Fast Five from the Valley: Edition 41
Stock market reacts to Chinese whispers
This week, two new studies were posted in Nature Medicine, a reputed medical journal, linking the highly heralded gene-editing technology, Crispr, with cancer. It shows that Crispr can work best, when the cancer defense of a cell is down.
The technology behind Crispr may one day be the key to curing incurable genetic diseases through editing specific sections of the DNA. Understandably, shortly after the publication, a major gold rush ensued with heavily venture backed companies, seeking to be the first to bring this to market and yield the returns.
However, research portrayed that Crispr was more likely to work on cells that were less effective at fighting cancer.
For investors in the biotech companies working on bringing Crispr to market, this was interpreted that Crispr can cause cancer. Subsequently, the stock prices of CRISPR Therapeutics and two associated companies experienced a 13% fall following the announcement. But the scientists behind the published research maintain that this is all just a market overreaction, and Crispr remains promising, although it might take longer until it hits the market.
Speaking of implausible market dynamics, Ayden, a payment provider and competitor to PayPal from Holland, has experienced an overnight surge in stock of nearly 100%, making it one of Europe’s biggest tech IPOs.
Cut the crew and turn the ship around, matey!
Two major US companies have announced cuts to their workforce this week: McDonalds and Tesla.
McDonalds is aiming to reduce the number of “layers” between field consultants and executives from 8 to 6, without stating how many people constitute each layer. Like the rest of the fast food industry, McDonalds has experienced harder times in recent years as consumers are trending towards healthier diets and alternatives. Now, the corporation is seeking to reorganize itself and find a way to bring more people back into their stores.
Tesla on the other hand, which is striving to reach the ambitious milestone of producing 5,000 Model 3’s per week, will be laying off nearly 9% of its workforce. This step was anticipated due to rising pressures of turning profits quickly in lieu of the stumbling production rate of the Model 3’s.
The net is dead, long live the net!
Following the massive merger between AT&T and Time Warner this week (see our Telco Tuesday post for more details), another big development for ISPs is the FCC’s repeal for net neutrality. The implications are still hard to grasp, but it certainly puts a lot of power into the hands of cable internet providers (such as AT&T) to promote their own content, whilst disadvantaging the content liberty of OTT providers like Netflix.
With Comcast’s $65m bid for 21st Century Fox assets, this would place a large portion of America’s media landscape into the hands of only a few content ISPs, with other software players paying premiums to deliver their services. For YouTube, Netflix, Twitch and others, this might result in a serious reduction in their negotiating power with ISPs. One way out could be veering towards becoming ISPs themselves, with Alphabet already going down this road with Google Fiber. Another way could be by forming strategic partnerships between Alphabet and the rest of the bunch to negotiate as a collective.
Pipedrive cracks open its war chest to tackle the sales software market
The competition within the sales software market is reflecting an oligopoly: Apart from the giants Salesforce and Microsoft, it’s hard for incumbents to tackle these powerhouses without sufficient funding. However, Pipedrive, a cloud-based sales software startup with offices in Estonia and New York might have received the war chest to follow up. In their Series C, they picked up $500m to expand the product, develop their business and make some acquisitions, positioning themselves right at the heels of the big dogs.
The big U is watching you
Uber has not only revolutionized the way we get from A to B, but also how we get home when we’re drunk. The ride-hailing company has filed a patent which allows them to determine the state of sobriety their customers are in. By assessing phone behavior, Uber can determine if you’re sober or completely wasted. It does so by comparing a wide array of input data like the accuracy and speed of typing, the angle you are holding your device at, or your walking speed. Another feature in the patent is a notification on the driver side, informing them of the state the customer is in when they are about to pick them up. We’re curious if and when all of these features might come into effect…