Another week of craziness
Hi, it’s Danny Crichton again and it’s time for some writing updates. As always, hopefully you all remember signing up for my update list (it’s double opt-in to avoid spam), but if not, feel free to unsubscribe in the email footer below (I won’t be offended). As always, feel free to email me at firstname.lastname@example.org.
I’m currently reading “The Death of the Artist: How Creators Are Struggling to Survive in the Age of Billionaires and Big Tech” by William Deresiewicz and enjoying it pretty well.
Gangster capitalism and the American theft of Chinese innovation
Wow, this analysis really hit a nerve. I’ve been covering the TikTok/Oracle deal the last couple of weeks, and it looked like there was a deal, but no one can actually agree on what the deal is or was.
My analysis Zoom-ed in on the rise of Chinese innovation, and how American policymakers are increasingly using the toolbox used by Chinese officials to block market access. TikTok was forcibly sold with very little due process, over the implication that it might hold national security concerns. Those concerns have never been proven, but even if you give the government the benefit of the doubt, the ribald shutting down of a Chinese upstart against American incumbents like Facebook and Twitter shows just how far America has fallen from its ideals.
Clearly, the article hit a nerve. Seven figures of readers, hundreds of DMs, emails, and messages, and a good pile of vitriol to boot as well.
It’s not always easy for us to confront our own weaknesses and faults. Certainly, China has been brazen in using everything from industrial espionage to market barriers to shape its economy and grow against its global competitors. Yet, when you’re facing an opposing force, you can’t just close your eyes and pretend the world doesn’t exist. We have to look at our weaknesses head on, and then actually solve them. I assure you, the alternative isn’t better.
Other TikTok and WeChat articles:
- TikTok rumors beg the question: Did Trump solve anything?
- Trump administration’s WeChat ban is blocked by U.S. district court
- In the WeChat, TikTok U.S. shut down order, TikTok gets Nov 12 stay, keeping it up through the US election and Oracle dealmaking
My work on Palantir and the company’s reversal
One of the other stories I have been covering the past few weeks is Palantir’s pursuit of the public markets through a direct listing. I originally leaked the company’s SEC Form S-1 filing all the way back on August 21, and there have been so many ups and downs in this story since.
The craziest one happened yesterday. The company, in its fifth amendment to its S-1 filing, essentially declared a mechanism that would allow its founders to “unilaterally adjust their total voting power.” It’s not hard to read what that means: Palantir is not a democracy, and as I wrote yesterday, “it really, really, really wants you to know that.”
Tech companies, even those publicly traded, aren’t democracies. The two-class voting system most tech companies offer their founders and early investors are not democratic — some people get 1 vote per share while others get 10 votes per share. But it has become a norm whether we like it or not, and it’s directionally helped tech companies avoid the sort of hostile investor scenarios that have plagued other companies in the market.
Now, Palantir is stretching these notions to the extreme, trying to present as a shareholder-centered corporation when it is — let’s just admit it — an oligarchy of three.
Well, just a few hours after the article hit, Palantir reversed course, filing a sixth amendment to the SEC completely excising any mentions of this new mechanism and deleting the reference to unilateral power. Chalk up a (very small) victory for the concept of shareholders’ rights, I guess.
Other Palantir articles:
- Palantir insiders are accelerating their stock sales as direct listing looms
- In its 4th revision to the SEC, Palantir tries to explain what the hell is going on
- As it heads for IPO, Palantir hires a chief accountant and gets approval from NYSE to trade
My other notable articles from the last week
- “A New World Begins” and the meaning of the French Revolution — a quick book review on a new history of that major event.
- Kleiner prints gold with Desktop Metal, netting a roughly 10x return — an analysis of one of the first major SPAC transactions and the underlying financial returns for the players involved.
- GoodRx offers founders $500M, nets $100M investment from Silver Lake, and makes quiet acquisition before IPO — lots of nuggets from all the GoodRx SEC filings the past few weeks.
Great articles from around the web
- “How the west lost” — Anatol Lieven gives a succinct summary of everything that has gone wrong in the West since the fall of communism back in 1989. It’s a popular topic these days (Anne Applebaum’s Twilight of Democracy was a great book on this subject as well from this summer), and it is only becoming more apparent how badly we wasted the so-called peace dividend of the 1990s.
- “Best Sellers Sell the Best Because They’re Best Sellers” — Alexandra Alter provides a great profile of Penguin Random House head Madeline McIntosh and discusses the changing business of bookselling along the way.
- “Why Are We in the West So Weird? A Theory” — Daniel C. Dennett reviews Joseph Henrich's new book on the growing conception of "WEIRD" (Western, educated, industrialized, rich, democratic) and how it is upending psychology and psychiatry. Constantly using undergrads at top Western universities as test subjects has fundamentally skewed psychology research, and we are only now starting to figure out how damaging that has been to the field.
- “Inside the Paradise Bubble” — Ann Chen offers a nice perspective on the civic computer programming "corps" that is driving Taiwan's efficient and effective response to COVID-19. Goes to show you it isn't impossible to build great tools and solve real problems to boot.
Photo by htmvalerio via Flickr used under Creative Commons.