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Mark Zuckerberg threatened to end Facebook’s UK investment in private 2018 meeting with digital chief, warning over “anti-tech” tone



Round of applause for the Bureau of Investigative Journalism — which fought for two years to obtain details of a closed door meeting between Facebook’s Mark Zuckerberg and the UK secretary of state in charge of digital issues at the time, Matt Hancock (now health secretary).

Freedom of information requests for minutes of the 2018 closed-door meeting between Zuckerberg and Hancock, which took place amist Cambridge Analytica-related tensions, were repeatedly refused by the Department for Digital, Media, Culture and Sport (DCMS).

An order by the UK’s Information Commissioner’s Office finally forced the government to hand them over — with the ICO concluding that transparency and openness are clearly in the public interest where Facebook’s business and CEO is concerned.

Last year the UK government set out an intent to regulate online platforms, publishing its Online Harms White Paper — which proposes to place a legal duty of care on social media platforms to protect users against a range of harms, from bullying to illegal content. Although there’s no sign of a draft law.

The government has only said it will lay one before parliament ‘as soon as possible’. (And this summer refused to commit to doing so next year.)

Additional context specific to Facebook is Zuckerberg repeatedly refused to appear before the UK parliament’s DCMS committee in 2018 to answer questions about online disinformation and the role of Facebook’s ad-targeting tools in the UK’s Brexit referendum — sending a variety of minions in his stead despite multiple requests for face-time.

It’s now clear that Zuckerberg took time to meet privately with Hancock, on the sidelines of the Paris VivaTech conference in late May 2018.

There, according to the minutes obtained by the Bureau, the Facebook CEO accused the UK of having an “anti-tech government” — and joked about making it one of two countries he would not visit. (The other is redacted from the documents but may have been a reference to China.)

Zuckerberg also threatened to pull Facebook’s investment from the UK — saying that while it was the “obvious” place for them to invest in Europe they were now “considering looking elsewhere”.

The tech giant employs thousands of staff at its London base, which is a major engineering hub for the company.

At the start of this year Facebook announced it would add another 1,000 jobs — bringing its total headcount up to 4,000+ in the city. A new HQ it’s preparing in London’s King’s Cross, to consolidate its existing London offices, is intended to house 6,000 staff in total when running at full capacity.

Per the minutes, Hancock responded to Zuckerberg by offering “a new beginning” for the government’s relationship with social media platforms — and offered to change its approach from “threatening regulation to encouraging collaborative working to ensure legislation is proportionate and innovation-friendly”.

He is also said to have sought “increased dialogue” with Zuckerberg — in order to “bring forward the message that he has support from Facebook at the highest level”.

While Zuckerberg is reported to have expressed support for UK policy and its intent to regulate the Internet — but said he was “worried about tone”.

We’ve reached out to DCMS for comment on the meeting and remarks made by its former digital secretary and to ask why it fought disclosure of the information for two years. We’ll update this report with any response.

Around the time Zuckerberg met Hancock Facebook employed around 2,300 staff in the UK. The tech giant signed the lease on the King’s Cross office space in July 2018 — a few months after Zuckerberg’s meeting with Hancock — generating headlines which couched it as a ‘major vote of confidence in the UK capital‘.

Reached for comment on the revelations that Zuckerberg branded the UK “anti-tech” and threatened to pull the plug on its local investments, Facebook sent us this statement — attributed to ‘a spokesperson’:

Facebook has long said we need new regulations to set high standards across the internet. In fact last year Mark Zuckerberg called on governments to establish new rules around harmful content, privacy, data portability, and election integrity. The UK is our largest engineering hub outside of the US and just this year we created 1,000 new roles in the country.

Also responding to the Bureau’s story in a series of tweets today, Damian Collins, the former chair of the DMCS committee said the minutes show Facebook did not like the inquiry; and that Zuckerberg was “determined not to appear as a witness”.

Collins was highly critical of Zuckerberg’s refusal to testify to the UK parliament, issuing a summons for him to do so on May 1, 2018 should he ever deign to step onto UK soil, and publicly lambasting the company for displaying an evasive “pattern of behavior”.

“The context of Mark Zuckerberg’s 2018 meeting with Matt Hancock was that it was two months after the Cambridge Analytica scandal had broken and MZ was refusing our requests for him to appear before [DCMS committee] to discuss it,” Collins tweeted.

“The notes from this meeting clearly show that Mark Zuckerberg was running scared of the DCMS committee investigation on disinformation and fake news and was actively seeking to avoid being questioned by us about what he knew and when about the Cambridge Analytica scandal.”

“It shows how afraid Mark Zuckerberg is of scrutiny that Facebook saw questions about the safety of users data on their platform, and how they worked with Cambridge Analytica as an ‘anti-tech’ agenda,” he added.

Outstanding questions related to the Cambridge Analytica include how much and when Zuckerberg personally knew about the scandal. It has previously emerged that Facebook staff raised internal alerts about Cambridge Analytica’s activity as early as September 2015 — yet the company was not booted off its ad platform until 2018.

A Facebook-instigated post-scandal app audit has also never fully reported findings.

Nor do we know why the tech giant hired the co-founder of the company that sold user data to Cambridge Analytica — around the same time it heard about the ‘sketchy’ company.

Zuckerberg’s question dodging over his personal level of responsibility vis-a-vis the scandal has been highly successful, even as his business empire has faced increased scrutiny and lawmakers around the world have new appetite to regulate the Internet.

The UK’s ICO issue no final report on its own investigation into the data misuse scandal. But in a letter to the DCMS committee in October it confirmed Facebook user data had been transferred to Cambridge Analytica and incorporated into a pre-existing database containing “voter file, demographic and consumer data for US individuals” — with the aim of predicting partisanship to target US voters with political messaging.

The ICO’s investigation did not find any evidence that the Facebook data which was sold to Cambridge Analytica had been used to target voters in the UK’s Brexit Referendum vote.

In its final report for the disinformation inquiry, the DCMS called for Facebook’s business to be investigated — citing competition and data protection concerns.

Last month the UK government announced a plan to set up a “pro-competition” regulator for big tech.


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Will this time be any different for Twitter?



As Twitter seems to buy its way into competing with Clubhouse and Substack, one wonders whether the beleaguered social media company is finally ready to move past its truly awful track record of seizing opportunities.

Twitter’s pace of product ambition has certainly seemed to speed in the past several months, conveniently following shareholder action to oust CEO Jack Dorsey last year. They’ve finally rolled out their Stories product Fleets, they’ve embraced audio both in the traditional feed and with their beta Spaces feature, and they’ve taken some much-publicized steps to reign in disinformation and content moderation woes (though there’s still plenty to be done there).

In the past few weeks, Twitter has also made some particularly interesting acquisitions. Today, it was announced that they were buying Revue, a newsletter management startup. Earlier this month, they bought Breaker, a podcasting service. Last month, they bought Squad, a social screen-sharing app.

It’s an aggressive turn that follows Twitter’s announcement that it will be shutting down Periscope, a live video app that was purchased and long-neglected by Twitter despite the fact that the company’s current product chief was its founder.

TikTok’s wild 2020 success in fully realizing the broader vision for Vine, which Twitter shut down in 2017, seems to be a particularly embarrassing stain on the company’s history; it’s also the most crystallized example of Twitter shooting itself in the foot as a result of not embracing risk. And while Twitter was ahead of that curve and simply didn’t make it happen, Substack and Clubhouse are two prime examples of competitors which Twitter could have prevented from reaching their current stature if it had just been more aggressive in recognizing adjacent social market opportunities and sprung into action.

It’s particularly hard to reckon in the shadow of Facebook’s ever-swelling isolation. Once the eager enemy of any social upstart, Facebook finds itself desperately complicated by global politics and antitrust woes in a way that may never strike it down, but have seemed to slow its maneuverability. A startup like Clubhouse may once seemed like a prime acquisition target, but it’s too complicated of a purchase for Facebook to even attempt in 2021, leaving Twitter a potential competitor that could scale to full size on its own.

Twitter is a much smaller company than Facebook is, though it’s still plenty big. As the company aims to move beyond the 2020 US election that ate up so much of its attention and expand its ambitions, one of its most pertinent challenges will be reinvigorating a product culture to recognize opportunities and take on rising competitors — though another challenge might be getting its competition to take it seriously in the first place.

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Sila Nanotechnologies raises $590M to fund battery materials factory



Sila Nanotechnologies, a Silicon Valley battery materials company, has spent years developing technology designed to pack more energy into a cell at a lower cost — an end game that has helped it lock in partnerships with Amperex Technology Limited as well as automakers BMW and Daimler.

Now, Sila Nano, flush with a fresh injection of capital that has pushed its valuation to $3.3 billion, is ready to bring its technology to the masses.

The company, which was founded nearly a decade ago, said Tuesday it has raised $590 million in a Series F funding round led by Coatue with significant participation by funds and accounts advised by T. Rowe Price Associates, Inc. Existing investors 8VC, Bessemer Venture Partners, Canada Pension Plan Investment Board, and Sutter Hill Ventures also participated in the round.

Sila Nano plans to use the funds to hire another 100 people this year and begin to buildout a factory in North America capable of producing 100 gigawatt-hours of silicon-based anode material, which is used in batteries for the smartphone and automotive industries. While the company hasn’t revealed the location of the factory, it does have a timeline. Sila Nano said it plans to start production at the factory in 2024. Materials produced at the plant will be in electric vehicles by 2025, the company said.

“It took eight years and 35,000 iterations to create a new battery chemistry, but that was just step one,” Sila Nano CEO and co-founder Gene Berdichevsky said in a statement. “For any new technology to make an impact in the real-world, it has to scale, which will cost billions of dollars. We know from our experience building our production lines in Alameda that investing in our next plant today will keep us on track to be powering cars and hundreds of millions of consumer devices by 2025.”

The tech

A lithium-ion battery contains two electrodes. There’s an anode (negative) on one side and a cathode (positive) on the other. Typically, an electrolyte sits in the middle and acts as the courier, moving ions between the electrodes when charging and discharging. Graphite is commonly used as the anode in commercial lithium-ion batteries.

Sila Nano has developed a silicon-based anode that replaces graphite in lithium-ion batteries. The critical detail is that the material was designed to take the place of graphite in without needing to change the battery manufacturing process or equipment.

Sila Nano has been focused on silicon anode because the material can store a lot more lithium ions. Using a material that lets you pack in more lithium ions would theoretically allow you to increase the energy density — or the amount of energy that can be stored in a battery per its volume — of the cell. The upshot would be a cheaper battery that contains more energy in the same space.

The opportunity

It’s a compelling product for automakers attempting to bring more electric vehicles to market. Nearly every global automaker has announced plans or is already producing a new batch of all-electric and plug-in electric vehicles, including Ford, GM, Daimler, BMW, Hyundai and Kia. Tesla continues to ramp up production of its Model 3 and Model Y vehicles as a string of newcomers like Rivian prepare to bring their own EVs to market.

In short: the demand of batteries is climbing; and automakers are looking for the next-generation tech that will give them a competitive edge.

Battery production sat at about 20 GWh per year in 2010. Sila Nano expects it to jump to 2,000 GWh per year by 2030 and 30,000 GWh per year by 2050.

Sila Nano started building the first production lines for its battery materials in 2018. That first line is capable of producing the material to supply the equivalent of 50 megawatts of lithium-ion batteries.

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Daily Crunch: Calendly valued at $3B



A popular scheduling startup raises a big funding round, Twitter makes a newsletter acquisition and Beyond Meat teams up with PepsiCo. This is your Daily Crunch for January 26, 2021.

The big story: Calendly valued at $3B

Calendly, which helps users schedule and confirm meeting times, has raised $350 million from OpenView Venture Partners and Iconiq.

Until now, the Atlanta-based startup had only raised $550K, but the company says it has 10 million monthly users, with $70 million in subscription revenue last year.

“Calendly has a vision increasingly to be a central part of the meeting life cycle,” said OpenView’s Blake Bartlett.

The tech giants

Twitter acquires newsletter platform Revue — Twitter is getting into the newsletter business.

TikTok is being used by vape sellers marketing to teens — Sellers are offering flavored disposable vapes, parent-proof “discreet” packaging and no ID checks.

PepsiCo and Beyond Meat launch poorly named joint venture for new plant-based food and drinks — The name? The PLANeT Partnership.

Startups, funding and venture capital

Fast raises $102M as the online checkout wars continue to attract huge investment — The new funding was led by Stripe.

SetSail nabs $26M Series A to rethink sales compensation — SetSail says salespeople should be paid them throughout the sales cycle.

Mealco raises $7M to launch new delivery-centric restaurants — By launching a restaurant with Mealco, chefs don’t sign a lease or pay any other upfront costs.

Advice and analysis from Extra Crunch

Ten VCs say interactivity, regulation and independent creators will reshape digital media in 2021 — We asked about the likelihood of further industry consolidation, whether we’ll see more digital media companies take the SPAC route and, of course, what they’re looking for in their next investment.

The five biggest mistakes I made as a first-time startup founder — Finmark CEO Rami Essaid has some regrets.

Does a $27B or $29B valuation make sense for Databricks? — A look at Databricks’ growth history, economics and scale.

(Extra Crunch is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Everything else

President Joe Biden commits to replacing entire federal fleet with electric vehicles — His commitment is tied to a broader campaign promise to create 1 million new jobs in the American auto industry and supply chains.

Meet the early-stage founder community at TC Early Stage 2021 — Early Stage part one focuses on operations and fundraising and takes place on April 1-2, while Early Stage part two focusing on marketing, PR and fundraising and runs July 8-9.

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 3pm Pacific, you can subscribe here.

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