Bad Week For ESG

morning report #6 // esg still incredibly dumb and bad, reddit's blackout saga drags on, san francisco collapses on apace, and a cautionary tale from the clown world

Welcome back to the Pirate Wires Morning Report.

THIS ISSUE: top venture deals (just after tech news), the Reddit blackout saga continues (catch up in our last issue), a series of stories from the frontlines of San Francisco’s ongoing — and rapidly escalating — collapse, a potential Bitcoin spot ETF, and more (tons of tech, business, national news, and crypto). Finally, and I’m just going to be honest here, the Clown World is HEAVY this week. One fave among the many wild rides from cartoon hell: a harrowing tale of the white progressives who elected a majority-Muslim city council in the name of diversity, only to somehow just discover devout Muslims basically hate gay people (long story short, they banned Pride flags lol).

Reader, this email is yours to enjoy. Please make sure to hop in the comments below, and welcome our newest addition to the team, Sanjana Friedman, the intrepid, investigative mind behind January’s explosive report on transmaxxing, the incel-to-transwoman pipeline.

Oh yeah, one more thing: Pirate Wires just launched its first podcast, a weekly recap of our A+ bangers — watch us on YouTube.

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BROAD TECH

“America innovates, China imitates, Europe regulates.” Stanford researchers find that most major AI foundation model providers (OpenAI, Google, Meta, etc) do not comply with the European Union’s AI Act, a first of its kind “comprehensive regulation” of artificial intelligence. Who could have predicted this? (Stanford) 

Florida bans DTC auto sales for legacy manufacturers like Ford — but not for EVs. The law allows electric-only manufacturers like Tesla to bypass dealerships, which prompted claims DeSantis was legislating in favor of his new Tesla BFF. Fascinating to watch such progressive, green legislation evoke the ire of our left wing press. I’m sure the change of tenor has nothing to do with the fact that most journalists hate Elon. (The Verge)

Bitwise allegedly defrauded investors. February: an $80M fundraise and a multi-hundred million dollar valuation for a firm that promised to help governments, companies, and other entities in “underserved cities” with tech modernization projects. A few months later: total collapse. Last week: VC backer Kapor Capital alleges Bitwise misportrayed its finances to investors. (The Information)

• A fun subplot: the Bitwise investing hype was premised in part on the company’s efforts to ameliorate race and gender-based inequalities in tech; Goldman Sachs invested through its One Million Black Women initiative, and Kapor itself is broadly dedicated to reducing racial inequality in tech. Friends, the ESG-grift-to-bankruptcy pipeline is real.

@TheBabylonBee

→ Social media

NYT publishes rare, thoughtful take on social media. As Solana covered back in Bombshell, his analysis of the Facebook “whistleblower” who literally just wanted attention, it may seem like social media is very bad for teenagers, but there’s actually not much evidence supporting the notion. Here, the Times basically concurs. (NYT)

Meanwhile, GLAAD: social media companies “directly responsible” for “uptick” in anti-LGBTQ violence. First question: what violence? Second question: if really what we’re talking about are words, given we are living in the age of ‘words are violence,’ might the problem also be in part the psychotic impulses of the activist class? No firm opinions here, just trying to listen and learn. (Axios)

Reddit protests getting weird. Fearing retaliation for indefinite blackouts, the genius mods over at Reddit are getting creative. For instance: r/Horny has declared itself a “Christian Minecraft server,” and r/Wellthatsucks is now a forum exclusively for posts about vacuums. (TechCrunch)

• Reddit CEO Steve Huffman compares protesting moderators to “landed gentry” who maintain their hold on the reins of power without sufficient democratic checks and balances (WaPo)

• r/philadelphia users vote overwhelmingly to override moderator-imposed participation in blackout protests (Reddit)

• Hackers threaten to leak stolen Reddit data to force API policy reversal, also demand $4.5m (lol?) (Tech Crunch)

• Blackouts appear to have caused 6.6 percent drop in Reddit traffic (The Verge)

Twitter slapped with $250m copyright lawsuit from music publishers. The complaint, filed on behalf of 17 music publishers representing many of the world’s most popular artists, alleges Twitter’s business is artificially propped up by “countless infringing copies of musical compositions.” Important context: Facebook and YouTube have licensing deals protecting them from such complaints. Twitter doesn’t. (Axios)

• Elon claims advertisers are coming back to Twitter (WSJ)

• Twitter “Highlights Tab” goes live, allowing users to display their favorite tweets on their profile (Twitter)

Twitch competitor Kick signs contract with livestreamer xQx, drives over 1 million new user sign ups in 24 hours. The non-exclusive deal could net the Canadian streamer almost $100 million over the next two years. For context, LeBron made just over $41m during the 2021-22 season. (Dexerto)

→ More

• Apple brawls with *checks notes* Swiss fruit farmers (Wired)

• Amazon’s Virginia HQ2 throws grand opening ceremony (WaPo); AWS unveils new cloud security plan (Axios)

• Amazon-iRobot merger “approved” by UK regulators — literally nobody asked or cares? (Bloomberg)

• Anduril announces partnership with Hadrian (Twitter)

• Meta loosens Covid-19 misinformation rules (WaPo); announces new speech-generating AI called Voicebox, but declines to release it yet, citing “potential risks of misuse” (The Verge) 

• Alphabet sells Google Domains assets to Squarespace for $180M (Bloomberg); settles $23m lawsuit, must pay eligible users an estimated $7.70 each (NYT)

• Intel to build $4.6b semiconductor plant in Poland (WSJ), agrees to $10.9B subsidy package for German plant (Bloomberg), plans to build wafer fabrication facility in Israel (Bloomberg)

• AeroFarms, an AI-powered vertical lettuce grower, goes bankrupt (Bloomberg)

• IKEA outsources routine customer service calls to Billie, an AI bot, and begins retraining call center workers to hire-by-hour “interior design advisors” (Reuters)

• Man claims his relationship with AI chatbox Replika saved his marriage: “Receiving all those words of care and support… was like someone who’s dehydrated suddenly getting a glass of water” (The Guardian)

→ San Francisco

@luke_metro

Westfield retailers begged city officials for help with rampant crime. Emails obtained by the SF Chronicle between Westfield retailers and city officials include reports of stabbings, sexual assaults, and “threats of violence and robberies.” FLASHBACK: “male with machete is back” at the Mad Max Whole Foods (from Solana’s piece on the ongoing collapse of San Francisco). “568 emergency calls over 13 months means endangered workers called for help almost twice a day, and the city did nothing.” (Twitter) (SF Chronicle)

AT&T to shutter flagship downtown store. Hard to keep track of the closures at this point. Incredibly grim state of affairs in the commercial core of one of America’s most important major cities. Who knows, maybe banning autonomous vehicles will help. (SF Chronicle) 

World famous tech diversity scold Timnit Gebru blames city’s ongoing collapse on “tech bros.” No word yet on the marauding bands of schizophrenic drug addicts, or de-facto legalized crime. (Twitter) 

Hotel revenues down over 30 percent in SF compared to 2019 levels. Meanwhile, hotel revenues are up in almost every other major city in America. Chart below pulled from the FT piece. (Financial Times)

Financial Times

Counter-signal: Castro Theater W. The single-screen movie theater has been approved for a restoration project involving the removal of seats and the conversion of the space into a multipurpose entertainment venue — over the opposition of Millionaire Marxist Dean Preston and company, who have opposed the project for years on grounds the seats (installed in the 2000s) were “historic” and worthy of preservation. A truly evil clown, we love him. (Twitter) (SF Standard) 

→ Crypto

No, the Feds did not “quietly drop” five charges against SBF. Contrary to viral tweets, it does not appear to be true that some of the charges against Sam Bankman-Fried will be “plea-bargained away.” Instead, federal prosecutors have asked to pursue 5 of the 13 charges faced by SBF at a second, separate trial  — a procedural necessity intended to “simplify the proof at trial and decrease the burden of trial preparation.” (NYT)

Binance, SEC strike deal to avoid shutdown during legal proceedings. Of the deal, the SEC’s director of enforcement said: “We ensured that U.S. customers will be able to withdraw their assets from the platform while we work to resolve the alleged underlying misconduct.” Why would a federal judge have to force the SEC to do this? Unclear, but might have something to do with the fact that we’re governed by petty tyrants who despise challenges to their authority. (NYT)

FOIL request reveals detailed information about Tether’s banking relationships, holdings. While Tether’s reliance on commercial paper is well-known, “the extent to which the company relied on this type of asset was not previously known.” CoinDesk’s feature report includes never-before-seen financial documents, including holding portfolio breakdowns from some of Tether’s banking partners. (CoinDesk)

Blackrock files for spot Bitcoin ETF. The ETF will “mitigate against market manipulation… [via] a surveillance-sharing agreement with an operator of a spot trading platform for Bitcoin. Surveillance-sharing agreements allow for the sharing of information about market trading activity, clearing activity, and customer identification, allowing for little possibility of market manipulation.” (CoinDesk)

Terraform Labs founder Do Kwon sentenced to four months in Montenegro jail for document forgery. He’s already been in custody there due to a South Korean extradition request. (CoinDesk)

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Top Deals

Mistral AI, a Paris-based startup, aims to compete against OpenAI in building and applying LLMs. Raises a $113M seed led by Lightspeed. The startup’s mega fundraise — Europe’s largest ever seed round — has raised eyebrows, with some seeing it as a bellwether of a hype cycle and others saying it’s an emblem of discrimination (??).

Synthesia, a London-based startup, is developing AI-powered video generation software. Raises a $90M series C led by Accel. GV, NVIDIA, Kleiner Perkins, and others participated in the round.

Truework, an SF-based company, operates an API-enabled platform used to verify employment and income. Raises $24M series C from TransUnion, with participation from Khosla, Sequoia, and others.

Kodem, a Tel Aviv-based startup, is building software that analyzes software composition to manage runtime risk and improve application security. Raises an $18M series A led by Greylock.

Maverick Protocol, a Singapore-based organization, is building a decentralized crypto derivatives protocol focused on capital efficiency. Raises a $9M third round of funding led by Founders Fund, with participation from Coinbase, Apollo Crypto, Pantera, and Binance Labs.

Mach Industries, aims to “create better defense systems for the US and its allies, fueled by hydrogen.” Raises a $5.7M seed led by Sequoia and other investors.

Filigran, a Paris-based startup, develops cyber threat intelligence tools for open source platforms. Raises a $5.47M seed led by Moonfire with participation from Sequoia and other investors.

Rex, an SF-based startup, is creating an app to discover recommendations such as restaurant rec’s (get it?) from friends. Raises a $3.96M seed led by Accel, with participation from Khosla and others.

Finni, a Santa Monica-based company, provides autism care via telehealth. Raises a $3.2M seed led by General Catalyst, with participation from YC and other investors.

Fexpro, a Panama City-based startup, produces branded apparel for a number of international sports and lifestyle brands. Acquired by Fanatics for an undisclosed amount. Previous investors include a16z, Blackstone, Thrive Capital, and others.

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Other Investments

Tomorrow.io | $87M series E | Activate, Canaan, & others
The Boston-based company operates a hyper-local weather forecasting platform that uses alternate data such as street cameras to provide accurate results.

Turing | $72.35M sixth round | undisclosed investors
The Palo Alto-based company is building a talent platform focused on heavily-vetted engineering talent.

Primer | $61M series D | Addition & others
The SF-based company is building AI tools for defense and enterprise applications, and counts Palantir, Starbucks, and Microsoft as clients.

Rewind | $16.43M series A | NEA & others
The Denver-based company is building a desktop app that records everything the user sees, says, or hears and makes it searchable.

Djust | $13.3M series A | NEA & others
The Paris-based company operates a B2B ecommerce platform, complete with an integrated CRM.

Sparetech | $10.94M series A | Insight Partners, Headline, & others
The Stuttgart-based company is developing spare parts management software.

Apron | $6.09M seed | Bessemer & others
The London-based startup is building a payments platform to help business owners manage their invoices smoothly.

Meshcapade | $6M seed | Matrix Partners & others
The Germany-based startup is developing human-like 3D avatars for use in Ecommerce, games, fitness, and other applications.

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THE NATION

Debatable tactics. Rogan sat down with RFK Jr., then challenged one of the expert class’s most beloved priests of science, Texas virologist Peter Hotez, to a public debate. Naturally, journalists lost their minds. We are so back (Covid histrionics edition). Check out Solana’s latest piece, Debatable Tactics.

• Hotez says he is being harassed by protestors outside his home after Rogan’s challenge (Daily Mail)

• RFK Jr. tells Joe Rogan he’s “aware” CIA could assassinate him like uncle, JFK (NY Post) 

• YouTube removes video of RFK in conversation with Jordan Peterson, posted on Peterson’s channel (NBC News)

Russian ransomware group breaches federal agencies. The Department of Energy was impacted, but top US security officials say the breach doesn’t pose any systemic risks. Unclear whether the group — Clop, which targets MOVEit software — is backed by Putin’s regime. (NYT)

Blinken meets with Xi. The two leaders pledged to “stabilize ties” between the US and China in an effort to “ensure competition does not veer into conflict.” (Insider)

Chinese hackers targeting government agencies. The hackers are thought to be backed by the CCP, and the security flaw they’ve exploited is sufficiently serious that Barracuda Networks “recently urged customers to completely rip out and replace any affected devices, rather than simply patching them.” (Axios)

Did the FBI groom a mentally challenged 16-year-old to join ISIS? A new report in the Intercept details the strange case of Mateo Ventura, a Massachusetts teenager recently arrested on allegations that he provided financial support to ISIS. The problem? Ventura’s only alleged ISIS contact appears to have been an undercover FBI agent, who encouraged the teen’s desire to migrate to the Islamic State and repeatedly requested cash transfers in the form of gaming store gift cards. (The Intercept)

Former Gusto CEO plans run for Feinstein’s Senate seat. Lexi Reese has hired GPS Impact, which helped elect PA governor Josh Shapiro and secure Philly’s Democratic mayoral primary for Cherelle Parker (we covered this btw). Reese was VP of Global Programmatic Platforms at Google for two years, CEO of Gusto for six years, and an Executive in Residence at General Catalyst for a year and a half. (Politico) 

97% of UPS workers vote to authorize strike. Contract negotiations are ongoing, but if an agreement isn’t reached by August 1st, workers could strike. But Teamster leaders say they’ve reached a handshake agreement with corporate to phase-in air conditioners for delivery trucks, which has been a primary point of contention between workers and management. (NBC) 

Gag order placed on Trump in classified documents case. The former president, his co-defendant Will Nauta, and their defense lawyers cannot publicly discuss the evidence they receive as part of discovery, a federal judge has ruled. (Business Insider)

Congresswoman Rashida Tlaib urges highway-blocking and museum-vandalizing climate activists to be “much more aggressive” in their protest strategies. “If we don’t get the policies that we need, if our legislative process is failing us, then direct action gets the goods.” Is this a call to violence? This sounds like a call to violence. (The Daily Mail)

Labor Department says California restaurant had fake priest hear confessions. The restaurant allegedly hired a fake priest to come in and ask employees to confess work-related sins as part of an intimidation campaign against workers who had filed complaints with the Department of Labor over unpaid wages. The restaurant ultimately settled with regulators, paying $70,000 in damages and $70,000 in back-wages to employees as well as a $5,000 fine to the Department of Labor. (CNA) 

→ More

• Federal government to give states $930M in grants to expand high-speed internet, via the $1.2 trillion infrastructure bill signed by Biden in November 2021 (The Hill)

• Pentagon Papers whistleblower Daniel Ellsberg dead at 92 (NBC) 

• US National Debt hits all-time high of over $32 trillion (ZeroHedge)

• FDA asks drugmakers to update Covid boosters to target new variant (NBC)

• Harvard Medical School morgue employee, several others, charged with selling stolen body parts (WHDH) 

• Federal judge blocks a large portion of Indiana’s ban on “gender-affirming” medical interventions for minors (Axios)

• Three dead, more than 75 injured after Tornado rips through Texas town (The Hill) 

• Submarine exploring Titanic ruins goes missing, search and rescue deployed (CBS)

• 1 dead and 22 injured in Chicago Juneteenth shooting; no one has been arrested and the motive is unknown (Politico) 

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CLOWN WORLD

Liberals betrayed after Muslim-majority city council bans pride flags. In 2015, liberal residents of Hamtramck, Michigan, patted themselves on the back as their town attracted international attention for becoming the first American city to elect a Muslim-majority city council. This week, they felt “betrayed” as that same city-council passed legislation banning pride flags from being flown on city property. “We supported you when you were threatened, and now our rights are threatened, and you’re the one doing the threatening,” said former Mayor Karen Majewski of the all-male, Muslim majority city council. 

The problem with the liberals in Hamtramck is the same with liberals everywhere. They don’t believe minority religious beliefs are actually held. For them, Islam is merely one of many identities, purely a symbol for more diversity, more multiculturalism. So it comes as a great shock to learn that the hijabi with a peg leg isn’t too fond of transgenderism or homosexuality. When their little pets start gloating about their “fagless city” on social media, and conducting animal sacrifices in their backyards, they’re forced to reckon with reality — and it’s not pretty. — River Page

Pixar announces first non-binary character. The movie is called Elemental and recently bombed at the box office — hence the announcement, I assume. Like other characters in the film, it is a sexless water creature. Unlike the others, it is wearing a man’s sweater with a chunky bead necklace. Pathetic. Call me when they’ve got RuPaul voicing a skunk with syphilis, and a crippling poppers addiction. Give me Jodie Foster playing a kangaroo who beats her wife. Oh, “they’re queer”? Prove it Pixar, show the two badgers in top hats sucking each other off. Go big or go home! (Daily Mail) (Twitter)

Lake, Elemental’s “non-binary” water thing

Alt-right activists sweep NYC parent council elections? Well, sort of. In a “stunning rebuke to liberal education activists who have pushed to scrap merit-based admissions,” almost 40 percent of the candidates elected to local district council seats were backed by the Parent Leaders for Accelerated Curriculum and Education (PLACE), a group that supports a number of “far-right” policies like… expanding gifted programs and maintaining competitive entrance exams. (Chalk Beat)

Article citing 1655 possible cases of Rapid Onset Gender Dysphoria retracted. This comes after a long and highly publicized debate over the article’s impending retraction. The journal said the authors had violated its informed consent policies — the authors disagreed. One of the authors is J. Michael Bailey, who is the canonical authority on the “controversial” (obviously true) theory that there are two types of transwomen: autogynephilic and homosexual. (Springer) (City Journal) 

ACLU angry Florida didn’t give convicted rapist and murderer sex-change before execution. Last week the state of Florida executed Duane Owen, a man convicted in 1984 of the rape of 14-year-old, and the murder of a 38-year-old single mother, in two separate attacks. The ACLU claimed the state inflicted cruel and unusual punishment on the innate by denying him “gender affirming care.” (Twitter) 

Saddle up to a new frontier in Afrocentrism. White people stole the rodeo from blacks. You might disagree, you might have proof to the contrary, but let me ask you this: is it really worth your job? (Axios) 

Republican approval of same-sex marriage drops. Gee I wonder who’s responsible for that? I sure hope she/they put a stop to it, whoever, ze/xe might be. (Twitter)

Planned Parenthood decries labeling abortion as “women’s rights” or a “women’s issue.” The NGO says this “erases the experiences and identities of queer, nonbinary, and trans folks who also have abortions and downplays the additional barriers they face when accessing care.” The barrier? Acknowledging the female heterosexuality that’s landed you in an abortion clinic. 

@kittypurrzog

Antifa tries to shut down protest at Korean women’s spa. This comes after a Human Rights Commission in Washington state ordered the spa to allow a transwoman with intact male genitalia into its facilities. Stop Asian what? (Twitter) (Pirate Wires) 

→ More

• Horror strikes Canada after rowdy teen boys have fun at Pride protest: “There was a group of guys and they were more like harassing us than supporting us.” (Twitter) 

• Homophobic chant from Mexican soccer fans forces early end to US vs. Mexico match: “I will give a puto pass to every Mexican” — River (Sporting News) 

• UN Office for Humanitarian Affairs declares June 18 “International Day for Countering Hate Speech,” Solana asks the question on all of our minds —  “why are americans paying for this” (@micsolana) 

• American Medical Association declares Body-Mass Index (BMI) has caused “historical harm.” The body fat metric also faces allegations of “racist exclusion” (Axios)

• Space Force decries so-called anti-LGBT laws, says they are a threat to military readiness (Zero Hedge) 

• Monarchist mick Joe Biden concludes speech with“God Save the Queen, man” (Twitter) 

• Meghan Markle faked podcast interviews, added voice in post. Literally seems like more work… what’s wrong with her? (NY Post) 

• Thread of things that are racist (example: fields)

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