Hello again, and welcome to this week’s edition of Trending, the newsletter where we highlight BI Prime’s biggest tech stories. I’m Alexei Oreskovic, Business Insider’s West Coast bureau chief and global tech editor.
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This week: The turbulence of the COVID crisis and what comes after
There have been canceled conferences and earnings warnings. But for Silicon Valley, the reality of the coronavirus wasn’t truly accepted until last week when Sequoia Capital published its now-famous Black Swan memo.
Like the VC firm’s dire“RIP Good Times” presentation to startups 12 years ago — which Sequoia delivered after the financial crisis had already toppled Bear Stearns and Lehman Brothers — Sequoia’s words are less a leading indicator of trouble than a confirmation to techies that they won’t be immune.
And the last few days have provided plenty of sobering examples of the virus’ toll on tech. South Park Cafe, a favorite of the venture capital crowd in San Francisco that’s owned by fintech startup Brex, is now indefinitely closed after a staffer tested positive for COVID-19. Salesforce mentioned the coronavirus 10 times in its 10-K annual report released on Thursday. And Y Combinator said its iconic Demo Day startup pitch fest will be pre-recorded.
If you look beyond the day-to-day impact on the stock market and the conference circuit, you might glimpse some of the deeper, potentially more significant consequences of this crisis.
Take the petro-feud between Russia and Saudi Arabia. As the Saudi Kingdom girds for the economic fallout of a price war, will the appetite for risky tech investments evaporate, cutting off a source of capital that startups like Uber and SoftBank Vision Fund’s collection of companies have taken for granted?
Similarly, could the Chinese government’s draconian-but-perhaps-effective tactics combating the virus alter the contours of the privacy battles that have pitted companies like Apple against law enforcement authorities in the US?
Or could coronavirus change the debate around universal healthcare, and in turn, the economics of gig economy businesses?
It’s impossible to predict, of course.
But the Silicon Valley that emerges on the other side of this outbreak may look very different from today’s Silicon Valley — and not just because some tech startups have layoffs or go out of business, or because more people are using Zoom to make video calls.
Automation, computer vision, and AI are getting more powerful every day. The barriers to adoption for some iterations of the tech are as much about societal norms as they are about technical capability. In a post-pandemic-world, for better or for worse, that may no longer be the case.
Read some of BI’s coverage here:
The cafe owned by $2.6 billion startup Brex has closed ‘until further notice’ after a worker tested positive for COVID-19
Born in a downturn
Taking a longterm view is easy from the comfort of an armchair, but for startups living through the uncertainty and volatility right now, these are scary days.
Benjamin Pimentel’s story about cloud software company Nutanix is a good reminder that an economic downturn is not necessarily the kiss of death for a fledgling business.
Nutanix launched in 2009 in the midst of the Great Recession. What’s more, the first version of the company name, Nutanic, sounded a little too much like Titanic. The company was able to fix the inauspicious name with a simple word swap. Surviving the recession was trickier. But as CEO Dheeraj Pandey recounted to Ben, a “stoic endurance” and confidence in a smart idea centered around the shift to cloud computing saw the startup through the choppy business waters and to an eventual public listing.
As the spread of the coronavirus spooks Wall Street — including Nutanix’s investors who sold shares off after a downbeat financial outlook — a little stoic endurance can do wonders.
Read Ben’s full story here:
$3.4 billion cloud company Nutanix was founded in the midst of the Great Recession. Here’s how its CEO plans to steer it through another crisis as coronavirus takes its toll on its business.
Salesforce’s revolving door and its rising stars
Salesforce has experienced some turnover in its upper ranks of late. Keith Block, the company’s co-CEO, announced his surprise departure in February. And as Paayal Zaveri was first to report on Friday, Gregg Schott, an EVP who joined Salesforce with the $6.5 billion acquisition of MuleSoft two years ago, is headed for the exits.
So what does the roster at Team Salesforce look like now?
Paayal’s look at the cloud giant’s rising stars is an invaluable peek at who’s who in Marc Benioff’s $143 billion company. Some of these execs are Salesforce veterans, others are more recent additions. As the company hopes to double its revenue in the next few years, these are the people who will make or break that plan.
Read Paayal’s full story here:
Meet the 21 rising stars at Salesforce who are playing key roles in helping CEO Marc Benioff grow the cloud computing powerhouse
Here are some of the latest tech highlights:
And more good stories from across the BI newsroom:
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