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U.S. partners with Kodak to end reliance on Chinese drugs; photo maker to manufacture drug ingredients with $765 million in new government loan

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United States government has partnered with photography pioneer Eastman Kodak to end its reliance on Chinese drugs. Today, White House announced a deal with the photography pioneer to produce ingredients in generic drugs in response to the coronavirus pandemic.

As part of the deal, Kodak will receive $765 million in government loan under the Defense Production Act to reduce what the White House called “our dangerous reliance on foreign drug manufacturing.” In addition, Kodak is also creating a new manufacturing line called Kodak Pharmaceuticals with the aim of shifting offshore prescription drug production back to the United States. The deal will also boost the domestic manufacturing of drugs in hopes of breaking foreign reliance.

Shares of Kodak soared more than 50% in extended trading. The stock more than tripled during Tuesday’s regular trading for its best day ever after the news.

Kodak also announced the creation of new business unit. In a message posted on its website, Kodak said:

U.S. International Development Finance Corporation (DFC) will sign a letter of interest (LOI) to provide a $765 million loan to support the launch of the new entity. The new business unit will produce critical pharmaceutical components that have been identified as essential but have lapsed into chronic national shortage. Once fully operational, Kodak Pharmaceuticals will have the capacity at Eastman Business Park to produce up to 25 percent of active pharmaceutical ingredients used in non-biologic, non-antibacterial, generic pharmaceuticals while supporting 360 direct jobs and an additional 1,200 indirectly.

“Our 33rd use of the Defense Production Act will mobilize Kodak to make generic, active pharmaceutical ingredients,” Trump said in a press conference Tuesday evening. “We will bring back our jobs and we will make America the world’s premier medical manufacturer and supplier.”

“And so what this administration recognized is that if we are going to be safe going forward, that was unacceptable,” Adam Boehler, CEO of the U.S. International Development Finance Corporation, the agency that is administering the loan, told reporters.

Kodak said Tuesday it will produce pharmaceutical components that have been identified as essential but have lapsed into chronic national shortage, as defined by the Food and Drug Administration.


Source: https://techstartups.com/2020/07/28/u-s-government-partners-kodak-end-reliance-chinese-drugs-photo-maker-manufacture-drug-ingredients-765-million-new-government-loan/

Start Ups

Enterprise investor Jason Green on SPAC hopefuls versus startups bound for traditional IPOs

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Jason Green has a pretty solid reputation as venture capitalists go. The enterprise-focused firm he co-founded 17 years ago, Emergence Capital, has backed Saleforce, Box and Zoom, among many other companies, and even while every firm is now investing in software-as-a-service startups, his remains a go-to for many top founders selling business products and services.

To learn more about the trends impacting Green’s slice of the investing universe, we talked with him late last week about everything from SPACs to valuations to how the firm differentiates itself from the many rivals with which it’s now competing. Below are some outtakes edited lightly for length.

TC: What do you make of the assessment that SPACs are for companies that aren’t generating enough revenue to go public the traditional route?

JG: Well, yeah, it’ll be really interesting. This has been quite a year for SPACs, right? I can’t remember the number, but it’s been something like $50 billion of capital raised this year in SPACs, and all of those have to put that money to work within the next 12 to 18 months or they give it back. So there’s this incredible pent-up demand to find opportunities for those SPACs to convert into companies. And the companies that are at the top of the charts, the ones that are the high-growth and profitable companies, will probably do a traditional IPO, I would imagine.

[SPAC candidates are] going to be companies that are growing fast enough to be attractive as a potential public company but not top of the charts. I think [sponsors are] going to target companies that are probably either growing slightly slower than the top-quartile public companies but slightly profitable, or companies that are growing faster but still burning a lot of cash and might actually scare all the traditional IPO investors.

TC: Are you having conversations with CEOs about whether or not they should pursue this avenue?

JG: We just started having those conversations now. There are several companies in the portfolio that will probably be public companies in the next year or two, so it’s definitely an alternative to consider. I would say there’s nothing impending I see in the portfolio. With most entrepreneurs, there’s a little bit of this dream of going public the traditional way, where SPACs tend to be a little bit less exciting from that perspective. So for a company that maybe is thinking about another private round before going public, it’s like a private-plus round. I would say it’s a tweener, so the companies that are considering it are probably ones that are not quite ready to go public yet.

TC: A lot of the SPAC fundraising has seemed like a reaction to uncertainty around when the public window might close. With the election behind us, do you think there’s less uncertainty?

JG: I don’t think risk and uncertainty has decreased since the election. There’s still uncertainty right now politically. The pandemic has reemerged in a significant way, even though we have some really good announcements recently regarding vaccines or potential vaccines. So there’s just a lot of potential directions things could head in.

It’s an environment generally where the public markets tend to gravitate more toward higher-quality opportunities, so fewer companies but higher quality,  and that’s where SPACs could play a role. In the first half of next year, I could easily see SPACs being the more likely go-to-market for a public company, then the latter half of next year, once the vaccines have kicked in and people feel like we’re returning to somewhat normal, I could see the traditional IPO coming back.

TC: When we sat down in person about a year ago, you said Emergence looks at maybe 1,000 deals a year, does deep due diligence on 25 and funds just a handful or so of these startups every year. How has that changed in 2020?

JG: I would say that over the last five years, we’ve made almost a total transition. Now we’re very much a data-driven, thesis-driven outbound firm, where we’re reaching out to entrepreneurs soon after they’ve started their companies or gotten seed financing. The last three investments that we made were all relationships that [date back] a year to 18 months before we started engaging in the actual financing process with them. I think that’s what’s required to build a relationship and the conviction, because financings are happening so fast.

I think we’re going to actually do more investments this year than we maybe have ever done in the history of the firm, which is amazing to me [considering] COVID. I think we’ve really honed our ability to build this pipeline and have conviction, and then in this market environment, Zoom is actually helping expand the landscape that we’re willing to invest in. We’re probably seeing 50% to 100% more companies and trying to whittle them down over time and really focus on the 20 to 25 that we want to dig deep on as a team.

TC: For founders trying to understand your thinking, what’s interesting to you right now?

JG: We tend to focus on three major themes at any one time as a firm, and one we’ve termed ‘coaching networks.’ This is this intersection between AI and machine learning and human interaction. Companies like [the sales engagement platform] SalesLoft or [the knowledge management system] Guru or Drishti [which sells video analytics for manual factory assembly lines] fall into this category.

The second [theme] is going deep into more specific industry verticals. Veeva was the best example of this early on with with healthcare and life sciences, but we now have one called p44 in the transportation space that’s doing incredibly well. Doximity is in the healthcare space and going deep like a LinkedIn for physicians, with some remote health capabilities. And then [lending company] Blend, which is in the financial services area. These companies are taking cloud software and just going deep into the most important problems of their industries.

The third theme [centers around] remote work. Zoom, which has obviously has been [among our] best investments is almost a platform, just like Salesforce became a platform after many years. We just funded a company called ClassEDU, which is a Zoom-specific offering for the education market. Snowflake is becoming a platform. So another opportunity is is not just trying to come up with another collaboration tool, but really going deep into a specific use case or vertical.

TC: What’s a company you’ve missed in recent years and were any lessons learned?

JG: We have our hall of shame. [Laughs.] I do think it’s dangerous to assume that things would have turned out the same if if we had been investors in the company. I believe the kinds of investors you put around the table make a difference in terms of the outcome of your company, so I try to not beat myself up too much on the missed opportunities because maybe they found a better fit or a better investor for them to be successful.

But Rob Bernshteyn of Coupa is one where I knew Rob from SuccessFactors [where he was a product marketing VP], and I just always respected and liked him. And we were always chasing it on valuation. And I think I think we probably turned it down at an $80 million or $100 million valuation [and it’s valued at] $20 billion today. That can keep you up at night.

Sometimes, in the moment, there are some risks and concerns about the business and there are other people who are willing to be more aggressive and so you lose out on some of those opportunities. The beautiful thing about our business is that it’s not a zero-sum game.

Source: https://techcrunch.com/2020/11/25/enterprise-investor-jason-green-on-spac-hopefuls-versus-startups-bound-for-traditional-ipos/

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Remote-controlled delivery carts are now working for the local Los Angeles grocer

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Robots are no longer the high-tech tools reserved for university labs, e-commerce giants and buzzy Silicon Valley startups. The local grocer now has access too.

Tortoise, the one-year-old Silicon Valley startup known for its remote repositioning electric scooters, has taken its tech and adapted it to delivery carts. The company recently partnered with online grocery platform Self Point to provide neighborhood stores and specialty brand shops with electric carts that — with help from remote teleoperators — deliver goods to local consumers.

The companies have launched the product offering in Los Angeles with three customers. Each customer, which includes Kosher Express, has two to three carts that can be used to make deliveries up to a three-mile radius from the store. Unlike the network models used by some autonomous sidewalk delivery companies, grocery stores lease the delivery carts and are responsible for storage, charging and packing it up with goods that their customers have ordered.

The initial Self Point/Tortoise launch is small. But it has the makings of expanding far beyond Los Angeles. More importantly for Tortoise, it’s a validation of the company’s larger vision to make remote repositioning a horizontal business with numerous applications.

Tortoise started by equipping electric scooters with cameras, electronics and firmware that allow teleoperators in distant locales to drive the micromobility devices to a rider or deliver it back to its proper parking spot. Now, it has taken that same hardware and software and used it to build its own delivery cart.

Tortoise co-founder and president Dmitry Shevelenko has said the company’s remote repositioning kit can be used for security and cleaning bots as well as electric wheelchairs and other accessibility devices. He’s even fielded inquiries from farmers interested in using remote repositioning scooters to monitor crops.

“From a practical point of view we’re not trying to not be everywhere overnight, but there’s really no technological constraint for us,” Shevelenko said in a recent interview.

The emergence of COVID-19 and its effects on consumer behavior prompted Tortoise to home in on delivery carts as its second act.

“We kind of quickly realized that we’re living in a once-in-a-generation change in consumer behavior where now everything is online and people are expecting it to be delivered same day,” Shevelenko said. Tortoise was able to go from the first renderings in May to a delivery cart launch by the fourth quarter because of its ability to repurpose its hardware, software and workforce.

The company still remains bullish on its initial application in micromobility. Earlier this year, Tortoise, GoX and and tech incubator Curiosity Labs launched a six-month pilot in Peachtree Corners, Georgia that allows riders to use an app to hail a scooter. The scooters are outfitted with Tortoise’s tech. Once riders hail the scooter, a Tortoise employee hundreds of miles away remote controls the scooter to the user. After riders complete trips, the scooters drive themselves back to a safe parking spot. From there, GoX employees charge and sanitize the scooters and then mark them with a sticker that indicates they have been properly cleaned.

While partnership with Self Point is Tortoise’s next big project, Shevelenko was quick to note that the company is only focused on one slice of the on-demand delivery pie.

“Low speeds and hot foods don’t work too well,” he said. Startups such as Kiwibot and Starship have smaller robots that focus on that market, Shevelenko added. Tortoise’s delivery carts were designed specifically to hold large amounts of groceries, alcohol and other goods.

“We saw kind of a big opening in grocery,” he said, adding that relying on remote operators and its kit is a low-cost combination that can be used today while automated technology continues to develop. “We’re doing for last-mile delivery what globalized call centers did for customer support.”

Source: https://techcrunch.com/2020/11/25/remote-controlled-delivery-carts-are-now-working-for-the-local-los-angeles-grocer/

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Insurtech’s big year gets bigger as Metromile looks to go public

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In the wake of insurtech unicorn Root’s IPO, it felt safe to say that the big transactions for the insurance technology startup space were done for the year.

After all, 2020 had been a big one for the broad category, with insurtech marketplaces raising lots, rental insurance startup Lemonade going public, Root itself debuting even more recently on the back of its automotive insurance business, a big round to help Hippo keep building its homeowners company and more.


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But yesterday brought with it even more news: Metromile, a startup competing in the auto insurance market, is going public via a blank-check company (SPAC), and Hippo raised a huge, unpriced round.

So let’s talk about why Metromile might be plying the public markets, and why Hippo may have have decided to pick up more cash. Hint: The reasons are related.

A market hungry for growth

The Lemonade IPO was a key moment for neoinsurance startups, a key part of the broader insurtech space. When the rental insurance provider went public, it helped set the tone for public exit valuations for companies of its type: fast-growing insurance companies with slick consumer brands, improving economics, a tech twist and stiff losses.

For the Roots and Metromiles and Hippos, it was an important moment.

So, when Lemonade raised its IPO range, and then traded sharply higher after its debut, it boded well for its private comps. Not that rental insurance and auto insurance or homeowners insurance are the same thing. They very most decidedly are not, but Lemonade’s IPO demonstrated that private investors were correct to bet generally on the collection of startups, because when they reached IPO-scale, they had something that public investors wanted.

Source: https://techcrunch.com/2020/11/25/insurtechs-big-year-gets-bigger-as-metromile-looks-to-go-public/

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Slack’s stock climbs on possible Salesforce acquisition

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News that Salesforce is interested in buying Slack, the popular workplace chat company, sent shares of the smaller firm sharply higher today.

Slack shares are up just under 25% at the moment, according to Yahoo Finance data. Slack is worth $36.95 per share as of the time of writing, valuing it at around $20.8 billion. The well-known former unicorn has been worth as little as $15.10 per share inside the last year and worth as much as $40.07.

Inversely, shares of Salesforce are trading lower on the news, falling around 3.5% as of the time of writing. Investors in the San Francisco-based SaaS pioneer were either unimpressed at the combination idea, or perhaps worried about the price that would be required to bring the 2019 IPO into their fold.

Why Salesforce, a massive software company with a strong position in the CRM market, and aspirations of becoming an even larger platform player, would want to buy Slack is not immediately clear though there are possible benefits. This includes the possibility of cross-selling the two companies products’ into each others customer bases, possibly unlocking growth for both parties. Slack has wide marketshare inside of fast-growing startups, for example, while Salesforce’s products roost inside a host of megacorps.

TechCrunch reached out to Salesforce, Slack and Slack’s CEO for comment on the deal’s possibility. We’ll update this post with whatever we get.

While Salesforce bought Quip for $750 million in 2016, which gave it a kind of document sharing and collaboration, Salesforce Chatter has been the only social tool in the company’s arsenal. Buying Slack would give the CRM giant solid enterprise chat footing and likely a lot of synergy among customers and tooling.

But Slack has always been more than a mere chat client. It enables companies to embed workflows, and this would fit well in the Salesforce family of products, which spans sales, service, marketing and more. It would allow companies to work both inside and outside the Salesforce ecosystem, building smooth and integrated workflows. While it can theoretically do that now, if the two were combined, you can be sure the integrations would be much tighter.

What’s more, Holger Mueller, an analyst at Constellation Research says it would give Salesforce a sticky revenue source, something they are constantly searching for to keep their revenue engine rumbling along. “Slack could be a good candidate to strengthen its platform, but more importantly account for more usage and ‘stickiness’ of Salesforce products — as collaboration not only matters for CRM, but also for the vendor’s growing work.com platform,” Mueller said.  He added that it would be a way to stick it to former-friend-turned-foe Microsoft.

That’s because Slack has come under withering fire from Microsoft in recent quarters, as the Redmond-based software giant poured resources into its competing Teams service. Teams challenges Slack’s chat tooling and Zoom’s video features and has seen huge customer growth in recent quarters.

Finding Slack a corporate home amongst the larger tech players could ensure that Microsoft doesn’t grind it under the bulk of its enterprise software sales leviathan. And Salesforce, a sometimes Microsoft ally, would not mind adding the faster-growing Slack to its own expanding software income.

The question at this juncture comes down to price. Slack investors won’t want to sell for less than a good premium on the pre-pop per-share price, which now feels rather dated.

Source: https://techcrunch.com/2020/11/25/slacks-stock-climbs-on-possible-salesforce-acquisition/

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