of Black Fridays from past years.

However, retail research firm ShopperTrak said store traffic fell less than 1 percent on Black Friday, bucking industry predictions of a sharper decline.

A cashier handles money in Macy’s Herald Square in Manhattan, New York. REUTERS/Andrew Kelly

“There has been a significant amount of debate surrounding the shifting importance of brick-and-mortar retail,” Brian Field, ShopperTrak’s senior director of advisory services, said.

“The fact that shopper visits remained intact on Black Friday illustrates that physical retail is still highly relevant and when done right, it is profitable.”

The National Retail Federation (NRF), which had predicted strong holiday sales helped by rising consumer confidence, said on Friday that fair weather across much of the nation had also helped draw shoppers into stores.

The NRF, whose overall industry sales data is closely watched each year, is scheduled to release Thanksgiving, Black Friday and Cyber Monday sales numbers on Tuesday.

U.S. consumer confidence has been strengthening over this past year, due to a labor market that is churning out jobs, rising home prices and stock markets that are hovering at record highs.

Reporting by Richa NaiduEditing by Marguerita Choy

Our Standards:The Thomson Reuters Trust Principles.

Jeff Bezos Is the World's Only $100 Billionaire. Will He Finally Start Giving his Money Away?

Black Friday was a particularly nice day to be Jeff Bezos. His company Amazon clearly won the day, pulling in an estimated half of all online sales. Those sales totaled more than $5 billion, so you do the math. Wall Street did, and Amazon’s stock price shot up almost $30 to $1,186. Bezos was already the richest man on Earth, having beaten out Bill Gates this past year. But now his net worth is north of $100 billion, an almost unimaginable number. It’s bigger than the GDP of most nations. It’s a 1 followed by 11 zeros. [Updated: Bezos’ worth dipped just below $100 billion based on after-hours stock trades but I’m willing to bet Amazon’s continued dominance of online sales puts him back at 12 figures next week.]

Unfortunately, Bezos is exceptional among billionaires in other ways as well. He’s conspicuous by his absence among signers of The Giving Pledge, created by Gates and Warren Buffett. Billionaires who sign the pledge promise to give away the majority of their wealth. So far, Bezos’ most high-profile bit of philanthropy is incorporating a 65-room homeless shelter into Amazon’s new Seattle headquarters. Don’t get me wrong–that’s a great move in many ways and I admire Bezos’ willingness to have homeless people mingling with Amazon employees. He and his family have also made donations in the millions to the Fred Hutchinson Cancer Research Center in Seattle, Princeton University (which Bezos attended), and more recently, a $1 million donation each to the Reporters Committee for Freedom of the Press and to St Mary’s Center in Massachusetts which provides lodging and job training to homeless women, children, and families. That’s all great, but it’s not much compared to the philanthropy of other American billionaires. The world’s only $100-billionaire can do better.

Last summer, Bezos stirred a lot of interest with a tweet asking for philanthropic suggestions. Some believed it signaled a new focus on charitable activity, but it more likely signaled a fear of embarrassment. The tweet came only after the New York Times asked the about-to-be world’s richest human about his charitable plans. He got more than 50,000 suggestions in response to his tweet and so far does not seem to have acted on many of them.

Bezos has never openly declared a political affiliation but friends say he has libertarian leanings. If so, he’s failing to live up to libertarian ideals, which argue that private donations can and should replace government programs for helping those in need. But his non-philanthropy may change in the future. Back when Bill Gates ran Microsoft, he himself was once criticized by his mother for giving too little away. He responded that he would get around to giving once his role as CEO was behind him, and he’s kept that promise in a big way. 

Some who know Bezos say the same will happen with him. For the moment, he’s too absorbed in achieving world domination for Amazon to put much thought into a philanthropic strategy or direction. But in time, he will come to focus more on philanthropy and then we may all see some impressive giving. 

I certainly hope that’s true. The world is full of really big problems his money could help to solve. 

Canadian charged in Yahoo hacking case to plead guilty in U.S.

(Reuters) – A Canadian accused by the United States of helping Russian intelligence agents break into email accounts as part of a massive 2014 breach of Yahoo accounts is expected to plead guilty next week, according to court records.

A photo illustration shows a Yahoo logo on a smartphone in front of a displayed cyber code and keyboard on December 15, 2016. REUTERS/Dado Ruvic/Illustration

Karim Baratov, who earlier this year waived his right to fight a U.S. request for his extradition from Canada, is scheduled to appear in federal court in San Francisco on Tuesday for the plea hearing, according to a court calendar seen on Friday.

Baratov, a 22-year-old Canadian citizen born in Kazakhstan, was arrested in Canada in March at the request of U.S. prosecutors. He later waived his right to fight a request for his extradition to the United States.

Andrew Mancilla, Baratov’s lawyer, declined to comment. A spokesman for the U.S. Attorney’s Office in San Francisco did not respond to a request for comment.

The U.S. Justice Department announced charges in March against Baratov and three other men, including two officers in Russia’s Federal Security Service (FSB), for their roles in the 2014 theft of 500 million Yahoo accounts.

Verizon Communications Inc (VZ.N), the largest U.S. wireless operator, acquired most of Yahoo Inc’s assets in June.

Prosecutors said that the FSB officers, Dmitry Dokuchaev and Igor Sushchin, directed and paid hackers to obtain information and used Alexsey Belan, who is among the U.S. Federal Bureau of Investigation’s most-wanted cyber criminals, to breach Yahoo.

When the FSB officers learned that a target had a non-Yahoo webmail account, including through information obtained from the Yahoo hack, they worked with Baratov, who was who paid to break into at least 80 email accounts, prosecutors said.

The individuals associated with the accounts they sought to access included Russian officials, the chief executive of a metals company and a prominent banker, according to the indictment.

At least 50 of the accounts Baratov targeted were hosted by Google, the indictment said.

Tuesday’s proceedings before U.S. District Judge Vince Chhabria are scheduled as a “change of plea” hearing.

Baratov, the only person arrested to date in the case, previously in August pleaded not guilty to conspiring to commit computer fraud, conspiring to commit access device fraud, conspiring to commit wire fraud and aggravated identity theft.

Reporting by Nate Raymond in Boston; Editing by Tom Brown

Our Standards:The Thomson Reuters Trust Principles.

Uber's messy data breach collides with launch of SoftBank deal

TORONTO/SAN FRANCISCO (Reuters) – A newspaper advertisement for an Uber Technologies Inc stock sale was juxtaposed on Wednesday with a report that the ride-service provider had covered up a data hack – something of a metaphor for Uber, a company with boundless investor interest, but whose penchant for rule-breaking has led to a series of scandals.

FILE PHOTO: A photo illustration shows the Uber app on a mobile telephone, as it is held up for a posed photograph, in London, Britain November 10, 2017. REUTERS/Simon Dawson/File Photo

The stock sale advertised in the New York Times will enable Uber [UBER.UL] investors to sell their shares to Japanese investor SoftBank, a critical deal for the company whose problems included building software to spy on competitors and to evade regulators and being investigated in Asia for paying bribes.

Uber on Tuesday said that it had paid hackers $100,000 to destroy data on more than 57 million customers and drivers that was stolen from the company – and decided under the previous CEO Travis Kalanick not to report the matter to victims or authorities. Uber was first hacked in October 2016 and discovered the data breach the following month.

Chief Executive Dara Khosrowshahi, who took the helm in August with the mission of turning around the company and overhauling its culture, acknowledged in a blog that Uber had erred in its handling of the breach. (ubr.to/2AmxlQt)

The timing of the disclosure could hardly have been worse.

The company is trying to complete a deal with SoftBank Group Corp (9984.T) in which the Japanese firm would invest as much as $10 billion for at least 14 percent of the company, mostly by buying out existing shareholders. SoftBank is advertising to find shareholders who want to sell.

Uber last month announced a preliminary deal for the SoftBank investment.

One question is whether SoftBank will now try to alter the price of the deal. One source familiar with the matter said SoftBank is planning to stick to its agreement to invest in Uber but may seek better terms. SoftBank has not yet made a final decision on whether to renegotiate, the source said.

Another question is the future of Kalanick, the co-founder who led Uber to becoming a global powerhouse but did so with aggressive and controversial tactics. He was forced out by investors in June who feared his leadership style would damage the company, although he stayed on the board and remains a significant shareholder.

A bitter battle among investors over how to resolve Uber’s problems led to a lawsuit by early investor Benchmark, which sought to oust Kalanick from any role. But a settlement was reached earlier this month to pave the way for the SoftBank deal, with Kalanick retaining his board seat and other rights.

Kalanick was made aware of the hack last November and was aware of the $100,000 payment, according to a person close to the matter. Kalanick has declined to comment. Uber did not respond to questions from Reuters on Wednesday.

MULTIPLE INVESTIGATIONS, LAWSUITS

The scope of the repercussions Uber will face for the October 2016 data breach began to take shape Wednesday with governments around the world opening investigations.

Authorities in Britain, Australia and the Philippines said they would investigate Uber’s response to the data breach. London’s transport regulator, which has been in discussions with Uber after stripping it of its license to operate, said it was pressing Uber for details.

Canada’s privacy watchdog said that it had asked Uber for details on the breach, though it had not launched a formal investigation.

Attorneys general offices in at least six U.S. states along with the Federal Trade Commission (FTC) have announced they are looking into the matter. Some states are likely to go after Uber for breaking laws on data breach notification within a reasonable period of time.

At least two class action lawsuits have been filed against the company in the United States for failing to disclose the data breaches and causing potential harm to consumers.

Uber said that it has been in touch with the FTC and several states to discuss a hack and pledged to cooperate.

Legal experts said the company is likely to face limited financial fallout from data-breach lawsuits. Uber might succeed in squelching them outright because its agreements with both customers and drivers call for mandatory arbitration of disputes.

Uber fired its chief security officer, Joe Sullivan, and a deputy, Craig Clark, over their role in handling the hack.

The board of directors had commissioned an investigation into Sullivan and his team, which is how the breach was discovered. The board committee concluded that neither Kalanick nor Salle Yoo, who was general counsel at the time, had been consulted in the company’s response to the breach, according to a second person familiar with the matter.

It is unclear what the board of directors knew, if anything. Multiple board members did not respond to requests for comment.

“The scope of this breach is something the Uber board should have been briefed about and consulted on at the very least,” said Cynthia Clark, an associate professor of management at Bentley University. “It’s a monitoring issue and one of strategy and reputation.”

Clark said that these sorts of risks could affect Uber’s IPO, which the board has agreed will take place in 2019.

The company has begun overhauling its security practices with help from Matt Olsen, former general counsel of the U.S. National Security Agency and director of the National Counterterrorism Center, CEO Khosrwoshahi said.

Uber in August settled with the FTC after the regulator found the company failed to protect the personal information of passengers and drivers, an agreement that requires 20 years of regular auditing of Uber’s data.

After this week’s disclosures, Uber can expect “more audits and more people inside of the company” from regulators, said cyber security attorney Steven Rubin.

Reporting by Jim Finkle in Toronto and Heather Somerville in San Francisco; Additional reporting by Diane Bartz in Washington, Greg Roumeliotis in New York and Alastair Sharp in Toronto.; Editing by Jonathan Weber and Grant McCool

Our Standards:The Thomson Reuters Trust Principles.

Regulators to press Uber after it admits covering up data breach

TORONTO/SAN FRANCISCO (Reuters) – Struggling ride-hailing firm Uber [UBER.UL] faces a fresh regulatory crackdown after disclosing it paid hackers $100,000 to keep secret a massive breach last year that exposed personal data from around 57 million accounts.

Discovery of the U.S. company’s cover-up of the incident resulted in the firing of two employees responsible for its response to the hack, said Dara Khosrowshahi, who replaced co-founder Travis Kalanick as chief executive in August.

“None of this should have happened, and I will not make excuses for it,” Khosrowshahi said in a blog post. (ubr.to/2AmxlQt)

Britain’s data protection authority said on Wednesday that concealment of the data breach raises “huge concerns” about Uber’s data policies and ethics.

“Deliberately concealing breaches from regulators and citizens could attract higher fines for companies,” James Dipple-Johnstone, deputy commissioner of the UK Information Commissioner’s Office, said in a statement. Current British law carries a maximum penalty of 500,000 pounds ($662,000) for failing to notify users and regulators when data breaches occur.

The stolen information included names, email addresses and mobile phone numbers of Uber users around the world, and the names and license numbers of 600,000 U.S. drivers, Khosrowshahi said. Uber declined to say what other countries may be affected.

Khosrowshahi also said Uber had begun notifying regulators. The New York attorney general has opened an investigation, a spokeswoman said. Regulators in Australia and the Philippines said on Wednesday they would also look into the matter.

Long known for its combative stance with local taxi regulators, Uber has faced a stream of top-level executive departures over issues from sexual harassment to data privacy to driver working conditions, which forced its board to remove Kalanick as CEO in June.

In recent months, London’s transport regulator stripped Uber of its license to operate citing the company’s failure to deal with public safety and security issues, although Uber is appealing against the decision and the new CEO has held talks with Transport for London to resolve the stand-off.

The agency said it was seeking more information from Uber.

“We are pressing them for the full details of what has happened so that we can be satisfied that all the right protections are in place for the personal data of drivers and customers in London,” a Transport for London spokesman said.

Britain’s National Cyber Security Centre said it was working with other national authorities to determine how UK citizens may have been affected, but added that it has no information, so far, that customer financial details had been compromised.

WHO KNEW WHAT WHEN?

The breach occurred in October 2016 but Khosrowshahi said he had only recently found out about it.

Bloomberg News first reported the data breach on Tuesday.

But Kalanick learned of the breach in November 2016, a month after it took place, a source familiar with the matter told Reuters. At the time, the company was negotiating with the U.S. Federal Trade Commission over the handling of consumer data.

FILE PHOTO: The logo of Uber is seen on an iPad, during a news conference to announce Uber resumes ride-hailing service, in Taipei, Taiwan April 13, 2017. REUTERS/Tyrone Siu/File Photo –

A board committee had investigated the breach and concluded that neither Kalanick nor Salle Yoo, Uber’s general counsel at the time, were involved in the cover-up, another person familiar with the issue said. The person did not say when the probe took place.

Uber said on Tuesday it was obliged to report the theft of the drivers’ license information and had failed to do so.

“There is no question that the previous management and security team at Uber failed in their responsibility to their drivers, to regulators, to justice and above all to customers,” said Rik Ferguson, vice president of security research at software firm Trend Micro. “That’s a pretty long list”.

There is no evidence of fraud against passengers as a result of the data breach, while drivers whose license numbers had been stolen are being offered free identity theft protection and credit monitoring, Uber said.

Two hackers gained access to proprietary information stored on GitHub, a service that allows engineers to collaborate on developing software code. There, the two people stole Uber’s credentials for a separate cloud-services provider where they were able to download driver and rider data, the company said.

A GitHub spokeswoman said the hack was not the result of a failure of GitHub’s security.

The chief executive of Uber Technologies Inc, Dara Khosrowshahi attends a meeting with Brazilian Finance Minister Henrique Meirelles (not pictured) in Brasilia, Brazil October 31, 2017. REUTERS/Adriano Machado

“While I can’t erase the past, I can commit on behalf of every Uber employee that we will learn from our mistakes,” Khosrowshahi said.

FURTHER FALLOUT

Uber is negotiating with a consortium led by Japan’s SoftBank Group (9984.T) for fresh investment that could be worth up to $10 billion, sources told Reuters earlier this month. SoftBank declined to comment on whether the security breach could lead it to renegotiate terms of its proposed deal.

Uber said it had fired its chief security officer, Joe Sullivan, and a deputy, Craig Clark, this week over their role in the handling of the incident. Sullivan, formerly the top security official at Facebook Inc (FB.O) and a federal prosecutor, served as both security chief and deputy general counsel for Uber.

Sullivan declined to comment when reached by Reuters. Clark could not immediately be reached for comment.

Kalanick, through a spokesman, declined to comment. The former CEO remains on the Uber board of directors, and Khosrowshahi has said he consults with him regularly.

Although payments to hackers are rarely publicly discussed, U.S. Federal Bureau of Investigation officials and private security companies have told Reuters that an increasing number of companies are paying criminal hackers to recover stolen data.

Uber has a history of failing to protect driver and passenger data. Hackers previously stole information about Uber drivers and the company acknowledged in 2014 that its employees had used a software tool called “God View” to track passengers.

Khosrowshahi said on Tuesday he had hired Matt Olsen, former general counsel of the U.S. National Security Agency, to restructure the company’s security teams and processes. The company also hired Mandiant, a cyber security firm owned by FireEye Inc (FEYE.O), to investigate the breach.

The new CEO has traveled the world since replacing Kalanick to deliver a message that Uber has matured from its earlier days as a rule-flouting startup.

“The new CEO faces an unknown number of problems fostered by the culture promoted by his predecessor,” said Erik Gordon, an expert in entrepreneurship and technology at the University of Michigan’s Ross School of Business.

Reporting by Jim Finkle in Toronto; Heather Somerville, Joseph Menn and Stephen Nellis in San Francisco, Manolo Serapio Jr in Manila, Byron Kaye in Sydney, Sam Nussey in Tokyo and Eric Auchard in London; Editing by Lisa Shumaker, Stephen Coates and Adrian Croft

Our Standards:The Thomson Reuters Trust Principles.

Digital currencies will not replace physical money soon: Bank of Japan official

TOKYO (Reuters) – Financial technology is fast revolutionizing the banking industry but digital currencies will not replace physical money any time soon, a senior Bank of Japan (BOJ) official said on Wednesday.

Bitcoin (virtual currency) coins placed on Dollar banknotes are seen in this illustration picture, November 6, 2017. REUTERS/Dado Ruvic/Illustration

“It’s too far off,” Hiromi Yamaoka, head of the BOJ’s payment and settlement systems department, said on the sidelines of a forum on financial innovation hosted by Thomson Reuters.

“It would change the banking system too drastically.”

Japan has become a front runner in the financial technology (fintech) industry, with the government this year having recognized bitcoin as legal tender and approved several companies as operators of cryptocurrency exchanges.

The BOJ last year set up a section in charge of fintech to offer guidance to banks seeking new business opportunities, and joined up with the European Central Bank to study distributed ledger technology (DLT) like blockchain.

But the BOJ and ECB said in September they had judged that blockchain – which is best known as the system underpinning bitcoin – was not mature enough to power the world’s biggest payment systems.

“From a practical perspective, I think this is still ‘under construction’,” Yamaoka told the forum, referring to blockchain and DLT technology.

He said the hype surrounding initial coin offerings was “quite tremendous”.

Blockchain is a public online ledger of transactions maintained by a network of computers on the internet.

Financial firms hope the nascent technology can reduce the cost and complexity of burdensome processes such as international payments and securities settlement.

Banks are also using fintech in other ways to make their financial services more efficient, including smartphone apps and artificial intelligence for advisory services.

Reporting by Chris Gallagher; Editing by Robert Birsel

Our Standards:The Thomson Reuters Trust Principles.

Facebook to open Nigerian hub next year in African tech drive

LAGOS (Reuters) – Facebook will open a “community hub space” in Nigeria next year to encourage software developers and technology entrepreneurs and become the latest technology giant to pursue a training program in fast-growing Africa.

The Facebook application is seen on a phone screen August 3, 2017. REUTERS/Thomas White

The U.S. social media company said the center would host an “incubator program” to help develop technology start-ups, while it will also train 50,000 Nigerians in digital skills.

Africa’s rapid population growth, falling data costs and heavy adoption of mobile phones rather than PCs is attracting technology companies looking to attract more users.

Facebook did not provide details of the period over which its planned training would take place in Nigeria, which is Africa’s most populous country with 180 million inhabitants.

“We understand the important role Facebook plays here in Nigeria with developers and start-ups and are invested in helping these communities,” Emeka Afigbo, its regional head of platform partnership, said in a statement on Wednesday.

Facebook said the training – aimed at software developers, entrepreneurs and students – would be offered in cities including the capital, Abuja, Port Harcourt in the south, Calabar in the southeast and Kaduna in the north.

Last year Facebook founder Mark Zuckerberg visited technology companies in Lagos and his charitable foundation provided $24 million to Andela, which trains developers.

Google’s chief executive in a July visit to Lagos said the company aimed to train 10 million people across the continent in online skills over the next five years. He also said it hoped to train 100,000 software developers in Nigeria, Kenya and South Africa.

Although Africa may not offer as much opportunity to add consumers as China or India, because large wealth gaps mean that many people in places like Nigeria have little disposable income, Facebook said more than 22 million people already use its social media website every month in Nigeria.

Widespread poverty means mobile adoption tends to favor basic phone models. That, combined with poor telecommunications infrastructure, can mean slow internet speeds and less internet surfing, which tech firms rely on to make money.

Writing by Alexis Akwagyiram; editing by Alexander Smith

Our Standards:The Thomson Reuters Trust Principles.

Uber Hit With $8.9 Million Fine in Colorado

Colorado wants Uber to pay a big fine for allegedly letting convicted felons and others with questionable backgrounds drive for the company.

The Colorado Public Utilities Commission said Monday that it had fined the online ride-hailing company $8.9 million for violating the state’s driver qualification laws. The commission found that Uber allowed 57 drivers to work in Colorado over the past year-and-a-half, even though their histories included stains like felony convictions that would have disqualified them.

The commission said it began its investigation into Uber earlier in the year after being notified by local police about an Uber driver alleged to have assaulted a passenger. The commission said it cross-checked driver information given by Uber with information from court records and state criminal databases and discovered a number of Uber drivers with violations.

Get Data Sheet, Fortune’s technology newsletter.

From the Colorado Public Utilities Commission:

Among the findings of the investigation were 12 drivers with felony convictions; 17 drivers with major moving vehicle violations; three drivers with interlock driver’s licenses, which are required after recent drunk driving convictions; and 63 drivers with driver’s license issues.

Companies that provide transportation services in Colorado must perform background checks on their drivers and bar those who fail the check from driving, the commission said.

“[Public Utilities Commission[ staff was able to find felony convictions that the company’s background checks failed to find, demonstrating that the company’s background checks are inadequate,” Doug Dean, the commission’s director, said in a statement. “In other cases, we could not confirm criminal background checks were even conducted by Uber.”

Uber said in a statement to Fortune that it “discovered a process error that was inconsistent with Colorado’s ridesharing regulations and proactively notified the Colorado Public Utilities Commission (CPUC).”

“This error affected a small number of drivers and we immediately took corrective action,” an Uber spokesperson said. “Per Uber safety policies and Colorado state regulations, drivers with access to the Uber app must undergo a nationally accredited third party background screening. We will continue to work closely with the CPUC to enable access to safe, reliable transportation options for all Coloradans.”

Last Chance To Pick Up This 5.3% Yielder On The Cheap

It’s been a rather forgettable year for shareholders in New York Community Bancorp (NYSE:NYCB). While the rest of the financial sector has surged, NYCB stock has been left for dead. Here’s the financial sector ETF (NYSEARCA:XLF) (red line) and the regional banks ETF (NYSEARCA:KRE) (yellow line) as opposed to NYCB in blue since the election last November.

I previously wrote about NYCB with my article The Sky Isn’t Falling in May. Since then, the stock has been flat once you count dividends. Indeed the sky wasn’t falling, but I’d been hoping for a rally. Instead, New York Community has continued to trail other regional and national banks. NYCB initially popped following Trump’s victory – along with the sector – but it’s been downhill since then.

That’s all about to change though. New York Community has trailed the market due to a specific problem. That is that NYCB is on the threshold between being a regular bank and a systemically important bank. Following the financial crisis, regulators put in place a rule that causes banks with total assets of more than $50 billion to face greatly enhanced oversight.

The threshold is high enough that not many banks were caught right at the $50 billion figure. However, New York Community Bank has been stuck up against the limit for years now. This arbitrary limit has caused a great deal of trouble for the bank, since any additional growth would cause NYCB to trip the limit and see its regulatory costs shoot up.

The bank tried to resolve this problem by merging with Astoria Financial, a move that would have catapulted the bank far over the $50 billion threshold. However, the merger fell apart. And, in the process of preparing for the merger, NYCB cut its dividend and issued new stock. Those moves, combined with the failed merger, greatly irritated much of the shareholder base, and the stock ended up largely abandoned. Hence the steady trade down from $17 into the 12s over the past year. Read NYCB articles at Seeking Alpha and elsewhere, and you’ll find there’s still plenty of resentment and revulsion toward the management team – understandable in the heat of the moment, but at this point, the past is past, and it’s not worth dwelling on any longer.

For years now, almost every quarter, we see NYCB perform well, but it is forced to sell off most of the new loans it makes. The bank operates in a quality niche within the New York City market where it has access to a large pool of low-risk loans. NYCB’s loan losses are among the lowest you’ll ever see for a national bank of its size. However, instead of getting to hold these high-quality loans and make steady profits, as most banks do, NYCB issues new loans and then immediately sells them to stay clear of the $50 billion limit.

As such, investors have looked at the bank as a dead stock, good for its 5%+ dividend, but not much else. Without any possibility of growth, NYCB stock may look more like a bond. I’ve been long the stock for awhile now, not just for the dividend but also for the possibility that the arbitrary $50 billion cap would be raised.

And now, at last, it’s finally happening. NYCB stock popped pretty aggressively on Monday, but there’s a lot more coming assuming this catalyst plays out. What’s the news?

Chart

NYCB Price data by YCharts

On Monday, reports surfaced that the Senate banking committee is preparing a bipartisan bill that would repeal some of Dodd-Frank’s most restrictive provisions, including the SIFI limit which has been the thorn in NYCB’s side. The bill specifically plans to raise the SIFI limit to $250 billion and has the support of nine Democrat and Independent senators.

Now, I’ll be the first to say that it’s been a bad bet to invest on the assumption that Trump can get any legislation passed in 2017, even through his own party. However, the SIFI limit in particular, and tough banking regulations in general are one area where there is substantial support within both parties for changes. In fact, there was a sizable contingent of Democrats that wanted to relax the banking rules, post-crisis, during the Obama era. And, on the Republican side, it seems unlikely that you’ll find too many votes against freer markets and fewer regulations. The bill would give Democrats a tangible example of them not being obstructionist, while allowing Trump to point to something in particular that he’d signed which should lead to job creation.

In short, there are a lot of reasons why a bill like this should be able to pass, even in a generally acrid political climate. It follows the historical pattern as well, where financial institutions are given more and more liberties until a crisis, and then the government hastily cracks down again. At nearly a decade out from the last crisis, and with banks exceptionally well-capitalized at the moment, there’s good reason to think the banks will be able to achieve a looser regulatory environment.

What’s it mean for NYCB specifically? If a bipartisan bill along these lines passes, the bank can immediately go back into growth mode. The bank trades cheaply now because the market is assuming that it can’t grow. When it flips back into growth mode, the rally will be a lot bigger than the 6% or so that we saw on Monday.

It’s also worth considering that NYCB has far less exposure to rising interest rates than most other banks, due to its short-duration loan book and reliance on wholesale funding. This was viewed as a negative when the market had assumed that the yield curve would be moving up sharply, as New York Community had less exposure (it actually loses money as interest rate spreads rise!)

The Financial Times explained it well earlier this year:

New York Community Bank, one of the largest US lenders, is facing a potential hit to annual profits from higher interest rates. While the earnings dent should be manageable for the $49bn-in-assets lender, the forecasts show there are some exceptions to the rule that increased borrowing costs will be good for the sector. […]

For a smaller group of lenders, however, higher rates are expected to spell lower profits. The largest is NYCB, which estimated in the small print of its most recent quarterly filing that a 1 percent rate rise would cause its net interest income to drop 3.9 percent. […]

Most banks can benefit from higher rates because they push up interest charges for borrowers while keeping deposit rates lower for longer. The widening gap between what they earn on assets and the cost of their funds should lift profits. NYCB has a different business model, however. It focuses on commercial real estate loans with terms fixed for several years, giving it less scope to increase interest charges.

However, now that the yield curve has plunged to new 5-year lows, more than wiping out the entire Trump rally, NYCB is among the best-positioned for this unexpected interest rate climate. As other banks see declining NIMs, NYCB gets relief on its short-term borrowing costs and doesn’t have nearly as much to lose from the long-end rates going down since it doesn’t lend for duration.

To sum up, NYCB is still yielding 5.3% and has massively underperformed its rivals over the past year. That despite its main obstacle (the SIFI limit) going away soon, and the interest rate curve taking a massive turn in NYCB’s favor as compared to peers.

At this point, NYCB stock is still down simply for past perceived sins. You still see authors demanding that NYCB’s management resign due to the stock’s underperformance for the past couple years. Classic “what have you done for me lately?” thinking.

It’s worth remembering that NYCB’s long-time CEO Joseph Ficalora took the company from seven branches in New York City to a 255 branch bank that is 24th-largest in the country. The stock performance over the past 23 years (as far back as my data source goes) has been jawdroppingly good:

NYCB sailed through the financial crisis with hardly a scratch, and in total, has compounded at 14%/year for the past 23 years, producing a total return of 1,994% over that stretch. One of the best banks in the US in fact. It’s short-sighted, to say the least, to demand that management leave because they had to play it conservatively for the last few years due to an arbitrary government limit that crushed their ability to grow. With that limit going away, the good times are back for NYCB. Put another way, you won’t have much time left to buy this stock with a 5%+ yield.

Disclosure: I am/we are long NYCB.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Stitch Fix’s IPO Is More Exciting Than Its Stock Would Have You Believe

Though it started off with a bang, shares of consumer tech company Stitch Fix closed its first day trading as a public company with a barely a blip.

The online personal stylist’s stock, which traded as high as $18.53 during the day, closed at $15.15 on Friday, just 1% above its already-downsized initial public offering price or $15. That gave the company valued at about $275 million as a private company a market capitalization of about $1.46 billion.

Stitch Fix’s IPO reportedly already raised some eyebrows on the roadshow, with some investors wondering about the long-term prospects of a company sitting in the path of Amazon. The e-commerce giant has been testing a service dubbed Prime Wardrobe.

Despite the speculations about the firm’s future viability though, its IPO already represents gains in other areas.

Thirty-four-year-old Lake is the first female CEO to take a tech company public this year. She helms a management team split 50-50 by gender, according to its IPO filing. Of Stitch Fix’s seven seat board of directors, three are women. That’s 43% against the near 28% of female board appointments in 2016.

She’s also likely to claims the net worth of a millionaire — adding a drop to the women’s side on the unbalanced world wealth scale. According to Capgemini World Wealth Report 2017, about 38.3% of people with over $1 million in net worth are women.

Following Stitch Fix’s IPO, Lake holds at least $219.6 million in assets. Lake sold at least a million shares of the clothing and tech company for a cash windfall of about $15.2 million. Additionally, the executive holds a stake in the Stitch Fix worth $204.4 million— 15.4% of the company. Lake also holds a stake in food delivery company Grubhub, where she serves as a director, worth $53,895 as of Friday.

But inevitably, whether or not Lake can maintain both that wealth and potentially, the gender balance of her management and board, depends to some extent on her ability to keep shareholders happy and the stock price up.

And odds are already stacked against her favor.

Research has shown that she will likely be judge far more harshly than a male executive in that same role. Yale psychologist Victoria Brescoll found in 2012 that women who spoke more than their male counterparts in professional settings were usually punished. Another study by the same professor revealed that women leaders are often judged more harshly for their failures than men in top positions.

Though on a more optimistic note: Companies with more women in the c-suite tend to be more profitable, according to a Peterson Institute for International Economics working paper. There’s also evidence that companies with women CEOs provide higher returns on stocks.

So who knows? Only time can tell.

How to Watch the Leonids Meteor Shower

The annual Leonids meteor shower this weekend will brighten the night skies with a fireworks show, courtesy of the universe.

The meteor shower, which usually takes place in November, gets its name from because some of its shooting stars appear to come from part of the Leo star constellation. In fact, the Leonids meteors are debris from Tempel-Tuttle comet that burn up in the Earth’s atmosphere—creating colorful streaks in the sky.

How to see the Leonids meteor shower:

The meteor shower, which can last for weeks, peaks in visibility tonight. The New Moon, when the moon passes between the Earth and Sun, helps make the sky particularly dark. For the best view, get away from city lights, if possible, and, of course, away from any clouds. Expect to see up to 10 meteors per hour during the shower’s crescendo at 3:00 am on Friday, according to NASA. If you can’t make tonight, you can also try Saturday night, when the shower will be only slightly less visible.

Get Data Sheet, Fortune’s technology newsletter.

Where to look:

Although the meteors can appear anywhere in the sky, you’re better off looking towards the Eastern horizon, where the Leo Constellation typically appears, according to a report by Space.com. At 5:00 am, the Leo Constellation will appear in the “south-southeast part of the sky,” the report said.

How to watch online:

Of course, if you can’t stay awake, are fogged in, or unwilling to go out into the cold, you can always watch a livestream. One should be available on Friday from the astronomy and telescope website Slooh.

Trump administration to release rules on disclosing cyber flaws: source

WASHINGTON (Reuters) – The Trump administration is expected to publicly release on Wednesday its rules for deciding whether to disclose cyber security flaws or keep them secret, a national security official told Reuters.

FILE PHOTO: A man types on a computer keyboard in front of the displayed cyber code in this illustration picture taken on March 1, 2017. REUTERS/Kacper Pempel/Illustration/File Photo

The move is an attempt by the U.S. government to address criticism that it too often jeopardizes internet security by stockpiling the cyber vulnerabilities it detects in order to preserve its ability to launch its own attacks on computer systems.

The revised rules, expected to be published on whitehouse.gov, are intended to make the process for how various federal agencies weigh the costs of keeping a flaw secret more transparent, said the official, who spoke on condition of anonymity because the rules were not yet public.

Under former President Barack Obama, the U.S. government created an inter-agency review, known as the Vulnerability Equities Process, to determine what to do with flaws unearthed primarily by the National Security Agency.

The process is designed to balance law enforcement and U.S. intelligence desires to hack into devices with the need to warn manufacturers so that they can patch holes before criminals and other hackers take advantage of them.

The new Trump administration rules will name the agencies involved in the process and include more of them than before, such as the Departments of Commerce, Treasury and State, the official said.

Rob Joyce, the White House cyber security coordinator, has previewed the new rules in recent public appearances.

“It will include the criteria that the panel weighs, and it will also include the participants,” Joyce said last month at a Washington Post event. He said the Trump administration wanted to end the “smoke-filled room mystery” surrounding the process.

Some security experts have long criticized the process as overly secretive and too often erring against disclosure.

The criticism grew earlier this year when a global ransomware attack known as WannaCry infected computers in at least 150 countries, knocking hospitals offline and disrupting services at factories.

The attack was made possible because of a flaw in Microsoft’s Windows software that the NSA had used to build a hacking tool for its own use.

But in a breach U.S. investigators are still working to understand, that tool and others ended up in the hands of a mysterious group called the Shadow Brokers, which then published them online.

Suspected North Korean hackers spotted the Windows flaw and repurposed it to unleash the WannaCry attack, according to cyber experts. North Korea has routinely denied involvement in cyber attacks against other countries.

Reporting by Dustin Volz; editing by Grant McCool

Our Standards:The Thomson Reuters Trust Principles.

7 Killer Traits Female Investors Seek in Tech Startup Founders

Tech investors want to pick winning companies, and that starts with picking winning founders.

Three female investors—Anjula Acharia of Trinity Ventures, Leah Busque of FUEL Capital, and Nisha Dua of BBG Ventures—gathered at Fortune’s Most Powerful Women Next Gen Summit in Laguna Niguel, Calif. to outline the qualities that they look for in promising entrepreneurs.

Here’s what they said.

Founders who make a great first impression

“You’re always looking for a founder that has incredible conviction in what they’re solving yet has flexibility and an ability to pivot when they receive feedback,” Dua said. “They need some level of self-awareness.” Investors can hear it when founders chat with them or respond to feedback, she added. “You can tell a lot about a person in those first few meetings.”

Founders who tell a great story

Busque, who is also the founder of TaskRabbit, the on-demand labor marketplace, said storytelling matters. “Is this founder purpose-built for the opportunity? Can you look them in the eye and believe that they’re going to persist?” she asked. That’s why the story a founder tells matters. “Who is this person sitting across from me? Why are they here?”

Dua agreed: “In asking a person who they are, you’re really asking what they want that business to be in five, 10 years.”

Founders who check their ego at the door

“Raising money is like dating,” Acharia said. “You can never look desperate.”

Nor should you look defensive, Dua said. “Founders who get defensive when you ask them questions or give them unsolicited feedback…and people who try to hide things,” she said, listing founder no-nos. “Don’t put your revenue on page 60 in the appendix. Don’t deflect when you’re asked about it because you’re embarrassed. The investor wants to know how you’ve thought about the business.”

Founders who take the long view

Acharia said that it’s worth finding investors who are in it for the long run. “My biggest mentor is Jimmy Iovine,” she said. “A week after he gave me a really big check, he told me my business would fail. He said, ‘For me, founders are about albums, not singles.’ So when I look at a founder, I don’t just look for that one hit.”

She continued: “I’ve given personal checks to founders to people whom I didn’t even believe their business plan but I want to be in business with them. And to be quite frank, my business failed, and I went on to do more things with Jimmy that were successes. That belief he had in me is now something I have in others. It’s about being on a journey with a founder and taking that long-term view.”

Founders who are women

“We think it’s a competitive advantage to invest in female founders who are building a product for consumers who look like them,” Dua said. “Women are the dominant consumer. They drive 85% of purchasing decisions. They drive most social platforms. And we’re increasingly the early adopter. The changing profile of the founder—it’s no longer the Stanford hoodie. So we’re seeing this tidal wave of female founders.”

Busque agreed. “Investors always say they’re looking to pattern-match,” she said. “I didn’t match a pattern. It was a few people who took a chance on me.”

Founders who recognize that it’s not always about them

“I still feel like I’m behind enemy lines” as a founder turned investor, Busque said, “So I’ll say this: I’ve learned that there are thousands of reasons why an investor won’t invest in your company that have nothing to do with you.”

Founders who wear failure like a badge of honor

“Everybody’s struggling with something on the inside,” Acharia said. “The best founders are struggling with something.”

Google broadens takedown of extremist YouTube videos

SAN FRANCISCO (Reuters) – Alphabet Inc’s Google in the last few months has begun removing from YouTube extremist videos that do not depict violence or preach hate, YouTube said on Monday, a major policy shift as social media companies face increasing pressure from governments.

FILE PHOTO: A 3D-printed YouTube icon is seen in front of a displayed YouTube logo in this illustration taken October 25, 2017. REUTERS/Dado Ruvic/Ilustration/File Photo

The new policy affects videos that feature people and groups that have been designated as terrorist by the U.S. or British governments but lack the gory violence or hateful speech that were already barred by YouTube.

A YouTube spokesperson, who asked not be named for security reasons, confirmed the policy in response to questions. The company would not specify when the policy went into effect.

As YouTube terms already barred “terrorists” from using the service, the new policy keeps out videos uploaded by others that militants likely would try to distribute if they could have accounts, according to the spokesperson.

Hundreds of videos of slain al Qaeda recruiter Anwar al-Awlaki lecturing on the history of Islam, recorded long before he advocated violence against the United States, were among those removed under the new policy, the spokesperson said.

Governments and human rights groups have pressed YouTube for years to crack down on extremist videos. They argue that the propaganda radicalized viewers and contributed to deadly terror attacks.

British Home Secretary Amber Rudd amplified the pressure during visits with tech companies in Silicon Valley in July and a speech in Washington, D.C. last week. European Union and U.S. lawmakers this year have threatened consequences for tech companies if concerns are not addressed.

Legislation could resemble a German law approved in June to fine social media companies 50 million euros ($57 million) if hateful postings are not promptly removed.

YouTube said discussions with outside experts prompted the new policy, but it was unclear why the company decided to act only recently. In June, the company announced that “inflammatory religious or supremacist content” that did not violate its policies would be allowed with warning labels and a restriction making them ineligible for ad revenue.

At the time, Google General Counsel Kent Walker said in a blog post, “We think this strikes the right balance between free expression and access to information without promoting extremely offensive viewpoints.”

The latest step goes farther and was praised by critics such as Paul Barrett, deputy director of the New York University Stern Center for Business and Human Rights.

“If the terrorist is in the business of recruiting and inciting people to make violent attacks, you’ve got to the draw the line” against any of their content, Barrett said.

The new policy does not affect news clips or educational videos about terrorism. But YouTube will not always have an easy time distinguishing, experts said, pointing to tactics such as overlaying extremist commentary on news footage to get around censors.

YouTube has resisted imposing more editorial control because it fears making it harder for important videos to get a wide audience, Juniper Downs, YouTube’s global director of public policy, told a San Francisco conference sponsored by the Anti-Defamation League on Monday.

“We will lose something very valuable if we completely transform the way these platforms work,” she said during a panel discussion.

Internet freedom advocates such as the Electronic Frontier Foundation have urged tech companies to be cautious and transparent in responding to government pressure.

YouTube is relying on government lists of terrorists and terrorist groups for enforcement. Content moderators check the listings and make removal decisions after fielding reports from an automated system, users or partner organizations such as the Anti-Defamation League and The Institute for Strategic Dialogue.

Al-Awlaki, whom the U.S. killed in a 2011 drone strike, was designated a terrorist by the U.S. Treasury the year prior.

The New York Times first reported the removal of al-Awlaki videos.

Reporting by Paresh Dave, David Ingram and Mark Hosenball; Editing by Jonathan Weber and Cynthia Osterman

Our Standards:The Thomson Reuters Trust Principles.

Toshiba considering $5.3 billion capital injection: source

TOKYO (Reuters) – Toshiba Corp, desperate for cash to avoid a possible delisting, is considering raising about 600 billion yen ($5.3 billion) by offering new shares in a third-party allotment, a person briefed on the matter said on Friday.

FILE PHOTO: Shoppers look at Toshiba Corp’s Regza television at an electronics store in Yokohama, south of Tokyo, June 25, 2013. REUTERS/Toru Hanai/File Photo

The Japanese conglomerate has received proposals from several domestic and overseas brokerages for plans to raise money through a public offering or third-party allotment, and is looking into the option of allocating shares mainly to overseas investors, the person said.

In early trade, shares of Toshiba fell as much as 8 percent on the capital injection plan, first reported by public broadcaster NHK. They were down 4.5 percent by mid-morning, underperforming the benchmark Nikkei average’s 1 percent fall.

Strapped with liabilities arising from its bankrupt U.S. nuclear unit, Toshiba agreed in September to sell its prized chip unit, Toshiba Memory, to a group led by Bain Capital for $18 billion. It needs to beef up its balance sheet by the end of the fiscal year in end-March to avoid a possible delisting.

The source told Reuters that Toshiba wants to finalize the capital injection plan by year-end because it would need shareholder approval depending on the offering price and scope of share dilution. The person declined to be identified because the plan is not public.

In a statement, Toshiba repeated its stance that it was aiming to close the deal to sell its chip business by the end of March, saying in response to the NHK report that nothing specific had been decided regarding any funding plans.

Announcing half-year results a day earlier, Chief Financial Officer Masayoshi Hirata said Toshiba had launched a working group to consider various options to raise capital in case the deal did not close in time. He offered no specifics.

Toshiba reported robust second-quarter results with a 76 percent jump in operating profit driven almost entirely by a strong performance from its memory chip unit.

If Toshiba fails to close the sale in time, that could keep Toshiba in negative net worth for a second year in a row, putting pressure on the Tokyo Stock Exchange to delist it.

Reporting by Taro Fuse; Writing by Chang-Ran Kim; Editing by Stephen Coates

Our Standards:The Thomson Reuters Trust Principles.

British official urges social media companies to block militant content

WASHINGTON (Reuters) – Britain’s top internal security official is pressing social media companies to devise automatic systems to spot and block violent militant messaging before it is posted on their networks.

Amber Rudd, Britain’s Home Secretary, leaves 10 Downing Street in London, Britain, October 17, 2017. REUTERS/Hannah Mckay

Amber Rudd, home secretary in the conservative British government led by Prime Minister Theresa May, told an audience at New America, a Washington think tank, on Thursday night that there was an “online arms race” between militants and the forces of law and order.

Rudd said government authorities and companies were already working to ensure that militant messaging promoting violence should be removed from the internet within one or two hours of initial posting.

But she said companies should press ahead with development and deployment of artificial intelligence systems that could spot such content before it is posted on the internet and block it from being disseminated.

Since the beginning of 2017, violent militant operatives have created 40,000 new internet destinations, Rudd said. She noted that she visited Silicon Valley companies, including Alphabet Inc’s Google and YouTube, Facebook Inc and Twitter Inc, earlier this year and called on them to do more to take down or block militant content.

As of 12 months ago, social media companies were taking down about half of the violent militant material from their sites within two hours of its discovery, and lately that proportion has increased to two thirds, she said.

YouTube is now taking down 83 percent of violent militant videos it discovers, Rudd said, adding that UK authorities have “evidence” that the Islamic State militant group was now “struggling” to get some of its materials online.

But she said there was “much more” companies can do to use cutting edge technology to spot dangerous content more quickly.

She added that in the wake of an increasing number of vehicle attacks by militants, such as the one at London’s Borough Market earlier this year, British security authorities were reviewing rental car regulations and considering ways for authorities to collect more relevant data from car hire companies.

Reporting by Mark Hosenball; Editing by Leslie Adler

Our Standards:The Thomson Reuters Trust Principles.

Rise of the machines: Philippine outsourcing industry braces for AI

MANILA (Reuters) – The outsourcing industry in the Philippines, which has dethroned India as the country with the most call centers in the world, is worried that the rise of artificial intelligence (AI) will eat into the $23 billion sector.

FILE PHOTO: Call center agents wait for calls from their United States clients as they work overnight in Manila’s Makati financial district February 6, 2012. REUTERS/Erik De Castro/File Photo

AI-powered translators could dilute the biggest advantage the Philippines has, the wide use of English, an industry meeting was told this week. Other AI applications could take over process-driven jobs.

The Philippines’ business process outsourcing (BPO) industry is an economic lifeline for the Southeast Asian nation of 100 million people. It employs about 1.15 million people and, along with remittances from overseas workers, remains one of the top two earners of foreign exchange.

“I don’t think our excellent command of spoken English is going to really be a protection five, 10 years from now. It really will not matter,” said Rajneesh Tiwary, chief delivery officer at Sutherland Global Services.

The Philippines, which was an American colony in the first half of the 20th century, overtook India in 2011 with the largest number of voice-based BPO services in the world.

“There’s definitely reasons to be concerned because technology may be able to replace some of what could happen in voice,” Eric Simonson, managing partner of research at Everest Group, a management consulting and research firm, told Reuters.

AI, which combs through large troves of raw data to predict outcomes and recognize patterns, is expected to replace 40,000 to 50,000 “low-skilled” or process-driven BPO jobs in the next five years, said Rey Untal, president and chief executive officer of the IT & Business Process Association of the Philippines (IBPAP).

Contact centers make up four-fifths of the Philippines’ total BPO industry, which accounts for 12.6 percent of the global market for BPO, according to IBPAP.

FILE PHOTO: A call center agent talks to a client in the U.S. as she works the overnight shift in Manila’s Makati financial district February 6, 2012. REUTERS/Erik De Castro/File Photo

BPO firms in the Philippines list Citibank, JPMorgan, Verizon, Convergys and Genpact <G. n> among their clients. While the United States remain the biggest customers for the industry, demand for BPO services from Europe, Australia and New Zealand is also growing.

The Philippines’ share of the global outsourcing pie, estimated to reach about $250 billion by 2022, is forecast by the industry to reach 15 percent by that year.

To get there however, the Southeast Asian nation must prove to the world it has more to offer than just a pool of English-speaking talent. BPO executives said the country has to take on high-value outsourcing jobs in research and analytics and turn the headwinds from Artificial Intelligence into an opportunity.

The key to stay relevant and ahead of the competition, they said, is to ensure workers are trained in areas like data analytics, machine learning and data mining.

“You will see in the next few years more automation coming in the way we do things in IT and BPO industry, robotic processing, the use of chat bots,” Luis Pined, president of IBM Philippines told Reuters.

“If we are ahead of the game, we will be at an advantage where people will give us more work, because we are cheaper and productive,” Pined said.

IBM Philippines divested its voice business in 2013.

IBPAP has projected a rise in the number of mid- and high-skilled jobs or those that require abstract thinking and specialized expertise which should bring overall headcount in the BPO sector to 1.8 million by 2022.

Augmenting the English language skills of the Philippines with technology will be a “game changer,” said Untal, the head of the association. “Who else can compete with us?”

Reporting by Karen Lema; Editing by Raju Gopalakrishnan

Our Standards:The Thomson Reuters Trust Principles.

Self-Driving Bus Crashes on its First Day in Las Vegas

A big public debut for a self-driving bus in Las Vegas turned out to be trouble.

An autonomous shuttle bus collided with a semi-truck just a few hours after Las Vegas city officials held a ceremony to celebrate its first day as part of a larger city-wide test.

There were no injuries reported, and the shuttle didn’t suffer any major damage, according to a report by a local Fox news station.

Las Vegas city officials said in blog post that the self-driving shuttle, built by the French automobile company Navya, was not at fault. Although a delivery truck “grazed” the shuttle, the post said, the ”shuttle did what it was supposed to do, in that its sensors registered the truck and the shuttle stopped to avoid the accident.”

“Unfortunately the delivery truck did not stop and grazed the front fender of the shuttle,” the officials wrote. “Had the truck had the same sensing equipment that the shuttle has the accident would have been avoided.”

The shuttle, called Arma, can carry up to 12 passengers. It is built without a steering wheel or brake pedals for human drivers, according to the Fox report.

Get Data Sheet, Fortune’s technology newsletter.

The accident occurred on the first day of the Arma shuttle’s 12-month long test in downtown Las Vegas over a half-mile route near the city’s strip. Las Vegas city officials said that the city would continue to test the shuttle despite the accident. The delivery truck driver was given a citation, the officials added.